Stellantis has validated a new distribution model with its European dealers, the auto group and dealer representatives announced Monday. After 18 months of negotiations, the group resulting from the merger of Peugeot-Citroën and Fiat-Chrysler has validated a new contract with its dealers that makes them “retailers” (agents) and no longer dealers who buy vehicles to resell them.
Next step: Commissions earned on each car sold by dealerships must now be discussed on a country-by-country and make-by-make basis. The European dealer associations said in a press release that they were “satisfied that agreement has been reached on a considerable number of contractual points”, even if “certain differences could not be overcome”. These associations also welcomed the establishment of a new governing committee, which brought together their representatives and Stellantis at the European level. The group had terminated in June 2021 the contracts that governed its entire distribution network in Europe.
“A fairly significant change in the business model”
“It’s a pretty big change in the business model,” said one of the distributor’s representatives. Peugeot, Fiat, Opel, DS or Alfa Romeo dealers will invest less. In particular, they will stop assuming the cost of vehicle stocks and will invoice the sale to the customer on behalf of the manufacturer. Stellantis will take over part of the investments, for example, those related to the brand image.
The manufacturer regains control of the final sale price, now in the hands of the dealers. The role of distributors in online sales has also been clarified. “We wanted it to be accurate and protective for retailers,” said the dealer’s representative. “We have reached a level that does not exalt us, but that offers a good level of protection,” he said.
Stellantis has indicated that this new distribution model will be rolled out from mid-2023, starting with three markets (Austria, Belgium-Luxembourg, The Netherlands), before gradually rolling out across Europe. “We appreciate the first positive reactions expressed by the European Dealers Association. This represents a fundamental step to address the next milestones,” said Maria Grazia Davino, Group Sales and Marketing Manager for Greater Europe, quoted in a statement.
Source: BFM TV
