Economic confidence drives up auto sales
The beginning of a new calendar year allows dealers time to reflect on events from the past year and to plan ahead for the coming year.
Today, I’d like to gaze into my crystal ball and share my thoughts about the retail car industry in 2014.
One of the big stories these days is new-car sales. Last year saw record sales in Canada and I foresee a continuation of that trend if the economy remains healthy.
Pent-up demand (the average age of a car in Canada is 9.2 years, according to DesRosiers Automotive Consultants Inc.) should serve as another trigger for a continuation of brisk sales throughout the year.
In 2013, Canadians purchased a lot of pickup trucks, large luxury sport utilities and compact sport-utes, while sub-compacts were down considerably and compacts were up marginally (final figures aren’t yet available).
This suggests that Canadian car owners feel confident about their employment status and the state of the economy. Based on my appraisal of the market, this trend toward larger, and luxury, vehicles should continue.
One of the intriguing developments in the car industry is driverless cars. Google has been developing the software and technology for autonomous vehicles and car companies (along with the public) are becoming increasingly interested in where it’s going.
In my opinion, we’re still five to 10 years away from driverless cars being offered for sale in North America.
Although issues of cost and liability have yet to be ironed out, the buzz surrounding this innovative tech- nology is getting louder and will continue to gain traction this year.
The impact of technology will continue to influence the buying and selling of vehicles in Canada as well. Car buyers have shown a growing appetite for information about their intended purchases and an increased preference to do their research and buying online.
In a recent column, I discussed how car buyers are spending more time online, and less time inside dealerships, before their purchase. This trend of increased online activity should continue in 2014.
Which leads us to the topic of digital marketing.
Dealers have been exploring many web and social media options in an effort to connect with customers and prospects — everything from Facebook, Twitter and e-newsletters to search engine optimization, blogs and mobile ads.
In 2014, dealers will continue to explore digital/mobile options with a greater sense of urgency and purpose, and I envision that more result-oriented decisions will be made with regard to digital marketing activities.
The Trillium Automobile Dealers Association (TADA) will continue to host its successful, annual Digital Dealer Conferences in Ottawa and Toronto. Another trend I foresee in 2014 is an increased awareness about the dangers of distracted driving. Studies have shown that texting and driving, or talking without the aid of a hands-free device while driving, is more dangerous than drinking and driving. We all know that the practice of texting and driving is wrong, and drivers are beginning to recognize the real danger this poses to themselves and to others, and it’s becoming more socially unacceptable to be practicing this type of driving behaviour. TADA worked hard in 2013 to raise awareness of several issues that are important to member new-car dealers and car owners throughout Ontario. In 2014, our association will continue to advocate against key issues, such as the Drive Clean program, the Ontario College of Trades, distracted driving, increased taxation for Ontario motorists to fix the gridlock problems and road infrastructure in the GTA and Hamilton, curbside’s and other issues. This column represents the views of TADA. Email president@tada.ca or visit tada.ca. Benny Leung, president of the Trillium Automobile Dealers Association, is a new-car dealer in the GTA.