Currently reading: Mercedes-Benz could end discounts under new sales process
Manufacturer is planning a radical overhaul of its dealer network that would give it control of the sales process
Jim Holder
News
2 mins read
23 September 2019

Mercedes-Benz is evaluating a radical overhaul of how it sells cars, potentially removing retailers’ freedom to offer discounts as it seeks to create a seamless sales process and grow online sales in the future.

Talking at the Frankfurt motor show, Britta Seeger, head of sales and marketing, highlighted trials that have taken place in Sweden since April. She explained that Mercedes renegotiated its dealer contracts to allow it to control the sales process, with retailers handling customer service and deliveries in exchange for a set fee.

The German manufacturer has a target of selling 25% of all its new cars online by 2025, up from less than 5% today. However, Seeger stressed that online sales will still require interaction with a dealer in at least 80% of cases.

“It wasn't easy," said Seeger in reference to the pilot scheme, "but as we look to integrate seamless retailing, we have to be in a position where we have one price across all our platforms, as we are not interested in driving margins down.

"To do that, we need to completely reorganise our model, and while our trial wasn't simple, it has shown that it can work for customers and retailers.

“Retailing is changing, and whatever we offer must be hassle-free. That might not be an easy point to reach, but our perspective is very much the future, and that means some difficult decisions that we must take now in order to be in a strong position. The model is different but still profitable for the dealers.”

Asked when the trial could be rolled out in other countries, Seeger would only say “we will see”, but she confirmed that it's a model Mercedes plans to pursue across all territories in the future.

What Car? Target Price data, which tracks a fair price to pay for a new car for consumers, reveals that some Mercedes models are currently available through retailers with some of the largest percentage discounts in the UK. What Car? also links buyers to retailers willing to sell cars at these reduced prices, underlining the veracity of the data.

The move towards setting pricing centrally and transitioning dealerships into centres for customer service, test drives and new car handovers mirrors an initiative currently being undertaken by the Volkswagen Group and being evaluated by other manufacturers.

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21

23 September 2019

Going for the Tesla model. 

With an average Mercedes costing say £35k the dealer might retain a couple of grand, money that otherwise would have gone to Mercedes direct, multiply that by however many thousands of cars they sell then multiply that by the number of countries they sell in, well you get the idea.

And all for the cost of software upgrade to their website and hand over process.   Like Tesla you might be left with out of town pick-up points and workshops.

23 September 2019
xxxx wrote:

Going for the Tesla model. 

With an average Mercedes costing say £35k the dealer might retain a couple of grand, money that otherwise would have gone to Mercedes direct, multiply that by however many thousands of cars they sell then multiply that by the number of countries they sell in, well you get the idea.

And all for the cost of software upgrade to their website and hand over process.   Like Tesla you might be left with out of town pick-up points and workshops.

 

In a few sentences, what is the "Tesla model" and can you contextualise your further statements with facts?.

23 September 2019
Takeitslowly wrote:

xxxx wrote:

Going for the Tesla model. 

With an average Mercedes costing say £35k the dealer might retain a couple of grand, money that otherwise would have gone to Mercedes direct, multiply that by however many thousands of cars they sell then multiply that by the number of countries they sell in, well you get the idea.

And all for the cost of software upgrade to their website and hand over process.   Like Tesla you might be left with out of town pick-up points and workshops.

In a few sentences, what is the "Tesla model" and can you contextualise your further statements with facts?.

It's obvious to anyone that doesn't have such a sad agenda like yours. 

'Facts', what are you on about, basically Tesla don't have sales agents/car showrooms etc.   Now jog on you sad hate filled t%$£!

23 September 2019

What a Meerkat you are, quadruple x. And you even go into calling up typos1 as He looks like doesn't respect other people opinions. You? 

Well, that *sugar* show that your beloved Tesla is: a 10-year-plus unprofitable company that has been putting a tremendous *sugar* show on trying to deliver those promissed-for-august Model 3. Yes, they do not have sales agents, car showrooms, they have an impressive amount of *sugar*.

And they are with an idiot CEO on top, too. Now he is very busy dismantling his red-blue beating Taycan Nurburgring setting records.

Mercedes-Benz is a 125-plus profitable startup!

 

23 September 2019
coolboy wrote:

What a Meerkat you are, quadruple x. And you even go into calling up typos1 as He looks like doesn't respect other people opinions. You? 

Well, that *sugar* show that your beloved Tesla is: a 10-year-plus unprofitable company that has been putting a tremendous *sugar* show on trying to deliver those promissed-for-august Model 3. Yes, they do not have sales agents, car showrooms, they have an impressive amount of *sugar*.

And they are with an idiot CEO on top, too. Now he is very busy dismantling his red-blue beating Taycan Nurburgring setting records.

Mercedes-Benz is a 125-plus profitable startup!

 

 

xxxx only has that "name", because they simply lack a suitable vocabulary, signs it's name similarly and to think that a decent education is free to kids and yet some are still too stupid to take it.

23 September 2019
xxxx wrote:

Takeitslowly wrote:

xxxx wrote:

Going for the Tesla model. 

With an average Mercedes costing say £35k the dealer might retain a couple of grand, money that otherwise would have gone to Mercedes direct, multiply that by however many thousands of cars they sell then multiply that by the number of countries they sell in, well you get the idea.

And all for the cost of software upgrade to their website and hand over process.   Like Tesla you might be left with out of town pick-up points and workshops.

In a few sentences, what is the "Tesla model" and can you contextualise your further statements with facts?.

It's obvious to anyone that doesn't have such a sad agenda like yours. 

'Facts', what are you on about, basically Tesla don't have sales agents/car showrooms etc.   Now jog on you sad hate filled t%$£!

 

Ah, you've trapped yourself yet again...so, for those (many) folks who do not share my "agenda", go ahead and explain, address the twin challenges put to you in my earlier post...or as you have been labelled by another contributer, who has your card marked...go on "MEERKAT" show us what you've got...no not your stupidty...again.

23 September 2019

If Merc still want to sell cars, and want to put an end to discounts, they'll need to drop their list prices.  Without trying too hard, you can get 20% off an E-Class or a 5-series BMW,  If Merc stop discounts but keep the list price the same, nobody will buy their cars retail.

And before someone says that everybody uses PCP these days, the starting price still matters as the monthly payments are based on what you pay less the expected residual.

23 September 2019

...and that’s just what they’re advertising as a “finance contribution”. 

23 September 2019
Nickktod wrote:

...and that’s just what they’re advertising as a “finance contribution”. 

 

New as in not registered, certainly not a new model. Vast majority of cars are discounted more deeply towards the end of the life cycle.

24 September 2019
Takeitslowly wrote:

Nickktod wrote:

...and that’s just what they’re advertising as a “finance contribution”. 

 

New as in not registered, certainly not a new model. Vast majority of cars are discounted more deeply towards the end of the life cycle.

That used to be the case, but 25% discount is the norm within weeks of launch for the new A class and some of the new Audi cars (Q3 etc).  Most brokers are in the 15-20% range, but there's a couple that openly advertise (and deliver) much more than that.

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