BMW – We will, we won’t, and now we will again

Back in October 2024, BMW announced that 100 per cent of its European retail partners (dealerships) had agreed agency contracts for the MINI brand. It said that the gradual rollout was commencing with MINI in Italy, Poland and Sweden on 1st January, 2024 and across other European countries thereafter, with the BMW brand transitioning to a similar model from 2026.

Fast forward to February of this year – after the BMW Group had completed the switch of MINI sales to the agency model – the plan to introduce the BMW brand to direct sales at the beginning of 2026 was pushed back. But unlike the Volkswagen Group, BMW is sticking to the move.

According to BMW’s sales boss, the brand will go ahead and roll out the agency model in Europe from 2027. The on-off, on-again move coincides with BMW’s plans to launch about 40 new or updated ‘Neue Klasse’ versions of models in the next two years.

Several automakers announced that they would adopt the agency direct sales model, but practically all have since shelved the concept.

The highest profile of those recently being the Volkswagen Group in Ireland. The advantage for the BMW Group is that it has already had its dealer network buy in to the model with MINI.

However, moving the core brand to the agency direct sales model could prove to be a much greater risk for its 13 main dealer outlets in Ireland, than it has with the MINI brand.

It should be noted that MINI is the only legacy brand on the Irish market to have made the switch to the agency model.

BMW sales so far this year are up 11.1 per cent and the core BMW brand is the sixth best seller in the Republic of Ireland for the year to date. The BMW market share is up from 3.70 per cent to 4.05 per cent for a similar period last year.

MINI on the other hand is in 26th position in the Irish market for the year so far, with 601 cars sold (0.52 per cent market-share). However, sales are up this year from 465 cars in the same period last year.

For those that haven’t been following the news about the agency model in recent years, it is a shift from traditional sales where the car manufacturer sells directly to the customer, rather than the dealership.

In this model, dealerships become agents, receiving a fixed commission and handling vehicle delivery and customer service without owning the car stock, which simplifies pricing and provides a direct customer interface for the manufacturer.

BMW Group says it aims to increase customer satisfaction, ensure price transparency, and digitalise the entire purchase process through this new sales approach from 2027.

As I have previously said about the direct sales process, since it was first touted a number of years ago by many carmakers and in light of all the pull-back since, maybe BMW Group should learn from the considered reflections of other competitors and the reversal of their decisions.

Unlike with MINI, it would seem to me that most BMW new car buyers in Ireland are middle-aged (35-65) and older – the kind of people who would prefer to purchase a high value car in the traditional way – face to face with a sales person.

Let’s wait and see what happens.