BMW could take the sales process away from dealers following a successful trial in South Africa

Time 11:06 am, November 17, 2020

BMW dealers could find the brand takes an agency model approach to the sale of new cars following a successful scheme in South Africa.

It has been suggested in a report from Autocar that Peter van Binsbergen’s promotion could lead to this being adopted in other regions but BMW UK did tell the car magazine that there are ‘no current plans’ to change the sales model.

Last week, he was announced as the new boss for the region and he has previously been responsible for rolling out other strategies globally for the car maker.

In South Africa, this strategy means BMW is responsible for taking the order directly, invoicing and receiving the payment and that sale is then allocated to a dealership or the customer chooses home delivery.

However, it’s clear that a blended online and offline approach is still the plan and BMW dealers will still be crucial to the process.

Car Dealer recently reported on an interview with BMW Group’s vice-president of digital and e-commerce Marcus Casey, who predicted between 30 and 40 per cent of car sales would be online within 10 years.

A spokesperson for BMW AG told Autocar: ‘Our customers today expect a seamless premium brand experience across all channels, online and offline

‘The best customer experience and thus further digitisation of our sales channels have been the focus of our sales development for many years.’

The outgoing BMW SA managing director Tim Abbott, and previous BMW UK boss, also spoke to Autocar and said that ‘dealers still have to be what I call product specialists, because people still want to know how Connected Drive works or what’s the different between four-wheel drive and two-wheel drive’.

This does mean the days of customers haggling over the price at dealerships could be numbers as BMW would set the same, regardless of whether they buy from a dealer or online.

Jim Holder, editorial director for Autocar and What Car? told Car Dealer: ‘Manufacturers have been talking about shifting towards an agency model for years, and some have successfully trialled it in some markets, making widespread adoption increasingly likely.

‘But it is a path that needs to be handled carefully: while digitalisation is changing the sales model, few if any manufacturers have covered themselves in glory while trying to insert themselves in the sales process in the past, and they cannot afford to cut margins for retailers if they expect them to represent the brands effectively.

‘It is a fine line to tread, and I have few doubts that not all who try it will succeed.’

Rebecca Chaplin's avatar

Rebecca has been a motoring and business journalist since 2014, previously writing and presenting for titles such as the Press Association, Auto Express and Car Buyer. She has worked in many roles for Car Dealer Magazine’s publisher Blackball Media including head of editorial.

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