Lotus UK Makes Agency Model Retail Switch Ahead Of Emira Deliveries

[Eric K]

Aberdeen you say?

https://autonoid.com/lotus-uk-makes-age ... eliveries/

[scott_e]

Dont know if you guys know but Laura has moved from Parks to Ferrari. Sad to see her move on, she has been fantastic. Lot of things changing at Lotus, some for the better, some not so much.

[Stevoraith]

Any idea what any of that means?

I mean, I've read the whole article and I'm still none-the-wiser, other than the fact that dealers will be getting new signs and that there should be a dealer in Edinburgh and Aberdeen opening soon.

[Lazydonkey]

I "think" it's this....

Dealerships are facing a simple choice: adapt and evolve or take the risk of becoming less and less relevant.

Dealers are not oblivious to this. According to Accenture, 85% of them agree that the sales model needs to adapt quickly in order for them to survive.

Where dealers used to be the end point of a traditional linear buying journey, we see a future where they will be part of a set of inter-connected touchpoints that the customer can decide to activate at any time.

In this new sales model, dealers become ‘agents’ who act on behalf of the OEM, with sales conducted directly between the OEM and the customer – both online and in store.

The dealership’s role becomes the one of an ‘experience centre’ that adds value through in-person interactions and technologies, sales consultation, test drives, and vehicle handover, with dealers taking commission as middlemen.

In the agent model, OEMs will be able to set and maintain a more consistent pricing strategy across all sales channels, which will reduce traditional price-based competition between dealers.

This could have a significant impact on bottom lines: research from Accenture has shown that franchised dealers have been undercutting OEM-set prices by an average of 12% to avoid losing sales to competitors.

Found here...
https://www.am-online.com/opinion/2020/ ... st-opinion

[Shug]

Long story short:

Traditional method - Dealer buys stock from manufacturer and then owns it as an asset, sells on that stock (often at discount to make the sale, meaning manufacturers have no concrete pricing control and we have the dealers occasionally cutting each others throats to sell cars)

Agency method - Dealer is a shopfront for manufacturer, takes a margin from sales, manufacturer has total control over model pricing.

That's as I understand.

[Stevoraith]

Thanks gents, that makes it clearer.

Can’t imagine there was any serious discounting or undercutting going on with Lotus sales previously but it’ll be very interesting if mainstream manufacturers go that way.

Presumably that’s the Mosel Tesla use- might we see more ‘high street’ stores for more up-market marques that don’t have/need a forecourt full of used cars?

[ClarkyBoy]

Long story short:

Traditional method - Dealer buys stock from manufacturer and then owns it as an asset, sells on that stock (often at discount to make the sale, meaning manufacturers have no concrete pricing control and we have the dealers occasionally cutting each others throats to sell cars)

Agency method - Dealer is a shopfront for manufacturer, takes a margin from sales, manufacturer has total control over model pricing.

That's as I understand.

That's pretty much the model we have just moved to with the bike shop. less margin for us vs traditional model, but zero exposure and in our case way more flexibility / Stability.