More cars selling online
Apr 20, 2020 12:46PM
By David Dykes
By Cindy Landrum
As the coronavirus spreads across South Carolina, auto dealers have changed the way they do business, and some say that the changes will probably remain long after the pandemic is over.
Car buying is going virtual.
While some customers are starting their car search online and conducting negotiations by phone, email, or videoconferencing, others are completing their purchase from start to finish without having to step into the dealership at all.
During the coronavirus pandemic, Robert Crews has seen a significant decrease in the number of shoppers at his two dealerships in North Charleston. But a larger percentage of those visiting Crews Chevrolet and Crews Subaru of Charleston are buying than pre-coronavirus, he said.
“The people who are coming out are serious about buying,” Crews said. “They’re not just kicking the tires; they are looking to replace a vehicle.”
To serve customers who either can’t or won’t visit car lots, South Carolina’s auto dealers are going to them – either physically or virtually on platforms such as Facetime.
From test drives to appraisals of trade-ins to completing paperwork, car buying now can be completed in a customer’s driveway, said E. Sims Floyd Jr., executive vice president of the South Carolina Automobile Dealers Association.
“We’ve basically moved our office to the customer’s driveway,” Floyd said. “Customers don’t even have to leave the house.”
Before the pandemic, new vehicle sales in 2020 were forecast at 16.8 million. Now, it’s around 13 million.
New vehicle sales plummeted 37.9 percent in March compared to a year ago, according to a National Automobile Dealers Association analysis. The NADA said new vehicle sales were on a healthy pace until mid-March, when widespread social distancing measures started nationwide.
April hasn’t been as bad as initially thought, however. J.D. Power had expected sales to decline as much as 80 percent in April. But through April 12, sales were off by about 55 percent.
“We have seen it pick up over the last week and a half,” said Ryan Norris, co-owner of Toyota of Easley.
Some of that traffic is because customers are taking advantage of historic incentives, including deferred payments and Chevrolet’s interest-free financing for up to 84 months.
“I can’t remember incentives quite that good,” Crews said.
Floyd said many South Carolina dealers are still doing well on new car sales, while used car sales aren’t as strong. There are two reasons new car sales are still strong, Floyd said.
“Manufacturers have gotten very aggressive with offering incentives and rebates,” he said, “Americans have been cooped. It doesn’t look like they will take vacations as they planned and they’ve saved up all this money. If they’re anything like me, they will still spend that money."
He said many are using the money to upgrade their cars.
"Where they might have gotten a used car in the past, they’re buying new cars because they have extra cash they’re not getting to spend on vacation," Floyd said. "And if you believe that our world will return to normal, and it will happen sometime, then some of these offers are too good to pass up.”
Toyota of Easley has been able to complete auto purchases 100 percent online for the last year and a half, Norris said.
“We’ve seen more activity online. It’s almost like Amazon. Many people will buy from Amazon so they don’t have to go into a store. It’s the same thing with a car dealership. Pre-virus, not that many people would do the whole buying process online. But they didn’t want to do the complete buying process in the store. We offered the whole process online so customers could go as far with it as they liked,” Norris said.
Three customers have bought cars completely online since the pandemic began, he said.
Still, Morris said, “Most people want to test drive a car and see it and put their hands on it. It’s not like ordering something from Walmart. Buying a car is an emotional experience.”
Crews said he expects online to play a more significant role in the auto-buying process.
“There will be a new normal, different from what we knew as normal two months ago,” he said. “I think there will be a lot more opportunity to do things remotely. I think it will push some processes a little more to the internet.”
Josh Waters, director of public relations and marketing for Jim Hudson Auto Group – which has seven dealerships, primarily in the Midlands – agrees.
“Our motto is, ‘Experience it once and you never forget.’ We believe that our online buying experience truly resembles that because we are providing the best customer service possible,” he said. “I think those who experience it once will never forget and will want to do it again later down the road.”