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Discussion in 'Cars and Transportation' started by S'toon, Jun 13, 2017.
Full article at:
Car dealerships could be out of business within a decade, says report
Please let their demise begin in Texas...
Texas, seriously, is an unusually interesting case.
First, Texas' longstanding fierce independence probably will eliminate any short-term change in dominant motor vehicle distribution;
Second, Texas' large cities, sprawling suburbs and well-marked roads will provide fertile ground for autonomous vehicle data;
Third, the relative paucity of public transportation will make demand-based ride-sharing a potentially easier sell;
Fourth, increasingly crowded highways and parking facilities argue to more ride-sharing too.
Fifth, the first point specifically is closely related to a general disdain of cooperative ventures...but...
Sixth, Texas has a robust and well-developed cooperative culture in agriculture, electricity and public utilities
So, I cannot wait to see the next major development in Texas, especially since car dealers do now have quite enormous statehouse influence or even control...
So much depends on achieving autonomy at relatively low cost. Cheap autonomy would kill dealerships through a shift to app-based shared taxi services.
I don't want to shatter anybody's dreams, but RethinkX appears to be stock speculator who paid a Stanford grad for a fiction short story. Stanford seems to be mostly a diploma mill today. A lot of really terrible science is spewed out for money.
The minute you hear somebody mentions Kodak as it relates to EVs you realize you are listening to somebody who does not have a firm grasp of reality. Kodak's demise was dealt by a single company called Fuji. Fuji wasn't the only Japanese company to crush an American company, and Kodak is only 1 of hundreds of examples.
So if you deal in predictions, you would have meant Fuji, not Kodak. This time it will be the Chinese who will do the 'disruption', and lack of dealerships and service plays into their hands better than it does Tesla. But they will do what Fujifilm did. They will crush the American EV producers on price, so things like dealerships aren't that important. You don't need dealerships if you can't sell your cars.
as much as fuji had a big role in the demise of kodak, their inability to see the future, digital, as the way photography was going is the probably the largest factor in their tumble to obscurity.
as for the dealership battles, many of the people here just don't understand the subtle corruption, base of power in state level politics that allows dealership groups to hold sway over the changing landscape of the auto selling world. Tesla does have a much better way of selling their cars but the auto selling business is a very big and entrenched business that is very well funded and these guys will use the capital that their money buys and the fact that they provide a huge amount of employment to keep the status quo of the business.
Odd that you use film as your example since digital is what did them both in. Fuji actually had some serious technical advantages too, beck in the film days, not least of which was superior color and wider availability of film options. Anyway, that is hardly analogous, is it? Without question Kodak, Xerox and Polaroid we dominant in the early 1970's and all three lost their markets due to complacency. The moral is that those who fail to understand technological change will wither. Price competition is not the point, although superficially it can always be used, it is rarely the cause of failure.
As for Stanford as a degree mill...I suppose you might just have missed that this is Leland Stanford Junior University.
rather than Stanford Financial Group.
Allen Stanford Convicted In $7 Billion Ponzi Scheme
You made an understandable mistake.
Leland Stanford Junior University is actually quite reputable,
Stanford Financial Group was the Ponzi scheme, actually not a degree mill.
if you need any more factual backup I'm sure many of us will be happy to help. Norco is a fair distance from Palo Alto, where the University is, but very nearby the university is the home of Tesla, Inc. You might know that company.
Kodak produced some of the first digital cameras. Many of the early players in the digital camera industry lost out, not just Kodak. I still have a $900 ($1400 corrected for inflation) Sony Mavica? digital camera from that era that took grainy 640x480 (0.3mp) images on a 3.5" drive. How often you see a Sony digital camera? Kodak also held early patents for cellphone camera technology before they were popular and even sued Apple for IP violations.
Kodak tried to monetize their their IP portfolio into areas such as pharmaceuticals and lost. Fujifilm tried to monetize in different areas and won. Kodak guessed wrong, Fuji guessed right.
