From franchise system threats to supply chain disruptions, the retail automotive industry has faced unprecedented challenges recently. On today’s Inside Automotive, we’re joined in the studio by Jim Ziegler, automotive retail veteran, speaker, and President of Ziegler SuperSystems, to give us his perspective on the current state of the automotive industry.
Overall State
According to the “Alpha Dawg,” the auto industry has “normalized” all our challenges over the past three years. Ziegler notes, “Going back to the pandemic, it dried up the sector, and several markets came to a halt.” While companies like Carvana and Tesla had their sales surge, everyone believed that was the new normal. But as a result, “We forgot how to sell, how to negotiate, and how to present our vehicles,” asserts Ziegler. The problem is that you need to put their training into practice because what they’re teaching people doesn’t match what they’re actually doing, not that the dealers’ employees aren’t trained.
"We don't have a knowing problem, we have a doing problem." - Jim Ziegler
In the last two to three years, the F&I market, according to Ziegler, has undergone substantial changes. “A paradigm shift has occurred. I’ve written about how I advocated for video F&I 10 years ago, and suddenly, it’s the new buzzword.” Today, however, there is an F&I issue. “People don’t know how to market the products.” Ultimately, Ziegler argues that the problem is a lack of presentation skills.
F&I
Furthermore, Ziegler explains how the industry has always been “menu-driven.” To illustrate, he explains, “It doesn’t matter what menu you’re using, whether it be technology, rentals, paper, or iPad, whatever you’re using, the presentation remains the same.”
“Some people will use digital retailing some of the time, but most people won’t do it most of the time.” - Jim Ziegler
Another concept that significantly impacted the market two to three years ago was digital retailing. However, it now stands as a result of the pandemic, and the globe expected people to buy entirely online. But that didn’t happen. Ziegler continues, “Progressive dealers will have digital retail tools available. Because, those dealers will employ whatever tool they need to succeed, even if the products aren’t used regularly.
