The commercial van segment is exploding in popularity in the US right now with a vast array of recent products from multiple marques, and there's even more on the way from automakers like Hyundai.Mercedes-Benz is trying to grab a bigger share of the expanding market, too, and is launching its smaller Metris here in the fall. Now comes word that Mercedes will construct a $500-million factory in Charleston, SC, that will build the next-gen Sprinter domestically.
According to Mercedes, construction of the new plant will begin in 2016, and when complete, the site will cover around 200 acres, including a body shop, paint shop and assembly line. It will also employ 1,300 people who will be building Sprinters badged as both Mercedes and Freightliner models.
Rumors about this new construction go back to late last year. Mercedes currently has to ship some partially disassembled Sprinters into the US from Germany, paying import duties on them, and then the company puts the vans back together at a site in Ladson, SC. The process obviously adds costs to the models, and the domestic factory should mean a more price-competitive vehicle. Plus, a local factory means quicker deliveries to dealers.
Despite the laborious import process, the Sprinter is a hit in the US. Mercedes sold 25,745 of them in 2014, which made the country the van's second-largest market behind Germany. They were first launched here in 2001 and since then have gained a nine-percent market share in the segment, according to the company.
Mercedes is on a construction boom at the moment. The company is building a new corporate headquarters for the US in Atlanta, GA, due to be complete in 2018. The German brand is also investing $2.4 billion to expand its Tuscaloosa, AL, factory to build models like the forthcoming GLE-Class.
MERCEDES-BENZ VANS TO INVEST AROUND $500 MILLION IN NEW VAN PLANT IN SOUTH CAROLINA,U.S.
- New plant to be built in Charleston, South Carolina, beginning in 2016
- Next generation Sprinter also to be manufactured in the U.S.
- Expansion of the global production network as part of the "Mercedes-Benz Vans goes global" growth strategy
- Creation of more than 1,300 new jobs planned
Volker Mornhinweg: "We are investing around half a billion dollars to create a top-notch Mercedes-Benz van plant here in South Carolina. This plant is key to our future growth in the very dynamic North American van market."
Mercedes-Benz Vans announced today that it will invest around half a billion dollars to build a new van plant in the United States. Located in Charleston, South Carolina, the facility will supply the North American market with the next-generation Sprinter. The plant's location was officially announced today in Charleston by Volker Mornhinweg, Head of Mercedes-Benz Vans, and by South Carolina Governor Nikki Haley. With the new plant, Mercedes-Benz Vans will become one of the biggest industrial employers in the region. Within the total area of more than 200 acres (more than 800,000 m²), the division will create a completely new body shop, a paint shop and an assembly line. Construction of the new factory is scheduled to begin in 2016.
The new Sprinter plant in the United States is essential for Mercedes-Benz Vans, as the large van segment is expected to grow rapidly in North America over the next few years. The United States is one of the most dynamic van markets in the world. At the same time, Mercedes-Benz Vans currently faces high U.S. import duties and a complex disassembly process of Sprinters made in Germany for sale in the U.S. The new plant and the vehicles 'Made in USA' will enable the company to more economically meet the growing demand from North American customers in the future and to considerably reduce delivery time on this market.
"Today is a very important day for Mercedes-Benz Vans and certainly also a very significant day for the Charleston area. We are investing around half a billion dollars to create a top-notch Mercedes-Benz van plant here in South Carolina. This plant is key to our future growth in the very dynamic North American van market," said Volker Mornhinweg, Head of Mercedes-Benz Vans, at the official announcement of the plant's location. "Charleston is an excellent location for our new plant. The region has very highly skilled workers, a dense network of reliable suppliers, and an outstanding logistics infrastructure that includes good transport connections to the nearby harbor. Just as important is the very good cooperation and support we've experienced at the local, municipal, and state levels. I would particularly like to thank Governor Haley and the many other people who've given this project their fullest support from the very start and thus helped make this decision possible."
"Today's announcement builds on a decade of success for Daimler and Mercedes-Benz in the South Carolina Lowcountry, and we couldn't be happier to be the home of their first full manufacturing facility for vans in North America," said Governor Nikki Haley. "Mercedes-Benz is not only a world-class brand - they are also a great corporate citizen and partner for our state and for the Charleston community. Its decision to bring South Carolina-made vans to the North American market is huge, and the 1,300 new jobs this plant will create is a big boost to the region."
The Sprinter "Made in USA"
First introduced in 1995, the Mercedes-Benz Sprinter has been a success story in the van business for 20 years now. Distinguished as the world's leading large van, more than 2.8 million Sprinters have been delivered to customers in around 130 countries worldwide. This makes the Sprinter a key pillar of the division's "Vans goes global" growth strategy, which aims to consistently expand the business of Mercedes-Benz Vans worldwide and exploit additional sales potential in growth markets outside Europe.
Volker Mornhinweg: "The Sprinter founded the large van segment and has always set the standards for safety, efficiency and quality in its vehicle class. We are market leader in many regions worldwide, and also here in the United States many van customers are enthusiastic about this vehicle concept. In 2014 alone, we delivered around 26,000 Sprinters to U.S. customers, making the U.S. our second-largest sales market after Germany."
The Sprinter has been available in the United States since 2001, and today holds approximately nine percent of the country's large van market. Mercedes-Benz Vans pursues a dual-brand strategy in the U.S., where it offers the Sprinter as both a Mercedes-Benz and a Freightliner-branded vehicle. Sprinters of both brands will also roll off the assembly line at the future plant in Charleston. Besides the Sprinter, the MercedesBenz Vans division will also add the Metris series of medium-sized vans to its product range in the U.S. beginning in fall this year.
About Mercedes-Benz Vans globally
Mercedes-Benz Vans is a full-range supplier in the van market. Besides the Sprinter and Metris, the division's global portfolio consists of the Mercedes-Benz Citan city van. In 2014, Mercedes-Benz Vans also introduced the new VClass, which is a new multi-purpose vehicle (MPV). Mercedes-Benz Vans has manufacturing facilities at a total of nine locations in Germany, Spain, the United States and Argentina, as well as in China within the framework of the Fujian Benz Automotive Co., Ltd. joint venture, and in France in the context of the strategic alliance with Renault-Nissan. The MercedesBenz Sprinter Classic is produced under license by the division's partner GAZ in Russia. The most important markets for vans at the moment are in Western Europe, which accounts for 65 percent of unit sales. As part of the "MercedesBenz Vans goes global" growth strategy, the division is also increasingly developing the growth markets of South America and Asia, as well as the Russian van market, through appropriate distribution and production activities in those regions.