Mercedes is set to add the fourth generation C-class saloon to the list of cars it already produces at its Tuscaloosa plant in Alabama as part of a program aimed at combating sagging profitability in its second biggest market.
With the continued strength of the Euro against the US dollar eating into margins on models produced in Germany and sold in the US, Mercedes-Benz insiders say efforts are underway to provide protection from unfavourable currency exchange rates in the form of increased North American production.
“We’ve reached a window of opportunity where we can now consider producing the next C-class in the US,” a source revealed to Autocar. “We’re mid-cycle on the W204 (the current C-class) and need to decide if we want to push ahead with its successor at Tuscaloosa.”
Mercedes-Benz already produces the M-, R- and GL-class at Tuscaloosa – a plant opened in 1997 and subsequently expanded in 2005 to meet growing demand.
But with sales of large SUVs down in most markets owing to the depressed state of the economy, the currency balancing effects of US production are not as significant as they have been in recent years, leading the German car maker to consider the addition of other models.
The earmarking of the next C-class saloon, due out in 2014, for North American production is significant as it could ultimately pave the way for other mechanical similar models, including the GLK, to be built there.
However, it would come as major blow to Mercedes-Benz’s worker union which fought hard to ensure production of left-hand drive versions of the current C-class saloon remained in Germany despite high labour costs.
Additional North American production would unlikely effect the UK as right-hand drive versions of the C-class saloon are sourced from Mercedes-Benz’s East London plant in South Africa, while the GLK is only available in left-hand drive form owing to difficulties in re-engineering its four-wheel drive system for right-hand drive applications.