Ok, this is something I have been thinking about lately and it should be interesting to see what people on the board think about it. Considering that most people seem to come here for info to their own vehicles and avoid the dealer unless they have no choice I can figure we are biased against them to start. While there are some good dealers, we hear a lot of horror stories of dealers and their staff that just seem to be out to get as much money out of the customers pocket as possible and just move on to the next. A good dealer can be a great asset to the manufacturer, but a poor one really hurts their reputation. The manufacturers aren't blameless in this either, sometimes they take the easy way out rather than deal with the customers concerns with a dealer.
So if you were a car company today and you were starting fresh would you go out and start up a franchised dealer network to sell your product to the public and service them? It may have been the way to go 100 years ago, but is it today? If you were a car company from China or India and you wanted to start selling a small inexpensive car in North America how would you market it? Multi million dollar dealerships have to be paid for, what if there isn't enough margin in the car to justify that much investment? Would you as a car buyer be willing to purchase a vehicle directly from a manufacturer or from another authorized retailer who carries the product?
With all of the options to research vehicles online, do you really need a sales person to sell you the car, or do you just need somewhere to go to test drive one and look at it in person to make up your mind? If the car company had it's own stores in larger centers would you go there to see and buy the product or to a retailer who carrys the product? Would you want the option of ordering the vehicle exactly as you want online from the manufacturer and having it delivered to a retailer near you?
For service, would you rather have the manufacturer set up authorized service centers for warranty service? Would you be willing to take your vehicle to a major retailer's auto center for warranty work? As far as regular service is concerned would you rather just find your own service facility or do it yourself and keep your own records and receipts of the work done for warranty purposes?
Another way of looking at this is to look at the real estate market. It used to be that just about everyone that bought or sold a house used a real estate agent. Now that there are many more options for researching and listing homes online, not everyone sees the need to go that way and pay thousands in commission for someone to act as your agent. If you can buy or sell your house on your own, why not your car? Is the dealership model outdated and ineffecient in todays marketplace?
So if you were a car company today and you were starting fresh would you go out and start up a franchised dealer network to sell your product to the public and service them? It may have been the way to go 100 years ago, but is it today? If you were a car company from China or India and you wanted to start selling a small inexpensive car in North America how would you market it? Multi million dollar dealerships have to be paid for, what if there isn't enough margin in the car to justify that much investment? Would you as a car buyer be willing to purchase a vehicle directly from a manufacturer or from another authorized retailer who carries the product?
With all of the options to research vehicles online, do you really need a sales person to sell you the car, or do you just need somewhere to go to test drive one and look at it in person to make up your mind? If the car company had it's own stores in larger centers would you go there to see and buy the product or to a retailer who carrys the product? Would you want the option of ordering the vehicle exactly as you want online from the manufacturer and having it delivered to a retailer near you?
For service, would you rather have the manufacturer set up authorized service centers for warranty service? Would you be willing to take your vehicle to a major retailer's auto center for warranty work? As far as regular service is concerned would you rather just find your own service facility or do it yourself and keep your own records and receipts of the work done for warranty purposes?
Another way of looking at this is to look at the real estate market. It used to be that just about everyone that bought or sold a house used a real estate agent. Now that there are many more options for researching and listing homes online, not everyone sees the need to go that way and pay thousands in commission for someone to act as your agent. If you can buy or sell your house on your own, why not your car? Is the dealership model outdated and ineffecient in todays marketplace?