Why The CLA Is A Huge Deal For Mercedes-Benz And Its Chairman

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The Mercedes-Benz CLA, the good-looking entry level sedan that was unveiled with Kate Upton-filled fanfare during the Super Bowl, isn't just another car for the luxury brand. It's crucial to their future, and that of their embattled chairman, Dieter Zetsche.

This story from Reuters has an interesting analysis of what's going on over at Daimler's luxury arm. Mercedes-Benz has been lagging behind BMW and Audi, especially in the area of smaller cars, and they hope the CLA — which officially debuts at the Geneva Motor Show this week — will help solve that.

Mercedes is also flagging in the increasingly critical Chinese market thanks to competition between its two distributors in that country and other factors.


From the story:

The CLA, which debuts at the Geneva car show on Tuesday, is a test of Daimler's ability to shake off a stuffy brand image partly blamed for Mercedes' failure to keep pace with its two main competitors.

Its premiere closely follows the February 21 board decision to trim Zetsche's next mandate to three years from the expected five and swap the manufacturing and truck division heads, in a move seen as improving both men's CEO prospects.

Under Zetsche's seven-year reign, Daimler stock has broadly flatlined - up 6 percent on the period - while BMW advanced 87 percent and VW's share price increased five-fold.


These issues have led observers to think that Zetsche is "occasionally out of touch with conditions on the ground," according to the story.

So what is the CLA supposed to do? Help Mercedes catch up in the small car department and appeal to younger buyers. Audi has a range of smaller cars and BMW has the 1-Series and Mini, so Mercedes will hope the new CLA — and a related SUV — will help them catch up.


We'll see if it works. The CLA certainly looks great, and it's a big step for Mercedes, being their first front-wheel-drive car available in the U.S. market. (All-wheel-drive is available, and there's a hotter AMG version on the way.) Check out the Reuters piece and tell us if you think the car will help Benz get back in the game.

Photo credit AP/Mercedes-Benz