October 16, 2018 / 1:10 PM / a month ago

VW targets online sales, over-the-air updates in new contract with European dealers

FILE PHOTO: The logo of Volkswagen is seen at their plant in Wolfsburg, Germany, April 12, 2018. REUTERS/Fabian Bimmer/File Photo

FRANKFURT (Reuters) - Volkswagen (VOWG_p.DE) will overhaul its dealership and sales organization by April 2020 to enable online sales and over-the-air software updates for its new electric cars, the German automaker said on Tuesday.

“Online business will make a key contribution to the development of the new sales model and is currently being massively expanded,” Volkswagen said in a statement.

The new sales model will be ready in time for its electric “ID” family which will debut in 2020, the carmaker said. Rival electric carmakers like Tesla already offer direct online sales and over-the-air updates.

Volkswagen plans to build 10 million electric cars based on its new modular MEB platform and is aiming for the launch of worldwide mass production toward the end of 2022. New digital distribution channels will help push vehicle sales.

“Volkswagen will develop a joint Internet platform which will handle the entire purchasing process through to contract conclusion, including financing, payment and even used car trade-ins,” the carmaker said, adding the new sales outlet would work in partnership with its existing dealer organization.

Dealerships in Europe are due to sign a new contract by the end of November to enable Volkswagen to offer these new digital services.

The new sales platform will allow Volkswagen to offer the possibility of direct sales for the first time, and the brand intends to use this mainly to sell software and online services, the carmaker said.

Customers will not have to visit one of the 5,400 dealers and service partners to access the new services.

Reporting by Edward Taylor; Editing by Mark Potter

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