Stellantis, agency and its retail network, part 2

  09 December 2023

Stellantis brands agency plans

One year ago, Stellantis in the UK, under the control of Paul Willcox, set out his plan for the network including cutting the number of retailers, the volume aspirations and the plan to ‘go agency’.

While the network plans around the number of investors was successful (from the national sales company point of view), with a reduction in the number of investors to a current position of 148, the volume target and agency plans were clearly not. Willcox had promised a 20% market share by 2025 and agency implementation for Alfa and DS in January 2024.

The plans resulted in a network that could not have been any more unhappy.

New UK Stellantis boss MariaGrazia Davino has now rewritten the plan for the group with a healthy dose of realism including a volume growth target of 1.5% share increase each year.  MariaGrazia Davino

Agency, while still on the radar (and on the radar for all brands), is kicked far enough down the road that both retailers and the OEM have got time to concentrate on more immediate challenges. Possibly the most telling aspect about the agency delay is that Stellantis has experience from an agency experiment in the Netherlands, Belgium and Austria which revealed it was “very capital intensive” for the manufacturer. Capital intensive could refer to a host of costs – IT, staff and so on – but it’s all very well running agency when there’s little stock and lots of demand but the real test was always going to come when the industry got back to a pre-pandemic push market. Manufacturers certainly aren’t used to costs associated with stocking loans.

But not only are we now back in a push market but that is linked very closely to 2024’s ZEV Mandate and what it means for both retailers and manufacturers.

Hitting the 22% BEV mix for cars when there is minimal retail demand for fully electric new cars is going to be enough of a task for the industry without being distracted by trying to introduce a new retail model.

Davino’s approach is to set BEV targets for retailers with “very rewarding” bonuses. However, will these rewards interfere with the customer experience? Davino says not and the best customer experience is paramount.

However, when bonuses come into play and a customer’s wavering on which car to go for, who’s to say a salesperson wouldn’t put pressure on them to go for an electric car rather than a petrol one?

Follow this line of thinking further and you could end up with a customer in the wrong car for their wants and needs.

Retailers will need to tread a fine line between hitting the targets and keeping customers happy.

But then that’s what the franchised retail model is all about and something the best sales teams in the best groups are able to do.

Stellantis knows this which is why, for now, it’s not going to switch to agency.

* Read the full interview with MariaGrazia Davino in the December issue of Auto Retail Bulletin.

* And for a full run-down of which brands are going agency and which are not, see our regularly updated list here.

Tristan Young

Editorial Director

Auto Retail Network

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