LOS ANGELES -- After years of steady and healthy growth throughout the auto industry, dark clouds are gathering on the horizon.
Rapidly changing demographics, new buying habits, ride-sharing and electrification will soon put the hurt on profits and volume for manufacturers and dealerships alike.
The way Hyun-dai Motor America CEO Dave Zuchowski sees it, this is not a matter of if but of when. So he's sounding a call to his dealers that their way of doing business must change -- fast.
"Going to market the exact same way we've gone to market the last 100 years isn't going to go very well," Zuchowski told Automotive News. "So we really have to change a lot of the processes we're talking about."
The shifts in the industry are coming from multiple fronts.
Baby boomers, the longtime life-blood of the auto industry, soon will be replaced by millennials as the largest group of car shoppers. About 75 percent of millennials -- 64 million by Hyundai's count -- will be in the market for a new vehicle in the next five years.
Millennials' shopping and buying habits differ from those of previous generations. Thanks to websites such as KBB.com, Edmunds.com and TrueCar and ready access to their smartphones, millennials are walking into showrooms much further down the purchase funnel than many consumers who are older.
Yet when they get there, they are encountering an antiquated and cumbersome buying process.
"The power of information -- which used to belong to businesses -- is now the domain of the consumer," Zuchowski said.
"Dealers that don't recognize that and still try to control the sales process and set up dealership infrastructure that's laden with liners and closers and deskers, it just doesn't make sense anymore."
Reducing turnover and streamlining operations, even to the point that a customer has just a single point of contact for the entire buying process, will be crucial, Zuchowski said. So will pricing transparency.