Search

Auto industry leaders see major shift in selling cars - Automotive News

A large number of global auto industry executives expect to see most new-vehicle sales moving to online transactions by 2030, with a steep rise in factory-direct selling, according to an industry survey by KPMG International.

A majority of executives told KPMG that they envision at least 40 percent of vehicles will be sold directly to consumers by automakers, as opposed to retailing through franchised dealerships.

"It's kind of a call to arms to dealers to get going and get ready," said Gary Silberg, KPMG International global head of automotive.

In its annual Global Automotive Executive Survey released last week, KPMG found that 78 percent of the leaders who participated think most new-vehicle purchases will be conducted online by 2030.

Almost half of the executives (46 percent) think 60 percent or more of all new-vehicle sales worldwide will be by automakers directly to consumers in their home markets by 2030.

Another 28 percent think 40 to 59 percent of sales will be direct-to-consumer by then. Only a few industry executives (2 percent) said they believe factory-direct sales will account for less than one-fifth of transactions.

The widespread outlook is significant, considering that the notion of factory-direct auto sales was unheard of in the U.S. only a few years ago. But the emergence of electric vehicle startups, including Tesla and Rivian, has brought about a new acceptance of nontraditional sales models. And retailers have moved rapidly toward a digital marketplace, with the pandemic crisis forcing the concept onto both dealers and consumers.

"There's a sense, globally and not just in the U.S., that people are fed up with that experience," Silberg said of going to an auto dealership. "You see it in this data. Those that can give a seamless, great experience are going to win in the marketplace."

KPMG polled 1,118 executives globally in August to gauge their expectations on the direction of the industry, finding that most anticipate that new business models will gain ground in the next few years. A large majority (84 percent) said they anticipate that by 2030, vehicle subscription programs will be competitive with traditional purchases and leases.

Approximately three-fourths of the executives said they think that in the next five years, offering a "seamless and hassle-free" buying experience will be a more important factor in vehicle purchase decisions than such traditional considerations as the vehicle's driving performance or its brand or image.

Silberg said that as more of the shopping process moves online and new entrants shake up the retail model, franchised dealers will need to invest in data and analytics to "understand their digital customer."

That ability to identify and analyze the digital marketplace, Silberg predicted, will further drive dealership consolidation, with larger groups with access to more capital and data having advantages over smaller stores.

"You'll see this continued consolidation of the industry," he said. "You'll get bigger and bigger dealers with more and more digital prowess and economic prowess."

The study found that most auto executives were optimistic about the industry's long-term profitability and the adoption of EVs, even as they expressed concern about short-term problems, such as the tight labor market and microchip shortage.

KPMG said 53 percent of its survey respondents considered themselves extremely or somewhat confident that the industry will achieve more profitable growth over the next five years, compared with 38 percent who said they were concerned.

The optimism about profitability comes even as a majority of the executives said they were worried about the supply chain for semiconductors and commodities, such as steel and aluminum, rare-earth elements, lithium and other components needed for batteries.

At the same time, 57 percent of the executives said they expect the cost and complexity of tariffs, trade rules and regulations to significantly or somewhat increase over the next five years, compared with just 17 percent who expect them to decrease.

"There is definitely concern on the supply chain moving forward," Silberg said. "That was the dichotomy for the industry: long-term optimism but near-term concern."

Auto executives also say they expect the EV market to grow significantly worldwide over the next decade.

On average, executives said they expected 52 percent of all new vehicles sold in the U.S., China and Japan to be electric by 2030.

EV sales are expected to make up 48 percent of the market in Western Europe by then, compared with 41 percent of sales in Brazil and 39 percent in India, according to the survey.

But Silberg said executive views on market share vary greatly, from those who anticipate EVs will make up 5 percent of new-vehicle sales in their home market by 2030 to those who think they will make up 90 percent.

"It's all over the board," Silberg said. EV market share will be "up, but there is no consensus on what it might end up being."

One-third of the survey's respondents were CEOs, presidents or chairmen, while 29 percent were C-level executives.

The rest consisted of managers of business units and department heads, with companies ranging in size from less than $100 million in annual revenue to more than $10 billion.

Adblock test (Why?)

Article From & Read More ( Auto industry leaders see major shift in selling cars - Automotive News )
https://ift.tt/3IlZaYM
Auto

Bagikan Berita Ini

0 Response to "Auto industry leaders see major shift in selling cars - Automotive News"

Post a Comment

Powered by Blogger.