Some changes to look for in the future of buying a new car
- Credit: Ford
Last week, we examined many changes at manufacture level with new entrants, takeovers, shared platforms, new powertrains and ultimately, autonomous vehicles.
Some of these changes are driven by Government controls as they strive to clean up the planet and slow the effect of global warming.
The objective is to be carbon neutral by the middle of the century and this means no new combustion engine powered cars to be sold by 2030 although some hybrids may be extended to 2035.
The cost of this investment will mean savings must be found to keep the price of a new vehicles affordable and one of the most expensive costs is in the distribution of their products and bringing them to the market.
This cost is split between the manufacturer and the motor retailer.
The retailer invests in expensive infrastructure, land and buildings, equipment, training, etc, and receives commission and incentives based on their sales and service to the customer.
Some manufacturers such as Tesla already operate without dealers but as their sales grow they need to provide service and repair facilities and Geely, who own Volvo and Polestar are operating Polestar with online purchases only, with Volvo dealers as the service provider.
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Ford have introduced the new Mustang Mach E, a fully electric 4X4 to rival Tesla, which will be ordered online and Ford dealers like Vospers will be involved in advice, handover and servicing, but the purchase will be direct with Ford and the dealer paid a fixed amount to pre-delivery inspect and handover the vehicle.
Most manufacturers have struggled to attract many buyers with online sales prior to the pandemic but have seen buyers move far more towards this on used cars in the lockdown periods.
This, of course, is because buyers have had no choice as showrooms and forecourts have been forced to close and while some customers are happy with a click and collect transaction, many wish to test drive the vehicle personally and rely on the helpful advice of their local dealer’s sales advisors who they have built trust with over previous sales.
Cars are changing and new technologies are requiring proper handover and explanation if for no other reason than the safety of other road users.
If all new car sales could only be purchased online this would mean less choice, with manufacturers building stocks of vehicles available for delivery within weeks but any specialist requirements taking much longer to be built and delivered.
Currently dealers in regular contact with their customers are aware of their individual requirements and anticipate local needs in their advance orders.
They hold stocks and in many cases are able to turn around the purchase in days.
Furthermore, they want the part-exchange for their used car business which is based on inspection and driving, as well as condition, mileage, and service history.
The manufacturers have no facility or appetite for this.
They would rely on customers pre-selling their part-exchange as even on a lease, would be unlikely to give full value, and the manufacturer would have to collect and manage the disposal themselves.
For the time at least customers who realise the benefit of talking to their local trusted advisor will be able to do.
They will also be able to accept or not, the offer for their part-exchange and those who wish to negotiate will continue to do so and not be forced to accept the price on offer from the manufacturer.
However, there will be changes and we must be prepared for them and ensure our customers are enjoying the experience and are completely satisfied.
Look forward to next week. Stay safe and keep smiling.