MERCEDES-BENZ’S strength in passenger car sales – particularly its traditional backbone models such as the C-Class and E-Class – has helped compensate for a 21.1 per cent slide in its SUV sales in Australia in the first quarter of 2017.

Mercedes passenger car sales for the first three months of the year are up a healthy 22.5 per cent, to 6506 vehicles – more than its two major rivals combined – helping to lift Mercedes’ combined SUV and passenger car sales by 4.5 per cent, to 9452 vehicles.

By contrast, BMW and Audi overall sales are both down by about 15 per cent. In each case, it is mainly passenger car sales that have done the damage, with BMW’s sedans and hatchbacks down 20.7 per cent, to 3015 units, and Audi’s sliding 27.2 per cent, to 2612 units.

But the worry for Mercedes is that its burgeoning SUV range has gone off the boil, even though many of its mainstream SUV models are relatively new.

Last year, Mercedes SUV sales soared a whopping 75 per cent, mainly due to a major impact by the large GLE (4454 units), small GLA (3766) and mid-sized GLC (2734), which together accounted for the vast majority of the three-pointed star’s SUV sales in 2016.

Mercedes’ 12-month SUV tally of 13,381 units in 2016 put it ahead of Audi (10,141) and close behind BMW (14,417), with every reason to believe it could at least maintain those levels, if not continue the upward trajectory.

This was a big improvement by Mercedes which was playing catch-up to BMW and Audi, both of which have carved out big luxury SUV markets with ground-breaking models such as the X5 and Q5.

But so far this year, Mercedes’ biggest-selling SUV models have all taken a dive, with GLC down 50 per cent, GLA falling 14.7 per cent and GLE easing 17 per cent.

So far this year, BMW’s SUV sales have slid 9.9 per cent, while Audi has eked out a 2.3 per cent gain on the back of the continued strength of its positively ancient Q5 that is due to be replaced later this year, plus the introduction of the new baby of its fleet, the Q2.

Part of the reason that German SUV sales have stalled in Australia is likely traced to the new-found strength of British rival Jaguar Land Rover which has no fewer than three entrants with sales topping 1000 units in the first three months of this year – Range Rover Sport (1035), Range Rover Evoque (1094) and Discovery Sport (1467).

To rub a bit of salt in the wound, JLR’s Jaguar F-Pace also has found 428 buyers.

JLR products now lead both the medium and large luxury SUV segments – the traditional province of the Germans. In the medium luxury SUV segment, its three contenders have given JLR an amazing 37.6 per cent market share.

For Mercedes, the good news comes from its traditional strong segments: luxury sedans and sportscars.

Buoyed by the arrival of the latest AMG variants, the C-Class – long the best-selling luxury car in Australia – has achieved 2146 sales in the first quarter, up 39.1 per cent.

The C-Class and slightly smaller CLA-Class combined have given Mercedes an unprecedented 53.1 per cent share of the luxury medium car segment.

Mercedes’ new E-Class has also forged a segment lead in the large luxury car class, with 547 sales year to date compared with BMW’s 343 5-Series sales.

In luxury sportscars, Mercedes is also dominant, with its C-Class Coupe and Cabrio taking almost one out of every two sales on the back of a 736 per cent rise in volume compared with the first three months of last year when the model was in run-out.

Last month, the two-door C-Class range achieved 350 sales, which is more than three times the volume of BMW’s entrant, the 4-Series (105).

Mercedes sportscar fortunes will be further bolstered by the arrival in the middle of this year of the E-Class Coupe and Cabrio.

By Ron Hammerton