I'm not disputing your opinion, but there are other factors.
as for sony who once led the way in televisions they lost their place of prominence as well, the one product has been their savior is their gaming systems
The researcher is Biography
He claims to be associated with Stanford University. There are a number of 'green' energy studies and other political or speculator funded papers from them that are total junk.
when you understand the funding angle of many of these "researchers" you'll see why the reports are skewed. right now funding drives a lot of the "research" and if the source of funding is promoting an outcome a researcher who comes up with divergent discoveries might see his sources of funding diminish. legacies schools like the ivies, stanford, melon, hopkins still have a lot to offer, but they are churning out a lot of intellectual/indoctrinated automatons
I can easily imagine that car dealerships will look much different in the future. Like "big box" department stores, they will disappear from the landscape as we now know them.
But I cannot imagine what the changes will be like for used or previously owned vehicles.
Some suggest that personal ownership of vehicles will disappear with the coming on uber and autonomous cars. I can't see that within my lifetime (I am elderly).
But I can imagine on-line ordering. Make all of the selections (color, interior, wheels, battery size .... the vehicle is manufactured to your order, and then you take possession at select locations .... isn't that exactly what Tesla is doing now? From what my brother described as how he bought his new S .... that is what he did.
Large inventories, with all colors and interior combinations to choose from will be a thing of the past. Thats my opinion.
Back to subject of privately owned (as opposed to mfr owned) dealerships, I encountered a mess that occurred when the dissolution of a dealership model has collapsed into anarchy.
Ingersoll Rand makes air compressors, mostly commercial duty units.
They dissolved their private dealerships, and all hell broke loose.
Service costs have now skyrocketed, ex - $1,300 for a PM (oil/filter change), that took 3 weeks to schedule "because we don't have oil or filters for your 5 year old compressor". They didn't replace one filter because they showed up without it, since it was still on backorder, but did bill us for it. Spares are now of inferior quality, but with a price bump and poor availability. Service can only be done by IR now because they restrict access to spares and consumables.
Some people assume that private dealers are 100% bad. It's really not that simple. There are good points and bad points to them.
I can 'shop' for spares among dealers, as well as service. Not to mention, shopping for the product itself. Competition is not always a negative.
the current dealership model is outmoded for sales, if the manufacturers could convince their dealerships tp transfer their energies into service it could be a way for their franchises to survive the wave of change hitting their sales model. right now auto dealerships are essentially two separate business models under the one roof. once you purchase a vehicle from the sales entity you have almost zero to do with that side of the business, all the interaction after the sale is with the service side. it would be quite simple, but costly for the dealers to lessen their sales side but continue their service side and remain a viable business.
One of the important forces that will be the gradual decline of dealers is the demise of private car ownership. Many young people were not in a hurry to get a license, and even less likely to purchase a car. Rideshare and CarShare are the future for many people. Think Tesla Network, Uber and Lyft. This reduction in total sales will impact dealers and manufacturers.
How many years do you think it will take before people are willing to commute to and from work with no car sitting at home or work? And surrender the privacy of private car ownership? Storing things in your car, customizing it to your liking, and the total freedom experience of driving will have to be abandoned. Anti-vandalism cameras will certainly put a damper on back seat antics as will central monitoring of car location.
Young people are waiting later for their licenses for many reasons:
1) Mandatory insurance laws combined with $2500 a year insurance for poor to middle class young Americans.
2) Mandatory FVMSS requirements that continue to push 'economy' car costs up, both new and used.
3) Tighter restrictions on age and more prerequisites.
4) The lack of high school driver's education programs.
In many ways, the US has declared war on young people today. Sure, you can join the Army at 17, but other than that, they would rather not have young people around.
I think he's right, but that it will be more like 20 years.
Not long. Cars really aren't what they used to be.
5) Lower incomes
6) Higher debts
Spend less money on transportation and more time and money on your smartphone. Irresistible, I suspect.
Depart By: Any Flexible[X]
Arrive By: 7:55am Flexible [ ]
Depart*: 7:30 am Arrive*: 7:54 am Fare: $10 [ ] Select <Confirm>
Ride Share Options:
Depart*: 7:25 am Arrive*: 7:54 am Fare: $6 (Save $48/hour): [ ] Select <Confirm>
Depart*: 7:20 am Arrive*: 7:54 am Fare: $4 (Save extra $24/hour): [ ] Select <Confirm>
Depart*: 7:15 am Arrive*: 7:54 am Fare: $3 (Save extra $12/hour): [ ] Select <Confirm>
Especially irresistible if it's really easy...
What about coal powered dealerships?
A huge resurgence, obviously.