Auto dealers and car manufacturers may not always see eye to eye, but the need for cooperation between the two is more important than ever. On this episode of Inside Automotive, CBT News anchor Jim Fitzpatrick is joined by Jessica Stafford, Cox Automotive’s senior vice president of consumer solutions, to discuss how changes in the consumer environment have made it necessary for OEMs and retailers to work together.
Cox Automotive recently published its quarterly dealership sentiment index revealing shifts in attitudes among the auto dealer community. Last year’s primary concern was inventory, as car manufacturers struggled to maintain output in the face of supply chain disruptions and factory closures. But since 2022, this focus has shifted to the economy and the challenges posed by rising interest rates and inflation. “So what was an inventory problem for our industry before is quickly becoming a potential demand issue,” explains Stafford.
Fostering collaboration between car manufacturers and auto dealers is essential to addressing these anxieties. Stafford recently participated in the Automotive Press Association panel, where she and other industry experts discussed issues affecting franchises and retailers. One of the key takeaways from the event was the importance of creating a seamless experience for customers through digital retail. “We talked a lot about helping to create seamless processes for buyers that introduce everything from F&I products to approvals…and making it more approachable for the consumer,” Stafford remarks.
This talking point underscores how many automotive industry insiders, on both the production and sales sides, have become more focused on customer service. The process of buying a vehicle now looks quite different than it did before the COVID pandemic. This means that car manufacturers and auto dealers must adjust to new consumers, methods and preferences to boost demand. Acclimating to this market is advantageous to all parties, Stafford notes: “Deep collaboration among all parties in our industry will end up being, of course, a better experience for the customer…but then serve all components of our industry, manufacturers and dealers alike.”
But even as auto dealers and car manufacturers evolve, they cannot afford to ignore the basics. “As we see car shoppers out there spending even more time online…they’re also still relying quite a bit on brick and mortar stores for a lot of areas…” Stafford explains. This goes back to the idea of making the car-buying experience seamless, allowing consumers to make their decisions at their own pace. “As our world is evolving to this place where we need to meet the needs of multiple segments of shoppers…the demand for flexibility is huge,” she continues. “As our industry evolves, there’s this need to address the balance of helping customers find the right car they want and need, but perhaps enabling or helping them get to the vehicle that’s not right in their local area.”
Ultimately, auto dealers and car manufacturers should see these new developments not as pain points or challenges but as opportunities to improve the customer experience. Doing so will allow the automotive industry to boost demand in any economic environment.