Did COVID kill the AUTO DEALERSHIP? [read more]

   My first experience with an auto dealership was in 1952. Our family had been living in Anchorage , Alaska and we were moving to Texas. Dad had driven us to Alaska two years earlier and pulled a motor home [trailer] all the way from St. Louis Missouri to Anchorage. That is another good story. He decided to sell everything to some new serviceman who wanted to move his family to Anchorage but not go through the drive. So we sold the trailer and our 1949 Chevy Carryall. We took a ship from Seward, Alaska to Seattle, Washington. At the Seattle dock, Dad found a cab and told him to take us and our luggage to a Mercury Dealer.

Mom and Dad walked around, looking at cars and they bought a brand new Mercury Monterey for cash. We all jumped in the new car and drove to Texas. It was a fun road trip. We stopped at Yellowstone along the way. Dad loved the new car after driving a Chevy truck for the last two years. The Mercury had a V8 and it was exciting.

As a kid, my dad would take me every September to the local car dealers to look at new models. We would collect brochures and compare features. It was a annual event to go to the Dealers and look at new cars. In 1963, we were living in Darmstadt, Germany and Mom, of all people, took us to the Mercedes Dealer. They only had two cars to look at. Germany and Mercedes were still rebuilding after the War. Mom wanted a Mercedes but Dad refused. He said, "Mercedes built the trucks that hauled Jews to Dachau." He would not have a German car. So we ordered a new 1963 Chevy Impala from Detroit and had it shipped to Germany. As I type this, it sounds crazy, but it is 100% true.

Over the years I have bought 27 new cars. But after Dad died in 1997, the excitement of going to the Dealers was gone. Our last four cars have been "built" on line. BMW, Mercedes, and Porsche have a "Build your own" feature on their web page that lets you designed the car with the features you want. Then, you take the "Build Code" to a Dealer and they order the car based on your specifications. 6 weeks later your new car arrives exactly like our 1963 Chevy did in Germany.

Due to the popularity of this Build and Order approach, Dealers have begun to stock fewer cars on their lots. Then Covid arrived. Nobody was going to Dealers to look at cars. 99% of all new cars were designed or built on line. So even fewer cars were on the Dealer lots. Then, due to workers shortages and supply chain disruption, computer chips became short and auto makers were building even fewer cars. The result is Auto Dealers have nearly zero cars to sell.

Auto Dealers have always been difficult. Their Sales technique is comical and many find it frustrating. The design and build approach has made it really simple to email six dealers with the "build code" you selected and ask them to price the car delivered to you. In this way, the Dealers are competing with each other to get the business. Most Dealer have an Internet Sales Department to handle these emails. The Dealer experience has changed.

Covid has changed our lives and one of the ways it changed is in how we buy cars. Today we can buy a car much the same way we buy from Amazon. It would not surprise me to find Amazon selling cars in the near future. Costco has such a program now. Dad would really not like how this is going.