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Dealers mobilize to protect their margins from automaker subscription services

Six individual auto brands — Lincoln, Cadillac, Porsche, Mercedes, BMW and Volvo — have established or are trialing a vehicle subscription service in the U.S. Three third-party companies — Flexdrive, Clutch and Carma — run brand-agnostic subscription services. And three automakers — Mercedes-Benz, BMW, and General Motors — have also launched short-term rental services. Dealers, afraid of how these trends might affect their margins, are building political and lawmaking campaigns to protect their revenue streams. So far, three states are investigating automaker subscriptions, and Indiana has banned any such service until next year. It's certain that those three states are the first fronts in a long political and legal battle. Powerful dealer franchise laws mandate the existence of dealers and restrict how automakers are allowed to interact with customers to sell a vehicle. On top of that, Bob Reisner, CEO of Nassau Business Funding & Services, said, "Dealers and their associations are among the strongest political operators in many states. They as a group are difficult for state politicians to vote against." In California earlier this year, the state Assembly debated a bill with wide-ranging provisions to protect against what the California New Car Dealers Association called "inappropriate treatment of dealers by manufacturers." One of those provisions stipulated that subscription services need to go through dealers, but that item got stripped out when dealers and manufacturers agreed to discuss the matter further. In Indiana, Gov. Eric Holcomb signed a moratorium on all subscription programs by dealers or manufacturers until May 1, 2019, to give legislators more time to investigate. Dealers in New Jersey have taken their campaign to the state capitol, asking that the cars in subscription programs get a different classification for registration purposes. Automakers run the current subscription services and own the vehicles. Sign-ups and financial transactions happen online or through apps, leaving dealers to do little more than act as fulfillment centers to various degrees, with little legal recourse as to compensation amounts when they're called on to deliver or service a car. That's a bad base to build on for business owners who've sunk millions of dollars into their operations.

Mercedes mulling Renault-based entry-level X-Class?

Somewhere in between the Smart brand and the all-new A-Class (pictured above), Daimler is said to be readying a smaller entry-level product for the Mercedes-Benz brand to compete with models like the Audi A1. According to AutoBild, Mercedes-Benz will get a new hatchback based on a platform from its recent partnership with Renault-Nissan, and it could be called the X-Class.
Expected to debut by 2018, the Mercedes-Benz X-Class could be offered in sedan, hatchback and crossover variants, and it would likely have a starting price below the $20,000-euro mark. Power would come from either a 1.0-liter inline three-cylinder engine or a 1.5-liter inline-four, and the car would likely be built in a low-cost nation in order to make the financials work. Wearing the Mercedes-Benz name, the X-Class would have to exhibit more distinguishable luxury and styling to set itself apart from the models that helped provide its underpinnings.

The Mercedes G-Class gets the full Maybach treatment before the curtain finally closes

Like the hotdog and soda combo at Costco or the official website for the 1996 movie Space Jam, the Mercedes-Benz G-Class has soldiered on nearly unaltered since its birth. Sure, there have been variants like the wonderfully over-the-top G63 6x6, but the G-Wagen is essentially the same squared-off SUV with rifle-bolt locks and doors with enough mass to support a minor gravity field. Spy shots show a replacement is finally on the horizon, but based on the leaked YouTube video above and Instagram post below, it looks like the current model is going to get the full Mercedes-Maybach Landaulet treatment before the curtain finally closes. While there has been no official word from the automaker, all signs point to a genuine Mercedes-Maybach product. The vehicle is badged as a G650, which falls in line with other current V12-powered Mercedes-Maybach products. The Maybach name and badge are found in all the expected places. The license closely matches other Mercedes German-manufacturer plates. The carbon fiber fender flares and portal axles look like they were taken from the G550 4x42. The latter means, despite the increased wheelbase, this new model should still be a formidable off-road machine. This content is hosted by a third party. To view it, please update your privacy preferences. Manage Settings. While we can't see the interior, look for the typical Maybach treatment. That means high-quality leather surfaces throughout and an increased focus on rear seat comfort and convenience. If this is indeed a G650, it's packing a 6.0-liter twin-turbocharged V12 under the hood that churns out 630 horsepower and 737 pound-feet of torque. The partial convertible top is what gives this the Landaulet moniker. According to the text on this Instagram post, there will only be 99 examples produced. Look for a full reveal in the next few months. Related Video: This content is hosted by a third party. To view it, please update your privacy preferences. Manage Settings.