With the availability of new mobility models, a customer today has more options to be mobile than it was the case 10 years ago. What started with the entry of Uber as the first digital ride service provider, has now evolved into a variety of on-demand, subscription and sharing solutions. Instead of “buy or lease”, customers today have to make a complex assessment of whether owning a car is even worth it.
To illustrate the complexity graphically, we have taken five exemplary mobility solutions and plotted them on the basis of their monthly costs on the annual mileage. For all solutions, a compact car was considered, including all costs (depreciation, maintenance, repair, operating costs, registration fees, etc.).
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For people in urban areas who have a limited annual mileage and at the same time can do without using their car exclusively, car sharing is an attractive way to be mobile in a cost-effective way. For those for whom owning a car is a prerequisite, we have taken a closer look at the other options below.
In comparison, owning your own car is the most expensive option. It is linear, but takes on a greater slope at high mileages, which is due to the increased need for maintenance.
The three subscriptions compared are consistently lower priced, which can be explained in particular by economies of scale. The cars are insured as a whole in a fleet insurance policy and possibly made available at preferential conditions by the OEM. These benefits filter down to the customer, who can save up to €100 per month.
For OEMs, this market could become particularly exciting as they have the potential to find the most cost savings through direct rental to the end customer. Manufacturing, repair, maintenance, insurance and tyres can be ordered or carried out collectively. In addition, planning security and customer loyalty can be increased. Whether manufacturers will increasingly enter this market remains to be seen.
The car dealership is directly affected here. On the one hand, part of the business threatens to disappear, since new car sales may increasingly take place directly with the manufacturers or subscription providers; on the other hand, the customer’s information situation improves. The dealership needs to understand the customer’s situation very well and be prepared for it.
Examples of ways to respond as a dealership:
Panoff Consulting has been studying automotive dealership processes for many years and has gained insights into how you can adapt your strategy and optimise processes so that your customers are delighted with a smooth and enjoyable car buying experience. Contact us and we will show you how we can put our methods and competences to work for you to be prepared for the change in mobility.