Auto Dealers, hang in there. The future looks bright


It’s been more than a couple of months since America implemented SIP, which threatened to bring the Auto Industry to a complete halt. Now that different parts of the country are opening up, there’s more good news to share for Auto Dealers based on trends from Wuhan. Within the last few days of Dealerships opening up, sales have already begun bouncing back close to their normal figures. 

During times of crisis, it’s easy for all of us, including auto dealers to focus on what’s out of our control. The good news is that people are getting back to the new normal. It’s time to shift our mindset by focusing on what we can do today and how it will impact tomorrow. No surprise, but the past several weeks have been a struggle for all Auto Dealers to hit their goal during COVID-19. 

However, auto dealers continue to adapt and mitigate hesitant shoppers’ concerns via virtual showings, rigorous and frequent cleanings, and at-home test drives. And just in case you need a little extra motivation to hang in there, here are auto dealer trends from the recovering city of Wuhan. (Spoiler alert: they’re quite promising.)

Public Transportation on the Decline

There’s no way to limit contact with COVID entirely, but public transportation is like walking through a rather crowded minefield. It should come as no shock that there are more first-time buyers than ever before. While it’s not always easy to convince people to buy a car, it becomes a lot more straightforward when the matter is directly tied to health.

Fewer People Taking Shared Rides

While shared rides certainly reduce how many people you come in contact with, there’s still that dreaded element of the unknown. The real question is less who’s right beside you and more how many people have touched the exterior and interior of the vehicle before you stepped into it?

Shared Rides Cost More

A person spends an average of $333 a month on shared rides, but only between $200 – $300 on an average payment for a sedan. And while a person will need to factor in additional expenses (e.g., gas, insurance, etc.) when they are buying a car, the marginal costs they spend are quickly mitigated by peace of mind.

People are likely to avoid air travel for months

Airports are said to be an area where individuals can more easily come into contact with the virus. While states and airlines are taking extensive measures to protect travelers, we don’t expect the same number of people flying. Instead, travel by road is easier and safer. This summer, trends predict more local vacations by road than by air travel, pointing toward new car purchases.

A Boom in Secondary Vehicles

It’s not just first-time buyers who are being lured into dealerships in Wuhan right now, it’s also households that need an additional one. We cannot stress enough that personal vehicles are seen as a necessity for anyone who’s vulnerable to the virus.

Manufacturers Are Providing Deep Discounts

With the economy’s current state, automotive manufacturers understand that getting people into the dealerships starts with offering the right deals. That’s why they’ve been taking steps to sheer their numbers down.

Car Insurance Deferring Payments

When drivers are being ordered to stay in place, it’s unfair to ask them to pay car insurance when they can’t use their vehicles. These savings will only entice those who were considering a new vehicle anyway.

Overall, there’s a strong signal for a really good bounce back on sales. Already auto manufacturers are starting to open their operations to keep up with the future demand. In fact, the week ending May 10 was the sixth consecutive week of improving vehicle sales at dealerships. Buyers are now expecting that dealers follow safety regulations, and it is becoming an important factor for showroom visits. It is important to let your audience know the measure you’re taking at your dealership to ensure safety and protection for your customers. The lessons learned during the past few weeks, and the safety measure that you’ve put in place, are going to pay off big time sooner than you can imagine. Now more than ever, it’s time to communicate clearly to your customers and drive showroom visits. Give us a call, and let’s work together to boost your sales using Digital Advertising.

DemandLocal has been adamant about following the trends for auto dealers, and we don’t believe that you’ll be disappointed next quarter. If you’ve been wondering where the light is at the end of the tunnel, there’s every reason to believe that Q3 and Q4 will make up for declining sales. The real challenge may be preparing for the extra demand.

Written by

Christian Ferrer

Christian serves as VP of Automotive Sales and Marketing for Demand Local. Christian has been with Demand Local since April of 2010 where he partners with dealer groups and ad agencies providing new and innovative digital marketing strategies that help clients grow their brand, market share and profit margins.

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