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New Mercedes-Benz CLA Outshines Aging C-Class, According To Kelley Blue Book

 New Mercedes-Benz CLA Outshines Aging C-Class, According To Kelley Blue Book

Upcoming C-Class Redesign Anticipated to Grab Back Sales, Market Share from
CLA

PR Newswire

IRVINE, Calif., Jan. 9, 2014

IRVINE, Calif., Jan. 9, 2014 /PRNewswire/ --The latest entry-luxury sedan to
join the Mercedes-Benz lineup, the 2014 CLA, is closing the gap on its
outdated sister model, C-Class, with stronger average transaction prices,
projected resale value and shopper interest, as well as lower incentive spend
by the automaker, according to Kelley Blue Book www.kbb.com, the leading
provider of new and used car information.

(Logo: http://photos.prnewswire.com/prnh/20121108/LA08161LOGO)

"Mercedes-Benz is looking to increase its reach in the entry-luxury category
with the CLA, and the initial numbers suggest they've succeeded," said Karl
Brauer, senior analyst for Kelley Blue Book. "Though touted as a sub-$30,000
car, the CLA is transacting in the mid-$30,000 range, or at roughly the same
price as the outdated C-Class generation. As the newer and arguably more
attractive sedan in this price range, the CLA has an advantage over the
stodgier C-Class. This is clear in the higher residual value and lower
incentive spend recorded for the CLA; however, this should change when the
all-new C-Class is revealed next week at the Detroit auto show. Expect
Mercedes-Benz to bump the new C-Class' price and drop its incentive spend to
distance it from the CLA."

Average Transaction Prices

Make          Model        Trim        Sep-13  Oct-13  Nov-13  Dec-13  Q4-13
Mercedes-Benz 2014         CLA250      $36,564 $36,744 $36,988 $36,605 $36,821
              CLA-Class    Coupe 4D
Mercedes-Benz 2014 C-Class C250 Sedan  $38,028 $36,226 $37,570 $37,685 $37,124
                           4D

Incentive Spend Per Unit

Make          Model     Sep-13 Oct-13 Nov-13 Dec-13
Mercedes-Benz CLA-Class $0     $572   $557   $545
Mercedes-Benz C-Class   $2,804 $2,884 $3,128 $3,104

Although marketed as an entry-level option for those interested in the
prestigious Mercedes-Benz brand, the CLA has been commanding a premium price
well beyond its advertised $30,000 price of entry since launch.

"Those quick to scoop up the CLA have shown no hesitation in loading the
vehicle with extra options to meet their needs, which has pushed transaction
prices near the higher priced C-Class," said Alec Gutierrez, senior analyst
for Kelley Blue Book. "This is especially impressive considering the
miniscule amount of incentive spend Mercedes has put behind the CLA. Although
prices are up today, we expect to see them dip in the months ahead as early
adopters that tend to load up on options get their fill. While the CLA is
clearly getting the attention of luxury shoppers looking for an affordable
option, a redesigned 2015 C-Class, which is expected to move the model line
upmarket, should help to differentiate the C-Class from the CLA and further
cement Mercedes' position in the quickly growing entry-level luxury category."

Residual Values*

Make          Model     36-Month Percentage of MSRP
Mercedes-Benz CLA-Class 56%
Mercedes-Benz C-Class   52.5%

*Residual values used are based on the January/February 2014 Kelley Blue
Book^® Residual Value Guide. Percentages based on the 36-month residual value.


With the CLA, Mercedes-Benz has brought to market a vehicle that has popular
appeal and due to its pricing strategy, is expected to retain its value better
than the aging C-Class.

"Although not quite segment-leading, the CLA is forecast to be the brand's top
residual value sedan across its entire lineup, except for the high-performance
C63," said Eric Ibara, director of residual value consulting for Kelley Blue
Book. "That, of course, could change with the redesign of the C-Class based
on the model's performance and stylistic revisions in relation to any price
change."

Shopper Interest: KBB.com Month-Over-Month Share of New-Car Traffic

Make          Model     Apr-13 May-13 Jun-13 Jul-13 Aug-13 Sep-13 Oct-13 Nov-13 Dec-13
Mercedes-Benz CLA-Class 89.6%  8.4%   8.6%   55.9%  30.1%  222.7% 36.4%  -15.9% -9.6%
Mercedes-Benz C-Class   -5.4%  1.0%   -2.2%  4.2%   11.2%  -2.4%  2.3%   -20.1% -2.1%

"As the CLA gained more traction, there has been cannibalization that has
taken place between the CLA-Class and C-Class," said Mark Williams, analyst
for Kelley Blue Book. "In fact, once the CLA was live on KBB.com, there was a
dip in C-Class share of traffic. The CLA's Web traffic continued to increase
after it arrived in showrooms, yielding an astounding increase of 340 percent
from August 2013 to October 2013. The surge in shopper interest positioned the
CLA as the most popular Mercedes-Benz model for the first time on KBB.com,
surpassing both the C-Class and E-Class in October 2013." 

About Kelley Blue Book(www.kbb.com)

Founded in 1926, Kelley Blue Book, The Trusted Resource®, is the only vehicle
valuation and information source trusted and relied upon by both consumers and
the automotive industry. Each week the company provides the most
market-reflective values in the industry on its top-rated website KBB.com,
including its famous Blue Book® Trade-In and Suggested Retail Values, and Fair
Purchase Price, which reports what others are paying for new cars this week.
The company also provides vehicle pricing and values through various products
and services available to car dealers, auto manufacturers, finance and
insurance companies, and governmental agencies. For two years running, Kelley
Blue Book's KBB.com ranked highest in its category for brand equity and was
named Online Auto Shopping Brand of the Year in the 2012 and 2013 Harris Poll
EquiTrend^® study. Kelley Blue Book Co., Inc.is a subsidiary of AutoTrader
Group, which includes AutoTrader.com, vAuto, VinSolutions and HomeNet
Automotive. AutoTrader Group is a majority-owned subsidiary of Cox
Enterprises.

SOURCE Kelley Blue Book

Website: http://www.kbb.com
Contact: Chintan Talati, +1-949-267-4855, ctalati@kbb.com, or Brenna Robinson,
+1-949-267-4781, berobinson@kbb.com, or Natalie Kumaratne, +1-949-267-4770,
nkumaratne@kbb.com
 
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