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EP 3: Dr. Helmut Groesser: Strategizing Mercedes-Benz products for the world
110 Plays1 month ago
In this week's episode John Stech, host of The Auto Ethnographer, has a conversation with Dr. Helmut Groesser. Helmut spent most of his career in Product Management at Mercedes-Benz. Most of the vehicles you know over the past decade were influenced by Helmut and his team in some way. Today he talks about how Mercedes-Benz considered different country-market requirements and some of the interesting ways to convince the vaunted Mercedes-Benz Engineering Department to adapt the vehicles.
He took a detour to the United States for three years to work on the Jeep, Chrysler, and Dodge brands when Mercedes-Benz and Chrysler were joined under the DaimlerChrysler roof. Here he helped to bring the more advanced Mercedes product planning methods to Auburn Hills, Michigan in order to prepare Chrysler for its coming global product offensive in the early to mid-2000s. Helmut speaks candidly about his time in that role and about the differences in working between Germans and Americans.
Helmut also speaks about his time working as Head of Sales for Mercedes-AMG, a highly operational role much different from his long-term-focused product strategy roles. He speaks of Mercedes-AMG's development process and how speed was achieved even when vehicle lines were developed within the parent company.
Living in the United States and working with people around the world has impacted Helmut personally. He explains how with some thought-provoking anecdotes.
Visit The Auto Ethnographer's homepage for more information about the podcast series at https://www.auto-ethnographer.com
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Transcript
Cultural Perspectives: American Optimism vs. German Pessimism
00:00:00
Speaker
This typical American thinking of, which I feel at least, the glass is half full. In Germany, German mindset in doubt, the glass is always empty.
Introduction to the Auto Ethnographer Podcast
00:00:14
Speaker
Hello and welcome to the Auto Ethnographer. I'm John Steck, the host on this journey. Every week we travel the globe to bring you stories about the impact of culture on the global automotive industry. Get out your passport, fasten your seatbelt, and let's get started this week's episode.
Meet Dr. Helmut Grösa: Career at Mercedes-Benz
00:00:35
Speaker
Hello and welcome to the Auto Ethnographer. Today we have a very interesting guest on this episode. I have Dr. Helmut Grösa. Dr. Helmut Grösa had a 30 plus year career with Mercedes-Benz, primarily in product management and product strategy.
00:00:54
Speaker
His most recent role prior to his relatively recent retirement was as the director of product management. I would say there are probably all vehicles in the last 10 years that have his fingerprints on their strategy in one way or another.
00:01:13
Speaker
He started his career 30 years ago with Mercedes, focused a little bit on service management. He shifted over to a product yeah management. and then was focused primarily on the German market.
00:01:28
Speaker
When the Mercedes-Benz M-Class came along in 1997, Helmut shifted over to product management on a global role.
International Experience: Working with Chrysler in the U.S.
00:01:37
Speaker
And this started to change his view of which countries and where he was looking on the planet in terms of product management.
00:01:47
Speaker
He took a small detour from Mercedes-Benz for three years and moved over to the United States where he worked with the Chrysler, Jeep, Dodge, and Ram brands during the Daimler Chrysler years, which was a nine-year company of Mercedes-Benz and Chrysler.
00:02:04
Speaker
After which he returned to Germany and returned to a variety of different product management roles, which included some of the crown jewels of Mercedes-Benz product lines like the S-Class, the SL, the SLK, the CL.
Global Market Adaptation: Mercedes-Benz Strategies
00:02:21
Speaker
He also, as the director of product management, was responsible for all of the SUV lines, the compact car lines, as well as the roadsters and all information, product information that Mercedes-Benz would share with the customers.
00:02:36
Speaker
I don't think there's anybody who can talk better about the Mercedes-Benz product. ah or how the product is adapted for worldwide sales and distribution than Helmut Gorsa.
Mercedes-Benz's Image Transformation
00:02:53
Speaker
So Helmut, I want to welcome you you to the auto ethnographer. And glad that you're here. Looking forward to our conversation. Hi, John. good Good to be with you.
00:03:05
Speaker
think it's going to be a great opportunity to talk about you know your history a little bit and how you evolved. um As I mentioned, you started your Mercedes-Benz career really focused heavily on the German market and then kind of evolved through a variety of different roles as you got greater and greater scope from ah from a product and and global viewpoint.
00:03:33
Speaker
So maybe we can start at the beginning with your time with the Mercedes-Benz Germany sales organization. Can you tell me a little bit about that and how you even got into the world of Mercedes-Benz?
00:03:44
Speaker
Yeah, interesting enough. As a student, I wasn't really interested in going into the automotive business.
