Volkswagen has announced a “restructure” of its sales model from 2020, with new sales and service formats joining its dealer network across Europe.
City showrooms, pop-up stores, used car centres, ‘service factories’ and scalable ‘full-feature dealerships’ will all form part of the franchised network’s structure after April 2020.
Information from Volkswagen suggests these may be structured in a market area ‘hub and spoke’ style, as the carmaker said each dealer “will only need to have one full-feature facility in the future” and franchisees “will be able to shape their presentation by agreement with the relevant importer to make their business more effective and customer-oriented, with city showrooms, pop-up stores, service factories, used car centres or scalable full-feature dealerships”.
Volkswagen said online sales are to be massively expanded and direct sales by the manufacturer will become reality.
“Within the framework of its new digital partnership with its dealers, Volkswagen will develop a joint internet platform which will handle the entire purchasing process through to contract concludion, including financing, payment and even used car trade-ins,” the carmaker said. Dealers will complete the transaction.
It said it intends to use the online platform for direct sales, mainly in the fields of software and online services.
All franchisees are expected to sign the new contract by the end of November.
“This is the right step at the right time,” says Jürgen Stackmann, board member for sales of the Volkswagen brand. “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.”
Stackmann said Volkswagen has qualified sales and service partners, an established logistics network, strong products and loyal customers, and the combination of these with the new elements would define its business in the future, such as with digital products and services or online sales opportunities.
The Volkswagen European Dealer Council has backed the carmaker’s new plan and said it actively participated in shaping the business model.
“We believe in the new business model as it will strengthen dealers’ entrepreneurial responsibility,” said Dr Matti Pörhö, its president.
“In the areas of digitalisation 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.”