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Did Daimler Lose Over $400k On Each Maybach Sold?

 
2 1,502 views Feb 9, 2012

The Maybach 57 S Edition 125!. Image: Daimler AG

HI-RES GALLERY: The Maybach 57 S Edition 125!. Image: Daimler AG
At the end of the day, success in business is deceptively simple: you simply need to sell product at a profit and quantity sufficient to sustain and grow ongoing operations. Do so, and you stay in business and (potentially) prosper.

On the other hand, if you sell product for less than it costs you to build, unless it’s a loss-leader for a very profitable item, you’ll eventually wind up out of business.

In the case of Maybach, the ultra-luxury brand hasn’t put parent Daimler out of business, but it clearly hasn’t been paying its way, either. When Daimler announced it was pulling the plug on Maybach at the end of 2012, it really didn’t come as a surprise; after all, the brand sold just 3,000 cars in seven years.

Despite Maybach’s lofty pricetags, which start at around $375,000 in the U.S., Car magazine has done the math to calculate the brand’s loss on each vehicle sold. Based on the 1 billion euros ($1.33 billion) that Daimler invested in the brand, Car says that the  loss works out to be 330,000 euros ($439,263) on each Maybach sold.

In fairness to Daimler, there’s really no way of verifying whether or not Car’s math is correct. Daimler isn’t going to share the landed cost, in each country, of every Maybach sold, nor will it share the selling price of each car. Then there are cost issues, ranging from depreciation to salaries and other production costs to account for. Car's numbers don't factor in the revenue from each sale, either, making its argument somewhat one-sided.

In reality, the simple business failure of the Maybach brand had many complex issues behind it, including the totally unrelated collapse of the global economy. Will Daimler be any more successful in taking the Mercedes-Benz S-Class upscale, to fill the void left by Maybach’s exit?

We suppose that depends on how you measure success, but this much is clear: Mercedes-Benz won’t lose hundreds of thousands of euros on each car built.



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Comments (2)

  1. WizardsLore avatar WizardsLore Posted: 2/9/2012 3:56pm PST

    one of the fundamental issues with Maybach was that it jsut wasnt exclusive enough in its design. It was just a massaged S-Class which if you got the S600L with all the bells and whistles you would still come out with a lot of change. the design needed to be bulkier to show you were getting car for your money. Look at the Phantom (its direct competitor), it had the presence and unique style to show exclusivity. The Maybach didnt have that. Its a shame really as it could have been a success regardless of the GFC if they had concentrated on that.
    Oh and by all accounts it was a fantastic car to drive and be driven in.
     
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  2. fb_1491948054 avatar Kurt Ernst Posted: 2/10/2012 3:18am PST

    @WizardsLore, I agree. The Maybach wasn't ugly (as many have claimed over the years), but it wasn't exactly an inspiring design, either.
     
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