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Challenges and Opportunities Ahead for Automobile Retailing

Article Highlights:

  • How dealers respond to new realities will set the tone
  • Consumers walking into a dealership today carry very different expectations

Across the automotive industry in North America, it’s easy to be optimistic about what’s ahead.

Overall, vehicle sales have made a steady comeback since the recession. In 2014, sales in Canada were just over 1.8 million vehicles for the first time, with forecasts for 2015 projecting similar results.

At the same time, there are fewer dealerships to serve more consumers. And, consumers walking into a dealership today carry very different expectations for what it’s like to buy and service a car.

Those dynamics have created what we at Reynolds describe as the “new normal” in automotive retailing.

Another dimension of the “new normal” giving dealers pause is this: In Canada, dealerships in 2013 recorded the lowest pre-tax profit margin since the depths of the recession. Plus, dealership net income after taxes is the lowest it’s been in four years.

In the midst of this “new normal,” the dealers I talk to are asking new questions and looking for new and different tools to better reach customers, respond to their altered expectations, and improve efficiency and effectiveness in dealership operations to grow the business.


  • How can I better focus my marketing efforts and control my advertising expenses?
  • How do I more effectively manage sales leads from all sources, including Internet, phone, and showroom? How can I better prevent leads from slipping through the cracks?
  • What new technologies can help my dealership deliver a more personalized, frictionless experience to customers in the service drive and improve service advisor efficiency?
  • Is the DMS evolving to be a more flexible, intuitive tool for my employees?
  • How can my management team access key business metrics in real time and in a format they prefer so they can move swiftly to resolve potential problems and profit leaks?


Dealers are clear on the challenges in the “new normal.” How dealers respond to these challenges will set the tone for how they manage their business going forward and for their future success.

I anticipate dealers throughout 2015 will continue to be primed to face these challenges directly and take advantage of the opportunities ahead. It continues to be an exciting time in the world of automotive retailing.

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Former Vice President of Sales, Reynolds and Reynolds Canada

Ian Reilly is the former Vice President of Sales, Canada, for Reynolds and Reynolds.

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