We all rely on the automobile, but what next for an over-serviced industry with overcapacity and limited product differentiation? Sizes, and hence new vehicle sales, are critical for vehicle manufacturers, and the battle for sales continues relentlessly. And reducing costs is a necessary element of remaining competitiveness, as new, lower cost manufacturers reach high levels of quality. The competitive pressure is greater than ever before. Increased sales and lower costs are the mantras for survival.
New sales are the key to sustained growth, driving additional earnings through finance and after sales services, and generating funds for continued research and development. With the similarity in product, the key for all is to “get closer to your customer” – a tough call, given the franchise retail model, both for vehicle manufacturers and parts suppliers.