Global Automotive Sales in 2021: The ever-changing landscape


AutoFacets STC

, Dealers

Gone are the days when OEMs used to decide the rules of the global automotive industry. Four of the most resolute and redefining automotive trends: connectivity, sharing economy, autonomous driving, and electrification are laying the foundation stone of the future of mobility.

The automotive landscape is shapeshifting at an unprecedented rate, especially after everything that 2020 brought along. Customer expectations are evolving, and they are leading to a modernized and entirely digital automotive sales journey. Today’s customer base is agile and aware, and the conventional car sales models need to keep up with it.

Once the reigning king of mainstream electric mobility, Tesla is now challenged by the likes of NIO, Rivian, Canoo, WM, and many more. These new entrants are not only bringing cutting-edge innovations with their products. They are also giving a new whole meaning to car ownership. This newly-evolving industry dynamic has posed a serious challenge to OEMs.

Traditional sales model: An inevitable jeopardy

The long-existing automotive sales models have been dealer-driven in most cases. They have played a decisive in terms of pricing, marketing and eventual automotive sales. A significant chunk of OEMs’ revenue comes from the bulk of new car sales, which dealers bring along. However, time has proved this existing model redundant and in need of a major transformation.

Direct sales: The way forward

To be a part of the online sales bandwagon, many prominent OEMs have come up with their own sales channels equipped with virtual walkarounds and digital showroom. However, despite the potential of these online stores, the adoption is slow, and there also have been plenty of instances when the customer experience was deemed inadequate.

It’s this trend that has compelled OEMs to adopt the direct sales model of the newcomers. This newly-popularized setup translates into OEMs approaching the customers directly on a first-hand basis and selling their vehicles directly to them. Hence, the middle-tiers of dealers and other stakeholders are eliminated.

It might sound like a simple proposition, but in order to be effectively deployed, OEMs need to gear up in the following three aspects:

  • The entire online car selling journey should be customer-centric, backed by the right technology and IT support.
  • The existing dealer network should be leveraged and integrated into the new ecosystem of online sales to escalate operations and customer touchpoints.
  • The current business models and revenue channels need to be thoroughly overhauled to incorporate the new implementations.


Adapt and accelerate

The disruption is intense; it is inevitable. Transforming retail sales is the best bet for OEMs to keep up with the global automotive industry’s changing trajectory. Technological advancements in electrification and autonomous mobility are investment-intensive. However, when the sales model is optimized, it will yield tremendous financial benefits. The retail cost would be cut down by up to 4%, and not only that, but it would also result in annual savings of more than $1 billion for an average mid-sized sales region. This transformation would enable OEMs to streamline their investments and keep up with industry trends.

This rapid transformation is opening new value pools with immense potential in shared mobility and platforms. These value pools will provide OEMs with much-needed direct access to their customers and elevate their value proposition from the retailer to the mobility provider.

That being said, delayed response from OEMs may cost them up to 30% of revenue to new competitors by 2035. They need to quickly develop and deploy an innovative sales model to future-proof their business from digital disruptions.

The future is competitive, but it is promising. As customers, new technologies will be accessible and deployment-ready for them. As OEMs, well, they must up their innovation quotient to stay relevant.

About AutoFacets

AutoFacets is a pioneer when it comes to offering world-class automotive IT solutions for the entire automotive industry. Right from the dealerships to aftermarket experience, we cover it all. Contact us for any query while we ensure that your business remains afloat and doesn’t go off track.


AutoFacets STC

Automotive speculators working with Dealers, Lease, and Aftermarket groups to solve their digital encounters. We gather a lot of research and industry standpoint from all over the cosmos of Automotive and Technology Innovation.

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