The automotive industry is complex and fast-moving, with manufacturers and their suppliers increasingly adopting a truly global view of the market.
Around the world, consumers are demanding an abundance of premium high tech features on vehicles, while at the same time expecting cheaper prices, parts, accessories and maintenance fees. Working in the consumers’ favour is global over-capacity, leaving manufacturers and dealers in a situation of fierce competition and decreasing margins.
Against this difficult background, manufacturers have attempted to achieve growth through company mergers and acquisitions, and by implementing global strategies. As the vehicles on offer around the world become increasingly similar in design, features and price, it will be the companies that quickly pick up on new trends, such as internet shopping and other alternative sales strategies, who will gain a competitive edge.
Australia has been affected by many of the trends impacting the industry worldwide. Although 1998 was a record breaking year in terms of vehicle sales (as correctly forecast by ACNielsen’s Charlie Nelson), this record has come at a cost of reduced profits to manufacturers. The Asian economic slump and widespread uncertainty over tax and tariff issues have also left their mark on manufacturers’ bottom line.
Australian vehicle buying habits have evolved as well, with the wide spread adoption of four wheel drive vehicles and mini-small cars. It is here, in the small car segment, where Korean produced cars have cut the deepest into the local manufacturers’ market share. This has had an impact not only on the sales of new small cars, but also on the used car market.
In Australia, customers are anticipating the coming of the millennium, when they believe newly developed, highly technological vehicles will revolutionise driving as we know it. The challenge to the automotive industry will be not only to meet these motoring expectations, but to ensure that customer service will equally evolve to a higher level. Developing different and unique ways of offering customer care and service must be the focus of future strategic planning for companies operating in the Australian market. It will be the nature of the triangular relationship between manufacturer, dealer and the customer that will determine which companies will flourish or wither in the new millennium.
Your competitive advantage
ACNielsen’s Automotive Unit has a team of executives dedicated to helping the Australian automotive industry understand their business via intelligent application of marketing research to specific business issues.
In addition, ACNielsen offers the industry Motor Focus, an omnibus program specifically designed to give quick, cost-effective information on the automotive mrket and consumers.