Mercedes-Benz will cut 15 to 20 percent of its dealerships in Germany, and about 10 percent globally, as part of a broad overhaul of its distribution network.

Mercedes is also moving toward direct sales (or agency model) and is targeting 80 percent of European sales through this method by 2025, with 20 markets in total, from five today, says Europe Automotive News.

At the same time, Mercedes is targeting 25 percent online sales by 2025.

The automaker says the moves will cut distribution costs and allow it to rein in incentives as the automaker seeks to move even farther upmarket with higher average selling prices.

There are currently about 1000 Mercedes and Smart sales and service outlets in Germany, and 6500 worldwide.

Mercedes-Benz NZ moved to the agency model in January this year. At the time the brand’s spokesperson said, “This change was successfully introduced in Sweden more than twelve months ago, and New Zealand will be another of the earlier markets to make the switch, alongside Australia.”