A strategic marketing case on the MCC SMART.

STRATEGIC MARKETING CASE

MCC SMART

1.1 - COMPANY DESCRIPTION

MCC SMART (Micro Compact Car) was established in April 1994 by the Mercedes and Swatch association. The Swatch main idea was to create an urban, simple, environment-friendly and inexpensive car for the new century. The name SMART is a combination of Swatch, Mercedes and art. The partnership between these two firms involves their respective knowledge about their specialities. Mercedes for the engineering and Swatch for the plastic know-how.

Today the locations of the factories are in Böblingen (Germany) and Hambach (France). These plants employ a total of 1,400 people and more than 5,000 suppliers. When the system partners are included, this means 2,500 people are involved in building, designing and marketing the SMART.

MSS SMART is a wholly-owned subsidiary of DaimlerChrysler (the group which owned Mercedes) and is the shareholder with 100% of the total shares.

1.2 - HISTORY

1994 Nicolas Hayek (from Swatch) is the creator of the SMART concept.

Seat Arosa

Mercedes and Swatch are developing the concept (507 millions Euros are spent for R&D

1997Launch of the SMART, objectives for the first year 200,000 cars to be sold, MCC SMART is controlled by 91% by Mercedes company

1997End of the year - Less than 130,000 cars have been sold across Europe

1998 Jürgen Schrempp, Mercedes CIO take the total control of MCC SMART, 110 SMART-CENTER in Europe

1999 End of the year - 80,000 cars have been sold, and losses represent 150 millions Euros since the launch

1999 April - Rescue plan = the production process is totally rebuilt, new marketing mix, price decrease by 533 Euros for each model, new distribution network, new communication style

2000Launch of the turbo diesel (CDI) model and the cabriolet

2000End of the year - Turnover is reaching 828 millions Euros

2004 First benefits...