Latest Automotive Business Models and How They Will Change Competition
Right now, the turmoil in the automotive industry is that there will have to be some heavy changes. Cadillac just had their third Sales Director leave in two years, this one after ten months. GM Bogs down trying to fix supplier connections and Japanese made cars are calling back over three million Green cars because of the Takata airbags. Nothing is looking good in this industry.
Ford it seems has Found Two Ways to Improve their Business
Well, that is not true, as Hans Greimel points out. Ford slammed 88 new dealerships in China in 24 hours. This increased their number of dealerships to 750 in China the fastest building markets. Ford it seems has found two ways to improve their business. First instead of taking the stimulus deal they dealt with the unions. And now as Mr. Greimel points out, they are pushing a building market.
Centralizing the Factory that Produces Body Frames Made Out of One Material that is more Economical
According to Peter Wells, The present business model is not sustainable because of social, environmental, and economical means. His article, calls for a new business model to be developed and recommends an outline. One of producing body frames made out of one material that is more economical and efficient, producing this one type of body material and making them for the various companies. Developing green cars to deal with the social issue and environmental issue.
The Customer is not Responsible for the Maintenance
BMW is working with a new project in San Francisco, the Drive now. In this program the driver does not own the car, but pays for use, $39.99 and 0.90¢ per mile. These are electric cars, and an app tells the user where an open parking place is, and charging station. The user uses the car, then drops it off. The customer is not responsible for maintenance, or any other aspect of the car, they just pay and drive. The need to book a driving test and salespersons can be removed from the equation.
Pointing Out that there is No Valid Reason to Support Keeping the Dealerships
Forbes reposted an article from INSEAD Knowledge, about one of the most effective and issued strategies to date. Showing how one small car company can make waves by creating an effective model. It also shows the issue when going against the big three, and Politicians. Tesla is using a model that bypasses the middleman, the dealerships, without the need to book driving test, and allows the customer to buy directly from the manufacturer. It works to well. To the point that INSEAD feels this is the sign of the death of the dealerships. That there is no valid reason to support keeping the dealerships.
New Companies Might as Well be about to Replace the Old Tired Giants
There is enough to say the new models coming out in a troubled market, will be to be innovative. Also setting limits and controls on the Unions as Ford did to bypass using the Government Stimulus. Pushing new markets, and new ways of supplying the customer. As well as new marketing plans. All of these are going to either save the completion, or trim it down. It could also be that the new Companies might as well be about to replace the old tired giants.