BMW, Mercedes-Benz launch discount campaign to rev up sluggish sales

BMW Korea and Mercedes-Benz Korea are widening their discount campaigns in their bid to rev up sluggish sales, as fewer customers — trapped in high interest rates — are going for premium cars, according to data and company officials, Monday.

They are offering discounts of more than 20 percent on some of their vehicles, according to data from the two carmakers.

Mercedes-Benz Korea is selling its EQE350+ mid-sized electric vehicle (EV) at a 25 percent discount. The carmaker aims to elevate its presence in the EV sector by increasing sales for the premium vehicle.

The German luxury carmaker also offers a similar level of discounts for other high-end models. The EQS 450 SUV sells with a 22 percent discount. The Mercedes-Maybach S680 luxury sedan is also available with a price cut of 25 percent.

BMW Korea is heating up the discount race to attract more customers away from its rivals. The carmaker sells the X3 M Competition SUV at a discount of 23 percent, enabling customers to purchase the vehicle for less than 100 million won ($73,700).

The company also gives a 17 percent discount on the full-electric iX3 M SUV.

The promotional campaign came amid the weakening sales performance of most imported vehicles. According to data from the Korea Automobile Importers & Distributors Association, the number of newly registered imported cars came in at 21,560 in April, down 14.7 percent from a month earlier. The accumulated figure for the first four months of this year also fell by 7.8 percent from the previous year.

Market watchers attributed the declining sales of overseas carmakers to unfavorable macroeconomic circumstances.

"Starting this year, most carmakers have reshaped their strategy focusing on sales of cheaper lineups, as demand for luxury vehicles was widely expected to remain lukewarm this year amid the continued high interest rates," a carmaker official said.

For instance, Kia has placed its management focus on the successful launch of its cheaper EVs — EV3 and EV4. The EV3 will be the cheapest EV of the carmaker.

Another industry official cited Genesis's rise as another reason for the decline in sales of imported luxury vehicles.

"Genesis is gaining more and more popularity, particularly among those in their 30s and 40s, after the luxury carmaker diversified its lineup encompassing both sedans and SUVs," the official said.

The data showed that sales for Genesis vehicles jumped by 6 percent between January and April from a year earlier. This was in contrast to the falling sales of the firm's German counterparts.

"More and more young customers with strong purchasing power display preference for Genesis vehicles, as the brand's image has gotten younger than before, and Genesis vehicles show strong performance that can be comparable with their overseas counterparts," the official said.