Volvo moves to agency model

[Ulrikas PA]

So, assuming that the manufacturers have done their sums correctly:-

> More people are locked into each company on finance
> Used car supply is controlled (prices go up again) because of the above
> People who decide to not play and hold onto cars meaning used prices also go up
> Manufacturers make more money, consumers pay more, choice is only changing badges

I think that's it ?

[Lexman8]

Originally Posted by Philip Fisher

Nor can I. To get anything as nice as mine would be 80k, which I can't bring myself to spend. So then I think I could get a base model for 55k ish (last time I looked) but then I would spend a load of cash for something not as nice (and pay 500 quid annual road tax). Which brings me back to keeping mine.....

My feeling exactly. I had planned to change mine about now but I reckon I'll be keeping it a lot longer.

[Ian0803]

For those that may not be clear on how buying a car is changing in the UK, here is an article that may help explain the "Agency model"

https://www.autoexpress.co.uk/buying...it-mean-buyers

[100K+]

Originally Posted by Lexman8

My feeling exactly. I had planned to change mine about now but I reckon I'll be keeping it a lot longer.

Could this new buying model actually cause a change in buyer behaviour? ie more of us running our vehicles much longer and/or into the ground? After all we don't ( sorry I don't ) change my washing machine; fridge; TV etc ; just for a change/because I can/whim, I wait 'til its FUBAR, then I change it.
.
I tend to do that with my cars too - scrap em when they (for me ) become financially unviable.

Cheers
Bob

[Discoman]

I do think the timing of it could backfire. Customers are already reticent about the move to electric be it fully or hybrid battery power so putting in another reason for people to say ‘I will just keep what I have’ is perhaps not great for the auto industry?

As an aside VW is already offering 8% off the facelift Touareg and that was only priced end of last week. I think Volvo’s policy might backfire on them.

[Philip Fisher]

Or they just react to reduced demand and lower their prices like Tesla have. I guess what this does is give them the control over prices which they don't have at the moment.

As an aside I think the entry EX30 isn't badly priced but the EX90 seems just obscene.

[Discoman]

Originally Posted by Philip Fisher

Or they just react to reduced demand and lower their prices like Tesla have. I guess what this does is give them the control over prices which they don't have at the moment.

As an aside I think the entry EX30 isn't badly priced but the EX90 seems just obscene.

Good point, albeit the mainstream manufacturers’ rarely do that.

Completely agree with the 30/90 price comparison.

[ergonomist]

I'm relaxed about agency model - having a contract directly with the manufacturer has attractions. However, I'd still want the ability physically to see and compare models, and test drive.

More significant for me is the move away from options. As a private buyer the main reason for buying new was the ability to spec the car to my requirements (do want feature X but don't want feature Y). Currently it appears as if the only 'options' are the colour and trim level. In that case, I may as well buy a used car because the spec will be no different from what I can buy new. And in practice this is what's keeping me in my current car (don't want to pay for features that I actively don't want just to get the ones I do)...

[MK09]

My dealer phoned me last week to discuss my ‘options’ as my PCP is approaching the 3 year point of a 4 year deal. As I understand it, I can still visit the dealer to physically see and test drive cars so that part hasn’t changed under the agency model.

What has changed is that I’ll be paying the full price of £69k for a like-for-like replacement for my current car, against the £55.5k (after Volvo deposit contribution and dealer discount) I paid for my current car 3 years ago. The APR is a bit lower than my current agreement but that’s about it.

When I asked what the incentive would be to terminate my current agreement early to pay 24% more for a replacement car, or what the incentive was for using a dealer 25 miles away when I could buy a car at the same full list price from the Volvo dealer 5 miles away, he was short on answers.

I understand the reasons for moving to this model, but from a personal perspective, I’m struggling to see any benefits for me. I don’t need the car buying process to be simplified. It’s simple enough to phone or visit a few dealers and give my custom to the one that offers me the lowest price.

[Philip Fisher]

Originally Posted by Discoman

Good point, albeit the mainstream manufacturers’ rarely do that.

Completely agree with the 30/90 price comparison.

As if to match the model numbers, the EX30 starts at a few grand more than 30k and the EX90 is priced at a few grand more than 90k!