Volkswagen has announced a bold new marketing plan for Europe that will be implemented from April 2020. The plant will include elements like service factories, pop-up stores, scalable “full-feature dealerships” and direct OEM sales.
The company has asked its dealers to sign new contracts that will allow Volkswagen to completely revamp its strategy to sell cars in the future.
Based on this new strategy, each dealer may be structured into a market area that will have only one full-feature dealership and will then expand into the PMA with facilities like “city showrooms, pop-up stores, service factories, used-car centers or scalable full-feature dealerships”, according to a statement that Volkswagen issued. Online sales will now be expected to play a key role in the sales strategy as would direct sales. Direct sales would be used exclusively for online purchases. As part of its new digital partnership with its dealers, Volkswagen will collaborate with them to develop a joint internet platform which will deal with the task of handling the entire purchasing process from the beginning through to contract conclusion, including financing, payment and even trade-in of used cars. The relevant dealership would act as the link between the company and the customer.
Volkswagen Group board member for sales and former director of Skoda and Seat, Juergen Stackmann called this new strategy the right step at the right time.
Stackmann said, “We have adopted this approach because our business environment is changing at a breathtaking pace in view of new technologies, changed customer expectations and new market players.”
He said that in combination with the elements that the car manufacturer already has like qualified sales and service partners, an established logistics network, strong products and loyal customers, the new elements that will be added would help Volkswagen define its business in the future, as in the case of digital products and services or online sales opportunities”.
The plan has been backed by the Volkswagen European Dealer Council which said it actively participated in shaping the business model.
Dealer council president Matti Poerhoe said: “We believe in the new business model as it will strengthen dealers’ entrepreneurial responsibility.
“In the areas of digitalization and e-mobility, the major tasks for the future, dealers will play a key role. To shoulder these challenges, dealers need a firm foundation of profitability.”
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