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4 auto industry trends in the new normal

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JOYCE REYES-AGUILA

As the sector gets up to speed, new pathways appear on the horizon

By Kap Maceda Aguila

FISH OUT that crystal ball from wherever you stashed it and give it a once-over. We’re going to need it to look at the (near) future of the local auto industry. But I digress. Ball-gazing is so passé; any self-respecting person of science and logic already has so many tools at his/her disposal.

Car companies have been allowed to open shop and restart the long shuttered casa for a while now. Of course, operational capacity has been curbed to (ideally) 50% to reflect the number of employees allowed on site for physical distancing considerations. If you’ve been checking out press releases and announcements of auto brands, it’s not easy to glean a pattern that helps define a not-so-new normal way of moving forward and conducting business. Since we all love listicles, let’s do that now.

1. All hail the digital showroom. Sure, any self-respecting auto brand has a virtual presence (website, social media) where we can check out offerings, services, and other goings on. Largely though, this domain had just been an adjunct to the real (i.e. physical) experience. The showroom was the primary showcase brands leveraged not just to display vehicles but, verily, all that they stand for: hospitality (or lack thereof), design ethos, luxury/practicality, service. While real dealerships and showrooms have opened, a growing number of marques have unveiled so-called digital showrooms — essentially microsites that remove much of the fluff of the original website to gear the experience specifically for people browsing models. We spy a few commonalities among brands: easy availability of pricing information, quick links or access to notify a sales agent of your desire to buy, and a function to “e-inspect” a vehicle. To be honest, some or all of these may have been possible on the main website, but the experience in a digital showroom is sleeker and more keenly curated for your e-shopping pleasure.

2. It’s a buyer’s market. This one we saw from miles away, right? As car companies were basically kept from selling vehicles for about three months, many had hemorrhaged as income was halted. The Chamber of Automotive Manufacturers of the Philippines, Inc. (CAMPI) and Truck Manufacturers Association (TMA) jointly reported a sales total of 11,029 units in March — a 63% free fall compared to the same month last year, when the group tallied 29,790 units. CAMPI President Atty. Rommel Gutierrez said in a release that “the double-digit negative growth recorded in March 2020 is the weakest monthly performance of the auto industry so far.” And that was March — with about two weeks of normal selling activities. Wait until we get to April and May numbers, said a car executive to me. But relief should be coming if people bite into a number of tantalizingly great deals from a number of auto brands. A handful of luxury brands are heavily discounting their products, (up to a million pesos and beyond). People contemplating getting vehicle this year before the pandemic happened have a lot more thinking to do as the repriced and repackaged pickings are aplenty.

3. Virtual launches will be the norm. The Ford Everest Sport’s launch last May 21 was bittersweet. While it symbolized a determined stand of business in this age of COVID-19, it was also a reminder that we just cannot simply pick up where we left off. It was surreal to see media colleagues in little Zoom squares and not in some large venue where we’d wait for a vehicle to roll in or be unveiled. But this is a norm that we have to and can live with if we want to keep everyone safe from the opportunistic coronavirus. Since that day, a handful of brands have revealed new models through the digital medium (with a couple of launches scheduled this week, actually). If there’s a silver lining to this, it’s that more people can actually check out the spectacle of launches (those opened to them, anyway), and benefit from the production of materials for the digital medium.

4. “Used cars” and “downgrading” might trend. Toyota Motor Philippines (TMP) probably did some gazing into its own crystal ball and saw an impending shift in local market preference toward pre-loved cars. Last week, TMP sent out word that it is pushing its TCUV (Toyota Certified Used Vehicles) brand. One of its so-called value-chain programs, TCUV vets used Toyota vehicles via a “rigorous 211-point inspection and certification procedure” to remove the guesswork and uncertainty. Come to think of it, the underlying thinking is easy. As companies across a range of industries have been savaged, with unemployment climbing to a record high of 7.3 million, those fortunate enough to keep their jobs need to be generally prudent in their spending, so they might be nixing the idea to get a brand-new vehicle in favor for a more inexpensive used vehicle. Another sentiment I’ve heard expressed is that since people basically have no choice but to bite the bullet on vehicle acquisition (in view of hampered public transportation), they can “responsibly” fill the need of getting a Point A-to-B vehicle by getting a cheaper ride. Instead of a mid-size SUV, the head of the family might opt for a small crossover or even subcompact sedan.





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