Mercedes Benz GLK, latest compact SUV by the German manufacturer will go on sale early next month with base price under $35,000. Reports say the GLK is priced low so Mercedes wouldn’t offer incentives on it but considering what this car has to offer, this is a bargain.

Mercedes declined to give a sales forecast for the vehicle. But Ernst Lieb, CEO of Mercedes-Benz USA Inc., said at a press event here that it makes little sense to import a vehicle without sales of at least 15,000 to 20,000 annually because of the cost of maintaining spare parts.

Lieb said the United States is expected to account for 35 to 40 percent of GLK’s worldwide sales.

The GLK is entering a segment that Mercedes-Benz expects will grow to just under 140,000 units annually in the United States by 2010 — a 72 percent leap from 2007 sales, said Bernhard Glaser, general manager for product management.

Next year, four GLK rivals will go on sale — the Audi Q5, Lexus RX 350 replacement, Volvo XC60 and Cadillac SRX.

Mercedes’ pricing of $34,775 for the GLK undercuts the BMW X3, which has a base of $40,225. Both prices include shipping.

“We priced based on what the market allows us to do,” said Lieb. “Yes, it’s aggressively priced, but we need the sales. We don’t want to have a higher price and then offer incentives.”

Mercedes-Benz expects the GLK to attract customers from other automakers and be an entry point into the brand, said Glaser. With buyers shifting from larger to smaller vehicles, “we see plenty of potential for the GLK,” said Glaser.

To draw a younger buyer, said Glaser, Mercedes-Benz designed the GLK with lines similar to the full-sized GL and the military-based G class, rather than the softer look of the best-selling ML.

source : AutoNews