Volkswagen To Change Sales Model For ID. EVs In Germany

Volkswagen modifies sales model for new all-electric cars in Germany.

Volkswagen ID.3 1ST (2020)

Mark Kane

By: Mark Kane

Feb 20, 2020 at 11:14am ET

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Volkswagen announced an agreement with “Volkswagen und Audi Partnerverband” (Volkswagen and Audi partner association) to introduce a new sales model for the ID. family in Germany.

According to the press release, the German manufacturer will sell its MEB-based electric cars directly to customers, while dealers will remain involved in a format similar to the agency model.

"A format similar to the agency model for major customers that has already proven its worth over many years will also apply for ID. models sold to private customers and small commercial enterprises. Following the go-ahead from retail partners, the agency agreement is to be added to the new dealer contracts that come into effect from April."

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Moreover, the buying process will offer a seamless switch between online/offline channels - no matter how a customer places an order (online or offline), the dealer will receive a commission and a bonus.

"In their role as agents, dealers make the arrangements for selling the ID. family to private customers and small commercial enterprises. This primarily relates to acquisition, sales consultation, organizing test drives, transaction processing and vehicle handover in coordination with Volkswagen. The customer’s preferred dealer receives a commission and a bonus identical to showroom-based business, even if the vehicle is bought online. At the same time, the partner is no longer tasked with vehicle financing and the sales process is simplified because the partner no longer needs to negotiate the price."

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"The agency model enables the customer to switch seamlessly between online and offline channels during the various stages of the buying process. Subject to the customer’s consent, available data about him and his vehicle is used to communicate with him individually and consistently across all touchpoints. “Thunder”, the new IT system, is being developed for this purpose and will debut at dealers with the launch of the ID. family. In addition, ID. configuration will become significantly simpler for the customer compared with the procedure for current models. It will only take ten clicks to define the entire vehicle.

In future, the customer will be able to switch seamlessly between online and offline channels during the buying process (example of a customer journey and touchpoints)."

We assume that Germany is just a pilot market for the new model and, if successful, Volkswagen will expand it to the rest of Europe and maybe also globally.

Holger B. Santel, Head of Sales and Marketing Germany, said:

“The agency agreement for the ID. family is a further important milestone in the forward-looking orientation of our sales model. For the first time, we will be the customer’s direct contractual partner, while their familiar Volkswagen partner remains involved in the process as the agent. This partner can focus primarily on its role as a customer consultant and we also reduce the financial burden. The concept takes account of the shift in customer expectations towards a seamless buying experience between the online and offline worlds.”

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Dirk Weddigen von Knapp, Chairperson of Volkswagen and Audi partner association, said:

“The new agency agreement gives our partners reliable and calculable compensation regardless of whether the customer buys their vehicle online or from the dealer. At the same time, the manufacturer takes responsibility for marketing the vehicles and for their residual value.”

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Volkswagen To Change Sales Model For ID. EVs In Germany

Volkswagen modifies sales model for new all-electric cars in Germany.

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