Report Predicts Dealerships Extinct Within a Decade

[AudubonB]

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.

I can imagine the mess that occurred when, as you write, IR changed its policy toward dealerships. I cannot imagine it being any less messy within the auto industry.

Regardless, wouldn't you agree with me that the moral of your story is that for someone in the market for an industrial compressor would nowadays run, not walk, towards Atlas Copco rather than stick with IR? That is, if a company fouls up its disentangling from its dealerships to the detriment of its customer base that the logical customer reaction would be to abandon that company?

 

[kort677]

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?

people using mass transit for work has been the norm for decades in many places, the majority of places not well served by transit are the newer more sprawled out suburban like settings. I know this is especially hard for the cali crew to grasp but I know of many people, especially in NYC, who don't even possess a driver's license. so the answer could be many people have already forsaken driving their personnel vehicles in their daily commute.

 

[McRat]

people using mass transit for work has been the norm for decades in many places, the majority of places not well served by transit are the newer more sprawled out suburban like settings. I know this is especially hard for the cali crew to grasp but I know of many people, especially in NYC, who don't even possess a driver's license. so the answer could be many people have already forsaken driving their personnel vehicles in their daily commute.

There is just over 1 motor vehicle registration for every person with a driver's license in the US today. 260 million cars / 220 million drivers.

This is just under the ratio of 1970 before many mass transit programs were funded. 110 million cars / 100 million drivers.

 

[kort677]

There is just over 1 motor vehicle registration for every person with a driver's license in the US today. 260 million cars / 220 million drivers.

This is just under the ratio of 1970 before many mass transit programs were funded. 110 million cars / 100 million drivers.

that's all true, however that doesn't alter my assertion there are many millions of people who don't have a driver's license let alone own a car. there are millions of households that own more cars than are drivers in that household. as for 1970, there was mass transit in many urban areas long before 1970.

 

[jbcarioca]

people using mass transit for work has been the norm for decades in many places, the majority of places not well served by transit are the newer more sprawled out suburban like settings. I know this is especially hard for the cali crew to grasp but I know of many people, especially in NYC, who don't even possess a driver's license. so the answer could be many people have already forsaken driving their personnel vehicles in their daily commute.

True. In many large cities around the world a majority of economically active people possess neither personal vehicles nor driving licenses. In others, protypically NA, Australia and a handful of others big cities still require personal cars.

The future is already here in many such places. Since Uber and similar have arrived in Rio de Janeiro, for example, my extended family has gone from 14 personal cars to four, and two of the four are now being sold. These people are ones who have never set foot in traditional public transportation. Similarly, friends in San Francisco, three of them, have sold their cars.

Obviously the preceding paragraph is 'mother-in-law' research.

Still, Tesla is moving as quickly as it can to move to new operational models, for which vehicle autonomy is a big part. This will not impede huge sales and growth in suburban, exurban and many urban environments. The prospects are that Tesla will be a net beneficiary of such developments.

 

[calisnow]

I can imagine the mess that occurred when, as you write, IR changed its policy toward dealerships. I cannot imagine it being any less messy within the auto industry.

Regardless, wouldn't you agree with me that the moral of your story is that for someone in the market for an industrial compressor would nowadays run, not walk, towards Atlas Copco rather than stick with IR? That is, if a company fouls up its disentangling from its dealerships to the detriment of its customer base that the logical customer reaction would be to abandon that company?

Only if you believe in a world of perfect competition and markets which function well.