The United States is the overall second largest vehicle production and sales market in the world. 2017’s sales numbers reached an all-time high of $17.1 million units, with this being the third straight year in which it has surpassed the 17 million mark.
Since Honda opened its first plant in the U.S. in 1982, major European, Japanese, and Korean automakers have been producing vehicles for the United States, which has supported over 130,000 American jobs.
The New Breed Of Automobiles
According to the annual report by Car Wars, the average number of new automobiles is around 39 new models. However, from 2018 to 2021 we can expect an outrageous 57 new vehicle launches, with 35% of those being crossovers. Within these new launches, several are coming from the German luxury brands, such as Mercedes Benz and BMW.
Another consumer purchasing trend that we’ve seen pop up is electric cars. The auto industry has seen this trend rise with sales growing at a rate of 30%. The number of electric vehicles is expected to rise to the point of taking over the entire automobile market.
Major automaking companies are getting in on the electric vehicle initiative. For instance, Mercedes-Benz plans to have fifty electric variations of all their auto models on the lot by 2022. In addition to that, BMW plans to start mass producing electric vehicle models by 2020, which are expected to be available by 2025. General Motors has also jumped on the bandwagon for electric vehicles and plans to make twenty new electric/fuel vehicle models to be available by 2023. Other automakers, like Ford, Volkswagen, and Toyota, also plan on getting in on the electric vehicle initiative by providing electric vehicles, mobility services, as well as autonomous driving features in many new automobiles.
Online Marketing Strategies Using Social Media
Millennials are making up a large part of the current car buyers market. Reports show that by 2020, 40% of the automotive market will be made of the millennial generation. Social networking sites, such as Facebook, are becoming an excellent way to advertise and connect with this new automotive market.
Just having a web page for your marketing strategy is not suitable for this new and evolving automotive industry. Since an average of 60% of car buyers do not know what car they want, how you advertise and catch the car buyer’s attention is imperative. Providing videos on social media and including testimonials from actual customers is a good way to advocate your brand.
Another question many potential buyers will have is whether or not the car they are looking at is the right car for them. It is the salesman and dealership’s job to ensure their customer that they are making the right choice and that the vehicle they are looking at is exactly what they want and need.
Trends That Are Slowing Down The Automotive Industry
The auto industry has been faced with negative issues which are causing a decline in sales so far this year (2018). One of the biggest causes behind the declining sales is the release of ridesharing companies, such as Uber and Lyft. Along with the auto industry, these ridesharing companies have had more of a negative impact against the taxi industry. Many millennials are opting for Uber and Lyft as their major form of city transportation due to the high cost of living in the city and the generally high cost of living, thus making this the affordable option.
Laws Regarding Commission-Only Pay And Overtime
The Fair Labor and Standard Act (FLSA) requires that all employees who work over 40 hours a week to be paid time-and-a-half of what their regular hourly wage is. For a salesperson on commission-only pay, this would be the minimum wage amount for that state.
For example, if a salesperson worked 48 hours in one week and only made $300 in commission pay, the employer would be required to adjust the payroll to make the employee’s wages be 48 x 11/hour (min. wage in CA) That would be 40 hours x $11/hour and 8 hours overtime x $16.50/hour= this would be $572 for the weeks earnings. Therefore, to be in compliance with the FLSA you would need to compensate your salesperson with an additional $272 in wages.
Now, these requirements are for dealerships making more than $500,000 in gross sales per year and dealing in interstate commerce activity. However, you probably want to get to $500,000 in gross sales a year someday and you never know if you are going to sell a car to someone that lives out of state. Therefore, it’s better to be safe than sorry by following these rules regarding your commission paid sales and technical staff.
Overall Facelift Of The Auto Industry
The automobile industry has undergone many facelift changes since the first vehicle was invented. It began with the ‘Steam Engine’ during the late 1800s. The steam engine was originally the engine of preference for giving automobiles power. By the 1920s, the internal combustion engine had become so advanced that the steam engine was being superseded. This new type of engine was so powerful that it is still being used in vehicles today.
From manual transmissions to safety seat belts and airbags, vehicles have undergone several mechanical and safety upgrades throughout the years. Electric and hybrid engines are also becoming more popular with car manufacturers, making automobiles more fuel and ecologically fuel efficient.
The automotive industry is undergoing even more facelifts over the years. From the use of social media for marketing strategies, people can now go online and learn all about a vehicle they wish to purchase and complete everything from the initial credit check to choosing the type of vehicle they want. All they need to do is go to the dealership, sign paperwork, and drive away in their new car.
Fixed pricing has become the new normal for car pricing. It takes away the need to haggle over a price, which very few people are good at doing anyway. The fixed price is set at a better price than what you would get at a competing dealership.
With all the overall changes that the auto industry has taken, car buying is easier than ever for the new car buyer. Ensuring every consumer receives fair treatment and prices every time they shop for a new or previously owned vehicle.