NADA 2022 is a wrap. After a pandemic-induced hiatus, the energy in Las Vegas last month was high. Attendees had a newfound eagerness to learn about new technology and embrace further digital transformation. NADA, for its part, announced support for a concerted effort to help dealerships sell electric cars.
Here are our six takeaways from the show:
One of the things we love about the industry is that a lot of dealerships are family businesses passed down through generations. With that comes a lot of tradition, which sometimes can translate to reluctance to change.
During COVID, everyone was forced to do business differently. That allowed some of the more old-school people and organizations to experience new ways to work. Now they’re asking, how can we continue on this trajectory? How can we become more progressive? What else is out there that we can explore?
Hybrid Work Comes to Dealerships
Even before COVID, forward-thinking dealerships were offering salespeople hybrid work. They could set their own hours and make their own appointments. The only time they had to come into the dealership was to meet customers for a test drive. Now other departments within the dealership are embracing hybrid work and are looking for technology to support it.
Websites have gotten much more advanced in the past few years, and they’re helping salespeople close deals much faster. Selling a vehicle no longer is a process with dozens of steps. Customers can pick out the vehicle and features they want before they talk to the salesperson. They come in much more knowledgeable and prepared, making it much easier to get to the endgame.
EVs Get a Big Push
There’s been a lot going on in the automotive world in the past few years: shared driving, short-term rentals, shared ownership models, car-as-a-service models, autonomous driving and new online-only dealerships. So many new things have been happening that it’s hard to know where to look.
Now NADA has narrowed its focus to helping dealerships sell electric vehicles, which it has characterized as the biggest shift in the 122-year history of the industry. They announced partnerships with the Center for Sustainable Energy and Plug In America to give training and education to dealers.
There are many factors pushing this to the top of the agenda. More manufacturers are offering electric or hybrid models. Sales of EVs are up 98% since 2020. In February of this year, President Biden signed a bill to invest $5 billion over 5 years to build a nationwide EV-charging network. And now we have skyrocketing gas prices.
Ultimately, every brand will need an EV and/or a hybrid option in their lineup in order to compete. NADA wants to make sure dealerships are prepared to speak to new questions about range, batteries, charging-station availability and home charging.
Inventory Shortages Drive Consolidation
Profit margins were at an all-time high last year, but access to vehicles was a nightmare. Smaller dealerships have had the hardest time getting inventory and we’re starting to see some of them sell out to bigger groups. With inventory shortages likely to continue for another 6-9 months, more consolidation may be yet to come.
Innovation Comes to Dealer Management Systems
New cloud-based software vendors are reinventing the DMS. They’re taking more of a fintech approach, with subscription business models, open APIs that allow third parties to build applications, and bi-directional integrations.
That should push legacy vendors to innovate. Ultimately, it will open up the ecosystem and make it more partner-friendly so that more people inside and outside the dealership can collaborate and share information.
As longtime sellers of technology to auto dealerships, the status quo has always been our biggest competitor. COVID smashed the status quo, and just about everyone now sees that they can no longer hold on to the old ways. Change is going to happen with or without them being on board. A new day is dawning.
Manufacturers are racing to see who can build the coolest EV. NADA leadership has crystallized their vision and mission around supporting dealers in selling the cars of the future. Given the amount of interest in new technology we saw at the show, dealers are ready and eager to start building the dealership of the future in which to sell them.
Pam Cichoke (pictured, above left) is vice president of Sales in the Automotive Vertical . Autumn Schutz (pictured, left) is the Director of Sales for the Automotive Div. at Corpay.