| INTEGRATIVE INSIGHTS ON EMERGING OPPORTUNITIES |
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tkiwala@firstanalysis.com
- While electric vehicle technology grabs auto sector headlines, other substantial changes underway include the shift toward automakers selling directly to consumers and the introduction of alternatives to traditional sales and leasing business models.
- As this shift continues, we expect to see strong demand for technology that enables automakers to initiate, manage and optimize direct interactions with car buyers and owners.
- We profile several companies we see as among the leading innovators in the market for such technology, some of which also serve franchise dealers and independent repair shops.
- Alternative consumption models, such as subscription auto services, appear to be a natural extension of this transformation, representing another compelling opportunity for enabling-technology providers.
TABLE OF CONTENTS
Includes discussion of six private companies
Incumbents following Tesla's lead toward more direct selling
Expect strong demand for tech that connects automakers to buyers, owners
Some leading innovators
Alternative ownership and service models: The next wave?
Another round of winners in the world's tech transformation
First Analysis Enterprise Productivity Index sinks again
Enterprise productivity M&A pace in line with recent levels
Enterprise productivity private placement pace slows
Incumbents following Tesla's lead toward more direct selling
The auto industry is evolving at a pace not seen since the early days of its existence. While electric vehicle technology grabs the headlines, other substantial changes underway include the shift toward automakers selling directly to consumers and the introduction of alternatives to traditional sales and leasing business models.
Tesla has been at the vanguard of these changes. It eschewed the traditional dealer sales model and instead engages with its customers digitally and uses its own stores to deliver and service vehicles. In 2012, when Tesla detailed the rationale behind this strategy, the industry was skeptical it could succeed given the capital investment necessary to build a retail footprint. But it has succeeded. Tesla sales have been robust, and the company has navigated customer satisfaction challenges, including pandemic-driven disruptions, quite well.