Customers hacked off with the haggle hassle

Manufacturers moving to an agency sales model without haggling could see a significant increase in online retail.

This is according to research by What Car?, which analysed feedback from 1,310 in-market buyers. It found that 65% said they would be more likely to buy their next car online if the manufacturer operated an agency model type network where haggling for the price of your next car was no longer needed.

When asked whether new car buyers would support the transition to an agency model that would result in standardised vehicle prices across dealers, 55% were in favour of the move, while 45% said they would prefer to stick with the current model.

Standardised pricing across franchised networks is said to result in lower list prices, but it would also mean buyers wouldn’t be able to haggle for their next car. This was preferred by 58% of buyers.

The agency sales model has already been mooted by multiple manufacturers, with some already confirming they are set to begin the process of adopting it in 2022, and others investigating whether it would suit them. Promising standardised prices across showrooms, with dealers operating as sales ‘agents’ directly for manufacturers, the model negates the need to haggle for your next car and is said to make buying easier for customers.

Steve Huntingford, editor, What Car?, said: “The agency sales model is one of the hot topics for 2022. While our research shows the majority of buyers support the move to it, and that it could result in a significant increase in online retail for manufacturers that adopt the model, it remains to be seen whether the industry can hold its nerve on pricing when it is running at full capacity.

“To work, it’s clear that automotive retail sites need to be slick and easy to use, and have adequate support in place to give customers the confidence to commit to set prices, rather than shop around, both for discounts or among rivals who might not have the same rules in place. With this in mind, it’s important manufacturers considering moving to an agency model ensure their online retail platforms ensure they are capable of meeting expectations.”