CBT automotive newscast: March 10, 2022

Headlines:

Rivian Automotive investor Charles Crews filed a lawsuit against the automaker on Monday, accusing it of lying to investors about the initial prices of its R1s and R1T vehicles. The case was filed after Rivian announced last week that prices of its vehicles would be increasing by at least 17%, including the vehicles of customers who had already pre-ordered them. Despite Rivian issuing an apology and rescinding the price hikes for existing customers this week, the lawsuit alleges securities violations and is seeking class-action status.

On Tuesday, lawyers for Tesla CEO Elon Musk issued a request for U.S. district judge Alison Nathan to throw out an earlier agreement he made with the Securities and Exchange Commission as well as a subpoena the SEC. Has issued seeking proof that he received prior approval for one of his Twitter posts from November. The request said the SEC’s activities have become “harassment” and violate his first amendment rights to free speech.

J.D. Power has released its 2022 U.S. Customer Service Index, which found that customers are still quite satisfied with their dealerships despite longer wait times and ongoing labor and parts shortages. The final score was one point higher than last year, totaling 848 out of 1,000. Lexus and Mini topped the luxury and non-luxury charts while Alfa Romeo and Chrysler saw the lowest scores. The study also found that more than 6 out of 7 consumers trust the service lane at their dealership and that electric vehicle owners are less satisfied than owners of diesel and gas-powered cars.

Toyota said Wednesday it will be meeting union demands for pay and bonus increases in the new fiscal year, but stopped short of providing full financial details. Japan prime Minister Fumio Kishida previously pleaded that corporations raise employee salaries by at least 3% to improve “wealth distribution.” Union officials are satisfied with the agreement, which comes after workers in Japan received very low pay raises in 2021 after widespread drops in profits due to COVID-19.

News & Opinion:

How dealership groups are reducing missed sales during the automotive supply shortage
As automotive supply shortages continue to drag on, now more than ever, every sale counts. The trouble is, dealership groups are leaving crucial sales opportunities on the table — often without even realizing it. Facing limited inventory, today’s consumers are no longer searching for a single vehicle make — they’re open to a wide variety. In fact, half of all consumers switch vehicle makes every time they purchase a car — and that rate has likely only increased on account of current shortages. Read More

Consumer sentiment of chip shortage pushes over 1 in 5 to postpone purchase
The ongoing chip shortage forced Ford to shut down production for their profit-driving pickups and SUVs last week, idling assembly lines in Kentucky and Ohio temporarily. While some sources predicted that the semiconductor chip constraints would be resolved by early 2022, it doesn’t appear that the auto industry is seeing major movement yet. It has led to extremely high demand for the limited supply of vehicles rolling off assembly lines with disappearing factory incentives overshadowed by dealer markup thousands over MSRP. Read More

The value lifelong customers bring to your car dealership
Building a loyal base of customers is one of the most challenging endeavors for any automotive retail store. Research shows that a commitment to building lifelong, loyal customers can have overwhelmingly positive results for the bottom line as these customers are willing to pay more for brands they love. Reflect on your own life, and you’ll no doubt realize there are dozens of products and services that you use time and again without shopping around. From soft drinks to underwear and smartphones, the human brain has a strong propensity for loyalty, and that’s all built on trust. Read More

CarNow launches Real-Time Retail platform to elevate the car-buying experience
Founded in 2014 and headquartered in Atlanta, Georgia, CarNow is a market leader in digital retailing solutions for the automotive industry. With more than 4,500 dealership partners and over twenty manufacturer certifications, it is one of the industry’s fastest-growing companies, a J.D. Power – Power Information Network Trusted Provider, and the most awarded digital retailing and communication platform in automotive. Driven by its mission to create simple, real-time experiences that streamline dealership operations and facilitate the transaction between dealers and their clients, CarNow’s comprehensive suite of technology solutions is transforming the way dealers connect with customers and sell cars. Read More