Being a part of the auto industry is like a double-edged sword when you think about it. If an automotive company fails to provide the highest quality vehicles, their sales will plummet. If an automotive company succeeds in providing the public with the highest quality vehicles, they’ll eventually reach complete market saturation, and their sales will plummet. The latter scenario is exactly what the global automotive industry has been experiencing.
Supply Constraints
The ultimate goal of any auto manufacturer is to provide the public with the highest quality vehicles possible. As manufacturers get closer to that goal and continue to innovate for the benefit of their buyers, a new challenge arises. With vehicles now being able to drive faster, further, and for a longer span of years, people are no longer buying cars as often as they once were. The industry refers to this as an economy reaching “peak car”. Peak Car is achieved as certain markets reach maximum automobile saturation, negatively affecting the supply and demand of the auto industry
A growing portion of many markets has been experiencing a push for autonomous and electric vehicles as well. This stems not only from communities’ desire for further developments in automobile technology but from the deeply held concerns governments across the globe are facing with climate change. As a result, auto manufacturers have invested hundreds of millions of dollars into bringing self-driving and electric-powered vehicles to the market.
While more people are investing in such vehicles every year, the impact on the traditional auto marketplace has not been offset by these developments just yet. In fact, so far, these developments —which will most likely benefit the industry down the road— have only worked to exacerbate markets ‘peak car’ dilemma, leaving economies reeling.
Dwindling Demand
As the demand for more efficient vehicles increases and the list of government regulations continues to grow and constrain auto manufacturers, the industry is also seeing a decrease in public demand for vehicles. This is especially true in urban areas, where the rise of ride-sharing companies like Uber and Lyft have given the public access to affordable transportation. This has all but eliminated many people’s need for a vehicle of their own, and has contributed greatly to the shrinking GDP of the industry both nationally and globally.
According to an IMF survey, the auto industry has also been experiencing a downturn in demand for vehicles because of the public’s “wait-and-see attitude” regarding cars. With new technology constantly being developed by manufacturers, people have held off on buying new cars, afraid that something better will come along only a few months after their purchase.
The hope has always been that when developed countries reach “peak car”, developing countries will be able to pick up the slack and maintain consistency in the global auto market. This has not been the case, unfortunately. Chalk it up to ride-sharing and the “wait-and-see attitude”, but the industry is slipping, and is primed to deal a devastating blow to the global economy. Unless the public begins to invest more in new technologies, the current situation in the global auto industry could mean bad news for hometown and national auto dealerships.
The Value of Automotive CRM
Business is finicky, and having the ability to adapt to a constantly changing world is paramount to having success in any sector of the economy. As the auto industry shrinks, and dealerships compete to attract a decreasing pool of potential customers, they’ll need to be able to make themselves stand out from the crowd. A great way to do just that is by investing in automotive CRM software. Such software will be able to help dealers and salespeople manage the dealership’s daily operations, provide a stronger level of personalized customer service, and increase their chances for success in today’s marketplace.
Independent dealerships across the country have been turning to CarDog as their trusted CRM provider, and they have been raving about the results. CarDog’s user-friendly platform is designed for independent car dealers and is set up to help tackle some of the dealership’s most prevalent issues.
Whether you want to close deals remotely, improve customer communications, run targeted marketing campaigns, or improve the look of the dealership’s website, CarDog can help you do it all. If you want to stay ahead of the curve in the ever-changing auto industry, it’s time you look into giving the dealership a leg up with CarDog.
