Mercedes-Benz Malaysia to implement agency model – direct sales to consumer, fixed price across all dealers

Mercedes-Benz Malaysia to implement agency model – direct sales to consumer, fixed price across all dealers

Hap Seng’s announcement to Bursa Malaysia

Mercedes-Benz Malaysia (MBM) has started working on implementing an agency model for Mercedes-Benz dealerships in Malaysia, as evident from Hap Seng Consolidated Berhad’s announcement to Bursa Malaysia that it has signed an MOU with MBM to negotiate the new model.

The agency model has already been implemented in parts of Europe (the UK first, Germany next) and it is expected that by the end of 2023, more than half of new Mercedes-Benz models will be sold under the new agency model.

What exactly is the agency model and how does it differ from a dealership model? In Mercedes-Benz’s proposed agency model, the sales contract with the customer will be with Mercedes-Benz, and not the dealership. The dealership will only act as an agent and will be paid a fee for their sales service.

In Europe, the dealers will no longer need to keep inventories, and prices will be fixed between all dealers. This is a “move away from selling the price to selling the car, which should be the case in the premium market,” according to Ola Kallenius, Mercedes-Benz Group chief executive. How it will work in Malaysia is still being finalised.

“Modern technologies and changes in customer behaviour open up new opportunities for the distribution and sales of our vehicles and services. Hence, we continuously review our sales structures and models. With the agency model our retail partners will continue to take on a central role in the customer experience towards a seamless purchasing journey from research to the vehicle handover.

In Malaysia, Mercedes-Benz intends to introduce the agency model before the end of 2023 and are currently evaluating the possibilities together with all of our authorized Mercedes-Benz dealers in Malaysia. Further details will be announced in due time,” says Bettina Plangger, VP of sales & marketing, Mercedes-Benz Cars Malaysia.

Hap Seng Consolidated Berhad’s Hap Seng Star dealership is not the only dealership that Mercedes-Benz Malaysia is in talks with to transition to an agency model. It just so happens that Hap Seng is public listed so it has to be announced. Cycle & Carriage Bintang used to be listed on Bursa but has been delisted and taken private in September 2022.

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Paul Tan

After dabbling for years in the IT industry, Paul Tan initially began this site as a general blog covering various topics of personal interest. With an increasing number of readers paying rapt attention to the motoring stories, one thing led to another and the rest, as they say, is history.

 

Comments

  • Bilderburg extraordinary members on May 13, 2023 at 10:47 am

    hooray now MBB goes MLM way

    Like or Dislike: Thumb up 19 Thumb down 1
  • At least they won’t judge walk in customers who want to buy a car and the sales agent just asks u got appointment etc.

    What a joke

    Like or Dislike: Thumb up 28 Thumb down 7
    • nomoreMB on May 15, 2023 at 8:28 am

      They don’t even ask! They look at you, ignore, and continue playing with their handphones

      Like or Dislike: Thumb up 10 Thumb down 0
  • Gomorrah on May 13, 2023 at 11:25 am

    Car manufacturers now want to directly sapu rather than having middle man. So no more ability to negotiate a good deal for yourself with the SA. As if prices will go down. And now you have a disinterested 3rd party (former dealership) who can only really make money from after sales service. Sounds like a losing proposition for the dealership networks that have invested time and money over decades to build their brand (this of course is not generally the experience at the consumer end, but for a business this is bad). From a consumer perspective, complaints, defects now all have to go to a global manufacturer. Good luck bringing the law to bear on them in the event you have a claim – cost you $$$. As it is so susah.

    If it is ok to link these here, please do: –

    https://www.abc.net.au/news/2022-08-04/mercedes-benz-dealers-seek-compensation-over-new-sales-model/101295126

    https://www.drive.com.au/news/mercedes-dealers-possibly-misled-on-agency-model-switch/

    Like or Dislike: Thumb up 31 Thumb down 2
  • Dato' Frank Steinleitner on May 13, 2023 at 11:46 am

    less dealer commission so sales price will go down?

    Like or Dislike: Thumb up 4 Thumb down 2
  • Bossku on May 13, 2023 at 12:21 pm

    I guess that means MB would be more “exclusive” because they can set whatever price they want and only loaded customers need apply. Macam iPhone, but way more expensive. Cannot negotiate.

    Like or Dislike: Thumb up 7 Thumb down 2
    • seancorr on May 14, 2023 at 5:07 am

      Yep that’s the direction that they are heading to. They don’t mind selling less cars as they want a bigger margin for each vehicle that they sell.

      Like or Dislike: Thumb up 8 Thumb down 0
  • what dealership network?

    hup seng or C&C what difference? dealership network means only the big player will sapu all the opportunity.

    Like or Dislike: Thumb up 8 Thumb down 2
  • Jason Lim on May 13, 2023 at 1:49 pm

    This will avoid dealer to offer lower price than suggested retail price? Doesn’t sound good for consumer

    Like or Dislike: Thumb up 22 Thumb down 4
  • No more free umbrella, t n go, steering lock, doscount la after this. And no commission on bank hire purchase.
    Sound like uber and grab model.

    Like or Dislike: Thumb up 11 Thumb down 0
  • hazamiey on May 13, 2023 at 5:48 pm

    Whatever. With ur dark, sombre interior.

    Like or Dislike: Thumb up 3 Thumb down 0
  • Sohai on May 13, 2023 at 9:19 pm

    Can I be my own dealer?

    Like or Dislike: Thumb up 4 Thumb down 1
  • Car Mafia on May 13, 2023 at 11:22 pm

    Like Tesla – direct dealings. In a way good, deal with the principal directly on any issues. Hope to see better year end sales and promotions.

    Like or Dislike: Thumb up 2 Thumb down 2
  • ROTI CANAI on May 14, 2023 at 2:10 am

    whatever, volvo best

    Like or Dislike: Thumb up 15 Thumb down 4
  • Perantau di Kota on May 14, 2023 at 10:18 am

    LoL. Do we expect a cheaper Merzzz ? Enough conning us.

    Like or Dislike: Thumb up 2 Thumb down 0
    • Munich kosher restaurateur on May 14, 2023 at 11:45 am

      very cheap at germany furthermore uses as taxi

      Like or Dislike: Thumb up 5 Thumb down 1
  • Mango on May 14, 2023 at 12:40 pm

    BMW, Volvo or Lexus better than this

    Like or Dislike: Thumb up 8 Thumb down 0
    • Lexus already implement this way of sales on January 2023.

      BMW is next. Volvo maybe will not so soon yet

      Like or Dislike: Thumb up 0 Thumb down 2
      • Trailer on May 16, 2023 at 9:28 am

        Depends. But BMW in here and others won’t do that, same can be said for Volvo too

        Like or Dislike: Thumb up 1 Thumb down 0
  • Susukotak on May 14, 2023 at 8:20 pm

    Kalau delivery kat kilang @ Pekan Pahang mesti dapat murah

    Like or Dislike: Thumb up 1 Thumb down 14
  • Sohai on May 14, 2023 at 9:48 pm

    The Merc is selling so well and sales men do not need to “sell”.
    So Merc decided might as well sell direct and cut the commission haha.

    Like or Dislike: Thumb up 0 Thumb down 17
  • hazri on May 14, 2023 at 10:56 pm

    toyota with lexus biscuit, mercedes with hapseng biscuit. whatever.

    Like or Dislike: Thumb up 2 Thumb down 2
  • apparently, you guys not listen the story behind
    https://paultan.org/2023/05/10/hap-seng-smart-appointed-pro-net-dealer-in-malaysia/

    Like or Dislike: Thumb up 0 Thumb down 0
 

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