AC

The new flagship Mercedes-Benz dealership here feels more like a Park Avenue boutique than an 11th Avenue car lot. No tacky plastic flags fluttering over hot asphalt, "low down payment" signs or free hot dogs. The atmosphere is sophisticated and subdued at Mercedes-Benz Manhattan. Cars are sold in a spacious gallery atmosphere of hardwood floors and designer furniture, soaring ceilings and a video wall. One of the 71 service bays is on display from the sales floor, as if car repair were a form of entertainment. That's part of an effort to make the dealership more "open and transparent," says Alan McLaren, vice president of customer service. Mercedes-Benz's shimmering new dealership, built and owned by the automaker, is intended to set an example for its hundreds of franchisees. Mercedes wants its dealers' stores to match the luxury feel of the cars. And it's joining industrywide efforts by automakers to pressure dealers into sprucing up, fixing up and rebuilding. Both foreign and...