There’s very low risk of infection at dealerships: Martin Schwenk, Mercedes-Benz India

Introduction

Factories have reopened. Dealerships are back in business. And as it turns out, cars are already being delivered to customers as well. But, the Indian automobile industry is nowhere near normalcy. We are also not very clear on how and when things will get back to normal. 

So, we are speaking to the captains of the industry to get a better idea about it. We have already had a mass-market carmaker future-gaze for us about what the car industry will look like going forward and what one should expect from OEMs and the dealers alike. You can read that HERE. 

This time though, we thought we’d get perspective from a luxury carmaker. And who better to give us that than the market leader and the man at its helm. Here then is what Martin Schwenk, MD and CEO, Mercedes-Benz India thinks…

Back to Business

For the customers to come back, it’s important to the have the right offering, says Schwenk. He believes it has to be a combination of several things. 

Schwenk: Offering easy access that’s online, a safe environment in the dealerships, and obviously, the right products are key to bring back buyers. We have lot of beautiful products and we are constantly launching additional new cars like we just launched the GLE, the GLC Coupe, and now we will soon be coming out with the GLS. I believe new products like these will create some traction with the customers. 

But products are just the starting point. Eventually, the customer has to buy a car. And in these trying times, good financial solutions can make that happen. Schwenk agrees and adds that it is in this regard that Mercedes has launched the WishBox. It’s a scheme wherein customers have options like not having to pay the EMI for three months or very low EMI for six months. They can also opt for a long 10-year loan contract. All this, says Schwenk, will make it easier for buyers to come back and purchase a new car. 

Schwenk: So yes, we need to do a multitude of activities in order to reach out to the customer to entice them and help them to purchase a new car.

The Online Route

One of those activities, at least in the short term, is also the online experience. 

Schwenk: We recently launched a platform for online sales or e-commerce. And at that time we spoke about something like 25 per cent of sales moving completely to online by 2025. I would stick with that number, and it is an area where we are ramping up. 

And naturally, the current situation will only accelerate the focus towards online transactions. A lot of customers will not only search cars online, but they will also look into product details and gather information online, says Schwenk. Some of them will then eventually transact online, a trend accelerated by lockdown. 

Schwenk: But I would think, there will still be a strong leaning towards physical retail with people coming into the showrooms not only for the reassuring ‘look and feel’, but also for test drives. So the brick and mortar stores will certainly exist. We expect both online and offline purchase happening simultaneously. 

What’s more, going forward it’s not just the purchase behaviour that will change. Customer’s expectations from both the carmaker and the dealer are bound to change too. Safety for instance will be a top priority for most customers. And we aren’t talking about the safety features in a car…

Schwenk: Consumers will ask – will I be safe if I walked into the workshop or into the showroom? Will my car be properly sanitised when I take its delivery? And will my interaction with the sales consultant at the showroom be safe? I think that is the first thing that will be on everyone’s mind. And I can confidently say all Mercedes dealerships have addressed this with detailed protocols. 

He adds that a dealership will do everything that’s necessary from social distancing to face masks to sanitising protocols and not only for showrooms or the people themselves but also for the vehicles. Schwenk believes that the risk is now very limited. And he himself would have no hesitation in taking his own car to a workshop or walking into any Mercedes showroom. 

The Change

The risk, no matter how limited, will exist. And that will, as a result, change many things and not just when it comes to buying cars. 

Schwenk: Everything will change to some extent. One lasting change, as we spoke about earlier, will be online sales and offline sales developing together going forward. We will also see that work from home and work from office will complement each other. And it will remain with us for sometime.

But what will not change at Mercedes, says Schwenk, is the plan to launch new cars. The company will go ahead as planned and we should expect 10 new models to come out this year. The timeline for these launches, however, might be a little delayed.

The most significant and obvious change at the dealer end, meanwhile, will be the use and implementation of social distancing and the various other safety protocols. We should also see some of the interaction moving to the online or digital space, says Schwenk. This would include enquires relating to new models as well as dealer consultation that consumers might want to better understand their model of choice. 

Schwenk: We have launched the Mercedes-Benz online consultation studio wherein customers can enquire, consult and even book test drives of models without having to step into a dealership. 

He expects this sort of interaction to only increase with time.

The Future

According to Schwenk, it is very hard to assess what the future of car sales in India might look like in the long term. It will depend a lot on how the economy grows, of course. But, forecast from almost all quarters indicate that the car sales will be much better in the next fiscal. The recovery will also depend on the new products that are launched.

And Mercedes is already on its way in this regard. It has already launched the AMG duo of the C63 AMG and the AMG GT R last month. And according to Schwenk, these are cars that properly embody excitement and emotion on wheels. Mercedes has also launched two new versions of the GLE SUV. And now the new generation GLS is knocking on the door, which Schwenk believes will find decent amount of takers.

But, the company isn’t out of the woods yet. And neither is the industry. The Covid-19 induced crisis still looms large. 

Schwenk: For us it is important to come out of this crisis and grow back to some semblance of normalcy. I am hoping it won’t take too long, maybe by the festive season. I hope that the right product offerings (which have already been launched) will help, and will give us momentum. And then come September, we hope we will be closer to normalcy.