Mercedes-Benz Korea ditches dealer pricing for ‘best price’ model

Mercedes-Benz Korea is overhauling its sales model, moving away from dealer-led pricing toward a centralized, transparent system designed to improve customer experience in the highly competitive luxury car market.

At a recent media briefing in Seoul, hosted by the Korea Automobile Journalists Association, the company introduced its new “Retail of the Future (RoF)” strategy. Set for launch Monday, it will centrally manage vehicle inventory and pricing, allowing customers to purchase cars nationwide under the same conditions through a direct sales system. The model has already been implemented in 12 markets where Mercedes-Benz operates, including Germany, the UK and Sweden.

“We don’t call it a same price policy, but a ‘best price’ policy,” said Lee Sang-guk, executive vice president of digital, marketing and communications at Mercedes-Benz Korea. He added that any improved promotions at the time of delivery will be applied, while original contract terms are maintained if conditions worsen — ensuring customers receive the most favorable deal.

This marks a significant departure from the current system, where pricing can vary by location, dealer and timing — long-cited as a major pain point for consumers.

Under the new model, Mercedes-Benz Korea will disclose promotion packages up to three to four months in advance, aiming to improve market transparency and give customers greater visibility into pricing before making a purchase decision.

The company is also digitizing the entire purchase process, integrating QR-based customer registration, online contracts and real-time vehicle tracking into a single platform.

Another major shift is in delivery timing. Traditionally, delivery depended on vehicle availability, with customers often facing uncertain delivery schedules.

“We are moving toward a model where vehicles are delivered on the date the customer prefers,” said Park Ji-sung, head of the RoF process at Mercedes-Benz Korea. “Customers who want a car in July will be matched with vehicles arriving in July. It’s about providing transparency and control.”

The strategy also redefines the role of dealers. While they will continue to engage in customer interactions such as test drives and after-sales services, Mercedes-Benz Korea will take over the pricing authority and inventory management.

“In the past, dealer earnings were margin-based, but they will shift to a commission-based model, providing more consistent and predictable income,” Lee explained, adding that dealers will no longer need to apply heavy discounts due to inventory burden.

Addressing concerns over dealer profitability, he stressed that “this is not a fight between Mercedes-Benz Korea and dealers over margins,” pointing to overseas markets where dealers in countries such as Australia, Sweden and Turkey answered that they do not want to return to the old dealer-driven system.

Lee emphasized that the current sales system — heavily centered on price negotiation — limits meaningful engagement with customers.

“In many cases, over 90 percent of conversations with our customers have been about pricing,” Lee said. “We want to move beyond that and focus on the product and brand experience.”