Benz adds a 3rd Production Shift

[spyder79]

 March 19, 2014 - 6:09 am ET
FRANKFURT (Bloomberg) -- Daimler's Mercedes-Benz is adding a third shift at a plant in Hungary to keep up with demand for its compact cars.

The extra shift at the factory in Kecskemet will start in May, Daimler said in a statement. The plant, which makes the B class and CLA models, will continue to produce on selected Saturdays in 2014 after adding work on the weekend last year.

U.S. sales of the CLA have been particularly strong since the compact luxury car's debut in October and Mercedes has advised dealers supplies will remain tight until June.

"Our production has hardly kept up with the dynamic sales development of our compacts," CEO Dieter Zetsche said in the statement. "This allows us to serve the wishes of our customers around the world even better and timelier."

The extra shift in Kecskemet follows other moves by Mercedes to boost production of entry-level vehicles. In October 2012, Mercedes added a third shift to a factory in Rastatt, Germany, that makes the A-class hatchback, the GLA compact SUV and the B class. Finnish manufacturer Valmet Automotive Inc. began building the A class for Mercedes last year under a contract to produce more than 100,000 of the model through 2016.

Daimler employed about 3,400 people at the Kecskemet site at the end of 2013, and staffing will increase with the additional shift, said Sebastian Wahle, a company spokesman. The factory produced about 109,000 cars last year. Mercedes' global vehicle sales have risen faster than at its premium-segment competitors in recent months, boosted by demand for the compact vehicles. Sales of the cars jumped 30 percent in the first two months of 2014, fueling a 17 percent gain for the brand.

The compact range is key to Zetsche's goal for Mercedes to surpass BMW’s core brand in sales by the end of the decade. Last year, the Mercedes brand sold 1.46 million globally, trailing Audi with deliveries of 1.58 million and premium-sales leader BMW brand with 1.66 million.