Mercedes-Benz Retains Title of World’s Most Valuable Car Brand; Toyota at Second Place
Mercedes-Benz is the world’s most valuable automobile brand for the third year in a row, according to the latest report by a leading independent brand valuation consultancy. Brand Finance says the German brand grew eight percent last year to hit a brand value of $65 billion. The growth was driven by significant investments in R&D in the anticipation of new trends, particularly electric and autonomous vehicles, as well as implementing innovative new business models.
Mercdes-Benz’s customer service is also the best in the business, according to Brand Finance’s research. That, combined with its new and existing model ranges and its excellence in design, is helping keep the brand one step ahead of its rivals.
Coming in at number two is Japanese behemoth Toyota, whose stronger growth in Asia helped it rise 11 percent from 2019 to hit a brand value of $58 billion. That was enough to keep it ahead of number three-ranked Volkswagen, which was up eight percent to $44.5 billion.
Mercedes-Benz’s perennial rival BMW came in at fourth place at $40.5 billion, while fellow German brand Porsche was at number five with $34 billion.
The rest of the top ten includes Honda ($33 billion), Ford ($18.5 billion), Nissan ($18 billion), Audi ($16.97 billion), and Volvo ($16.91 billion).
Electric cars make strides
Brand Finance noted the explosive growth of electric vehicles in the ranking, calling it the year’s most important trend. It said electric-only brands recorded some of the fastest growth and that almost all the major marques launched electric ranges within the past year.
American brand Tesla is racing ahead as the fastest-growing brand in the ranking, up an impressive 65 percent to a brand value of $12.4 billion. The Elon Musk-led company has rapidly widened its footprint, with sales now in China, Australia, the UK, and several markets in Eastern Europe.
Brand Finance, however, said there have been concerns of the brand achieving production targets, but the announcement of a new factory in Shanghai, which is partly supported by the Chinese government, is set to solve production worries, putting Tesla in a position to capture market share in the world’s biggest market for electric vehicles.
For the first time, Tesla’s Chinese rival Nio appeared in the rankings at 64th place with a brand value of US$1.1 billion, following stellar growth this year. The company is growing fast, but its struggles with high initial operating and investment costs make it unclear if it can be as successful as Tesla.
Brand Finance took special note of how Porsche, which it calls the most commercially successful luxury car brand and the fastest-growing car brand in the top 5, is becoming electric. “It is futureproofing and cementing its strong position with the launch of the Taycan, making the brand the first traditional luxury car manufacturer to launch a fully electric model,” the report said. “Porsche has seen some of the fastest long-term growth of any brand in our ranking, built off sports cars and later SUVs and similar models. It is testament to the brand’s strength and wide appeal that its move to sports electric vehicles is one of the most hotly anticipated new models this year.”
“Electric car brands and electric models from existing brands are the most interesting and dynamic part of the industry at the moment,” said Alex Haigh, director of Brand Finance. “Charging ability, performance and design are all developing at a pace faster than ever before.”
Mixed results in luxury cars
Meanwhile the ultra luxury car segment has seen some mixed results this year. Bentley (down 24 percent to $1.7 billion), Maserati (down 44 percent to $1.6 billion) and Aston Martin (down 50 percent to $1.6 billion) have all fallen in brand value this year. Brand Finance took special notice of Maserati, which it says has been unable to keep up with customer trends and thus has seen continuous drops in sales volume.
Lamborghini’s brand value this year, however, has increased 12 percent and it is expected to grow further thanks to the incredible jump in sales experienced by the brand on the Urus, its SUV model, which accounted for roughly 60 percent of overall sales volume. The Urus demonstrates that the SUV trend does not look likely to abate soon.
Ferrari is strongest automobile brand
Finally, Ferrari has also achieved solid growth, recording a nine percent increase in brand value to $9.1 billion.
According to Brand Finance, in addition to measuring overall brand value, it also evaluates the relative strength of brands, based on factors such as marketing investment, familiarity, loyalty, staff satisfaction, and corporate reputation. These, alongside revenue forecasts, help measure brand strength, which is a crucial driver of brand value.
Based on these criteria, Brand Finance says Ferrari has retained its position as the world’s strongest automobile brand with a BSI score of 94.1 out of 100 and a corresponding AAA+ elite brand strength rating.
Ferrari announced five new models in 2019, including the SF90 Stradale and Ferrari Roma, both aimed at new market segments. It also established a manufacturing agreement with the Giorgio Armani Group to help push Ferrari collections into a more premium space. Brand Finance says the Maranello, Italy-based brand has utilized merchandise to support brand awareness and diversify revenue streams, but it is now taking steps to preserve the exclusivity of the brand. This includes plans to reduce current licensing agreements by 50 percent and eliminate 30 percent of product categories.
“Ferrari is the world’s strongest brand because its brand’s power stretches across its sports fans and across luxury car owners,” Haigh said. “Pulling back from merchandising is shifting that balance in a bet that brand strength in its core segment is better than widely spread revenue.”
According to Brand Finance, brand value is the net economic benefit that a brand owner would achieve by licensing the brand in the open market. Brand strength is the efficacy of a brand’s performance on intangible measures relative to its competitors.