Mercedes, BMW global luxury lead wanes as Tesla and new EV brands ascend – Automotive News Europe

Mercedes-Benz narrowly beat BMW for the title of world’s best-selling luxury-car brand in 2020, a year in which cracks started showing in German dominance of the all-important China market.

BMW said Tuesday worldwide deliveries for its namesake division fell 7.2 percent to 2.03 million, coming within 136,000 units of Daimler’s main passenger vehicle line. While Mercedes outsold its archrival and topped the premium auto ranks for a fifth consecutive year, EV producers led by Tesla made serious inroads in the world’s largest market.

Tesla, Nio and Li Auto emerged as forces to be reckoned with in China, where BMW, Mercedes and Volkswagen’s Audi have long controlled more than 60 percent of the luxury segment. The market was a source of growth for the Germans last year, though they still gave up some of their share to the electric companies.

“The historically untouchable German brands have begun ceding market share to Tesla and other luxury EV specialists,” Alexander Potter, a Piper Sandler & Co. analyst, wrote in a report. He predicts the trend will only get worse for BMW, Mercedes and Audi. “Bottom line: whenever Tesla opens a store in a new city, the Germans lose share… and there’s still lots of headroom for opening new stores.”

The German automakers are responding to the threat by rapidly expanding their EV offerings. Daimler will introduce the EQA compact this month, one of four purely battery-powered vehicles it’s launching in 2021. BMW will almost double the number of full-electric and plug-in