Almost two years after launch Mercedes-Benz is claiming success for its agency model in the UK.
In the year to September the brand registered 80,252 cars, an increase of 20% year on year while retail sales rose 29%.
The road to agency has been a rocky one for many brands. Ford launched its agency model in the Netherlands as a pilot telling dealers it was going for a pan-European launch. It then pulled the plug. JLR also did a U-turn on agency, cancelling plans and adopting a hybrid model.
Mercedes-Benz performed strongly in the just published NFDA Dealer Attitude Survey ranked number two in the UK for current and future profitability.
This week Mercedes-Bens issued a statement, which included testimonials from dealers – including Lookers, Lithia, Eastern Western and Sandown (full testimonials below.)
Sally Dennis, sales and marketing director, Mercedes-Benz UK, said: “The evidence is undeniable, retail customers are happy to buy direct from our network of agents.”
Emeritus Professor Jim Saker, director of the Centre for Automotive Management, told Motor Trader: “Mercedes-Benz have had a good year and a really good September. The bit that I struggle to understand is why they feel that it is so evidently the result of the agency model.
“From their dealer/agents own quotes there has been some great national offers, competitive finance, consistent above the line promotions, directed local marketing and an available product mix that allowed them to adjust to Government imposed EV targets.
“The working of the agency model for new car sales is obviously not a barrier as the customer would probably not notice the difference. However, whether it actually made the difference is open to debate.”
Steve Young, managing director with ICDP, told Motor Trader: “Managing channel mix is a key part of effective agency, so you would certainly hope for a higher retail share driven more by stopping sales through poor quality channels like brokers and pre-registration, rather than as a total volume increase.
“There are still nearly new Mercedes around the network which I can’t explain, and which will divert some potential new car agency business, but other than that it does seem to be on a positive track.”
Full testimonials from dealers issued by Mercedes-Benz
National Managing Director at Eastern Western Motor Group Ltd. said: “We are delighted with the way Agency sales have developed with Mercedes-Benz and with the new car sales growth we are seeing this year. The support and focus of the team at Mercedes-Benz UK are big factors in our success, with a great choice of offers available and updated regularly. Our customers have adapted to the new process as have our Sales and Admin teams, and it is now very much second nature to them.
Gavin McAllister, Managing Director, Sandown Motors Limited, said: “Sandown is achieving encouraging levels of new car retail sales under the Agency model. The dynamic national offers, competitive finance rates, consistent above-the-line promotions and Sandown-directed local marketing are generating high volumes of enquiries. Our intense focus on enquiry management matched with excellent levels of available in-demand stock is resulting in a robust volume of profitable new car deals.”
“Agency’s consistent pricing principle is proving to be a significant advantage for Sandown. Mercedes-Benz UK’s dynamic market pricing intelligence provides our sales teams with genuine confidence that our deals are highly competitive in the market, builds trust with our customers and enables us to win business on the strength of our customer experience. Our customer satisfaction is stronger than ever, underlining the benefits of transparent pricing.”
Keith Caddick, franchise director for Lookers Mercedes-Benz, said: “The Agency sales model is working well for Lookers. Customer feedback has been positive and from a business perspective, gross profit has increased and our costs have decreased.”
Neil Williamson, regional president, Lithia UK, said: “I’m happy with the way Agency is working at Mercedes- Benz. From the start they have partnered with dealers which helped our transition, and a critical success factor has been allowing us to handle the part exchange process.”