My point was never to attack the dealerships but to try and better understand their thinking because in my humble opinion a bunch of billionaires are going to take over the entire industry and eat the dealerships for lunch in the same manor as they did the real estate agents.
New players have shown up in every country, dominating used car sales and the one thing they all have in common, is the majority do not have any inventory of their own.
This is a platform war and the ones with the best platforms, better marketing, and better performance are winning. And the average dealership website is full of code bloat, errors, bad practices, and takes nearly a minute to load.
As a matter of fact dealerships seem to have accepted their losses and hired their competition to build their sites.
In the future the playing field will look a lot different.
As everything moves online it becomes more competitive and disruptive as Carvana, Roadster, Shift, and Vroom launch price-competitive business models to compete against one another, they will simplify the buying and selling experience for consumers and the dealership will lose more income.
The shift to purchase cars online is already outpacing offline purchases.
As dealers begin to counter with the up-sale of parts-and-service contracts the nimbler high-tech players will introduce new business models and will cause more disruptions.
If the dealerships do nothing they will go out of business.
Dealerships will not be able to compete with the pricing transparency offered by online channels.
Dealerships have already lost the used car sales but they have laws in place that say it’s illegal for any car manufacturer to sell directly to the consumer or open up their own dealership. All dealerships have to be completely private and unrelated to the car manufacturer.
Tesla uses a loophole.
Dealerships have been lobbying against and have even taken Tesla to court on multiple occasions.
However if Tesla is willing to fight court case after court case to avoid using dealerships, something must be wrong with the current dealership model.
A lot of people feel dealerships should never have been given a monopoly on new car sales.
If dealerships make the most business sense for the manufacturer then the manufacturer should be able to choose that model. If selling direct to the consumer makes the most sense, then the manufacturer should be allowed to pursue that strategy.
This should not be something that the government is involved with!
Manufacturers want to fight the law because EVs require a lot less service and to compete with Tesla they need more control over their prices.
And sites like cars.com stand to replace the dealerships if those laws get changed. The very company that controls the dealerships ability to compete online, stands to gain the most if they can’t.
To survive the dealership needs to adopt drastically different business models and pursue new revenue streams.
Dealerships need to be able to compete online with sites like cars.com.
But they need a way to implement their own ideas and goals that go beyond just being a clone of the competition. Dealerships need a website that is able to handle some of the offline work to reduce operating costs via improved operating efficiency.
And while I'm not in the dealership and can't see all the problems the dealerships are dealing with I can see that the dealerships need to pivot and they need to pivot in a way that will allow them to compete with the online players.
My only intentions was to try and shine some light on the problem and bounce different ideas off the people who are going to have to fight this battle, I'm not the hero, guide, or even in the battle, all I'm trying to do is show you that you are in the battle and your time is running out.
