Pub. 16 2017-2018 Issue 1

N E W J E R S E Y C O A L I T I O N O F A U T O M O T I V E R E T A I L E R S I S S U E N O . 2 , 2 0 1 7 10 new jersey auto retailer With more people living and working in urban areas; a growing desire to lessen our dependence on fossil fuels; and the emergence of the sharing economy, the automotive retailing industry will be transformed in the years and decades ahead. All consumers want two things- freedom and mobility. In the past, freedom and mobility required individual vehicle ownership. Today consumers have more choices. Think about it, 15, 10, even 5 years ago, there wasn’t much choice. Now, there are options and, in the future, consumers will have even more choices when it comes to personal mobility. THAT is the game changer for the auto retail business. Imagine a future where consumers buy a yearly subscription or pay a monthly fee for the ability to use any vehicle they want, any time they want. The market for privately purchased personal auto- mobiles is likely to shrink, while fleet purchasers placing vehicles into the shared economy will likely grow. While this may sound like terrible news for the auto retailers, it will not decimate new vehicle sales. Right now, vehicles purchased by consumers sit idle in a driveway or parking lot 95% of the day- one of the reasons the average vehicle on the road is nearly 11 and a half years old. In a shared mobility economy, these vehicles will be used much more often, will cycle through the marketplace at a much faster pace and will be replaced far more often. So what role will dealers play in the future? As more cars are sold through fleet sales channels, fewer will be sold through tradi- tional retail channels. But these vehicles will need to be serviced, and they will need to be remarketed as used vehicles. Who will service them and remarket them? The answers to these questions will shape the dealership of the future. The future of mobility will probably be a combination of the var- ious scenarios discussed in this column. Regardless, the future of personal mobility WILL change the auto retailing business as we know it. The auto retailing business has been changing ever since the first dealership opened its doors. Whether dealers continue to play a central role in the marketplace depends on their willingness to adapt. Sure, you’ll still sell lots of new (and used) vehicles and you’ll still service what you sell to individual owners. But, as technology advances and consumer choice expands, dealers will be forced to reinvent themselves as key players in the personal mobility market- place. They may be owner/operators and/or staging areas and/or service facilities for ride-sharing and car-sharing fleets. They may be brokers for car-sharing services or personal mobility providers. They may be remarketers of used ride-sharing and car-sharing vehicles. They be a combination of all these things or something else completely different, because if there is one constant in the automotive retail industry, it’s change. PRESIDENT’S MESSAGE  continued from page 7