Going to a dealership to negotiate an advantageous discount on your next electric car will become increasingly rare in the years to come.
With its online purchasing process, Tesla was one of the first brands to eliminate the possibility of negotiations on the price of its future electric car. Other brands, new to the mobility market, are copying the American giant and its marketing method. But the most surprising thing is that even historic brands are changing their sales model to reduce dealers’ room for maneuver.
Little by little, automobile brands want to regain control of sales. If many are not ready to move to sales entirely on the Internet to market their cars, they want to better control prices and the customer experience. This is yet another revolution for the automotive sector, and it is electric cars that are once again contributing to it.
Much less fluctuating prices depending on the points of sale
In the usual way manufacturers operate, cars are sold to distributors who then manage the rest of the customer relationship more or less independently. Depending on the affinities with the local point of sale, two customers will not obtain the same price for an equivalent vehicle. This is an element that will disappear with the changes underway.
The large European groups want to move to a model where the points of sale are “agents” of the brand, who only apply the instructions and prices decided above. The Stellantis groups (Peugeot, Citroën, Fiat, Jeep, etc.), Volkswagen, Mercedes and BMW (initially for Mini) have already announced the change in distribution method, which will change the habits of many buyers and grind the teeth of resellers.
Discounts that have already become rarer
Discounts granted on vehicles have already been reduced significantly in recent years. The shortage of new vehicles, following the pandemic, has allowed manufacturers to regain a little more control over the prices charged by resellers. Less inventory generally means fewer discounts to sell them.
However, fewer concession discounts do not mean a disappearance of good deals either. A manufacturer can market its models for direct sale and find itself lowering prices to sell part of its stock. This is the case of Tesla or Lucid for example. The difference is that all buyers are likely to have access to the same price offer, regardless of their negotiating skills.
Open days and promotional offers still remain ways to facilitate the purchase of increasingly expensive vehicles. These methods are not going to disappear, there will always be times to make the purchase at the best price.
100% online purchases: this is not yet for tomorrow for certain brands
Brands are aware of this, customers use the internet as part of their purchase of a new car. They are much better informed than before. But many European manufacturers still refuse to proceed, like Tesla, with a procedure carried out entirely by the customer online. However, the Internet would be the best way for large groups to definitively eliminate any attempt at negotiation on the part of the buyer. Manufacturers want to continue to prioritize the human relationship with the customer, but find themselves in a balancing act to change purchasing habits in the years to come.
After all, a website isn’t everything. Some Chinese brands have tried to conquer Europe by replicating what they do in their country. But direct selling, when buyers do not know the brand well, is not as simple. Nio even wonders if they won’t have to go through resellers to boost sales.
Tesla has succeeded in imposing another way of selling cars; other manufacturers are following suit, seeing the effectiveness of the sales method. Things are changing, but the negotiation enthusiast will be the loser in history.
With the electric car, the automotive sector must reinvent itself. All the trends related to electric mobility can be found in our newsletter on the subject. Watt Else is sent every Thursday with new content.
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