Reports of the death of automobile dealers have been greatly exaggerated.
I want to assure everyone in the automotive community that contrary to the prognostications of some — including Bob Lutz in the pages of Automotive News last fall — dealers are not going away. In fact, I could argue the changes faced by our industry today will lead to a new generation of dealers who will live far beyond any horizon we can see.
Yes, we are in a transformative time with the development of electric propulsion, connected cars and autonomous vehicles. But it's human nature to create transformation — it's called progress. Meeting change head-on and taking advantage of it by adapting is nothing new to dealers.
The entrepreneurial spirit and can-do attitude is in their DNA. Big data, robocalls and computer programs cannot replace the skills of a seasoned sales professional. When it comes to repairing vehicles, there will never be a robot that troubleshoots and fixes broken cars and trucks. Whom do automakers turn to when they can't find the problems created by their engineers? Our technicians.
Why am I so confident that dealers will prosper during this period of transition? In part, the generational nature of ownership. I have seen second- and third- generation dealers improve and build upon the businesses they inherited by implementing progressive, technically advanced and customer-focused business practices. There are thousands of examples, such as my longtime business partner Mack McLarty. Dealers are eager to try new processes or programs that will improve customer experience and increase efficiencies. The cumulative investment dealers have made and the great returns they enjoy are evidence of their ability.
I have worked side by side with auto dealers for the past 50 years and can promise you that they will find a way to capitalize during this period. Connected and shared cars open the doors to become fleet logistics managers. Subscription services give access to personal data about customers that will form the basis of even stronger customer relationships. Virtual vehicle and service sales programs are being implemented.
At the core, customers are driving this change. Technology is responding to the market. And who is best positioned to read the market and react first? Yes, it's car dealers.
Bob, please don't take offense at my disagreeing with you. You are one of the greatest automotive executives and designers of all time. I have always admired your work (except when you predicted that hybrid technology would fail miserably after I introduced the Prius at the Detroit auto show in the 1990s).
But the fact is, our business works best when the engineers design and build great vehicles and dealers do what we do best, sell cars and take care of customers. If anyone needs proof, just tour the new Toyota Motor North America headquarters in Plano, Texas. Arguably the best car company in the world just made a magnificent investment in the next 50 years of automobiles and its partners for life — Toyota dealers.