VW Group creates new sales roles as it progresses down agency route

Volkswagen Group has replaced the roles of head of fleet across its five brands with new positions to reflect its move to an agency model for selling cars and commercial vehicles in the UK.

The agency set-up supersedes the traditional route to market via franchised dealerships, and will see the brands set the sale prices of their vehicles, removing dealer margins.

Customers can still choose their preferred dealership, which will provide test drives, consultations and vehicle handovers in return for a commission from VW Group.

The VW Group says the new structure reflects changing consumer behaviour as buyers zig-zag between dealers and websites during the buying process. Under the agency model, drivers will be able to buy vehicles seamlessly online.

The organisational changes were introduced in August and apply to Volkswagen Passenger Cars, Volkswagen Commercial Vehicles, Seat/ Cupra, Škoda and Audi. Fleet sales for all of the brands now sit under the direct sales teams.

Owen Shepherd becomes head of direct sales for Volkswagen Cars, with David Hanna his counterpart at Volkswagen Commercial Vehicles.

James Jetten becomes head of direct sales for Seat/Cupra; Nick O’Neil, head of direct sales for Škoda; and Bal Ahir, interim head of direct sales, Audi (to December 2022), with Warren Richards replacing Ahir from January 1, 2023.

The agency model covers all fleet sales, as well as sales of electric vehicles (EVs) to private individuals.

A spokesman for Volkswagen Group said the agency model would have minimal impact on fleets and leasing companies, because business customers have had a direct, central relationship with the brands for several years.

The franchise model continues for the sale of internal combustion engine (ICE) vehicles to private individuals, and has seen two more key appointments: Rob Holdcroft, head of network sales for Volkswagen Commercial Vehicles and Claire English, head of network sales for Seat/Cupra.

The logical conclusion is that the direct sales teams will eventually take over all sales responsibilities as the 2030 deadline for the end of sales of all new cars and LCVs with internal combustion engines approaches, followed by the 2035 deadline for the end of plug-in hybrid vehicles.

The spokesman said: “Clearly, we are in the early days of the transition to zero-emission cars by 2035 and the agency model.

“Logically, all sales would then be direct sales – but with another 10-plus years to go, the business landscape may well evolve further in that timeframe and our goal will always be to maximise the support we give to customers and match the business opportunity.”

Fleet trade body the Association of Fleet Professionals (AFP) believes the relationship between fleet and dealerships is so important it has developed a Dealer Standard that includes extensive checklists covering both the pre-delivery inspection of vehicles and the handover to drivers, prompted by the greater complexity of EVs.

AFP board member Lorna McAtear, head of fleet at National Grid, said: “Relationships with dealerships are always key, but they are generally down to people, and they build up over time like any supply relationship. It’s mainly improved communication, but if you give dealers repeat custom, the great ones will go the extra mile, with extra services, such as free delivery.

“By moving to the agency model, we are not sure how many of those services we will lose as a good customer. If dealers haven’t got that margin to play with, what kind of service will you get?”

On the plus side, the agency model means fleets only need to have one negotiation to acquire vehicles, rather than dealing with both manufacturer and dealer, which should make it more straightforward to negotiate discounts, volume rebates and harmonise invoicing.

However, the head of one leasing company questioned the long-term viability of an agency model if vehicle production returns to pre-Covid levels.

Franchised dealers have been a useful outlet for absorbing, registering and selling excess stock, he said, asking “how will manufacturers manage the local situation from head office?”.