One such initiative is the adoption of an agency retail model. VW Group is upending the way customers will buy its new cars. And Ireland is going to be a test case.
Behind all this is a desire by car makers to cut the cost of doing business. It’s reckoned the agency model will see fewer physical car dealerships, each selling more cars, which would reduce the costs of shipping as well as the cost of agency fees. “On the contrary, where we tried it out you already have the positive feedback that from the income point of view it’s the same. There are pros and cons, but we believe that after the first tests we have made it is positive for customers and dealers.
Cars are quickly becoming more like computers, and tech giants are starting to see the opportunity to have motorists using their in-car apps and paying them subscriptions for the services, leaving the car companies as mere hardware suppliers. It’s the fear of being left out of this lucrative future revenue stream that has driven many car makers to try their hands at software development.
“There is a lot in the media about Cariad, asking are we doing the right thing. But if you are not controlling the data that is collected and processed off your vehicle – the vehicle is going to be the biggest data collecting device out there – if you don’t do that and use it for the good of the customer, to optimise the automated driving functions and give them features that help getting daily life better, then you are losing a major part of your business.