The global pandemic has brought an unexpected boon to the car market in the US, with prices skyrocketing as people race to buy new and used cars. However, many people never reach the dealer or the shipment, because of the blockade order and the increasing trend of online car shopping gather into a situation that makes many people agency suspense: in 2021, online car sales in the US have grown by 25%.
This accounts for the largest increase that US automotive e-commerce has seen over the past decade, as Wired report, which states that buying a car on the internet is no longer appropriate; it quickly became the standard. Wired refers to this change in car buying as the “Amazonization” of the US auto market, comparing the process of buying a car online to the process of buying a TV or couch on Amazon:
For years, automakers have resisted the Amazonization that has swept the rest of the global economy. There’s a feeling buyers won’t feel comfortable making that big, expensive online purchase. But U.S. auto e-commerce sales are up 25% in 2021, the biggest jump in the past decade, according to a report from investment banking firm Cowen, which evaluates the industry. This area is still “early” in digital transformation. Recent data from auto service company Cox Automotive shows that although overall satisfaction among U.S. auto buyers declined last year, those who completed at least half of the steps online Lines are more likely to be satisfied with the process. Most car buyers will interact with at least one digital tool when buying a car this year, Cox estimates.
Automakers were skeptical that buyers in the US – where it just so happens agency protected by a Legal framework dating back to the 1950s — will accept online car shopping. But they have. While the pandemic could be a catalyst for automotive e-commerce growth in the US, tram currently promoting it.
Car companies like Volvo, Acura, Ford And GM are committing to selling cars online for their upcoming electric cars, albeit to varying degrees. Tesla was the first to offer a digital car buying experience across its entire product line, but older carmakers are embracing the idea.
Agents and franchisees are grappling with change; they still cling to old business models despite pressure from both automakers and car buyers. It is not surprising that dealers will refuse to sell directly, because, by definition, direct-to-consumer sales will reduce the dealer’s profits. And it’s hard to accept less profit later record money was done during the pandemic.
Some dealers are pushing back on online initiatives handed down from automakers: Ford is being sued by dealer associations in three states alleging the company is breaking the law by led them to spend up to $1.2 million to sell electric vehicles like the Ford Mustang Mach-E and Ford F-150 Lightning. Ford CEO Jim Farley said the company wants to move to a non-negotiable pricing model and sell 100% online. Honda’s motobike repeated love.
Dealers will go from lavishly decorated auto shopping centers with ambitious finance departments to service centers where buyers can learn about their new electric vehicles (selected and buy online), then pick up the car and hit the road — only to come back after servicing intervals.
And yet, automakers like GM say the future of car buying isn’t 100% online or 100% in-store. It is likely that car purchases in the near to medium term will be very diverse. There will be options to buy a new car online or at a brick-and-mortar dealership or somewhere in between. Agents will have to adapt to this hybrid business model and learn how to foster relationships online. Sales start via email, then move to the showroom.
For the next few generations of cars, at least, dealers are still here. While the “Amazonization” of the US auto market is a persistent trend, the things we buy online range from furniture and oversized electronics to mundane and mundane objects, such as phone charger cable. There are still many people who want to buy TVs, couches and cars directly. Dealers will sooner or later have to adapt to digital retail, but they will last for now.
