Mercedes-Benz India has announced that it will be selling cars directly to customers from now on. The company had first revealed the new strategy in June this year, and after testing it under a ‘beta’ phase, is now finally implementing the new sales model.
- Mercedes-Benz dealerships to still be responsible for test drives, vehicle deliveries
- Buyers will now pay Mercedes-Benz directly for vehicle purchase
- Mercedes to set discounts and offers; customers can’t negotiate prices with dealers
What is Mercedes-Benz’s direct-to-customer sales model?
Traditionally, carmakers sell their vehicles first to authorised dealerships, who in turn retail them to prospective owners. Mercedes-Benz announced that it had sold the last vehicle to its dealership network earlier this month.
Under its new Retail of the Future (ROTF) model, the automaker will now be the one directly drawing the invoice for customers. The company says that India is its first CKD (completely knocked down) market, and fourth worldwide, to implement ROTF, with Sweden, Austria and South Africa being the other global markets to have seen Mercedes-Benz’s new retail model. The luxury carmaker has also received over 1,700 orders while beta testing the new sales plan in India.
How does the new sales model change the experience of purchasing a Mercedes-Benz?
We’ve had an in-depth look at what Mercedes-Benz’s direct-to-customer sales model would mean for you. To recapitulate, not much will change for customers wanting to purchase the Three-Pointed Star. Mercedes-Benz states that the current showroom infrastructure will continue, and as such, dealerships will still be responsible for test drives and vehicle deliveries. However, customers will now be paying Mercedes-Benz India directly, and not the dealer, for their new vehicle.
Mercedes will also control the pricing centrally, which means that you will no longer be able to haggle for the best price, and pit the quotation from one dealership against another’s. Discounts will still be provided, but with Mercedes in-charge of the offers, they will be uniform across the country. As such, dealers will now have to contend only by offering the best purchase experience.
The complete inventory of new Mercedes-Benz vehicles throughout the country will now be owned and managed by the German carmaker, not individual dealers. This could bring down waiting periods for some of the models.
In-charge of its nationwide stock, Mercedes-Benz says it will be able to provide customers with the VIN (vehicle identification number), right at the time of the booking. Using Mercedes-Benz’s online store, buyers will also be able to search for their exact model specification from the available stock, view the on-road price based on their PIN code and make bookings.
The luxury marque started assessing the feasibility of the ROTF project in October 2019, and has invested over Rs 60 crore to implement the model. It is important to note that the new sales strategy will only be applicable to new car sales, and not its pre-owned car business and aftersales service.
Commenting on its latest move, Martin Schwenk, MD and CEO of Mercedes-Benz India, said, “Today, we are proud to implement the ‘Retail of the Future’ in India. With ROTF, we have created a completely unified customer journey experience with many industry-first initiatives. For the first time in India, there are no incidental or extra charges for the customers.”
He continued, “Customers now have a direct access to Mercedes-Benz India’s national stock with a wide variety of inventory choices. ROTF is a step in the right direction in getting closer to our customers, and a result of listening to their wishes and evolving requirements.”
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