Toyota Dealership Model Future for Survival

[campbeam]

I do not know much about how a car dealership operates except seeing the new car model showroom, the service centre and the used car lot. To me, it is an integrated approach with the different areas creating synergy for profitability and survival. There is also an interdependence between the manufacturer and the dealership. In current times, we have seen how a particular brand's model have been made available via online pre-orders. The underlying success is that there is demand for the end product.

Just viewed this recent video from auto expert John Cadogan. I am thinking that Honda's new business model with fixed driveaway pricing will be interesting with potential buyers delaying purchases until there is a special deal. It may have some degree of success while there is a shortfall in available of supply for the new car market. However, there should be increased supply and competition in 2022. Reduced dealership network may then translate to fewer sales. Certainly expecting Toyota Australia to be monitoring this business model and learning from any shortcomings.   

 

[campbeam]

Following video outlines the changes coming to the USA car dealership model. Also I am thinking of a sales model used in other industries where there are display centres to view the product but no direct sales of walking out of the store with the goods. Instead it is possible to place an online order at the display centre and the goods are delivered directly to your address. Looks like this sales model is being applied to EV sales e.g. Tesla but there are still dealerships e.g. MG

 

[ZZT86]

Why would anyone buy a car with their hard earned, some not so hard earned, that they haven't driven ? Personally I think Honda are in trouble which is a real shame. Been on the cards for years as JD mentioned. They're not cheap & not selling enough of them. A bit like Tesla.

Personally I don't see the point of EV unless a) they’re battery tech can last a good lifetime, say 10 years & is completely clean & recyclable at EOL & b) they’re “cleanly” charged, ie: not by coal.

Battery tech aside, to me an EV should be far cheaper to engineer & manufacture & don’t think they’re worth their asking $$, even less if it’s “a one price fit’s all” suit.

 

[Tony Prodigy]

On 7/11/2021 at 2:11 PM, campbeam said:

I do not know much about how a car dealership operates except seeing the new car model showroom, the service centre and the used car lot. To me, it is an integrated approach with the different areas creating synergy for profitability and survival. There is also an interdependence between the manufacturer and the dealership. In current times, we have seen how a particular brand's model have been made available via online pre-orders. The underlying success is that there is demand for the end product.

Just viewed this recent video from auto expert John Cadogan. I am thinking that Honda's new business model with fixed driveaway pricing will be interesting with potential buyers delaying purchases until there is a special deal. It may have some degree of success while there is a shortfall in available of supply for the new car market. However, there should be increased supply and competition in 2022. Reduced dealership network may then translate to fewer sales. Certainly expecting Toyota Australia to be monitoring this business model and learning from any shortcomings.   

 

As always, Cadoges nails it again. I don't know who hired those suits at Honda, but the decision making over there smacks of desperation with a touch of arrogance and egoism. What a proper truck load of B.S the marketing knobs have dumped on us. I am in total disbelief. It's no wonder Honda is dying a slow death and the sad part is, they either can't see it or are in total denial. I used to love Honda cars back in the 80s and 90s but they have nothing which remotely excites me anymore.

The second half of the video had me in stictches though with his rebuttal of Mr Dusty Dousch 🤣🤣🤣 !
Cadoges is a Master in his element when he's faced with douchbaggery such as Mr Dusty Dousch. So funny and straight for the jugular I might add.

It's even worth watching a second time 😁

[campbeam]

5 hours ago, ZZT86 said:

Why would anyone buy a car with their hard earned, some not so hard earned, that they haven't driven ? Personally I think Honda are in trouble which is a real shame. Been on the cards for years as JD mentioned. They're not cheap & not selling enough of them. A bit like Tesla.

Personally I don't see the point of EV unless a) they’re battery tech can last a good lifetime, say 10 years & is completely clean & recyclable at EOL & b) they’re “cleanly” charged, ie: not by coal.

Battery tech aside, to me an EV should be far cheaper to engineer & manufacture & don’t think they’re worth their asking $$, even less if it’s “a one price fit’s all” suit.

