Mercedes Aims for the Super-Rich With a ‘Super’ S-Class

The “super S-Class,” as the car is reported to be called internally, will feature a longer wheelbase and even more sybaritic interior appointments. Given that the upcoming garden-variety S-Class already has simulated hot-stone massages in the seats, self-steering cruise control, and scented-air ventilation (use either one of Benz’s premade scents or pour in your own cologne for a Drakkar-scented ride), those appointments will likely fit for a pasha. Daimler (Mercedes-Benz’s parent company) Chief Executive Dieter Zetsche has said the new car will cost around $250,000—a considerable hike above a standard S-Class, which runs somewhere around $120,000.

But going after the ultraluxury market seems like a fool’s errand, right? I mean, the volume just isn’t there. Last year, Rolls-Royce sold 3,575 cars worldwide. Bentley sold 8,510. The sales of just the S-Class last year were 65,128, What’s another few thousand cars to Benz?

A lot of profit, actually. “The distance from your garden-variety S-Class to a Super S-Class is all margin,” says Kevin Tynan, senior automotive analyst at Bloomberg Industries. “The added content goes all to the bottom line.” According to a study from Commerzbank, the estimated profit margin on a regular S-Class is 25 percent, Tynan says. “While the additional margin may not be all that much more,” he wrote in an e-mail, “the profit contribution of 25 percent on $250K vs. $150K is still significant.”

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