Over the past few years, the automotive industry has drastically changed. Throughout the pandemic, drivers were forced to find new ways to buy their car and dealers had to learn how to sell in the new isolated environment.
Many automotive brands took this as an opportunity to really understand their customers buying behaviors and preferences.
When thinking of the new car buying journey, there are two particular pain points that stand out… negotiating price and the inability to buy your car online.
Introducing the ‘agency model’.
This direct-to-consumer model sees the manufacturer, (Mercedes, Volkswagen, etc.…) setting a consistent pricing strategy across all dealerships. The negotiation process entirely and competition among dealers.
Dealers no longer own their own stock that can be individually priced or discounted. Instead, the manufacturer becomes the retailer, and the dealer receives a commission on each sale.
The agency model also allows for the customer to buy their car online, including researching, configuring, and actually purchasing your car.
The role of the dealership is reimagined. In this new model, dealers become agents who act on behalf of the manufacturer. The dealership becomes an experience center that helps throughout the buying process where the driver can ask in-person questions, test-drive the car, and handover the vehicle.
In 2022, new car buyers are much more informed about what they want in a car and the car they are looking at itself. Customers are more in the ‘drivers’ seat’ and the educational component of the dealer has slowly become redundant.
In theory, the agency model makes the experience of buying a new car similar to any other purchase you’d make. Think to when you buy your new phone. Whether it be online or in-store, you as the customer know that the pricing is consistent.
Tesla is an early adopter of this method and its proven successful!
Other brands have announced their making the switch to the new model too. Daimler (Mercedes-Benz), Smart and Volvo, are all joining the agency model movement.
To achieve certain savings on your new car, driving your car with a novated lease is the clear solution. New car buyers instantly save on the purchase price of their new car as you are not required to pay GST (up to a threshold). By sourcing your new car with Remunerator, you are given access to exclusive stock from dealerships not available to everyone.
To learn how much you can save on your new car today, see your savings in action with our calculator and talk to our novated leasing team here.