8:34 am, January 23, 2025
Volkswagen has pulled the handbrake on its agency sales plans after discussions with its dealer network.
The group has told its dealer partners that it will be returning to a wholesale model and canning direct to consumer sales for the ‘short to medium term’.
The manufacturer did not put a timescale on the delay but sources told Car Dealer that they believe it will never return.
Car Dealer broke the news that VW was planning on canning agency sales – which see car brands sell their cars to consumers via their website and their dealers paid a handling fee for handing over the car – for the ‘foreseeable future’.
Yesterday, dealer partners were told of the news via a ‘notification’ from head office.
In a statement, VW said it still had a ‘long term ambition’ to move to a full agency model.
Critics of agency sales say manufacturers have struggled holding stock, especially with weakened demand among private buyers for EVs, whereas before they would push this oversupply into their dealers.
Excess stock would be taken on and registered by dealers as ‘nearly new’ helping car manufacturers hit targets – something that is especially critical at a time when car makers are punished by punitive ZEV Mandate targets.
VW said: ‘Following discussions with brand investor councils from Volkswagen, Volkswagen Commercial Vehicles, Audi and Skoda in the UK, we have reached a decision and issued a notification to our retailer partners today.
‘This states our intention to pause ‘Direct to Customer’ retail battery electric vehicle sales for the short- to medium-term, and return to the wholesale model.
‘The change would then apply to BEV orders from April 1 for Volkswagen, Volkswagen Commercial Vehicles and Audi, and February 20 for Skoda.
‘Retail BEV Agency will continue for Cupra as the forerunner brand for agency since inception; there is no change or review planned for fleet agency; and full agency for all vehicles and drivetrains will be established in the Swedish and Irish markets.’
Many car manufacturers have cancelled plans or delayed plans to introduce agency sales. BMW, Mini, Jaguar Land Rover and Stellantis have all stalled agency sales plans.
One VW Group dealer partner told Car Dealer: ‘This was always going to happen. It’s fanciful that car makers believe they are better at selling cars than their dealer network.
‘While it might have looked good during the new car shortages of the Covid years, as soon as the market returned to a push market with an oversupply of cars that consumers don’t want, car makers do not want to be left holding the baby.
‘Despite what VW says I can’t ever see agency sales returning. The wholesale model has worked for years – car manufacturers are starting to realise if it ain’t broke, it doesn’t need fixing!’
