“Digital disruptors” already playing a big role in motor industry, says Nada

Brian Joss – The 23rd Annual National Automobile Dealers Association (NADA) Dealer Satisfaction Index (DSI) awards evening took place in Gauteng, when senior management from manufacturers and importers, dealer principals and management from dealer groups, as well as financial institutions, gathered at WesBank’s head office, to network as well as receive their awards.

“The DSI survey forms a vital link in the relationship between dealers and manufacturers. This year’s survey showed a high completion percentage rate of over 80% in the passenger vehicle section,” Mark Dommisse, national chairperson of NADA, told the group.  “We also had one of the highest completion ratios in DSI history this year, which is extremely encouraging.

“The DSI survey provides the dealer body with a platform to provide robust feedback to manufacturers and importers. In most cases, the findings are used to benefit the working relationship for both parties,” said Dommisse.

Over the years, the results of the survey have been used by dealer councils and manufacturers as an effective management tool to address areas of concern and thereby improve service delivery throughout the entire value chain to the ultimate benefit of the consumer.

Dommisse addressed the very real economic factors facing the industry. “Political uncertainty has had a major effect on investment appetites, as well as consumer spending on large ticket items,” said Dommisse.

“While consumer confidence is relatively high, the rest of the underlying metrics like household debt, inflation, fuel, and increased consumer taxes are putting our businesses under pressure. Apart from a very slow economy that hasn’t quite manifested in the Ramaphoria everyone had hoped for, the retail motor industry is facing frightening pressures.

“We need to embrace the ever-growing presence of digital disruptors in our game. They are competitors to the traditional dealer model, used car supply and our F&I departments and we are being challenged. We need to evolve and continue to align with this new generation of customer,” Dommisse added.

Speakers shared a number of insights of the retail automotive industry. Additionally, all three speakers shared similar thoughts on the “disruptors” the industry faces.

Paul de Vantier, managing director, Lightstone Consumer, noted that when it comes to online marketing and dealing, this industry has seen a growing number of people who will transact the whole deal online, from start to finish, with the dealer simply being a delivery and service point.  This isn’t something that’s coming, he said, it’s something that’s already happening.  And he is convinced that this trend will grow.

De Vantier also made note of South Africa’s ageing car park. In 2015 it was 9.6 years, but now it has aged to 9.9 years. He attributes this to rising vehicle prices, affordability and general consumer confidence. “Consumers either can’t afford to replace their vehicles or lack the confidence to commit to long term financing deals,” stated De Vantier.

Ghana Msibi, the Executive Head of Sales and Marketing at WesBank, shared his views on the significant changes that are happening in the motor industry. The main emerging trends that Msibi highlighted are electric vehicles, connected cars, mobility as a service and autonomous vehicles.

 “We cannot ignore the largest disruptor out there – the new generation of customers.” said Msibi. “As an industry, we can’t continue to offer them solutions on the same basis as we’ve done before.

 “Our traditional approach has given us a superior footing in the industry, but if we don’t meet them halfway, they will ultimately find alternatives that suit them.”

Msibi said the existing strength of industry players provides a powerful platform to offer services to the new generation of customers.

CAPTION: Mark Dommisse, chairman of the National Automobile Dealers Association (NADA), and Ghana Msibi, executive head, sales and marketing, Wesbank.

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