* New China board member "long needed change" -analyst
* Daimler veteran Troska will take post for 3 years -Daimler
* Move underscores "strategic importance" of China -Chairman
* Troska must solve distribution problems -analyst
* Daimler lagging rivals BMW, Audi on Chinese sales
FRANKFURT, Dec 12 Germany's Daimler
has named a new executive board member to take charge of its
operations in China, the world's biggest auto market, where it
is falling further behind rivals BMW and Volkswagen's
Hubertus Troska, a 24-year Daimler veteran who heads
Mercedes-Benz truck operations in Europe and Latin America, will
take over the newly created post on Thursday for three years to
the end of 2015, Daimler said on Wednesday after a meeting of
its supervisory board.
Daimler, which slipped deeper into global third place in the
luxury market this year, is revamping its distribution in China,
as managing two separate Mercedes sales units had contributed to
its underperformance there.
Singapore-based Bernstein analyst Max Warburton said the two
channels had caused internal bickering among distributors,
prevented coherent sales strategies and led to unnecessary
The appointment of Troska was a "long-needed change at the
top", London-based Credit Suisse analyst David Arnold wrote in a
note published on Wednesday. "Daimler's China operations are one
of the major disappointments for markets."
"A lot of Mercedes's problems in China have been home-made,"
said Ferdinand Dudenhoeffer, head of the Centre for Automotive
Research at the University of Duisburg-Essen. "It's high time
that a dedicated top manager tackles them."
Though economic performance in China has been more patchy
this year, Chinese sales have helped German premium
manufacturers to offset weakening business in recent years in
core western European markets. In November, however,
Mercedes-Benz suffered a 6.6 percent drop in Chinese deliveries
to 16,876 vehicles, holding the year-to-date gain to just 4.2
percent, making a total of 177,301.
By contrast, sales of luxury-market leader BMW surged 62
percent to 29,005 autos in November, extending its 11-month
increase to 37 percent, and sales of 274,985, while Chinese
market leader Audi posted a 26 percent monthly gain to a record
37,600 autos, making a 31 percent gain so far to 370,559.
BMW and Audi manage Chinese sales through a single
"Mercedes Benz had a lot of problems to sort out its
dealerships in China," said John Zeng, LMC Automotive's Asia
Pacific director. "They are trying to tackle the problem now,
but the dealership issue could take a long time to resolve."
Mercedes had also failed to introduce new models at
appropriate prices and lacked a cohesive brand positioning to
respond to changes in Chinese consumer buying patterns, said
Stefan Bratzel, head of the Center of Automotive Research near
They also misjudged a trend showing wealthy Chinese buyers
preferred luxury SUVs over sedans and failed to release an SUV
that could rival Porsche's Cayenne or BMW's X5, he said.
Daimler's move reflects the heightening competition among
Germany's top carmakers for greater business in the lucrative
Asian nation. VW, the first overseas carmaker to enter China
three decades ago, appointed executive board member Jochem
Heizmann in June to take charge of a special portfolio to
oversee expansion in China.
"We are underscoring the strategic importance of China for
Daimler," Daimler Chairman Manfred Bischoff said in a statement.
"We continue to see great potential there for sustained growth
and the continuous expansion of our business."
Daimler shares were up 0.6 percent as of 1138 GMT, trading
at 39.69 euros in Frankfurt.
Stuttgart-based Daimler already promised 2 billion euros
($2.6 billion) in cost cuts at the Mercedes-Benz division by the
end of 2014 after warning in October that it would miss its
operating profit target this year by 1 billion euros.
Separately, the supervisory board also extended the contract
of Daimler Trucks chief Andreas Renschler until Sept. 30, 2018.