Product Line Diversification with the M-Class
00:03:52
Speaker
Thought of other areas which could be interesting. And Mercedes-Benz,
00:03:59
Speaker
As long as I was a student in the 80s, Mercedes was not really the brand I was was thinking of. It was very conservative. It was status-oriented, technology-driven, pure luxury, ah primarily E and S-Class sedan were the dominating vehicles. Sure, there were the the the highlights like an SL or like the Coupes or Cabrioles but primarily it was a sedan ah market or sedan program Mercedes had.
Cultural Challenges in Engineering: Integrating Cup Holders
00:04:38
Speaker
Interesting enough around in the mid 80s you first saw the newly launched Baby Benz. You probably remember It it was the first C-Class, a very interesting ah vehicle because it was a start, kind of the first er venture into into new areas.
00:05:03
Speaker
to adapt to to reach new customers. That was interesting because suddenly you saw, you didn't see this conservative vehicles only in the and the street, but you saw these smaller ones, black, deep,
00:05:20
Speaker
big wheels, just suddenly it vehicles which got interesting.
Collaboration Insights: Mercedes and Chrysler Differences
00:05:26
Speaker
um When I entered the market, when I started with Mercedes, Mercedes just launched the S-Class at that time. That was the 140.
00:05:39
Speaker
You probably remember it. It was...
00:05:44
Speaker
Automotive Sport said it's the best car of the world and praise was perfect. It was technology was without end. It was the best of the best.
00:05:57
Speaker
I think you can say that. But on the other hand, in Germany especially, it was heavily criticized for being too much, being a dinosaur,
Daimler-Chrysler Merger: Synergy Challenges
00:06:08
Speaker
a tank, whatever. So it was not the time where ah People really accepted it.
00:06:16
Speaker
It was very well executed for the States, for other markets outside Europe. But there was some criticism in Europe. And that was the time when I came into the the market. And at that time, you primarily were distributing vehicles.
00:06:37
Speaker
It was not a real sales organization. it was more distribution. You had, in Germany especially, you had long waiting lines.
Adapting German Processes to Chrysler
00:06:47
Speaker
ah You ordered vehicles and and half a year later or even a year later, you you got the vehicle. So totally different story versus today or what you know from the States or from other countries.
00:07:03
Speaker
And with this S-Class, it slightly changed a bit. You touched on something interesting, which is the German customer. but The German customer is um more willing to wait and to order a car, you know to spec it out, looking at these order books, the specification lists.
00:07:25
Speaker
they they've They work through and then they they're willing to wait. Yes. Yes, that's exactly the point. ah Is that still the case? and And that's partly still the way until
Luxury Models and International Markets
00:07:40
Speaker
today.
00:07:41
Speaker
you You have a base vehicle in Germany and you have the options or option packages. Nowadays, you try to to optimize the process, of course. But in Germany, you are speccing the vehicle and that's different to other countries.
00:08:00
Speaker
especially outside of Europe. I basically as was working in product management shortly after already, product management Germany, and my role was basically yeah to do special editions or ah yeah inform markets, the sales organization about what's coming up in the next modification year, and so on and so on. So it was...
00:08:29
Speaker
And of course, to the other side, to to the headquarter, the role was to explain what German customers are demanding. But of course, that's probably probably
Chinese Influence on Mercedes-Benz S-Class
00:08:43
Speaker
obvious in a German engineering organization believes to know what a German customer wants to have. So your role as a product manager was more towards the outside, towards the dealer network and the customers, and less towards towards the headquarter. Even that Germany at that time was the biggest market for Mercedes-Benz close up with with the States.
00:09:12
Speaker
So that was the phase in the German sales organization. As I said, with the S-Class, thinking changed a bit. We realized as a company that... ah You can be
AMG's Integration and Development Speed
00:09:28
Speaker
too much technology driven. You can can go far too much, probably also put too much cost in it. And ah we also saw that new customers were or new brands were coming into the market, like BMW got more and more successful.
00:09:48
Speaker
Lexus came in and the States, you probably remember the face as well and so on and so on. so it It was pretty obvious. ah You have to get new customers.
00:10:01
Speaker
You have to get to to expand your brand into new segments. And that was when ah Mercedes really had this big product offensive starting.
00:10:13
Speaker
And that was also a change in thinking. um So, for example, if you think of the M-Class, you suddenly said, I'm building it totally new type of vehicle in a segment which is nearly not existing at that time.
00:10:30
Speaker
It was basically the M-Class and the X5 who launched the luxury SUV segment. um in a new market, a new production location and in Tuscaloosa, Alabama, with new production technology, with new type of development. So everything, it was a new approach. And Company changed at that time. We also were thinking about small city cars.
