Over the past decade, dealerships have done everything the manufacturers have asked: multimillion-dollar facility upgrades, more inventory and increased square footage. With the proliferation of the electric-vehicle and ride-share economies, what are automakers doing to return the favor, now that dealerships are oversized and underperforming?
For just the third time in a decade, the U.S. auto industry entered the summer selling season without a monthly sales gain.
This is the first sign of an industry in flux — even as the economy continues to soar. Consumers are holding onto their vehicles to steady their daily living expenses vs. trading up every three years. They are looking for the next-generation car to help them curb fuel costs. The topic of autonomous driving is hotter than ever, especially as millennials and mobility-challenged consumers seek the convenience of driverless cars. At the retail-sales level, Tesla is showing that market-shifting sales and service are possible — all without a dealership network.
With a dealership-footprint crisis at our doorstep, manufacturers should be working in lockstep with their dealer advisory councils to right-size dealerships now — not 10 years from now.