Message from the Secretary General – January 2018
Every year, the month of January kicks off with the Brussels Motor Show. While the latest cars on display there clearly proved that vehicles are undergoing a not-so-quiet revolution, coming with state-of-the-art connectivity technology and an expanding range of powertrain options, there are also other players in the automotive supply chain that are changing rapidly. Not least, the dealers that sell the vehicles that ACEA members produce.
To explore how digitalisation is reshaping the retail part of the auto business, ACEA teamed up with the European Council for Motor Trades and Repairs (CECRA) to organise a workshop about these trends in the side-lines of the biggest motor show in the Benelux. The overall objective was to bring dealers and Europe’s automobile manufacturers together to better understand the challenges and opportunities facing both ends of the supply chain in this increasingly digital world.
In order to provide some context to this dialogue, Dr Julia Saini (Global Vice President Automotive at research and consulting firm Frost & Sullivan) provided an extensive overview of the trends that are currently shaping automotive retailing. Dr Saini explained that the sector is moving from a more traditional, transactional model towards an experience-based approach that requires the latest digital technology. Not only did she highlight those major trends that are changing almost every part of our economy, such as big data and online retailing, but Saini also stressed the importance of tailoring the retail experience to specific customer groups – mentioning the increase in retail models focussing on female customers as an example.
Following this scene-setting presentation, Werner Straub of Daimler zoomed in on how auto manufacturers are embracing the digital world. Straub mentioned, for example, how the mobility market is being reinvented based on car-sharing and ride-hailing models. These are developments that fit in the overall trend of auto makers increasingly shifting their focus to customer-oriented products and services, tailored to meet individual needs.
To complement these views with the perspective of a dealer, Pierre Jallu-Berthier took the stage. The CEO, who leads a group of 23 dealerships in the north of Paris, made clear that the purchasing process of a car is constantly evolving, with the border between online and offline fading in particular. Using concrete examples, Jallu-Berthier illustrated how his dealerships are transforming their operations and sales practices to meet changing consumer behaviour – for example by leveraging the power of social media networks in reaching customers and prospective buyers.
The afternoon session continued with roundtable discussions on how the identified opportunities and challenges of digitalisation should be dealt with and the domains where manufacturers and dealers could work more closely together. During the enlightening discussions that followed, the recurring conclusion I picked up on was that all agreed that the customer should always be placed at the centre of the digitalisation discussion.
As new services develop around the booming data economy and smart vehicles, the roles of both manufacturers and dealers within the supply chain will be redefined. Hence, participants agreed on the necessity of better understanding the impact on the entire supply chain, from the manufacturer to the customer, through the dealer.
In addition, ACEA and CECRA representatives talked about the need for a European education programme to foster and improve the digital stills of automotive engineers and workers; making the sector more attractive to work in while strengthening Europe’s competitiveness and know-how in parallel. And that’s something that all ACEA members and dealers present agreed with: as Europe’s automotive sector we must steadfastly invest in the right digital skills now, so that our workforce is future-proof.
As the end of the workshop approached, both sides recognised the added value of continuing this dialogue in the future. Jean-Charles Herrenschmidt, CECRA’s President, underlined the importance of jointly identifying new ways of doing business that not only reduce costs but are also more efficient, thereby boosting synergies between dealers and manufacturers to the benefit of customers.
From my side, the major takeaway from this event was that it confirmed our common belief that the customer is at the heart of the relationship between auto makers and dealers. I do believe that dealers and manufacturers alike should always strive to provide the best product or service, and digitalisation offers great opportunities to improve the customer experience. Rather than focussing on the differences between manufacturers and dealers, it is instead vital that we work together on those things that we have in common, such as information sharing and developing joint business opportunities.
Erik Jonnaert
Secretary General of ACEA
