Carvana, Vroom, etc. are taking market share from the used car departments of franchise dealerships across the country at a faster rate than what some would call “slowly but surely.”
Turnover with salespeople and other positions in the retail automotive industry continue to grow. This leads to worse CSI, lost sales, and higher costs each month.
While this is going on margins are compressing on new and used vehicles and dealers are searching for new innovative ways to retain their profits and ideally grow them in 2019.
Automotive Digital Retailing Helps New and Used Sales
So why should OEMs care about digital retailing as it relates to used vehicles? Because without a healthy used vehicle department, many of the dealerships will not be profitable and will likely not stay open over the coming years. That means consolidation will likely happen, and these dealers will get gobbled up by the larger groups both public and private — and maybe the OEMs don’t mind that.
However, if the OEMs want a healthy dealer network, the time to start supporting them with resources for digital retailing with used vehicles is now. Incentivize them to take steps toward digitizing their sales process. Even small steps can help make the salespeople more competent and confident product experts while making the sales process more collaborative.
Even if the manufacturer is developing their own digital retailing solution for new vehicles, supporting these types of initiatives for used car sales will help prepare the staff to embrace the changes on the new side when those final products are fully operational and widely used in the market.
There are so many approved programs that do far less to support the future of retail automotive and the direction the consumer and the OEM ultimately want to go. Let’s hope they take one step in the right direction this year and start to incentivize their dealers to use this type of technology on the used side of the business.