The First American-Built Ultra-Luxury Car Was An Embarrassing Flop

Who knows whether this story is true or not, but legend has it that when an American Toyota executive visited a plant in Japan, he asked where the rubber mallets were, and his tour guide told him that, when you build the panels right, you don't need someone to hammer them into place. This could be a tall tale, but the moral of the story is clear: it actually matters where a car is built.

Any JDM will tell you that Japanese Toyotas are simply built to a better grade than their American-built counterparts when it comes to fit and finish. This is a conversation that dates to well before the 1965 Corona, Toyota's first real success story in the US. In fact, it dates back to more than half a century before the development of the American Interstate system, and, to the best of our understanding, it starts with the American Mercedes.

What Was The American Mercedes?

American Mercedes

In the early 1900s, years before the establishment of the company now known as Mercedes-Benz, the name was already attached to some of the earliest luxury cars, selling to rich and famous customers in Europe and America, including the Rockefellers. We're glossing over a whole lot of history here, but the point is that the demand was there. Mercedes was the name in luxury automobiles, and there was money to be made by eager entrepreneurs in the United States.

The American Mercedes was a licensed Mercedes Simplex, a car designed by Willhelm Maybach producing up to 60 hp, which was pretty impressive for the time. The Simplex, specifically in the extravagant touring saloon body, measuring around 15 feet in length, could be considered the first ultra-luxury car, and it was certainly one of the earliest predecessors to modern limos. Kaiser Wilhelm II, the German Emperor, was a fan of the Simplex, and the car was driven to some success in the racing scene by William Vanderbilt Jr.

Like A McDonald's Franchise... But For Luxury Cars

What you had in the American Mercedes was sort of like a McDonald's franchise: you pay them for the recipes and branding, etc, but you handle the actual expenses and logistics of running the business and delivering the product.

By all accounts, American Mercedes wasn't interested in putting an "American spin" on the car. The American Mercedes was simply a Mercedes Simplex, but it was assembled, marketed, and sold in America. The company also marketed a number of 60 hp models as ambulances and commercial vehicles, though it's unclear if they actually sold any, or simply offered such models.

Why Have You Never Heard Of The American Mercedes?

Mercedes Simplex

As it turns out, the last competition you need when selling Mercedes... is Mercedes. By 1906, Mercedes Import Co of New York was handling American import business for the German brand, selling German-made models to the American public. Mercedes Import Co and American Mercedes were both stationed out of New York, so they didn't even have the option of controlling different territories. They were competing head-to-head.

Mercedes Fans Simply Preferred The Real Thing

Now, if you're wondering if price was a factor in American Mercedes' failure, given that American Mercedes had to cover their licensing costs, it wasn't. A 40-hp American Mercedes sold at a starting price of $7,500, which the brand boasted in a promotional booklet was "three thousand dollars less" than an imported Simplex, because the royalty paid on every car built was "very much less than the duty on an imported car".

That sounds like a good deal, but consider that, according to the Bureau of Labor Statistics, $7,500 in the first decade of the 20th Century comes out to more than a quarter of a million dollars in the modern day, and it was 10 times the cost of an entry-level Cadillac runabout. We don't know what the term for "eff you money" was 120 years ago, but we're willing to bet that anyone who could afford a $7,500 American Mercedes could just as easily spend a little more for the real thing.

Germany Has Always Had A Reputation For Excellence

If the American Mercedes was known for being less reliable than the German Mercedes, if the sales staff were known to be surly and impatient, if you opened the engine bay and found an "I.O.U." note instead of an inline-four, those details have been lost to time. All we know for sure is that Germany has had a reputation for excellent manufacturing for as long as there have been factories, and a multi-millionaire wasn't going to buy the American version to save a piddly $3,000.

When you consider the direct competition from Mercedes, and the fact that the folks at American Mercedes had to pay a licensing fee to the very company that was driving them out of business, it's not hard to guess why they were gone by the end of the decade. We would have quit just for the sheer disrespect of having to pay our competition every time we sold a car.

America Would Build A Mercedes Again, Nearly A Century Later

2025 Mercedes-Benz EQS

The first time someone tried to build Mercedes cars in America, it turned out to be kind of a bad idea. But, around 90 years later, Mercedes-Benz would have no small degree of success in bringing German manufacturing to the States.

The 1,000-acre Mercedes-Benz US International, or MBUSI, is located just outside of Vance, Alabama, and 19 miles east of downtown Tuscaloosa. First announced in 1993, MBUSI finally built its first vehicle, an ML320, in 1997.

Considering that the plant has been around for nearly 30 years now, producing GLEs, EQS SUVs, and, starting in the 2027 model year, the GLC, we feel confident in saying that the second attempt at bringing Mercedes manufacturing to the US was a success. As of 2021, the plant employed 6,000 people, and gave tours for five bucks.

German Oversight Makes A Difference

It helps that MBUSI is an actual Mercedes-Benz plant, owned and operated by the German brand itself, and not a licensing arrangement like American Mercedes. But it may be just as important that the plant has been overseen by Mercedes all-stars like Andreas Renschler and Ola Kaellenius. The plant is currently managed by chief executive Federico Kochlowski, who began his administration in 2024, bringing 20 years of Mercedes experience to Alabama.

When it comes to building a Mercedes, there are certain cultural factors that need to be considered, whether you absorb that from a lifetime in Germany or a career in the German automotive industry. After all, a luxury car isn't just a product, it's a piece of art.