Daimler opens Beijing R&D centre

Beijing

DAIMLER AG has opened a research and development (R&D) centre in Beijing tasked with further tuning its Mercedes-Benz brand to wealthy Chinese tastes and closing the sales gap with Audi AG and BMW AG.

The German auto maker's move demonstrates a desire to "embed us more deeply in China, to make cars best suited to China", Hubertus Troska, Daimler's China head, told Reuters.

Daimler is expanding its Mercedes-Benz brand in China at a time when an investigation into anti-competitive practices in the auto industry is prompting car makers to lower prices. Mercedes-Benz itself has previously said it was co-operating with an investigation into unspecified matters.

The new R&D centre nevertheless signals commitment to a market Mr Troska said would become Mercedes-Benz's largest in as early as one or two years. With that in mind, the automaker plans to raise the number of Mercedes-Benz engineers and other specialists in Beijing to 500 by the end of next year from 350.

"It is a logical step to better understand the market and make sure Chinese requirements are properly regarded early in the process when we develop a next generation of cars," Mr Troska said last week.

The R&D centre caps a series of moves Mr Troska has made since becoming China head in 2012, including reforming marketing and sales and raising dealer numbers. Its focus on Chinese tastes should help Mercedes-Benz catch up in the local luxury car segment with Volkswagen AG's Audi and BMW, he said.

Researcher LMC Automotive projects Mercedes-Benz to sell 291,000 vehicles in China this year, compared with 581,000 for luxury market-leader Audi and 448,000 for second-placed BMW.

Mr Troska said new models such as the GLA compact SUV should help Mercedes-Benz sell "significantly more than 300,000 units next year". REUTERS