Are Auto Dealers & The Franchise Business Model Dead Meat? (or at least Impossible Burgers)

Will the Failure to Adapt to Digital Vehicle Buying, Outmoded Franchise Laws,
& Millennial Customer Needs Dismantle Traditional Dealers Business Model?

Digital business models are working (e.g. Carvana ) and in a few dealerships.
Electric Vehicles being adopted and Autonomous Vehicles progressing.|
Consumer shifting to online buying and responding to Covid-19 disruptive changes.


SO: One or all three will quickly demolish traditional auto dealer business model.
In the next 5 years, the franchised dealer model will be changed by overwhelming pressure.
Franchises have been a protected species for a 100 years in its current regulated / lobbied form.

SO WHAT: Just like the vinyl record industry [ Kodak & Polaroid], maybe it is time.

SOLUTION: [What Dealers Can Do]
Top 10% of dealers talking about how to change & adapt.
Seeking what needs to done to come to grips with all these new things.
Discussing change management is a waste of time;
Dealers need to discuss how to adapt to an uncertain future where they will not have franchise protection.
Need to gather the industry leaders at or before NADA ASAP — and deal with this issue.
Have honest discussion about either truly adapting & listening to the customers OR– simply selling out soon.
Just like the railroads, the auto dealer’s biggest asset will be real estate.


This Post is authored by Mike Pochan, Industry Entrepreneur and Analyst & Carnegie Mellon Faculty;

 See “The Unexpected Future of the Dealership” from AutoSuccess Magazine –

FIGURE: The ‘Chasm’ of the Technology Adoption Curve will most likely swallow 2/3 of the Traditional Dealers.

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