 

Tesla has side-stepped the USA dealership model for good reasons. They are using a direct to manufacturer model to maximise their profits which are then used to fund R&D. It is only recently that they are building EVs profitably and moving into a rapid expansion phase. In contrast, legacy auto Manufacturer SAIC which owns the MG brand is using their existing Australian dealerships to sell their EV. There is a YouTube video of an interview with a MG salesman. They encourage buyers to test drive both the ICE and EV version of their MG SUV plus book a 24hour test drive. 

Agree that Honda is in trouble with declining sales. There is another video by John Cadogan predicting the demise of Ford in Australia. Totally reliant upon sales of the Ford Ranger and one mis-step or a market change could see their exit similar to GM Holden. 

In this thread, I have posted links to YouTube videos about BYD. It is vertically integrated manufacturer and its recent Blade battery technology is reportedly at the $83/KWH cost point which will enable it to sell its EV cars very competitively. 

https://au.toyotaownersclub.com/forums/topic/58708-latest-electric-car-news-and-developments/page/3/#comments

26 minutes ago, Tony Prodigy said:

As always, Cadoges nails it again. I don't know who hired those suits at Honda, but the decision making over there smacks of desperation with a touch of arrogance and egoism. What a proper truck load of B.S the marketing knobs have dumped on us. I am in total disbelief. It's no wonder Honda is dying a slow death and the sad part is, they either can't see it or are in total denial. I used to love Honda cars back in the 80s and 90s but they have nothing which remotely excites me anymore.

The second half of the video had me in stictches though with his rebuttal of Mr Dusty Dousch 🤣🤣🤣 !
Cadoges is a Master in his element when he's faced with douchbaggery such as Mr Dusty Dousch. So funny and straight for the jugular I might add.

It's even worth watching a second time 😁

John certainly exposes the marketing BS which is not going to magically transform into sales. I can remember a time in the 80's and 90's when their product range was highly desirable. People would walk into the showroom, be advised of a price higher than a competitor's model e.g. Mazda 626, leave, re-arrange finances and return to buy. Today, they are trading upon brand loyalty from enthusiasts and that is a declining market in the face of competitors with quality vehicles. Financial reality has a way of swaying past buyers onto other vehicles with established reliabity i.e. Toyota. 

As for John's rebuttal of Mr Dusty Dousch, I did wonder what upset him so much for the lenghty no holds jugular response. There has to be more background to cause John to have such a bad hair day.  

 

[campbeam]

On 7/15/2021 at 11:56 PM, ZZT86 said:

Personally I think Honda are in trouble which is a real shame. Been on the cards for years as JD mentioned. They're not cheap & not selling enough of them.

I have been reading about Mercedes Benz adopting the Agency model and now being sued by the various dealerships. Presumably they have seen the writing on the wall for Honda Australia and do not want to get sucked into that vortex.

Looks like Honda will have to review their pricing structure to make sales to survive in the Australian market.

 

[Tony Prodigy]

I actually watched that same video only a couple of days ago and thought to myself how arrogant of these companies to think that they can simply snub their customers and simply demand a fixed price for their vehicles. The last thing you'd want is to upset the masses and in doing so, it would be so easy for any customer to simply snub back and find another mark for their purchase. It's such a shame how the world has become.

[ZZT86]

I reckon the online thing is great for some things but only as an additional option for car sales & the like. Besides, it's quite an occasion just going to the dealer to see/feel/drive the cars you're interested in, no way I'd buy something like that sight unseen.

[campbeam]

20 hours ago, ZZT86 said:

I reckon the online thing is great for some things but only as an additional option for car sales & the like. Besides, it's quite an occasion just going to the dealer to see/feel/drive the cars you're interested in, no way I'd buy something like that sight unseen.

This was one topic that came up in discussion with a friend during an extended luch and a few beers.

Remember how Toyota did their online sales for the GR Yaris, selling their allocation of 1000 vehicles quicker than expected then scrambling to get another 500.  

I am certainly not expecting Toyota Australia to be adopting the agency model for their mainstream vehicles.

[Tony Prodigy]

I would be very confident in saying that Toyota would not adopt that agency model. It would be commercial suicide I reckon. The agency model smacks of desperation and arrogance. Mercedes are a very snobby and arrogant company and it doesn't surprise me one bit. The sales numbers will be the proof.