Q+A: Mercedes-AMG Boss Tobias Moers
AMG leader talks about his brand and its ongoing expansion.
Mercedes-Benz might be the world's busiest automaker at the moment, with a product-launch onslaught with a new car debut seemingly every other week. Within that business plan, Mercedes-AMG plays a larger role than ever. We sat down with AMG boss Tobias Moers to take his temperature on the state of three-pointed-star performance.
Automobile: AMG is evolving at a significant rate. It seems like you have your finger in every piece of Mercedes-Benz business now, whereas maybe a decade ago AMG was a much smaller in-house performance arm.
Tobias Moers: AMG is on the run. We started that journey maybe two years ago, maybe two and a half years ago. AMG is on the run to stand a little bit more on its own as a performance and sports-car brand. This is the journey we started two years ago. We're still not at the end.
Automobile: How does something like this evolve at a company like Mercedes-Benz? Somewhere, at some point, someone made a decision to what you're speaking to: "We're going to take AMG from the little corner over there in the shop, the one that hots up certain Mercedes-Benz product, to a much bigger place."
TM: It needs a little bit of strategy, which was done by AMG. [Then we] send it to the board of management and get support out of the board of management. It's supported. Part of that deal is, always deliver what you promise. If you deliver what you promised as a business case, as a performance level of a car, of being competitive and the comparisons of the competitive set. If you deliver all that, then it's proven that your attitude, your strategy could be successful. Then it's moving on.
Automobile: This might sound funny at first, but it's interesting from a business and a professional-growth standpoint: What's the motivation for you or for your team when you present a plan like that, to grow this business? In some aspects, you're then just giving yourselves more work to do when you already had a successful business to focus on.
TM: That's a good question. The AMG leadership culture is called "inner force." The inner force of AMG is what drives us. I'm part of that inner-force attitude [for] 22 years now. I was a part of bringing the company to that level, and it was always the same story. Every idea, every expansion, every next call, every modification, and [improving] driving dynamics: The whole story was brought up internally, to find internally at AMG … it's always to question the status quo. [That's] not a phrase; it's our mindset. If you signed a contract at AMG, that's part of your love.
Automobile: Speaking of your employees, how has the workforce grown in, say, the last decade?
TM: Maybe double, more or less, [maybe even] three times. [We have] close to 1,500 [employees].
Automobile: That's appropriate, because …
TM: We doubled our capacity from 2008 to now. We doubled engineering capacity.
Automobile: How difficult is that to implement? When you grow something so quickly?
TM: It's pretty difficult; sometimes you forget some ... not necessarily technology, that [is something] you never forget. Sometimes you forget human resources as a process. Things like that, sometimes you could consider, oh, we should establish a process.
Automobile: So you have to map out a plan, identify roles you will need to fill as the business expands.
TM: Yeah, that's what we do. That's standard business. It's not that easy, because it's hiring the right guys. It's not a war, but we're in a triangle between Porsche, Audi, and Mercedes, and we're right in the middle. Sometimes we lose guys to Porsche, sometimes we get some people from Porsche or from Audi, but it's not that easy.
Automobile: You know, that is an interesting point. In the German automotive sector, with these premium brands, have you seen a percentage -- like where X percent of the employees have also been at one or more of your rivals during their careers?
TM: Loyalty is really high. Not that many people move from one brand to another. ... If I lose maybe 20 guys a year, it's 17 to Mercedes, two to Porsche, and one to Audi.
Automobile: Everyone in this industry talks about brand values, and brand dilution comes up all the time as a concern -- especially for premium brands like yours, and now we see, as noted, the expansion of AMG's footprint. We saw the concern when Porsche introduced the first Cayenne SUV: loyalists went bonkers and some predicted Porsche would suffer because they would leave the marque. Instead, premium brands continue to have years of record sales. Is all the talk about brand dilution getting silly at this point?
TM: No, it's never silly. This is nothing that we underestimated. We discussed it a lot. The thing is, we brought up the AMG A45, which is a very approachable car. I think [the time] where AMG just stands for exclusivity, that time has really passed. That is long, long, long ago. We expanded it out before by bringing out the compact 45s; we expand now by bringing out the 43s. The thing is, regarding brand, it's mandatory to take care of all of the brand, but the brand is defined by the products. If you always deliver what you promise in the products, and an E43, a GLE43, they have drive in them, it's done by AMG. It's a different power level for sure. They do have [their own AMG engineering behind them]. We take care of everything … you feel the AMG personality. There is no fear from our side to dilute the brand. Porsche had the same discussion when they brought out the Cayenne, the Panamera, the Macan.
Automobile: For every old-school Porsche fan who might have left the marque after that, Porsche gained far more new customers.
TM: It's the same story. Our Internet community, we had more than 30,000 main members joining us in a private launch. It's an AMG community, dedicated for AMG owners. [We launched] the 43s; we had three or four people who are really not nice talking about it. End of the day, we banned two of them out of 30,000. One came back and now he's OK, better behavior than before. Sometimes you lose, but you get more. Regarding customer journey, not necessarily everybody, not every performance enthusiast, feels good with a C63. Maybe you need a different entrance level. The guy just gets used to that [lower] level of performance then moves up to the C63, that's going to happen.
Automobile: Thanks for filling us in, Tobias.
TM: Thank you.