Volkswagen to invest heavily in German dealerships

Volkswagen Passenger Cars (VWPC) is making a significant investment in sales and distribution for its home market; Germany. The carmaker projects funds will reach the triple-digit million-euro mark up through to the end of 2023, making it the largest programme in the country to date. Looking to boost sales, the VW Group subsidiary will invest in both physical dealerships and online marketplaces. ′Germany is our home market. We will be providing a further significant boost to sales here and will be making Germany a model for other markets, also with respect to digitalisation,’ said Klaus Zellmer, board member for sales, marketing and after-sales at Volkswagen. ′With Accelerate, we intend to make Volkswagen the most attractive brand for sustainable mobility. This also includes an excellent customer experience during the purchasing, leasing or servicing of a Volkswagen. We want to set standards in this area.’ Driving improvements This investment programme is a landmark for VWPC, as it has never piped additional funds of this magnitude into sales and distribution in Germany before. The plan will be made to drive  improvements such as:

• Upgraded dealerships and showrooms
• Broad-based product and service training for dealers
• Extended e-mobility training
• Introduction of new vehicles
• More replacement mobility for customers during servicing
• Better brand presentation

The funds making all of this happen come on top of the COVID-19 support already agreed with dealers. ′Our dealership organisation is putting its tremendous performance capabilities to the test every day under COVID conditions,’ said Holger B. Santel, CEO of Volkswagen Germany. ′With this boost programme, we want to lay the foundations to make these efforts even more successful in the future.’ Lockdown lessons Given the COVID-19-induced closures, this latest additional splurge on dealerships makes sense. Online sales did allow carmakers to move some models during lockdowns, opening their eyes to the advantage of digital platforms. However, it also underscored the importance of dealerships to the consumer. So, taking the lessons of the pandemic to heart, VWPC is investing in both its physical and online spaces. First on the carmaker’s summer to-do list is launching online sales together with dealers. With electrification another top priority, the primary focus of this digital push will be the new all-electric ID. family. Pinning its hopes on the recently released ID.3 and ID.4, VWPC is making sure its new battery-electric vehicles (BEVs) hit the ground running. New and used vehicles held by dealers will then follow. Up to 2024, the OEM will continue expanding its portfolio with the likes of the Taigo CUV, the ID.5 SUV coupe and the production versions of the ID. BUZZ and ID.Vizzion studies. ′A strong brand needs a strong presentation. We need customer proximity and local presence. Customer orientation also means taking into account severe changes in purchasing behaviour,’ said Zellmer. ′It goes without saying that our sales system must be available to customers both online and offline. This is why we are implementing a digital marketplace in the first step for the ID. fleet, followed by vehicles in stock as well as new and used cars together with our dealers.’ Struggling home market While dealerships in Germany were able to reopen conditionally since 8 March, registrations retreated in April as COVID-19 infection rates continued to cause issues. This means the country saw a registration decline of 26.1% compared to April 2019. In this month, VWPC was able to capture 18.8% of the country’s new-car market, racking up 43,230 registrations. In the first four months of 2021, Germany saw a year-to-date contraction of 25.6% compared with the same period in 2019. The vaccination rollout is gathering pace and the number of new COVID-19 cases is lowering, but the recovery of the German market will come later than previously anticipated. Accordingly, Autovista Group has reduced its forecast for 2021 to 3.06 million new-car registrations, up just 5% on 2020 and 15% lower than 2019. Therefore, if carmakers like VWPC want to see any kind of recovery, the need to invest in dealerships and online markets is a must. Consumers must be enticed back into spending with new models, new sales approaches and new showrooms.