00:11:05
Speaker
You probably remember the A-Class coming up in 98 or even the cooperation with Smart started there
Sales at AMG: Agile vs. Traditional Methods
00:11:16
Speaker
where you just said, I have to get into a new segment. I have to somehow um broaden the the face of the brand.
00:11:26
Speaker
was that a Was that a reaction to something happening in the European market or in Germany, the home market? but Or was that something to have a more global appeal? basically realized that ah to focus too much on on Germany is the wrong thing.
00:11:43
Speaker
ah Sure, you need the German base, you you need it, but ah growth is happening outside. And ah the the brand had a lot of potential in in other markets, in the States, for example.
00:12:00
Speaker
ah Think of the SUV market, which which was not existing in Germany at all. Yes, you had a few off-roaders. Yes, we had a G-Wagon and there was a Land Rover existing, but There was so much potential on on the horizon and it was obvious you have to get in there.
00:12:23
Speaker
You need more volume, you need ah new customers. The brand can carry far more. and And that was the time where really this product offensive started. And that was the moment where I figured out
Cultural Insights and Career Reflection
00:12:41
Speaker
There the music is happening. There you have to go. And that was when I moved into the headquarter and got responsible for the M-Class at that time, directly at the launch phase.
00:12:54
Speaker
Very interesting. you your focus broadened. Yes, you were thinking of the German market as well, but ah US, s for example, at that time was far more interesting.
00:13:09
Speaker
Right. So that was your shift then from pure focus on the German market. And then suddenly you opened your eyes and and i looked at it. And the same happened, ah of course, in engineering. Engineers.
00:13:25
Speaker
primarily still were thinking German. We're located in Germany, we're developing products in Germany. ah Even that ah new processes were starting, ah the German mindset was still deeply into the cars and into the development phase.
00:13:48
Speaker
it was hard to convince them that things are happening outside of Germany, which have to be taken into consideration,
Podcast Conclusion and Future Invitations
00:13:58
Speaker
that customer demand are different.
00:14:01
Speaker
One of the best examples, I think, were the cup holders. Cup holders at that time in Germany were... not relevant at all german engineers were convinced that ah cup in a car is the absolute wrong wrong thing you should not consume in the car you should not drink in the car you could spill the coffee onto your middle console. The area around the middle console is the most most expensive real estate in the car.
00:14:39
Speaker
You need it for buttons, you need it for shifts, shift levers. You need it for other things, but there is no space for a cup holder.
00:14:52
Speaker
And ah yeah, customers the engineers learned in that time that still we need to have some cup holders, which were optional in Germany, of course.
00:15:04
Speaker
And they were Great ah ah technical solutions for these cup holders. You had to press a button and something was unfolding in the area of the ah here of your middle console.
00:15:19
Speaker
Great technical solutions are just not what the customer was looking for. And even the first M class, um You probably remember it yourself. the custom The cup holders were, ah because there was no space at the middle console, cup holders were placed left and right at the ah ingress egress area.
00:15:43
Speaker
at the instrument panel below the the air outlets. um And we tried to explain the solution that this is a great one because you then even can heat your your drinks through the air vents or cool them down.
00:16:05
Speaker
Of course, it was a stupid solution, to be very honest, because when you got in or out, you You hit the cup holder with your knee or it just didn't really work out. And so, for example, um it was a real huge process to convince engineers that cup holder now for the next generation M-Class has to change.
00:16:30
Speaker
And one of the of the key messages was, best cup holder in the world has to be in the next generation M-Clouds. So now when you talk about cup holder to an engineer ah who doesn't know cups from Germany or if at all the small paper cups,
00:16:50
Speaker
a had they had no understanding what is really ah needed. So for example, I was on vacation in in the States in 2000, 2001.
00:17:02
Speaker
two thousand two thousand one Interesting enough, ah I was with my family. We were collecting cups. I came back with around 20 cups from Burger King and McDonald's and all the others in different sizes up to the 32 ounces and and brought them back home. I even bought a 64-ounce cup, which amazing.
00:17:31
Speaker
nearly two liters. ah The 64 ounce. Of course, not for the car, but I told the engineers this is what we need to have as well. They refused to do it, but at least they understood that the smaller ones, up to 32 ounce, so more or less a liter,
00:17:51
Speaker
that they have to realize it and they have to realize it in the middle of the middle console and then have to get rid of the shift lever, for example.
00:18:03
Speaker
but So when you were traveling in the US with your family, ah collecting cups, Was this the first time that you actively were trying to eat in the car and and experiencing eating and and drinking in the car?
00:18:17
Speaker
To be honest, it was not usual in Germany to eat or drink in the car. That was a place which had to be clean. So that was just one example which can show how the the shift had changed, ah ah had to change. You ah had to look outside of the German market and focus on on yeah customer demand all over the world.
