India’s third largest luxury car manufacturer Mercedes Benz India is all set to have a new Managing Director and Chief Executive Officer in Mr. Eberhard Kern. The present MD of the company, Mr. Peter Honegg has stated that he has decided to return to the company’s headquarters in Germany and resume his chairmanship there. He was appointed the Managing Director of Mercedes Benz India on January 1, 2011, and since then he has done a phenomenal job of building the brand’s name in the luxury car markets in India. Mr. Eberhard Kern is slated to join Mercedes India on December 1st 2012, coming in as head of operations.
Although it’s a generally accepted rule that an expat CEO spends a minimum of three years in a foreign market, (Wilfried Aulbur, Honegg’s predecessor had spent five years based in India before leaving), Peter Honegg, after spending just 2 years in the country, wants to return to Daimler’s Stuttgart headquarters due to personal problems. Recognizing his long-standing relationship with Daimler, the company’s top management has supported his decision.
Mercedes Benz happened to be the first German luxury car maker to enter India but soon lost out on the race to its other rivals, who have introduced new models rapidly. As Mercedes Benz India lacks a proper entry-level SUV model in is product portfolio, it may be a major reason for its sluggish growth in the Indian luxury car market. On the other hand, its rivals BMW and Audi each have entry-level SUV models in their product portfolios, in the form of the X1 and the Q3 compact SUV respectively.