Why Americans can't buy the new Mercedes-Benz pickup truck

Advertisement

Mercedes Benz X Class

Mercedes-Benz

The Mercedes-Benz X-Class.

Advertisement
  • The Mercedes-Benz X-Class is the company's first true pickup truck.
  • It's not available for sale in the US.
  • Questionable whether it would be profitable.
  • It also doesn't fit with the brand's luxury ethos.
  • The X-Class is also built on a Renault-Nissan platform.

This week, Mercedes-Benz unveiled the production version of its long-awaited X-Class pickup truck in Cape Town, South Africa.

Although the German automaker has a long and storied history of producing rugged utility vehicles alongside its luxury cars, the X-Class is the brand's first true pickup.

Complimentary Tech Event
Transform talent with learning that works
Capability development is critical for businesses who want to push the envelope of innovation.Discover how business leaders are strategizing around building talent capabilities and empowering employee transformation.Know More

According to Mercedes, the X-Class is scheduled to launch in Europe this November followed by South Africa, Australia, and New Zealand in 2018. Argentina and Brazil will get the truck in 2019.

However, one market is conspicuously missing from the list. The largest and most profitable truck market in the world, the United States of America.

Advertisement

Unfortunately, there isn't a typo to be corrected. A Mercedes-Benz spokesman confirmed to Business Insider that the company has no plans to bring the X-Class to the US. Thus far, the company has not given a full explanation as to why the US of A won't see the truck.

Mercedes Benz X Class

Mercedes-Benz

After all, the US pickup market is massive. The three best selling vehicles in America last year were all pickups.

But, take a deeper dive into the mechanics of the US truck market and it becomes fairly clear why the X-Class, at least for now, isn't coming to America.

Even though automakers have sold more than 1.3 million pickups in the US this year, 1.12 million of them have been full-size trucks like the Ford F-150 and the Chevrolet Silverado. The X-Class, on the other hand, is a mid-size truck and that market is much smaller.

(Competition in the full-size segment is so brutally competitive that industry heavyweights like Toyota and Nissan have struggled to gain any type of market traction. The two brands accounted for just of 78,000 of the 1.12 million in sales this year while Detroit's big three have neatly carved up the rest of the market.)

Advertisement

Mercedes Benz X Class

Mercedes-Benz

For Mercedes, the profitability of bringing an all-new truck into the market is questionable. Through June, consumers have purchased only 216,000 mid-size pickups in the US with annual growth at roughly 2.4%. The full-size segment is growing at 4.8% annually.

Further, Kelley Blue Book data shows the average transaction price for the segment at $32,000 - well below the $43,000 base price Mercedes set for the X-Class in Germany.

Unless Mercedes is willing to sell the X-Class in the US as a purely utilitarian work truck alongside the Metris and Sprinter commercial vans, anything less than $40,000 for a mid-size product doesn't coalesce with the brand's premium pricing strategy. For comparison, the cheapest Mercedes-Benz crossover is the GLA at $33,400 while the mid-size GLE starts at $52,200.

And the utility route is what Mercedes seems to be taking with the X-Class. After all, it's a product of the Mercedes-Benz Vans - the same division responsible for the Metris and Sprinter.

Mercedes Benz X Class

Mercedes-Benz

In addition to luxury cars, Mercedes-Benz is known globally for producing reliable work vehicles ranging from taxis to cargo vans. In the US, however, it's a brand known almost exclusively as a purveyor of luxury autos. And it's a mystique that lets Mercedes charge its customers a price premium for the privilege of experiencing the luxury, performance, and refinement of its products.

Advertisement

Having seen the interior of the new X-Class, it's one that's definitely geared more toward surviving wear and tear than the cosseting leather-lined cocoons we are used to seeing in Mercedes' passenger cars.

(In case you're curious, power for the X-Class comes from a selection of turbodiesel engines with the most powerful rated at 258 horsepower. A 165 horsepower gasoline engine is available, but only in select markets like Dubai or Morocco. If, by some miracle, the X-Class does make it to the US, expect it to have more market appropriate powertrain options.)

Mercedes Benz X Class

Mercedes-Benz

Finally, there's the matter of the mechanics of the truck itself. Even though it's badged as a Mercedes-Benz, the X-Class is actually built on a Renault-Nissan platform at Renault-Nissan plants in Spain and Argentina.

According to Automobile, the X-Class sits on the same platform that underpins Nissan's NP300 Navarra mid-size pickup. However, the NP300 Navarra isn't available in the US. (We're waiting to hear back from Nissan as to why.) Instead, Nissan is still selling the 13-year-old previous-generation version of the truck as the Frontier.

That means Mercedes-Benz would have to work out an arrangement with Nissan should it choose to sell the X-Class in the US.

Advertisement

So, there you have it. The Mercedes-Benz X-Class isn't coming to America. Even though, on the surface, it makes for a tantalizing option, the economics and the branding challenges associated with bringing the truck to the US simply doesn't make sense right now.

NOW WATCH: HENRY BLODGET: Seeing more skepticism around Trumponomics