00:18:47
Speaker
So at that time, ah working on the M class, something else happened. If you think back, we are now in around 2000.
00:18:58
Speaker
ah Daimler and Chrysler, there was the merger going on. And obviously, it was an easy thought, how can you can you get synergies out of it?
00:19:14
Speaker
So one of the exercises was to to look at the next generation M-Class, which was supposed to launch in 2005. So from development cycle, more or less started in 2000.
00:19:27
Speaker
two thousand And the the Grand Cherokee ah at the same time was also supposed to launch in around
00:19:39
Speaker
So first thought, obviously, was can you put both vehicles together on one platform or have at least but what kind of synergies can you can you get out of it, cost benefits, you don't have to develop everything parallel, and so on and so on.
00:20:00
Speaker
And at that time, also could figure out cultural differences between US s and Germany very well. you You probably have been there partly as well at that time. Or i think you we were there at a meeting together in in Detroit.
00:20:22
Speaker
ah a A German delegation was basically coming to... to the states 25 people with your big binders full of information on on the product concept, the parts, a meeting 20 Chrysler guys who were not prepared at all.
00:20:48
Speaker
say this was the The moment where I realized with with the Daimler Chrysler merger, that the single ah intersect overlap point of these two big companies was that SUV, the M-Class and the Jeep Grand Cherokee.
00:21:07
Speaker
It was the one intercept point where the two brands thought that maybe they were the same the same customers. Yeah, and it already started with positioning discussions. I remember...
00:21:22
Speaker
um Jeep guys tried to convince us that there is only one ah one brand capable of of off-road and Rubicon and all the arguments. And Mercedes, you you are in a different corner. You are sedan somehow driven and have nothing to do with off-road.
00:21:48
Speaker
We came on the other side and said, have you ever driven G-Class? ah That is Rubicon capable. That is really Rubicon capable. They are even better than then the Jeep, than the Wrangler.
00:22:02
Speaker
So very interesting discussion, just showing you that To be honest, the Mercedes guys had no clue what Jeep really was standing for and and what Jeep was capable of.
00:22:16
Speaker
And ah the Jeep guys on the other side had the same problem and it was hard to to get both together. You also could realize that the Jeep engineers had totally different understanding of development than the Mercedes engineers.
00:22:37
Speaker
No one really wanted to to ah utilize things developed from the other side. I remember I was part of ah of a group. We were discussing about climate control, about the HVAC system.
00:22:54
Speaker
And it's basically, it's a big box. some somewhere behind your instrument cluster, you don't really care about what's going on there. Just what you need is a significant air, airflow, right temperatures, no big deal on the first wheel.
00:23:16
Speaker
And both had the same requirements. And still, I was sitting there for three, four hours and learned why the mercedes system won't work with the Chrysler system or with Jeep system and the Jeep system won't work with the Mercedes one. And it was really shocking that afterwards, after two days of hard discussions, result was basically that we nearly didn't find any common parts bringing together.
00:23:47
Speaker
You would think that anything under the skin that you don't see could could could be somehow an efficiency, like so seat frames or, yes, the AC, which which should, like you said, is is a black box. It should blow hot air, should blow cold air at different speeds.
00:24:05
Speaker
um It's hard to imagine that this wouldn't transfer but between two vehicles, which are essentially in the same segment. It also probably had to do with that,
00:24:17
Speaker
ah the development processes were happening exactly at the same time and ah no one wanted to give up ah anything. Mercedes, for example, at that time,
00:24:32
Speaker
Clear understanding was always we are developing everything new from scratch. We are not taking on any old parts of the previous vehicle, probably some screws, but that's it.
00:24:46
Speaker
We were proud that we had to develop every part and Every part knew, had to partly work with new suppliers, had to to add new technology in there.
00:25:01
Speaker
And we always said that's the most cost efficient way. But that required, of course, long development cycles, a lot of of of power to be to be put into this process, a quality gates, a strong, a strict process going on.
00:25:23
Speaker
to make sure that at the end every new part falls together and you have a functioning vehicle which can be launched into the marketplace.
00:25:34
Speaker
Chrysler was slightly different. Chrysler also said we are working on new parts, but they always had in them their mindset, ah if it doesn't work out, we can go back to the old one.
00:25:48
Speaker
So if if wev we start developing something new, a work together with suppliers, and if we figure out Timing-wise, it's not coming in in time.
00:26:03
Speaker
we still have a backup plan. Mercedes didn't have backup plans at all. The only consequence was if you are if you won't make it, you probably have to postpone ah launch, which normally that did not really happen because if you have a strict ah detailed planning and clear quality gates and deliverables and then it somehow worked out. and So therefore, processes were different, but also this not invented from me, I want to do everything myself, that was the dominant force. and
00:26:46
Speaker
We nearly didn't get anything together. Yeah, the diesel engine, for example, for the Grand Cherokee came from Mercedes. Things like this could brought to could be brought together.
