Mitsubishi Australia rules out switch to fixed-price new-car sales

Mitsubishi Australia rules out switch to fixed-price new-car sales

Mitsubishi says it has no plans to follow Honda and Mercedes-Benz with a fixed-price sales model in Australia, leaving room for customers to drive a bargain for the foreseeable future.

Mitsubishi Australia says it has no plans to switch to a non-negotiable fixed-price new-car sales model, as research shows most buyers prefer the ability to negotiate a good deal.

Fixed prices for new cars were introduced locally by rival Japanese brand Honda in July 2021, and German manufacturer Mercedes-Benz in January 2022.

Mitsubishi Australia CEO Shaun Westcott told Drive at this week’s 2022 Mitsubishi Outlander PHEV launch: “We have no immediate plans to change our (new-car sales) model in any way.

“We don’t have any preference for agency (the industry term for a fixed-price sales structure) and we haven’t got plans to go there at this point in time.

“I can’t say what the future holds because the world evolves, but we have no immediate plans and we’re not considering it.”

As previously reported by Drivethe Top 12 car companies in Australia say they have no plans to switch to a non-negotiable pricing structure.

The roll-out of fixed prices among a small number of car brands – which the industry refers to as an “agency” model because the dealers become selling agents under the new agreement, rather than owning the showroom stock – has been met with mixed success .

Sales of Mercedes-Benzes have increased since it went to the non-negotiable, fixed-price business model at the beginning of 2022, however Honda sales hit reverse since it made the switch in July 2021.

Supporters of the fixed-price approach say the new business model is designed to be fairer to customers who aren’t good negotiators.

However, detractors of the scheme say a fixed-pricing structure penalizes buyers who know how to drive a bargain, and limits the abilities of dealerships to offer sharp discounts – or generous trade-in valuations – to move metal.

Tom started out in the automotive industry by exploiting his photographic skills but quickly learned that journalists got the better end of the deal. He began with CarAdvice in 2014, left in 2017 to join Bauer Media titles including Wheels and WhichCar and subsequently returned to CarAdvice in early 2021 during its transition to Drive. As part of the Drive content team, Tom covers automotive news, car reviews, advice, and holds a special interest in long-form feature stories. He understands that every car buyer is unique and has varying requirements when it comes to buying a new car, but equally, there’s also a loyal subset of Drive audience that loves entertaining enthusiast content. Tom holds a deep respect for all things automotive no matter the model, priding himself on noticing the subtle things that make each car tick. Not a day goes by that he doesn’t learn something new in an everchanging industry, which is then imparted to the Drive reader base.

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