Trent Broberg is an automotive professional and CEO of ACERTUS.
Since 2020, car dealerships have faced monumental disruptions and demanding situations in their supply chain. The unprecedented Covid-19 pandemic and resulting chip shortage have contributed to the lowest stock levels the auto industry has experienced in decades. In the past four years, car calls have surpassed the source at dealerships.
Fortunately, those constraints have begun to ease, as new vehicle inventories are expected to reach a four-year high in 2024. Dealer inventories are recovering, car sales are rising, and dealerships are better placed to meet pent-up demands for new ones. vehicles. Vehicles.
However, there is a problem with this influx of new vehicle stock. Many dealerships have been operating with limited sources for so long that adapting to pre-pandemic stock levels is a huge challenge in itself. Adapt in one fell swoop to emerging stock levels. They will create bottlenecks in the processes they have relied on in recent years.
Let’s take a look at the demanding situations distributors will face in the coming year and how AI, coupled with the right logistics partner, can help distributors overcome any obstacle in their way.
Getting new stock to the checkout is a lot more confusing than driving new cars from point A to point B. With vehicle production and stock levels expanding across the board, dealers will want to quickly increase their transportation needs, optimize shipping loads, and track stock. in the shortest time imaginable.
Now more than ever, dealers will need seamless access to carriers, data on the prestige and prestige of shipments, as well as responses that allow cars to move to lots where consumers can see and purchase them as temporarily as possible.
Dealerships offer a wide diversity of facilities at each and every level of the journey, from transportation and garage to on-site service and maintenance. Any vehicle from an auction, trade-in through a consumer, or other broker will require preventative maintenance before arriving. in the batch or being delivered to a consumer.
However, as fewer cars have been manufactured and sold in recent years, many maintenance providers now have less capacity. Due to supply chain challenges, some auto parts are also in short supply. This causes car owners to keep their vehicle and forgo maintenance for longer periods. of time.
As a result, making maintenance plans and executing them on time will be tricky for distributors until suppliers fill their staff, portion inventory, and operations to pre-pandemic levels.
Another challenge dealers across the country will face next year is the number of electric cars (EVs) in their inventory, as electric cars spend more time in the field. Electric car inventories increased 506% compared to last year. Electric vehicles stayed in parking lots for 82 days, compared to 64 days for gas-powered vehicles.
Due to their higher weight and battery characteristics, electric cars have urgent shipping and garage needs compared to their gasoline counterparts. Carriers will have to comply with strict cargo weight limits, and the extra weight of an electric vehicle means fewer electric cars can be shipped right away.
In the face of these new challenges, distributors deserve resilient equipment to help them optimize their supply chain logistics to cope with the explosion of incoming stock. In a nutshell, there are three main stages in the dealership’s supply chain: preparing incoming stock, preparing stock for sale, and optimizing vehicle pricing to drive sales.
Skilled distributors and logistics partners are increasingly employing AI-based knowledge and equipment in the supply chain at each of the three stages. To overcome the aforementioned transportation, maintenance, and sales challenges, dealers want unprecedented visibility, transparency, and power. opportunities to keep stock flowing at the checkout and in the hands of buyers.
1. Inbound Inventory Management: Since new cars are delivered on-site in a much larger volume, dealers will want to keep incoming stock moving temporarily and efficiently, while reducing transportation costs. Dealerships are looking for full-service logistics providers that can offer a combination of human and AI-based responses to achieve any of those goals. Real-time, AI-powered freight recommendations help partner carriers locate cargo temporarily and reduce downtime. It’s also easier for distributors to see the location of stock in real-time. and prepare for their arrival, thanks to AI-enabled GPS tracking of incoming vehicle deliveries.
2. Prepare stock for sale: While service providers face their own challenges, dealers want fast and reliable maintenance responses to deliver cars in saleable condition. Today, with a greater diversity of gas, electric, and hybrid cars on the market, even more maintenance and garage needs want to be educated. Dealers deserve to offer off-site garage services to facilitate EV lot stocking. Many of them also provide transit and garage maintenance, as well as electric car charging. All of this is helping to keep the chain of origin of automobiles in saleable condition.
3. Price Optimization to Drive Sales: Merchants deserve to employ device learning to analyze giant sets of old knowledge (transactional and operational insights, as well as insights from external sources) to identify the most compelling values for consumers, shippers, and carriers. Optimization of the value of the source of equipment Optimal prices at each and every level of the origin chain, expanding the possibilities of on-time deliveries and sales.
As vehicle inventories grow, it’s more vital than ever for dealers to keep their supply chain moving and flexible so they can maximize full load opportunities and bottlenecks.
These bottlenecks can exist at each and every level of the origin chain: efficient transportation, optimized maintenance, off-site storage, and optimized pricing. Adopting a holistic technique for those advancements in the origin chain will get new cars into the hands of drivers faster, according to visitors. satisfaction and increase the likelihood of visitor loyalty and positive referrals.
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