Dealers will be given greater protection from early termination of contracts under the forthcoming review of Block Exemption.
The prediction was made yesterday at the two-day Automotive Management Digital Dealer Fair in Birmingham by Ed McCabe, chief executive officer of Ebbon-Dacs.
He told the audience during his seminar, entitled 'Sea change in motor retailing', sponsored by Auto Online, the review would see manufacturers made to treat their dealers with greater sensitivity.
He said: “We will get away from the situation of manufacturers telling their dealers, 'thank you very much, here's two years termination and goodbye'. Contracts would not just be for two years, but possibly up to five years.”
There would, Mr McCabe predicted, be a loosening of dealers' ties to a manufacturers' chosen finance house and parts' suppliers.
“We may move towards the US model where it's much harder for a manufacturer to get rid of a dealer and they have to buy them out or compensate a dealer to 'disappear',” he said.
On the day of its launch Cap Network, a new business alliance bringing together Cap and AutoLocate, announced a strategic partnership with Microsoft.
Cap Network will provide used car pricing information to Microsoft's automotive portal www.carview.co.uk together with more than 4,000 pages of information on every make, model and trim of vehicle available for sale in the UK, creating what the two companies claim will be the most comprehensive new car research facility on any UK website.
The partnership between MSN Carview and Cap Network follows the previous announcement of Carview's alliance with AM100 leading dealer group Pendragon to create an online new car buying service on Carview.co.uk.
Making the announcement at the Digital Dealer Fair, where the Cap Network was unveiled, Shane O'Neill, the network's chief executive, said: “This opens up exciting possibilities for the industry. Microsoft has unrivalled expertise in software development and in developing internet services for consumers. Cap Network is the leader in developing comprehensive, vehicle pricing information for use on the internet.
“Through working together the potential to create class-leading services for both consumers and the motor industry is enormous.”
And John Brewer, director of Carview Europe, said the partnership was a step towards creating a website “unrivalled for its depth of car research, ownership and buying services”.
“Ultimately we aim to offer our customers access to a wide range of car related information, in any place, on any internet enabled device. This deal moves us a step closer to being able to realise this goal.”
Carview is due for launch in the UK the spring, integrated into the msn.co.uk website which attracts 10.5m users per month.
The internet should be seen as a threat to dealers, rather with sound development strategies and investment plans it can be used as a valuable new route to market – but keep your web operation “simple and slick”.
The advice came from TMS Group's deputy chairman Peter O'Connor in his seminar presentation at the fair entitled 'How can dealers survive change', sponsored by Cap Network.
He said the three rules of succeeding on-line - attracting customers, converting interest into sales and customer retention - should be familiar to dealers already.
“Haven't we been achieving these three for a long time? We provide a good service and we deliver the car on time – that's the only way to keep customers,” he said.
With this achievement as the basis, Mr O'Connor said, it was important for a dealership to then have a strategy for its website development that's appropriate to the present business, but also allows for changes.
“The internet is here to stay, so start to respond. Decide where your business is going and get your staff on board. Develop your IT approach including email, dealer management systems and digital cameras, and appreciate your assets. You have customers that you see more than once so talk to them and find out how their needs and expectations have changed.
“Then see what aspects of new IT can customers benefit from and have IT wish-list.”
Examples were providing customers the ability to book test drives on-line and allow suppliers to check parts' availability via the website.
Using used cars as an example, Mr O'Connor suggested that many dealers were not using technology well in an area “vital to the survival” of many businesses.
“You should use technology to show how good your stock is, emphasise your service standards, send a brochure via email to potential customers – and include a location map.”
He said internet business is expected to account for 10-20% of TMS Group's sales activity this year, some of which was new business. The group's IT investment had been in the region of £100,000.
The Digital Dealer Fair saw the first presentation of the Automotive Management award for dealer website of the year to TMS Group.
The group's deputy chairman Peter O'Connor received the award from Mark Cowling, Cap Network's chief economist.
The award comes on the back of dealer group website reviews featured in the Dealer Dotcom section of Automotive Management.
David Sumner Smith, AM's information technology editor and chairman of the Digital Dealer Fair seminars, said: “TMS is not amongst the biggest dealer groups, but it has taken a very important initiative of integrating the web with the back office sales process and news, including feeds from motor shows.”
Mr O'Connor said: “We saw the potential of the internet early on, both in terms of the threat and opportunity and initially the policy was just to get on-line. But it struck me this wasn't going to work without getting our people involved. We started to evolve that strategy so we no longer had to rely on outside website designers to change the look of the site and it's now done locally, which promotes staff ownership.”
TMS Motor Group's website is at www.tmsgroup.co.uk.
CD Bramall is to re-launch its website at the end of May, inspired by the success of its initial on-line venture which now accounts for 6% of its sales.
Detailing the re-launch at the Digital Dealer Fair was Keith Hartrick, group managing director, in his seminar presentation 'Partnerships are the key to success', sponsored by Global Remarketing.
He said: “The new website will be a lot more user-friendly and interactive. It will provide the customer with the opportunity to do everything from buying the car, arranging finance and insurance, look at the spec of any new car in considerable detail, driving additional inquiries to us.”
Mr Hartrick said that with its current website accounted for 6% of total sales, or 3,000 vehicles a year. “Maybe we would've sold those cars anyway, but those of our 50 dealerships which have adopted internet processes are selling cars further away than they were before.”
An example he cited was an customer in Grantham who bought a used car online from a CD Bramall dealership in Berkhampstead, without test driving it and having only seen images of it on the website.
CD Bramall's partner in its website development is Global Remarketing.
“We chose them because they offered IT and internet literacy and motor trade expertise. And they also recognised we wanted to go at our own pace, offered user-friendly systems and were prepared to get involved in training our management teams in the dealerships,” Mr Hartrick said.