In recent years, the direct operation/agency direct operation model pioneered by Tesla and carried forward by new car manufacturers has put forward new requirements for traditional car companies that are undergoing electrification transformation.
While this isn't the first time traditional automakers and their dealer partners have faced the choice of a channel model, it's definitely one of the strongest challenges in history for the traditional 4S store model:
According to the latest data released by the China Automobile Dealers Association, in the three years from 2018 to 2020, more than 700 4S stores have successively withdrawn from the top 100 auto 4S store system. The number outside the top 100 system is even larger. The data shows that in the first 6 months of 2021, more than 1,000 4S stores were withdrawn from the network. In contrast, it is the "prosperity" of auto city showrooms and directly operated/agent directly operated stores: the number of directly operated stores of Wei Xiaoli will reach about 300 at the end of this year, and more and more new brands of traditional car companies have joined the directly operated tracks: Extreme Kr, Lantu, Volkswagen ID., Cadillac electric vehicles, Ford Electric Horses...
With the rise of new forces, and the policy's embrace of new energy, as well as the improvement of consumer acceptance, and the delisting of some traditional car companies, more and more people are beginning to be unoptimistic about traditional car companies, believing that they should accelerate the transformation. But in fact, traditional car companies have long reacted and are constantly trying to change, and even directly joined the direct operation model, but both the process and the result are not perfect.
Dealer model, to put it bluntly, is that the dealer company or the dealer individually under their own capital wholesale vehicle sales, this is a fairly traditional business model, dealers are responsible for their own profits and losses. Compared with the direct model, the dealer model can save considerable costs, share risks and profits, and roll out a sufficiently extensive sales network very quickly. In this model, dealers have enough means to make beautiful sales results, such as pressing, such as terminal discounts, such as batch sales.
However, from the perspective of consumers, this model has corresponding drawbacks, or it is insufficient compared to the direct operation model. For example, in the direct operation mode, due to direct management, there will often be a more unified service quality, a more perfect purchase experience, and a more unified and bright façade. Simply put, the service perceived by consumers is uniform and of high quality. This is undoubtedly crucial today, when the quality of service is valued. But for traditional car companies, it is embarrassing to achieve this transformation. First, the original sales network is complex, it is difficult to carry out unified planning training and management; second, if the car company intervenes in the operation of the dealer, it will break the original relationship, and there will be obvious conflicts of interest.
Taking Volkswagen as an example, it has tailored a set of direct agency system for the ID series, but the actual implementation is difficult. Previously, there have been cases where dealers have reduced prices to sell cars, which is obviously inconsistent with the official "official unified price", which has caused a considerable number of car owners to be dissatisfied. Although in the end, Volkswagen officials said that they would punish individual dealers who adjusted prices privately: the dealer was given a deduction of all the commissions and yellow card warning penalties this month to calm the incident, but in fact, similar phenomena were repeatedly prohibited.
It is true that we have seen a large number of dealers withdraw from the network, and we have also seen the emergence of more and more directly operated stores. But in fact, the scale between the two is not the same. Simply put, there is a world of difference in quantity and capital between the two. The reason why the new forces choose the direct model instead of the dealer model is essentially two reasons: one is that not many dealers in the early days will be willing to join a new brand that suddenly appears; the other is because they are emerging brands and need to enhance their brand image through the direct model, and their core contradiction is not in selling cars but how to build cars.
Therefore, when new energy is good and new forces get more capital, they can naturally choose to expand the scope of direct stores, but in essence, they will not be popularized to too many cities, and more will still be concentrated in first-tier cities. There are also two reasons: one is that the current new force models are generally high in price, and large cities have higher consumption power; the second is that the direct operation model is very asset-heavy, taking the automobile Volkswagen as an example, there are thousands of regular 4s stores in the country, counting the two online stores at all levels may reach tens of thousands, if these stores are engaged in a direct operation model, then the investment will be huge, and the new forces simply cannot pay this money.
In fact, the direct operation model still has many problems, making it impossible to run through the whole process. In August 2021, a number of media followed up with the news that Tesla's direct-operated stores are withdrawing from first-tier city supermarkets and beginning to change the channel model. According to this analysis, Tesla's retreat may lead the trend of new cars returning to the auto city, but some media believe that this is a signal that "has to" borrow traditional channels after the expansion of the sales scale of new car manufacturers.
After all, for new car manufacturers, to establish a direct store alone, the cost problem is still secondary, and the cost of labor and time consumed is the biggest trouble. This is also one of the reasons why more and more new car manufacturers choose to cooperate with traditional dealers to adopt the agent direct operation model. As Zhao Gang, vice president of Zero-run Automobile, said, "The explosive power of the direct operation model is very weak, it cannot cover enough areas, and the cost efficiency will be very low." ”
Judging from the results, both models have advantages and disadvantages, just like whether new energy is pure electricity or fuel cells are good, before things are finally decided, it is still necessary to argue while developing. From the perspective of development, today's traditional car companies hope to grasp the traffic password of the new consumption era through channel transformation, and the new car brands want to create a new and old moat through a new direct operation model... Both have a bit of a "eat in the mouth and look into the bowl", but we say that there is no perfect model, just as there is no one-time success. After all, some people will try and make mistakes between them, and some people will succeed and some people will fail.
(Image source network, invasion and deletion)