Are Dealerships Dying? Think Again!
Download MP3 In this episode, we delve into the ongoing transformation of the automotive industry. From pandemic disruptions to the rise of EVs, here’s what we discuss:
- Industry Turmoil
- The impact of the pandemic, lockdowns, and inventory shortages.
- Supply chain issues and dealership markups driving used car prices up.
- Current Challenges
- Higher car prices and increased loan payments due to inflation and interest rates.
- Average new car price hitting $46,000, with monthly payments reaching $1,000 for a 5-year loan.
- Shifting Dealership Dynamics
- Dealerships now have inventory but face reduced demand.
- Factories pushing direct-to-consumer sales models, mimicking Tesla’s approach.
- The Future of Used Cars
- Large retailers like Carvana and CarMax encountering operational issues.
- Questions around whether used cars will remain dealer-exclusive or diversify.
- Electric Vehicles (EVs)
- State mandates pushing dealerships toward EV sales by 2030.
- How the transition to EVs will impact service departments.
- The decline of "fixed absorption" (service and parts covering fixed expenses) due to reduced repair needs for EVs.
- Dealership of the Future
- From large traditional dealerships to smaller, boutique-style delivery outlets.
- Potential changes in staffing and operational structures.
- Consumer Experience
- Fixed pricing models vs. traditional negotiation processes.
- Carvana’s struggles with titles and vehicle maintenance: Is it still a viable alternative?
- Looking Ahead
- Balancing profitability with sustainability in a changing market.
- What does the ideal car-buying experience look like for consumers?
Join the Conversation:
Share your thoughts on the future of dealerships and the car-buying experience. Let us know what you think is the perfect balance between convenience, pricing, and service.
Share your thoughts on the future of dealerships and the car-buying experience. Let us know what you think is the perfect balance between convenience, pricing, and service.
Tune in to explore the evolving landscape of the automotive industry!
