Volkswagen is fighting against an enormous debt, the employees have announced a strike at all the brand's factories and now the management announces that they are dropping the so-called agent model towards the dealers.
Volkswagen is dropping the maligned agent model when it comes to selling cars. The crisis-hit car giant has decided to pause the introduction of the new sales model.
The agent model, which should have revolutionized the car industry, has met with opposition from several dealers. The model implies that car brands such as Volkswagen, Skoda and Audi sell the cars directly to customers instead of through dealers.
The dealers act as so-called agents who display the cars and provide customer service for a commission.
According to information in a press release, Volkswagen Group's decision to postpone the agent model is due to a slower transition to electric cars than expected.
The German car manufacturer is currently experiencing several challenges, and in recent months has lowered its expectations for both sales and earnings.
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The agent model should have given the dealers more power and increased their earnings. Instead of buying the cars from the manufacturer and reselling them to customers, they simply brokered the sale and received a commission.
However, this change to the business model has raised concerns among some retailers who fear losing control of the sales process.
The Volkswagen Group's decision to put the agent model on hold is a sign that the transition to a new sales model in the car industry is not without challenges. It is not yet known when or if the Volkswagen Group will resume plans to introduce the agent model. However, the model has been dropped in several countries – including on the domestic market in Germany.
Volkswagen is not the only car group that is now throwing the agent model on the floor. So does Stellantis, which owns brands such as Peugeot, Citroen and Opel. According to Car Dealer Magazine, the Stellantis management, which received the director's resignation on Sunday night Danish time , regrets that they 'made a mistake'.
