The global COVID-19 pandemic and associated enforced shutdown has changed the way we live and work, at least in the short-term. Wherever possible, people are working from home, meetings are being conducted by Zoom, and a business meeting in a cafe has become a no-no.

Most of the changes we are experiencing will hopefully be short-term, but some will be permanent, as workers and employers find new and better ways of doing things.

The most obvious example is the ability of staff to work remotely. A recent Gallup survey in the US found that 54% of employees would leave their current job for one that allowed them to work remotely. It’s not for everyone, of course, with many saying they miss the personal contact of the workplace, but the key word going forward will be ‘flexibility’.

How that works for Dealers remains to be seen. Much of car buyers’ research is now conducted online, even before this pandemic. A remote-working salesperson can take an online or telephone enquiry and book a test-drive, but dealerships will still need to cater for the person who simply walks in off the street to look at a vehicle. Service and repair work will still be conducted on-site.

Other factors that might impact car sales are a potential move away from people using public transport so as not to expose themselves to large numbers of people in confined spaces, and the current closed borders. With Australians currently unable to take that overseas holiday, will they instead spend that money on a new car? How do we encourage them to do that?

In such an uncertain economic environment, people might postpone any major purchases, such as buying a new car. Research conducted on in March saw 19% of 1600 respondents say they were ready to buy “now” and 50% say they were planning to buy within the next month. But new car sales continue to fall. Yes, they have been falling for more than two years now, but the lowest May new car sales total in 26 years – a 35% reduction on the same month last year – tells you the pandemic is having a significant effect on new car sales figures.

What is clear is that the customer experience is now the most important consideration. In a world in which people can now work in their pyjamas and participate in meetings from their lounge rooms, making our services accessible to consumers is crucial.

Consumers are demanding more online and personalised services, and the dealerships that embrace this and invest in digital sales tools are going to be the ones that thrive. Consumers are expressing a desire for a more flexible purchasing process that doesn’t necessarily have to be conducted during traditional business hours.

“For digital, this whole disruptive period with corona is an inflection point from which there’s no turning back,” Mike Jackson, chairman and CEO of AutoNation, the USA’s largest auto retailer, recently told investors.

Consumers want the ability to conduct as much of the buying process online as they desire. They don’t want to spend time waiting in dealerships. We have seen the likes of Tesla and other new auto retailers adopt the online model, and the enforced online world of COVID-19 is accelerating the need for all dealers to consider how they will adapt to this new paradigm.
Mr Jackson said the shutdown had boosted online auto sales. Contrary to fears that online sales would eat into more profitable dealership sales, he said AutoNation had not suffered a decline in profitability from sales conducted online versus those in a traditional showroom.

That doesn’t mean showrooms will become obsolete, but they will have to change, including new sanitisation processes and a greater mix of online and in-person sales.

“I think the bar has now been raised for any company that wants to perform in this marketplace. You need first-class digital capability, you need a safe environment for your customers and a safe environment for your associates,” Mr Jackson said.

“That is the Holy Grail going forward.”

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