How many times since 1897 — when Detroiter William Metzger opened the country's first new-car showroom to sell Waverley electrics — has the future of auto retailing been called into question?
Far too many to count. So it's understandable why some dealers can listen to doom-laden talk about the changing auto ecosystem and remain blase and incurious.
Hasn't there always been a "retail revolution" of some kind brewing, and isn't it usually a preview of things not to come?
Yet the revolution being advertised these days — often referred to as "the demise of automotive retailing as we know it" — is hard to tune out. Smart dealers are acting on their suspicions — not panicking, but preparing.
It's not only wide-angle consultants who expect the number of dealers to decline sharply by 2025. Presidio Group, a no-nonsense buy-sell outfit working on deals every day, warns of profound changes wrought by electric and autonomous vehicles and has advised clients to develop a 20-year plan that anticipates consolidation.
Yes, there's pushback — much of it constructive. Last month, National Automobile Dealers Association Chairman Wes Lutz questioned some assumptions surrounding disruption narratives. For sure, car dealers must stay in the moment.
But while NADA leaders and many dealers expect evolutionary, not revolutionary, change, they aren't sticking their heads in the sand. What Holman Automotive Group, AutoNation and others are doing indicates cautious acceptance of the winds of change. In fact, dealers who answered a Cox Automotive survey released last month saw more opportunity than threat.
About three-quarters of them said they don't view mobility trends as the end of the dealership model, even though more than half expect the number of dealerships to shrink.
Dealers should start figuring out their next step now. They should learn about the changes and their potential impact. They should study the mobility moves by automakers, watch what other dealers do and weigh the cost to experiment.
Dealers uncertain about how to prepare have time — to either learn and then come up with a plan or decide they'd rather sell now and leave that conversion to someone else. But they don't have time to wring their hands and do nothing.
