‘The retail revolution putting car dealers in jeopardy’

Editor-in-chief Steve Fowler thinks dealerships could become places to 'try' rather than 'buy' as more and more car customers turn to online purchasing

As dealers threw open their doors to welcome a surprising number of eager customers back into showrooms, so the bosses of dealer groups and car companies accelerated their plans to offer end-to-end digital sales channels. That could see dealers becoming ‘try’ rather than ‘buy’ outlets, and customers – if they want – only interacting with retailers over the internet.

A few dealer and car company bosses have admitted that they had been “caught napping” when it comes to their digital offerings during lockdown. Not so the Managing Director of Ford, Andy Barratt.

However, when I caught up with him recently, he did reveal that Ford’s upcoming online sales channel – due to launch later this summer – could mean job losses in the retail business. “I think some dealers will say, ‘Do I need all these sales staff any more on the basis that I’m so digitally enabled in a way that I never was before?’,” he said.

Of course, not everybody wants to buy online, and I’ve had plenty of correspondence from people who much prefer real face-to-face contact (now at a social distance) at a dealer rather than doing a deal via a video link.

There is a growing concern, though, that your local dealer might not be very local soon. Put simply, many of the UK’s biggest dealers are in trouble, with the CEO of one of the UK’s most successful dealer groups telling me, “We’re all vulnerable.” The value of dealer businesses is at a real low right now.

That could play into the hands of Sergey Petrov. The name won’t ring any bells for you, but he set up Russia’s biggest car dealer group and is eyeing some of the ailing retailers in the UK.

Petrov has a reputation you might not expect for a Russian businessman; he’s widely liked by the global car makers he represents in Russia, and known for working in a very ‘western way.’ He might be about to make a big impact on the upcoming automotive retail revolution.

Do you agree with Steve? Let us know your thoughts in the comments section...

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