Tata Motors Limited (ADR) (TTM), General Motors Company (GM): The Best Luxury Compact SUV

Mercedes hasn’t released pricing for the GLA, but an educated guess by Automotive News puts it around $32,000. At this price the GLA, like Mercedes’ CLA model, has a lower entry point, which should help attract younger buyers. More pointedly, Mercedes said the GLA, like the CLA, is aiming at conquest buyers, or buyers who are new to the Mercedes brand. Further, Mercedes said, “The sales figures amply demonstrate how well the new compact models are received by customers: In the first half of 2013, for example, 173,362 units of the A and B‑Class and the new CLA Coupe were delivered worldwide (+58%). Especially gratifying is the high conquest rate of the new A-Class: around 50 percent of the buyers in Europe come from other brands.” Considering Edmunds called the GLA “Essentially an A-Class with better ground clearance and a straighter roof line,” this is great news.

What to watch
For the first seven months of 2013, SUV and crossover sales rose 12% compared to the same time last year. That’s in comparison to car sales, which rose 6%, and overall vehicle sales, which rose 8%.  Obviously, the SUV/crossover segment of the auto industry is growing, which means profits for auto manufactures. Currently, if you want what Edmunds considers a “luxury compact SUV,” the choices are the X1, Tata Motors Limited (ADR) (NYSE:TTM) Range Rover Evoque, which in July sold 953 units — an increase of 53.3% from the same time last year, and General Motors Company (NYSE:GM)‘ Buick Encore, which sold 3,098 units in July — an increase of 13.8% from the same time last year.

Next year, however, Mercedes is moving into the “luxury compact SUV” market with its GLA. Based on what I’ve outlined here and what the GLA is rumored to look like, my personal preference is for the GLA. Thus, for me, I’d say it’s the best. But only time will tell if I’m right. Regardless, the GLA could make Mercedes, and its investors, a pretty penny. Thus, this is something I’ll be watching closely, and I’ll report back as updates come.

The article The Best Luxury Compact SUV originally appeared on Fool.com and is written by Katie Spence.

Fool contributor Katie Spence has no position in any stocks mentioned. Follow her on Twitter: @TMFKSpence. The Motley Fool recommends General Motors.

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