Current global events have been causing supply problems in various industries for the past several years. The automotive industry has not been spared, which significantly affects new car sales and presents dealers with new challenges.
In this edition of our Impulse, I would like to share my personal experience on this topic.
The ongoing chip shortage is affecting the production of ECUs, a vital component for new vehicle assembling. Logistical challenges within the Asian region increase complexity and are the main cause of decreased car production. As a result, dealers can only order and distribute a limited number of vehicles, and it is not uncommon for these orders to involve waiting times of up to 15 months or more. These circumstances also affect the end customer, who is often unaware of how long it can take for the new car to arrive.
But the question we actually have to ask ourselves here, is, how do dealerships deal with these circumstances and uncertainties? More importantly, how is the customer is accompanied throughout this process?
Two approaches became apparent. The first approach is to continue with the sales procedure in a standardized manner, of course by informing the customer of the current delivery times. Increasingly, however, the customer encounters a new behavior that has not been experienced this way in past years. This behavior is a defensive attitude in the sales process, which is incomprehensible to him.
One might think that the current supply challenges have put some dealers in a comfortable situation since there is no sales pressure. After all, all available models, including the company’s own demonstration models, have already been sold. The new, reordered demonstration cars will also be sold by the time they arrive at the dealership. This puts dealers in an unprecedented position, where there is no pressure to meet sales targets, or sell discounted inventory vehicles at the end of the year. This also impacts the used car market.
Especially with all the challenges and supply bottlenecks, it becomes even more important not to lose sight of the customer and to further strengthen their brand loyalty through an excellent customer journey.
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