The global epidemic caused a dramatic spike in demand for new and used automobiles, resulting in price increases for the US automotive sector. Yet, when lockdowns and a rising trend of online car purchasing came together, online vehicle sales in America grew by 25% in 2021, which was the biggest rise in the U.S. auto e-commerce industry’s growth over the previous ten years.
According to Wired, the procedure of buying a car online has become increasingly common and is quickly taking over as the standard in the United States, giving it the label “Onlinification” of the American auto industry.
Despite the advantages of online purchases, auto dealerships, and franchises are unwilling to embrace this innovative method of car marketing. Despite the pressure from both vehicle manufacturers and automobile purchasers, they are still sticking with outdated business strategies.
Ford is being sued in three states by dealership associations who claim the company is breaking the law by requiring them to spend up to $1.2 million to sell EVs like the Ford Mustang Mach-E and Ford F-150 Lightning according to (Jalopnik). Some dealers are pushing back against online initiatives handed down from automakers. Honda has expressed similar views.
The hybrid business strategy, which combines online and offline sales, requires dealerships to adapt. Companies need to develop relationships online since sales begin via email before moving to the showroom. Dealerships must continue to operate in the short term since they will continue to exist for the foreseeable future.
Even if the “Onlinification” of the American auto industry is a long-lasting trend, many consumers still like making in-person purchases of Televisions, sofas, and automobiles. Dealerships will endure for the time being, but sooner or later they will need to adapt to internet retail.
Although automakers have always been opposed to the idea of online automobile sales, the epidemic has expedited the trend. Electric vehicles (EVs) are currently accelerating the trend. Although to varied degrees, automakers like BMW, Acura, Ford, and GM have committed to selling their planned EVs online. Tesla was the first to offer a digital car-buying experience across its whole portfolio, but traditional manufacturers are now starting to adopt the concept.
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Andrew has always had a passion for cars and has worked in several consumer-focused roles throughout his career, including the financial advisor and vehicle salesperson. He completely bypassed financial success to become an automotive writer and drive new vehicles for a job, proving that being wealthy is tougher than social media influencers make it appear.