00:27:01
Speaker
But other than that, b we were not able to really create synergies. You spent time, obviously, on the Mercedes-Benz M-Class SUV side.
00:27:15
Speaker
yeah having all of these conversations with the colleagues at Chrysler. But then you decided somehow to go into the lion's den and you literally switched over and moved over to them the world headquarters in Auburn Hills, Michigan, moved your family over to the United States and took on a role where you were yeah basically talking to the same people you had been talking to before, but now you were a Jeep guy.
00:27:49
Speaker
And you your your mission now was a little bit different. Mission was different. You're right. First of all, the thought was bring a part of this accurate planning process in the development phase of new cars, bring it and implement it as much as possible into the Chrysler, Jeep, Dodge world. So meaning, for example, in in Germany at Mercedes, ah there was the so-called Lastenheft, it was called, so a spec book.
00:28:29
Speaker
a which basically had the target to put together all the requirements, describe how a vehicle has to look like a ah around two to three or three years before before launch of the car. So put down all the thoughts.
00:28:51
Speaker
develop it in your mind, develop it on paper, in the systems as much as possible, start already testing it, and then at a certain time, freeze, say, that's my targets, that's how the vehicle has to look like, ah put it together.
00:29:09
Speaker
And to get this going, it also meant you have to ah clearly define the targets. So for example, whatever, fuel consumption. a And someone from engineering has to evaluate if this fuel consumption target for for vehicle X and engine Y, ah that it really will work. And then you could benchmark yourself towards market launch.
00:29:37
Speaker
can you Did you reach your targets? If not, what do you have to do to improve to to get in the right direction? So in Germany, it more or less, of course, there were still changes going on after the spec book.
00:29:53
Speaker
But more or less, the description of the spec book, the vehicle in behind, somehow got in reality three years later. At Chrysler, at that time, it was not the same way. So for example, from the international markets, um we were complaining at the at the launch that targets were not met, but we had not really written then them down ah and and aligned on them with the engineering community.
00:30:28
Speaker
three years in advance where it was but would have been possible to either go in the right direction or make the reality check and tell you in the in in the market, in the marketing area, tell you that it won't work this way and you won't be able to to to meet these targets.
00:30:49
Speaker
So that was one of the assignments. Can you bring in some German expertise on how to plan the the development cycle, how to plan the input ah you need from from product management, from the markets, and and stop whining afterwards that you didn't meet it, but bring it in in advance and then align it with engineering.
00:31:19
Speaker
That was one part. where there why they they asked me to to join Chrysler. The other was, yeah, can you bring in this international view? Because Chrysler Jeep and Dodge Ram, at that time, they were 90% US market driven.
00:31:43
Speaker
And vehicles sold in US, 90% sold in US, and around 10% were sold outside in outside North America, i have to say.
00:31:56
Speaker
So for a Chrysler, it was obvious if they want to grow, they have to grow outside their core market. And therefore, what can we do from a product product strategy perspective?
00:32:12
Speaker
to have a better match of Chrysler products into international markets. That was the reason why I came there. The way of working was really different.
00:32:25
Speaker
So just to give you one example, I remember my first meetings. We were preparing a paper for the board, for a board meeting, let's say six weeks ahead.
00:32:39
Speaker
was meeting with the key ah people who had to put things together from sales and marketing, ah laid out the plan, who has to do what until when, gave clear assignments, or I believe that I have a clear agreement with my partners ah to deliver next week certain results so that if everything falls together, we have a nice package six weeks later for for the board.
00:33:12
Speaker
I was happy with the first meeting. Everyone was friendly and nice. and looked great and everyone agreed on the assignments. I believed at least everyone agreed because a week later when we met again and I was asking for, can you please show me what you have researched in the meantime? And they were looking at me and didn't really understand what what's going on. Why am i asking them to to deliver something?
00:33:45
Speaker
So
00:33:48
Speaker
Somehow different to Germany. In Germany, you knew if you have agreed on next week, then someone will at least bring something to the table. Maybe not exactly what you have expected, maybe some but but they will tell you in advance if they cannot make it until next week and so on and so on.
00:34:13
Speaker
So week two, i thought maybe I was not clear. My English wasn't good enough. or I tried it again. and week three, more or less nearly similar result.
00:34:31
Speaker
they They didn't feel the urgency of putting the paper together right now, which I had from a German perspective, being accurate and clearly planning it and organizing it, and the process has to be like this.
