Dealers are being urged to prepare for an unrecognisable automotive industry in the next decade.
Cox Automotive and Grant Thornton’s fourth annual Automotive Insight Report, which was launched today (Oct 21), highlights the impact of electrification and digital transformation as well as the manufacturer agency model becoming a possibility.
As such, it suggests that dealers must rethink their customer engagement and revenue streams if they want to stay competitive in years to come.
It says that because of the pandemic, people now expect a seamless experience across whichever channel they use – and it has to be fast, personalised, effortless and transparent.
Vehicles need to be visible via a search, and connecting all stages of the customer journey has to be straightforward, including trading in a part-ex and arranging funding.
Connecting data and touchpoints is vital to create a seamless end-to-end experience, the report suggests.
A large proportion of car buyers are still looking to complete their next transaction in a dealership, says the report, adding that in some markets, legislation makes the direct-to-consumer model difficult.
It looks at opportunities relating to electrification, mobility, aftersales and servicing that offer dealers a way to expand their relationship with the driver.
The report also says that online used car sales are likely to double in the next five years, although it acknowledges they still comprise a relatively small proportion of the total.
Cox Automotive insight and strategy director Philip Nothard said: ‘With direct-to-consumer models on the horizon for many manufacturers, there is an opportunity for dealers to keep their relationship with drivers through education and information centres.
‘How these evolve to generate both footfall and also drive sales opportunities, even if those are via the manufacturer website, will be interesting to see.
‘The importance of the dealer in helping consumers with the transition to electric should not be underestimated.’
Following the weakest September for new car registrations since 1998, Cox Automotive has further revised its year-end forecast down to 1.63m – the same as the year-end figure for 2020. Earlier this year, it downgraded it to 1.82m.
Meanwhile, having originally downgraded its 2021 used car sales forecast to 6.8m, it is now expecting the market to top 2020’s 6.75m transactions, with a projected 7.14m for 2021.