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VW eyes revamped and transformed sales model by 2020

By Dave Leggett | 18 October 2018

The Volkswagen brand says it is to fundamentally restructure its sales model with a new programme to be launched in Europe in April 2020.

The new programme will involve a 'transformation in sales driven by progressive digitalisation and connectivity of Volkswagen fleet'. It also said that online business is to be expanded, with direct sales to and direct online sales to customers will grow 'massively'.

Customers are also to be targeted more individually through city stores and other new sales formats.

This week, in Berlin, Volkswagen and the European Dealer Council presented their vision for the future world of Volkswagen's 5,400 dealers and service partners as well as their 54,000 employees in Europe.

VW said the objective is to provide seamless individual round-the-clock support for customers going far beyond vehicle sales on the basis of a unique Volkswagen customer ID.

Each year, the Volkswagen brand intends to introduce about 5 million customers to the new world of mobility around the globe and to offer them individual services on the basis of their ID. The car buying experience itself will also change. VW said online sales are to be 'massively expanded and direct sales are to become possible'. Five new sales and service formats such as city showrooms or pop-up stores are to be added.

At the same time, the sales organisation is to become more 'flexible and efficient'.

"This is the right step at the right time," said 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."

According to Stackmann, Volkswagen is outstandingly well-positioned, with qualified sales and service partners, an established logistics network, a strong product portfolio and extremely loyal customers. He said that the new sales model was the combination of this infrastructure with the new elements which would define business in the future, such as digital products and services or new online sales possibilities for products and services.

VW says the new sales model is being driven by the progressive digitalisation and connectivity of the Volkswagen fleet, which will reach a new level with the introduction of the new, fully connected electric 'ID' family in 2020. From then on, Volkswagen customers with their personal ID number are to be at the centre of a fully-networked world of mobility including seamless individual support going beyond vehicle purchasing, with round-the-clock availability. "This way, we will learn more about our customers' needs and will be able to develop optimum tailor-made offerings for each individual customer through intelligent data management. This is already practiced successfully in other sectors," Stackmann added.

Online business will make a key contribution to the development of the new sales model and is currently being massively expanded. Within the framework of its new digital partnership with its dealers, Volkswagen says it will develop a joint Internet platform which will handle the entire purchasing process through to contract conclusion, including financing, payment and even used car trade-ins. Customers will be able to choose from the entire brand model range and to complete their car purchase with their selected dealer online. For Volkswagen, the new platform will offer the possibility of direct sales for the first time; the brand intends to use this possibility mainly in the fields of software and online services.

People who prefer to maintain personal contact with the brand and the dealer will have a choice of different points of contact in the future. There will be five new formats in addition to the traditional full-feature dealership with sales and service under one roof. Each dealer will only need to have one full-feature facility in the future. Dealers 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 centers or scalable full-feature dealerships (i.e. of variable size).

"We believe in the new business model as it will strengthen dealers' entrepreneurial responsibility," said Dr Matti Pörhö, President of the European Dealer Council (EDC), which represents the interests of Volkswagen dealer councils in Europe. "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." Pörhö praised the fair and open cooperation with Volkswagen: "We actively participated in shaping the business model right from the start."