00:34:48
Speaker
Interesting enough, er when it got closer to the so the final paper, They all got very active. Finally, the paper was put together in time.
00:35:03
Speaker
a But it somehow just just came together in the last minute. I remember that whenever we had to do the paper at the day before, at around 7 or so the in the evening,
00:35:16
Speaker
We had to order pizza to to make sure that the paper was coming together, that everyone stayed on board.
00:35:28
Speaker
You were there all night. somehow finished at at four. The finance guys had their numbers in well as well. Four at night.
00:35:39
Speaker
And at eight or nine, the paper was presented. That could never work in Germany. In Germany, you have to be ready at least a week before to be able to brief everyone, to put all the backups together.
00:35:54
Speaker
so totally different process between Germany and and and US, what I realized. It sounds a lot like what you would witness on American college campuses, where you have the big assignment that you know about for the entire semester, and then you wait until the very end. And then and as they say, you pull it all night.
00:36:18
Speaker
So i i know in 2005, you headed back to Germany.
00:36:23
Speaker
you headed back to to germany I do remember that a few weeks later after you left, Dr. Dietrich Zetcher returned to Germany as well. we We realized that he knew Chrysler could not survive without you there. So when you left, he he followed immediately.
00:36:42
Speaker
Yeah, I followed him to the States. He had started his assignment, I think, a year before. And we basically had to leave the same time. And I was at that time responsible for S-Class, which is just as you mentioned it in in before, which is just the luxury icon of Mercedes-Benz. I was responsible for the S-Class, for the big coupe, the CL, for the SL, for the SLK.
00:37:17
Speaker
So... a dream job for a product manager. And ah of course, the focus changed As well, ah German market now was not relevant at all. I'm sure you are selling cars, but you are not developing S-Class for for the the German market.
00:37:40
Speaker
You are not even developing it for the US market. Sure, you have it in mind, but you are primarily looking at the Chinese market.
00:37:51
Speaker
And you have to find a balance. If you remember the first S-Class I was speaking about, the 140, in the 90s, that was the most status-oriented S-Class we had at that time.
00:38:08
Speaker
um With the criticism, the dinosaur discussion in Germany, and probably the understanding that we overdid it a bit. The next generation, which came in the late 90s, the 220 was far more dynamic, less status-oriented, still technology-wise a very attractive vehicle, but It was oh no on a continuum, it was the opposite side. the One was most status, that was least status oriented.
00:38:46
Speaker
And the understanding of the vehicle in 2005 was place it in the middle. Add status, but don't go beyond status.
00:38:57
Speaker
add far more status, focus on on international markets, focus more on Asia. And the the successor even was primarily built around Chinese customers.
00:39:14
Speaker
The interesting thing with the Chinese customers at that time was they didn't fit into ah the mindset you had so far. the Germans, the Americans, or in other markets as well, it was this, I have have working a long long time, I have been successful, i have made it to the top, and now I reward myself by buying an S-Class, and of course also showing off um that I have been that that i am there, that i made it.
00:39:52
Speaker
but slightly different to the BMW world where you more wanted to show I'm climbing up, I'm on my way up. With S-Class, you clearly demonstrated I'm there.
00:40:04
Speaker
So traditionally, elder people in the 40s and the fifty s who bought these cars, if you look at China, um totally different clusters now happening. On one side, the ones who...
00:40:21
Speaker
who are linked to, somehow were linked to the party, to the political party, to the communist area, who got in time, whatever, were owning some and big company, working closely linked to to to the communist party,
00:40:45
Speaker
And the on the other hand, you had the young ah technology, new technology founders, entrepreneurs. There were people in the twenty in the twenty s when you asked them, so now you have bought an S-Class, what was the car before?
00:41:05
Speaker
They told you, I didn't have a car before. It was my first car. And when you then asked them, What is it what you are looking for? ah what What is an S-Class for you in your market?
00:41:21
Speaker
the It was primarily, um this especially for the the older ones, for the ones linked to the Communist Party, it was I want to sit in the rear, want to relax, want to have... Don't understand why you care about the driver's seat.
00:41:43
Speaker
a You can build in whatever you want. It's just a driver sitting there. I don't understand your German mindset of of optimizing a car from the driver's seat coming.
00:41:57
Speaker
Just optimize the rear area, put in luxurious materials, put in comfort as much as possible, space, some entertainment.
00:42:09
Speaker
I just want to feel comfortable when I'm driven from from a space to space. From the younger ones, there were also at that time a lot who were using chauffeurs, had their drivers.
00:42:25
Speaker
um But at least on weekends, they were driving themselves. They had their family in the rear. And they also said, i I need space. I need luxury in the rear You have to focus far more on the rear.
