The annual North American International Auto Show (NAIAS) underscores why “product” is an essential element of the 4Ps of Automotive Marketing™ — product, price, place, and person. The 2018 show is no different, with OEMs unveiling a class of new cars hitting the market. Unlike the Consumer Electronics Show, which showcases concept cars, NAIAS focuses on products coming to consumers in the near-term.

As Jake Fisher, director of auto testing for Consumer Reports magazine, told USA Today, “What we have here are the meat-and-potatoes — the cars that are actually driven.”[i]

So far, the cars that are actually being driven are creating some considerable excitement, especially electric cars. At NAIAS, OEMs came out of the gate with major announcements about their commitment to producing electric cars. For instance:

  • Ford announced that it will invest $11 billion into electric vehicles by 2022 and roll out 16 fully electric cars within five years – the first of which will arrive by 2020.[ii]
  • Volkswagen announced it will bring a new all-electric car platform to production in the United States by 2020.[iii]
  • Mercedes-Benz announced the launch of hybrid Mercedes-AMG 53 models. As Tobias Moers, Chairman of the Board of Management of Mercedes-AMG GmbH, said in an announcement, “With the new 53-series models we are extending our portfolio in a first step towards a hybridized future with a leading-edge combination of sporty design, performance and efficiency.”[iv]

These developments follow a number of 2017 announcements from OEMs pledging to invest more in electric cars. For instance, in July 2017, Volvo Cars announced it would phase out gas-only cars by 2019.[v] In September, Volkswagen Group said it would electrify all its cars in some fashion by 2030.[vi] All told, OEMs globally are investing $90 billion into electric cars according to Reuters.[vii] Reuters indicates Volkswagen is driving the largest single investment into electric cars, with $40 billion.

According to Reuters, “That money is pouring in to a tiny sector that amounts to less than 1 percent of the 90 million vehicles sold each year and where Elon Musk’s Tesla Inc, with sales of only three models totaling just over 100,000 vehicles in 2017, was a dominant player.”

For dealerships, these developments challenge salespeople to change the conversation from new features to completely new products. Salespeople have an opportunity to act as informed consultants, explaining why electric cars are coming, their cost, and their performance, among other factors. Clearly, the market is getting flooded with a lot of news about electric cars. Dealerships can connect consumers with these products through their most important asset: their people.

 

[i] USA Today, “Detroit Auto Show: 5 New Cars That Lit Up the Event,” January 16, 2018.

[ii] The Verge, “Ford Is Throwing $11 Billion at Its Electric Car Problem,” January 15, 2018.

[iii] Electrek, “VW Announces New All-Electric Platform to Be Produced in the US by 2020,” January 15, 2018.

[iv] Mercedes-Benz, “The New Mercedes-AMG 53-Series Models of the CLS, E-Class Coupe and E-Class Cabriolet,” January 15, 2018.

[v] Volvo Car Group, “Volvo Cars to Go All Electric,” July 5, 2017.

[vi] TechCrunch, “Volkswagen to Offer Electric Versions of All Its Cars by 2030,” September 11, 2017.

[vii] Reuters, “Global Carmakers to Invest at Least $90 Billion in Electric Vehicles,” January 15, 2018.