Volkswagen Group has redrawn the collective agreement governing dealer franchises for the VW brand in Europe, as it looks to reorganise its business around vehicle connectivity and ancillary mobility services.
VW said it was making its “sales organisation fit for the future … to fundamentally realign its sales model with its dealers,” and was looking to launch the “new sales model” in Europe by April 2020.
The brand set out a three-phase strategy for its future, with the initial phase centred around development of SUVs and latter stages focused on the introduction of the “ID” family of connected cars and the delivery of mobility services.
Volkswagen ID and online sales
VW said it would associate each customers with an identifier, and use it to deliver targeted offerings and tailored products. The aim is to introduce 5m customers to the Volkswagen connected ecosystem very year.
The carmaker said it would aim for digitalisation of the sales channel to build direct customer relationship, at the same time relying on its 5,400-strong European dealer network for delivery and servicing of vehicles.
“As an OEM, we will reserve the right to market vehicles direct in individual campaigns by agreement with the dealers. Our dealers will also be involved in this business and receive remuneration,” Volkswagen said.
The carmaker set out five sales formats for the future, ranging from showrooms and pop-up stores to used car centres.
“Each dealer will only need to operate one full-feature facility,” it said, adding that requirements for dealership would be “significantly” reduced in order to give retailers “greater entrepreneurial leeway [and] flexibility”.
Volkswagen is compounding the restructuring of its dealership franchises – the second major one in Europe thi s year after Opel/Vauxhall’s – with heavy investment in digitalisation of internal process and consumer products, as the Wolfsburg company tries to catch up with mobility incumbents BMW and Daimler.
“We are … adding new services to the traditional core business of car sales with financing, maintenance and [servicing],” VW said. “[These] new services [are] only made possible thanks to direct connectivity.”
The services will be marketed under the “We” family of brands, the first product of which – car club We Share – is due to launch in Berlin next year. Additional product names revealed on Wednesday include “We Deliver”, “We Park” and “We Charge”.