BMW has revealed more about its direct-sales agency model, which will see it invoice customers directly and retailers receive a fixed fee for each sale. Sales and marketing boss Pieter Nota said it will start with Mini in 2024 and all BMW cars in 2026.

Often Misunderstood

Nota was keen to stress “the agency model is often misunderstood. We will not bypass dealers in taking this step. It will be a triad that benefits all three parties involved in buying a vehicle”.

Agency will improve the customer experience, provide an attractive business model for BMW retailers, and give the firm direct access to the customer. “Those are the three most import aspects in our plans.”

Uniformity of IT

BMW will introduce a uniform IT service that will link its web activities with retailer systems. As it takes over many of the retailer’s tasks, the OEM will also add staff – “but there will not be a significant increase. We have a number of large subsidiaries that can handle these tasks.”

Nota refused to discuss commission. Mercedes-Benz has agreed 6.5% initially and 6% later, but he would not comment, saying commission is confidential between BMW and its retailers.

Nearly New Cars Included

He also refuted suggestions that BMW is considering expanding the agency model to include aftersales and parts sales. Nearly new cars (aged six to 12 months, maximum 18 months) will, however, be part of agency. “All other used cars… will continue to be the exclusive business of dealers.”

Nota added agency will be inconceivable in the US.