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BMW, Mercedes battle for top spot in luxury autos Add to ...

BMW Canada Inc. would be happy to hang on to first place in the fierce battle it’s waging with Mercedes-Benz Canada Inc. for leadership in the luxury segment of the Canadian automotive market, but won’t open the cash vault to buy sales.

“We will not spend $10-million more to get 500 units just to get to No. 1,” BMW Canada president Franz Jung said Wednesday, even as he acknowledged that the unit of the Germany-based auto maker would like to finish the year in top spot, as it has done annually since 2001.

“No. 1 is the position you want to be in because our customers … want to buy success,” Mr. Jung told reporters at the company’s new headquarters in Richmond Hill, Ont.

The fight between BMW and Mercedes for luxury leadership as they and other German auto makers grab market share away from Japan-based companies is one trend that is emerging amid a slow recovery from the 2009 slump in the Canadian auto market.

Mercedes-Benz led BMW by about 1,800 vehicles as of the end of August.

While BMW may not surpass Mercedes-Benz, it is still on track for a record year, with sales perhaps topping 26,000, which would be ahead of the record 24,724 racked up last year, Mr. Jung said.

But the 2009 figure, he noted, came at the expense of aggressive incentives. Incentives have dropped by 4.5 per cent this year from the high levels of last year, he said, although he would not provide specific amounts.

BMW is trailing Mercedes-Benz in part because it has an older lineup, said industry analyst Dennis DesRosiers, president of DesRosiers Automotive Consultants Inc. of Richmond Hill.

“In the luxury market, it’s even more about product than in the mass market segments,” he said.

Mr. Jung acknowledged that competitors have newer product offerings, but unveiled a redesigned X3 compact sport utility vehicle that will arrive next March and give BMW a fresh vehicle in one of the fastest-growing segments of the Canadian market.

Marcus Breitschwerdt, president of Mercedes-Benz Canada, said his goal is not to be first in sales volume, but to meet sales and profit targets set at the beginning of the year. Mercedes-Benz will exceed those targets, Mr. Breitschwerdt said.

“You want to be the No. 1 for every single customer you have,” he said, pointing to customer satisfaction ratings as more important than sales leadership.

While those two auto makers duke it out for top spot, Audi is outperforming both of them this year with a jump of 37 per cent in sales, vaulting it into fourth spot in the luxury rankings.

Follow on Twitter: @gregkeenanglobe

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