Automotive History: Mercedes W163 (1998-2005 M-Class) – Conceived in Germany, Born In America

IMG_2443In order of appearance, the four M320s I photographed for this article are 1998, 1999, 2001, and 2003 models. 

Befitting of German-American Heritage Day, we celebrate the first non-commercial Mercedes-Benz made in the U.S.A., the 1998 M-Class. While not the first German car built in America, the M-Class is significant in that the very concept of it was uncharted territory for Mercedes. Designed from the ground up, a civilian-oriented SUV was a totally new type of vehicle for the manufacturer. Mercedes’ choice to produce this vehicle in the U.S. was quite a gamble – a gamble that unfortunately took subsequent generations to earn a record worthy of the Mercedes-Benz name.

mb alabama

After accepting the state of Alabama’s enticing subsidy package of over $250 million, Mercedes-Benz began work on its first automobile plant in the U.S., in 1993. Mercedes-Benz U.S. International (MBUSI), as it is called, was not the first Mercedes plant in either of the Americas. Mercedes had been building commercial vehicles in Argentina since the 1950s, and was also opening plants in Mexico around the same time.


The Mexican plants specialized in final assembly, component production, as well as full-production of cars. These vehicles were sold only in local markets, however. MB had also manufactured commercial trucks in Virginia back in the 1970s. MBUSI was the first American plant that would be the single production facility for a global car sold worldwide.


MBUSI’s first completed vehicle, a 1998 ML320, rolled off the assembly line in February 1997. Sales of the M-Class commenced in September of that year.


Despite all the fanfare, build quality and reliability of these early M-Classes (or W163 to Mercedes loyalists) was notoriously poor. This can be exemplified from a 1998 episode of Top Gear, where Jeremy Clarkson was able to fit his fingers between the unacceptably wide gab between the rear bumper and the body.


Interiors of the early models were also subpar for a Mercedes-Benz. Hard plastics, cheesy-looking fake wood door trim, and lack of many expected luxury features such as automatic climate control were among its shortcomings.


The M-Class even scored last place in a J.D. Power quality survey. In spite of this, the M-Class sold remarkably well in the United States. It’s timing was spot-on in the booming luxury SUV segment.


The M-Class was unique, in that it was intentionally designed as a luxury SUV from the get go. Most other SUVs sold by luxury brands at the time were gussied up versions of more modest vehicles. These included the Acura SLX, Infiniti QX4, Lexus LX, Lincoln Navigator, and Mercedes’ own G-Class.


The Lexus RX was released around the same time as the M-Class. While it too was designed as a luxury vehicle, it was based on a unibody car platform, and didn’t provide the off-road capability as the body-on-frame M-Class.


Although it scored low in quality and reliability, the W163 did get high safety marks. It was the first SUV with standard electronic stability control and side-impact airbags. Crash test results were good, with the IIHS naming it a “Best Pick”. From my childhood, I remember this “Stayin’ Alive commercial for the M-Class, highlighting its safety.


The W163 was produced through the 2005 model year. While quality was never as impeccable as buyers had come to expect from Mercedes-Benz, they made efforts to improve it to less embarrassing levels by the end of its run.


For the 2000 model year, M-Classes were given an interior makeover, replacing many of the much-criticized surfaces with higher quality materials and real walnut trim.


A more significant update occurred in 2002, which included over 1,100 new parts to the M-Class. This overhaul included further exterior and interior enhancements, especially on V8-equipped ML500 models.


My personal experience with the W163 is limited to exploring it at auto shows (that’s me above, dreaming of Mercedes ownership in 1998), my several car models of it, and occasionally riding in one as a child. Some good family friends owned a new M-Class that I vividly remember. I’m almost certain it was a 2000 model. In addition to being the first Mercedes I ever rode in, it was also the first car I ever rode in with a navigation system. Pretty cool back then!


One thing I distinctly remember was how awkward the rear seating position was (at least for a 4-foot tall 2nd grader). If you notice in the photo, the rear seat bottoms are especially long. The seat bottoms extended further out than the back of my knees. Given that our friends were 6-footers, requiring the front seats moved considerably aft, it made for a very uncomfortable seating position.

w164 mclass

Regardless of quality issues and rear seats, I liked the W163 M-Class as a kid, and still do now. It’s appearance still looked tough while not being as utilitarian as other SUVs like it G-Class. Over succeeding generations, build quality and reliability have greatly improved to levels worthy of its big 3-pointed star. The second generation W164 (2005-2010) was an improvement in quality, as well as luxury and technology.

w166 mclass a

The current W166 M-Class (2011-present) brought a host of further refinement, as well as a powerful injection of style. It happens to be one of my favorite new cars on the market, and for what its worth, I did push for it when my mom was purchasing her GLK this past summer. I naturally lost, as the ML was both bigger and more expensive than what she needed and could budget.

w166 job 1image: MBUSI

The W163’s legacy lives on, not just in the current W166. In addition to the M-Class, MBUSI now produces the world’s supply of GL-Classes, as well as the R-Class (which is no longer sold in the U.S). C-Class assembly is reportedly scheduled to begin there in 2014, as well as an additional TBA vehicle. So for better or worse, here’s to the W163, the first Mercedes born in America!