Mercedes-Benz UK reports 20% growth in car sales under new agency model

Mercedes-Benz UK has reported strong growth under its agency model, with new car registrations up by 20% year-on-year and a 29% rise in the private retail channel.

The brand’s agency model, launched in early 2023, allows customers to choose between online and in-store purchases with consistent pricing across all platforms.

Mercedes-Benz UK also report high customer satisfaction, with an average score of 4.84 out of five.

Mercedes-Benz said it saw a 14% increase in sales over the previous September, registering a total of 16,476 vehicles sold in September.

The consistent pricing principle has been highlighted by Mercedes-Benz dealers as a key benefit, allowing them to present competitive offers backed by the brand’s market pricing intelligence.

Gavin McAllister, managing director, Sandown Motors, said the business was achieving encouraging levels of new car retail sales under the agency model.

“The dynamic national offers, competitive finance rates, consistent above-the-line promotions and Sandown-directed local marketing are generating high volumes of enquiries. Our intense focus on enquiry management matched with excellent levels of available in-demand stock is resulting in a robust volume of profitable new car deals.

“Mercedes-Benz UK’s dynamic market pricing intelligence provides our sales teams with genuine confidence that our deals are highly competitive in the market, builds trust with our customers and enables us to win business on the strength of our customer experience. Our customer satisfaction is stronger than ever, underlining the benefits of transparent pricing.”

Other Mercedes-Benz franchisees also praised the agency model for increasing profitability while reducing operational costs.

Keith Caddick, franchise director for Lookers Mercedes-Benz, said: “The agency sales model is working well for Lookers. Customer feedback has been positive and from a business perspective, gross profit has increased and our costs have decreased.”

Neil Williamson, regional president, Lithia UK, also noted the importance of the brand’s partnership with dealers which he believes was critical for a smooth transition to the new model: “From the start they have partnered with dealers which helped our transition, and a critical success factor has been allowing us to handle the part exchange process.”

Graham Affleck, divisional managing director at Eastern Western Motor Group added that the model provides a broader selection of in-demand stock for customers.

 “The support and focus of the team at Mercedes-Benz UK are big factors in our success, with a great choice of offers available and updated regularly. Our customers have adapted to the new process as have our sales and admin teams, and it is now very much second nature to them.

“There is a lot written about the agency process and how it is perceived to work. There are a lot of upsides which I often find people I speak to are unaware of, such as a much wider choice of available stock to offer our customers, and the misconception of reduced turnover, which is simply because the brand raises the invoice to the customer, not the agent. I am looking forward to seeing how we finish the year.”

According to Sally Dennis, Mercedes-Benz UK’s sales and marketing director, the agency model has been positively received by not only dealer partners but by customers too: “The evidence is undeniable, retail customers are happy to buy direct from our network of agents.”