00:42:42
Speaker
And I don't really care this much about the latest technology, what you know from whatever, German or American customers.
00:42:57
Speaker
So different world, interesting enough, and of course, different ah requirements for engineering and for positioning of the vehicles.
00:43:09
Speaker
It's vastly different when you think that in the in the United States or in Europe, very few people have a driver. Even when you get to driving an S-Class, quite often, probably 95% of the owners drive the car by themselves.
00:43:24
Speaker
I fully understand from a Western perspective why you would have a car engineered around the driver, not engineered around the passengers in the backseat. Fully understandable. And it's such an incredible comparison to China where the owner probably would almost never drive the car themselves. Nowadays it has started to change, of course, and you are driving yourself as well.
00:43:47
Speaker
ah But um still the the place in the second ah second row is extremely valuable. Your family is sitting there, your kids especially, your parents.
00:44:03
Speaker
You have to show them the comfort as well. so the comfort focus, the focus on wealthy, on on on luxurious materials, and and so on and so on, is still on an extremely high value, far far more than on the far more than for the empty nester S-class buyers in Germany or or in the States. It's interesting, too, because now when you look at the The discussion was about the rear seat and continues to be, but now it's also about the the the driving and the handling and the performance of the vehicles. You have the rise of the local brands in China, which are not as performance or handling ah oriented.
00:44:52
Speaker
um But the question is, when you're sitting in these multi-million megalopolis cities, in traffic, you you don't need to drive 250 kilometers an hour.
00:45:05
Speaker
ah you You need to just be able to be comfortable and and and have a good a good climate control and you know a lot of infotainment and all of this.
00:45:18
Speaker
And it sounds like what what you described with the the rear seat occupant and this hurdle that had to be cleared, it sounds like it's coming again now, but on the performance side versus infotainment. Absolutely perfect description.
00:45:32
Speaker
that that's that's what you realized and uh why why vehicles have changed so for example you had to get reclining seats in there which were not usual in whatever this 140 in the 90s things like this had to be implemented and if you look at it now ah It's really to to experience the luxury in a traffic jam situation.
00:46:03
Speaker
Bringing me to AMG, ah that's of course a totally different world. i was After my S-Class product management time, I was was responsible for all sales at AMG, so head of sales.
00:46:19
Speaker
um and Yeah, that's another different world. Driving performance is really key of the brand and and ah processes are happening as well, but the speed is totally different.
00:46:38
Speaker
Sure, AMG gets integrated into the development cycle from from scratch, but ah the the way of how products are ah done at AMG is far, far more... a Yeah, there there is more speed in it. It's really, it's also about performance.
00:47:02
Speaker
It never kind of lost its independence as a, like almost an entrepreneurial or startup type of environment. Yeah, it originally, if you look at the history of AMG,
00:47:16
Speaker
Originally, it were kind of a tuning brand. There were two engineers at at Mercedes and who felt that you should put in very sporty engines into an S-Class at that time in the 70s.
00:47:35
Speaker
um But Mercedes had discontinued the car racing business, so we're not into racing anymore. And they figured out, so let's let's do it ou ourselves. Let's find it's found an own company. They were successful Mercedes.
00:47:51
Speaker
with these vehicles but at that time it was take ready developed vehicle remove the engine put another engine in or remove some parts and it was basically tuning in the beginning in the meantime in 1990 AMG was bought by by Mercedes and from then on you started to integrate the AMG requirements in an early phase of the of the development cycle. and So it's not that you have to just throw away things, but implement them in production processes.
00:48:37
Speaker
The engine, of course, still is 100% made by AMG, one man, one engine concept. Big changes in the car happen right in the beginning.
00:48:49
Speaker
For AMG. And AMG even has developed its own own cars nowadays. Think of the Galwing, the SLS, which ah was was launched in around 2010 when I took over at AMG in the sales department.
00:49:09
Speaker
That was probably the the best example of that it is to integrate AMG into the the Mercedes world as the top performance brand driving performance, as I just said.
00:49:28
Speaker
Very interesting time, of course. Also sales being now looking at daily results and monthly and yearly numbers and not looking on on product management. You are looking in advance. You are preparing for a car which will be launched in five years, partly at least.
00:49:53
Speaker
At sales, it's just about can we get some more cars out? Yes, that that's the world that I existed in a little bit more, a little bit less the strategic ah product management side. One question that that popped into my mind about AMG is, you know, you described the difference between how the former Chrysler organization, which of course is Stellantis today, how they had product planning and ultimately engineering.
00:50:22
Speaker
and how that didn't necessarily match up with the Mercedes-Benz processes. And then now you have AMG, which is an even more engineered product, but they somehow managed to do it faster.
