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Future Automotive Sales Models: Hybridization as the new norm

Munich, October 2025
T

he automotive industry is undergoing a once-in-a-century transformation. Electrification, digitalization, and the rise of new competitors dominate the headlines of the industry, but one of the most disruptive shifts today is happening in automotive sales and distribution. The way cars are sold is being redefined and the winning formula will be hybrid.

Hybridization: The rise and retreat of Direct Automotive Sales & Agency Models

For years, direct-to-consumer (DTC) and agency models were positioned as the inevitable future of automotive retail. Inspired by Tesla’s trailblazing direct sales model, OEMs envisioned tighter pricing control, stronger customer relationships, and healthier margins. Billions were poured into contracts, IT platforms, and pilot programs.

Yet, as the dust settles, many of these initiatives have stalled or reversed. Recent announcements from OEMs such as Volkswagen and Stellantis underscore a broader reality: the pure agency or DTC model is not scaling as expected. Many launches have been postponed (e.g., BMW), halted, canceled (e.g. Skoda, VW), or reframed as “long-term targets.” In short, what was once seen as an unstoppable wave has proven to be a costly and uncertain experiment.  

“Building a fully owned direct-to-consumer models have proven too costly and complex for most OEMs. The focus should therefore be on the most suitable functions and on enabling retailer partners to succeed” 

 - CCO Volume OEM (Indirect Sales Model)
car brands different approach to sales 2020-2025

Future Sales Models: Regional perspective: One size does not fit all

The future of automotive sales models is not uniform across the globe. Regulatory frameworks, customer preferences, and market maturity drive very different strategies — yet a common trend is clear: direct-to-consumer and agency sales models will account for only up to 10% of global new car sales. The vast majority will still flow through dealers.

  • China: Market entry often begins via pure DTC (online sales and branded showrooms), with dealer networks introduced later. Younger customer bases and digital adoption accelerate experimentation (especially for upcoming NEV brands).
  • North America: Legal structures heavily favor dealers. While Tesla, Rivian, and Lucid continue with DTC, established players must work within franchise laws. VW’s Scout brand is one to watch, testing direct sales amid dealer resistance.
  • Europe (EMEA): Most incumbents are retreating from agency rollouts. Mercedes-Benz and BMW remain committed, but VW and others have scaled back. Tesla remains the exception, pursuing pure direct sales. Also new entrants such as BYD are going with traditional indirect sales models.

Development of Direct Sales/ Agency Model share for main regions (% of total new car sales)

Development of Direct Sales/ Agency Model share for main regions (% of total new car sales)

Why Dealers are here to stay

Dealers continue to offer unique advantages that OEMs cannot replicate at scale: local presence, customer service, and the ability to absorb working capital and operating costs. Dealers also remain critical for customer acquisition, trade-ins, and aftersales relationships.

“Retail partners remain a central pillar of customer engagement, making hybrid models that combine retailer strengths with selective direct-to-consumer elements the most viable path forward.” 

 - CSO, Luxury OEM (Indirect Sales Model)

However, this does not mean a return to “business as usual.” OEMs need to rethink the dealer relationship. The opportunity lies in Dealer 4.0—a hybrid approach that integrates the Best-of-Both worlds: the efficiency and data-driven insights of agency models, combined with the entrepreneurial strength and reach of traditional franchise networks.

Hybridization of Automotive Sales: The Best-of-Both-Worlds Approach

“Direct-to-consumer and agency models bring significant benefits but require substantial investment in capital and skills; hybrid models are likely to dominate in the future.” 

 - CCO EU, Volume OEM (Agency Model)

Instead of abandoning innovation, leading OEMs are focusing on hybridized models that mitigate the weaknesses of both systems:

1. Mitigated downsides of dealer entrepreneurship

  • Reduced incentives and less room for excessive discounting.
  • Network consolidation to minimize intra-brand competition.
  • Leaner, fairer margin systems aligned to cost coverage and adequate returns.
  • More structured supply and target setting.

2. Optimized costs

  • Enhanced lead creation and management between NSCs and dealers (“no lead lost”).
  • Centrally managed inventory for higher availability at lower working capital.

3. Retained control

  • OEMs keep tighter steering, while dealers gain reduced financial exposure and greater collaboration opportunities.


This hybridized “Best-of-Both-Worlds” approach enables superior sales performance at lower fixed costs.

The road ahead: Dealer 4.0.
The future of automotive sales is hybrid

The lesson is clear: pure agency or DTC will remain niche. The future is hybrid—OEMs combining the structural advantages of new sales models with the operational resilience of dealer networks. Success will hinge on redefined partnerships, collaborative IT systems, and a pragmatic balancing of cost and control.

Car dealers are not being replaced—they are being reinvented. The industry’s next chapter is not about choosing between DTC, agency, or franchise. It’s about hybridization, where the strengths of each model converge into a more efficient, scalable, and customer-centric Dealer 4.0 system.

Authors

Jonas Wagner

Partner & MD

Arthur Kipferler

Partner & MD

Henry Lundt

Associate Partner

Thorsten Mauthe

Senior Vice President