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Are Manufacturers Getting Ready to Dump Their Dealerships?

ARE DEALERSHIPS OBSOLETE? This article is a collection of Ziegler’s opinions and his interpretation of current events as he sees and his conjecture of what it might mean.

The Perfect Storm. It all began during the shut-in, locked down period of the Pandemic.  We’ll call it the ‘Amazon Effect’. Consumers discovered they could order products and services, even groceries, online which could be delivered to their homes almost immediately, a generation of instant gratification.

Even though they’ve only captured a small percentage of retail sales, the new players like Carvana, Vroom and Tesla have captured a growing niche within the market, but don’t lose sight of the fact it’s only a small percentage of total sales nationally, to a very elite clientele so far.

In the meantime, several other situations created by the Pandemic occurred. We have a shortage of microprocessor chips and raw materials to build the cars caused by supply chain issues and labor shortages. On top of that, the manufacturers are having to compete with cell phone companies and computer manufacturers, and suppliers in almost every other industry that also need these chips.

Read the whole article on LinkedIn here.

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