00:50:35
Speaker
um it seems a little bit almost contradictory that you would have a more engineered product that is able to be developed faster. Just if you look at an engine process, development of an of an engine, and we are now in the gasoline world, not in the electric world, of course.
00:50:53
Speaker
In the gasoline world, you are far faster, but still developing the engine faster. basically from scratch. Sure, up you take some parts from the Mercedes world, but you add ah new things in there. You can start a bit later, um but then you have to a still have to try to to to launch as early as possible. you You don't want to fall behind. If you do a new whatever, an or S65,
00:51:31
Speaker
ah you don't want to launch more than half a year after the first S-Class at that time. And therefore, sure, a lot of testing is happening, for example, with S-Class ready vehicles, with S-Class,
00:51:47
Speaker
A, with prototypes, developed prototypes, and then you start adding adding some changes which were prepared, that it's plug in, plug out, but how to to execute it, that is happening in an extremely late phase.
00:52:10
Speaker
It's a bit like what I mentioned with Chrysler, this somehow also creative process. this If it doesn't work out, let's try it somehow else. And we still have a backup.
00:52:23
Speaker
Now, AMG doesn't really have a backup, but ah they are far more creative. When Mercedes believes we have to test it, three times have to test it at least two or three winters in in Scandinavia or summer in in in the desert of Death Valley or Laredo or wherever.
00:52:51
Speaker
amg just cannot afford this they have to shorten this process there is more risk in it there is probably also not the expectation that the vehicle has to run for a million kilometers a it's it's a different mindset which which is happening in behind there is more risk in the car But still, quality has to work out. You you cannot compromise too much on quality.
00:53:22
Speaker
I just wanted to ask really one last question. And having spent your career where you were focused heavily on the German market, and then you broadened your worldview through the M-Class SUV product management program,
00:53:45
Speaker
and and then moved over to the United States for three years, worked in a completely different environment, different culture, different way of working.
00:53:55
Speaker
what what do you What did you take home with you back to back to Germany? Did you find that the experience in the US was a learning experience that made you think a little bit different, that that the the the old German way that you worked before you you you changed? Did you start drinking Coca-Cola's in the car when you returned?
00:54:19
Speaker
Partly, yes. And now Germans are using the cup holders as well. So it's not that it was that it is still not used. ah I think ah two two things which I brought back.
00:54:34
Speaker
i One was um the the this typical American thinking of, which I feel at least, the glass is half full.
00:54:46
Speaker
In Germany, German mindset in doubt, the glass is always empty and you have to work hard to somehow get it at least filled a bit.
00:55:00
Speaker
ah In US, it's the opposite. It's a far more positive thinking. Nowadays, I'm sometimes boring for for Germans who say, don't think always this positive.
00:55:13
Speaker
and But, yeah, there is always a way ah to to also see look at the bright side of life. That's one thing. The other, Germans ah don't... Now, how do I say it?
00:55:28
Speaker
in In Germany, the saying is net shiftft is new cloed ah so that means, grace if not complaining. That's somehow the the best translation. So don't complain.
00:55:44
Speaker
That's enough praise. In US, I had a different appearance. When I was living there, I figured out you get positive feedback.
00:55:56
Speaker
And ah this positive feedback is far more motivating than the way how how we sometimes did it in in Germany.
00:56:08
Speaker
Am I fully on the side nowadays or is still some net schimpf, this gnu glop in me? Sure, a little bit, yes. But overall, I try to be more positive and that is helpful.
00:56:24
Speaker
It's great to to hear about your your journey and your experience between the the different places that you've lived now and and all of the different cultures that you worked with.
00:56:38
Speaker
So Helmut, thank you very much for joining today on The Auto Ethnographer. It was a great conversation learning your journey from starting with Mercedes-Benz 10 years ago in the German market and then your personal evolution through the global market with the M-Class B program, going global, literally global by living in the United States and then working with all of the Chrysler markets outside of the NAFTA markets.
00:57:09
Speaker
you know and then returning to Germany and bringing back some of your learnings with you. Thank you very much for for sharing that with us today. i think you're true we can easily have more conversation.
00:57:22
Speaker
And i have a feeling i will have to one day invite you back to join the autoethnographer for a continuation of our journey. Whenever you want, and thank you for for inviting me. I really like this idea of of your podcast, and I feel honored that you asked me to participate. Thank you.
00:57:46
Speaker
Great. Thank you very much, Helmut. With that, I'd like to say goodbye to all of the listeners and invite you back next week for another episode of The Autoethnographer.
00:57:58
Speaker
In the meantime, keep on driving. Thank you for joining us on today's journey. I hope you found the episode both informative and entertaining. Please remember to like and subscribe to The Auto Ethnographer and leave us a rating or comment.
00:58:13
Speaker
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