BMW Group’s sales and marketing boss Pieter Nota confirmed in an interview with Automotive News Europe that it may switch to an agency sales model and end its dealer franchise agreements from 2024 for Mini and from 2026 for the BMW brand.

Mr Nota said that the timing is still under discussion and that the agency model could be applied to the BMW and Mini brands, but not to the company’s Rolls-Royce brand which will stay with the current franchised dealer model.

BMW’s premium competitors, Mercedes-Benz and Audi (for e-tron electric cars only), are moving to the agency model, in which automakers invoice customers directly and hold the inventory, while dealers receive a fixed fee for each vehicle sold.

Mr Nota said its agency model would be used only in Europe, however added that China may be a possibility in the future. It is not possible in most American states where franchise laws prohibit car-makers from selling directly to consumers.

No other markets, including Australia, were discussed in his statement and interview with AutoNews Europe.

BMW was one of the first OEMs to start an agency model in Europe when it launched the i sub-brand for its electrified cars in 2013. It abandoned this sales model a few years later and then began testing the agency model on its entire range in South Africa in 2020.

“If we will move to the agency model, this time it will be for the entire range,” Mr Nota said.

Other OEMs, in addition to Mercedes and Audi, have signalled their intention to switch to the agency model in Europe.

In Europe, Stellantis, created in 2021 from the merger of PSA Group and Fiat Chrysler Automobiles, plans to move to an agency model beginning in June 2023 with the Alfa Romeo, DS and Lancia brands and light-commercial vehicles badged Citroen, Fiat Professional, Opel /Vauxhall and Peugeot.

Stellantis said it will not renew existing contracts with its dealers from Belgium, the Netherlands and Austria when they expire in June 2023.

The move will affect dealers representing all 14 Stellantis brands as the firm looks to take more control of sales transactions and prices.

A report by Reuters said Stellantis intends to implement the new structure in Europe’s 10 largest markets by 2026.

Dealers would earn a five per cent fee on new cars sold, although retailers could eventually earn different fees for different brands.

Volkswagen Group uses an agency model only to sell electric vehicles for the VW brand’s ID range and for Audi, and its Spanish brand Cupra is moving to a non-genuine model.

Polestar, co-owned by Volvo Cars and Geely, launched in Europe in 2021, is applying an agency model.

Meanwhile BMW Group Australia told GoAutoNews Premium:

“Together with our dealer partners, BMW Group always strives to offer its customers the best premium experience.  

“With customer expectations changing, digitalisation increasing and the online sale of vehicles expanding, BMW Group sees the future of Europe as a direct sales model. This is currently being developed together with dealer partners who will continue to be the backbone of our company’s sales success. 

The focus is on Europe and there are no current plans to change the existing sales model in Australia.”

By Neil Dowling