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FRANKFURT -- DaimlerChrysler turns a profit on its Maybach luxury limousine business just three years after relaunching the brand, Mercedes Car Group division chief Eckhard Cordes said in a newspaper interview.

"We already make money on it," he was quoted as saying in an interview with weekly newspaper Die Zeit released ahead of publication on Wednesday. He was responding to a question on whether he hoped to turn a profit on Maybach at some stage.

DaimlerChrysler said in January that it delivered around 500 Maybachs to customers in 2004 despite an economic environment "that was challenging for the entire luxury car sector". Maybach cars cost more than $300,000.

It said the Maybach brand accounted for more than one-third of all sales worldwide in this segment.

Cordes, who took over at Mercedes Car Group in October, has repeatedly played down his predecessor's forecast that Maybach could generate annual sales of 1,000 units.

"Five hundred cars (sold) is an outstanding annual result. The entire market segment is smaller than forecast," he told the newspaper.

"Over the past two years our sales are equal to the century-old Rolls-Royce brand even though we reintroduced Maybach only three years ago. I view that as a success."

Rolls-Royce, owned by rival German carmaker BMW, sold 792 of its Phantom model last year, also short of its 1,000-car target.

FRANKFURT -- The head of DaimlerChrysler's Mercedes Car Group expects sales of its super-luxury Maybach model to fall in 2005, German business daily Handelsblatt reported on Thursday, citing industry sources.

Eckhard Cordes, who is faced with a steep decline in profitability at Mercedes-Benz and continued losses at its Smart brand, is now expecting demand for the Maybach to sink below the roughly 500 units sold last year, the paper said.

According to estimates from market researcher Jato Dynamics, Mercedes has sold only 67 Maybachs in the first quarter this year.

Mercedes, Daimler's luxury division, does not break out sales figures for the Maybach brand on a monthly basis.

No one was immediately available for comment at DaimlerChrysler.

It's official! Mercedes will build a diesel version of the Maybach luxury saloon, and we have learned it's to be powered by a mighty oil-burning V12 - a first for any passenger car.

Thomas Weber, a member of the DaimlerChrysler board, confirmed: "We will use a diesel in the Maybach." The amazing news came during a talk on the future of Merc's oil-burning models. A colleague let slip earlier that a V12 diesel was under development specifically for use in the limo.

Meanwhile, Mercedes has just announced three new diesels of its own. Top of the bill is a 221bhp CLS 320 CDI, which will go on sale in the autumn. The company has also launched a new V6 CLK 320 and a left-hand-drive-only E420 CDI V8.

Mercedes-Benz is giving hotels and resorts a $50,000 discount on its Maybach cars and is offering the same amount to dealers for demos kept for 5,000 miles.

It's a way to drum up business for the luxury sedans, which range in price up to $377,750. Mercedes initially predicted U.S. sales of up to 600 units a year, but sold just 244 last year. Sales through May totaled 64, up from 48 in the first five months of last year.

Build-to-order

Mercedes also expected all Maybachs to be built to order. But two years after launching the brand in the United States, nearly 50 percent of Maybach customers want to buy off the lot, says Wayne Killen, Maybach brand manager.

"If there is one area we may have underestimated, it is the number of people who wanted immediate gratification," says Killen.

Mercedes is offering dealers the $50,000 discount on demonstrator cars because some dealers who sold their demos to customers didn't reorder a new one quickly.

Usually, Mercedes-Benz requires demonstrator cars to have between 800 to 1,000 miles on the odometer before a dealer can collect an allowance and sell the car, says a Mercedes spokeswoman.

Killen says the new 5,000 mileage requirement for the Maybach demo incentive will encourage dealers to drive the cars to events and show them to prospective buyers.

The hotel deal was launched after the MGM Grand hotel in Las Vegas asked for a deal on five Maybachs, says Killen. At the MGM Grand, a Maybach and a driver will be made available to high rollers staying in high-priced rooms, says Thomas Zumbo of Fletcher Jones Imports in Las Vegas, which sold the cars to the MGM.

Maybach allows all of its 70 dealers to offer discounts to hotels and resorts, says Killen.

"Dealers are aware of this program, and I expect them to look at opportunities in their local market," he says. "It is great branding value that some of these hotels will bring to us."

The short-wheelbase Maybach 57 sells for $327,250, including shipping. The larger Maybach 62 costs $377,750. Rival Rolls-Royce doesn't offer similar discounts in North America.

2-car requirement

"Our dealers are required to have two cars, one for the showroom and the other as a demo," says James Selwa, outgoing president of Rolls-Royce Motors Cars North America LLC.

The only discount Rolls-Royce offers is a $15,000 loyalty rebate for previous owners when they purchase a new vehicle, says Selwa. Hotels pay full price, he says.

Killen won't say how many Maybachs he expects to sell this year. But he says Maybach sales aren't slow.

"I am not sure we overestimated the market," he says. "It is a task for us to build a brand."