Amag: Creating Its Own Future In A Disrupted Automotive Industry

AMAG is Switzerland’s premier automotive retail and service company, holding exclusive rights to import Volkswagen Group car brands such as Audi, Volkswagen, Skoda, Cupra and Seat. In 2022 AMAG had 7,300 employees and a revenue of CHF 4.4 billion. The electrification of the automotive industry and the introduction of the agency model by the Volkswagen Group are major challenges for the traditional Swiss company. The case describes AMAG’s traditional business model, including recent changes, its vision and ambitions. Follow Frank Boemerle, the head of strategy at AMAG retail, as he develops new business models and captures insights about the company’s transformation journey. New business models like Mobility as a Service (MaaS) and Retail as a Service (RaaS) are elaborated and described. Existing and future profit pools are analyzed, and new business opportunities and threats are discussed. The EV transformation and digitalization require up to 50% fewer employees in the after-sales service business, and the impending agency model questions the current infrastructure and capital employed. Therefore, AMAG is searching for new mid-term revenue streams and new employment for the workforce. Change management and up-skilling of the employees are additional challenges after the changes in the financial transactions of future business models on a subscription base. Shall AMAG invest in renewable energy to offer electrification packages to customers next to EVs? Shall AMAG expand to Italy and France? Shall AMAG expand the EV portfolio with new brands from China and potentially risk its exclusivity with Volkswagen? Support Frank in the analysis and make your conclusions on how AMAG can stay in business in Switzerland beyond 2030, given that the electrification of mobility and the new agency model disrupt the main revenue streams of AMAG’s current business model.