Forbes: Tim Butler on auto manufacturer business strategies

The point of sale (POS) of any business is critically important. If you imagine the register at any retail outlet or fast-food franchise, the operator must know the menu, those items presently sold-out, and the semi-scripted-yet-extemporaneous process of reacting to unforeseen incidents as to salvage the customer relationship. So is the standard life of an auto dealership. Only this year presents multiple challenges that far exceed the norm, and as the annual conference approaches where manufacturers and dealerships meet to coordinate the upcoming year – the 2022 National Automotive Dealers Association Show. The question hangs in the air about whether this year is the most critical for dealerships, specifically the looming areas requiring fantastic communication between manufacturer and dealer are how to presently manage the integrated circuit chip shortage and how to prepare for the anticipated, step-function change in electric vehicle sales. Depending upon the strategies of the manufacturer, supply chain issues have played out either by reducing manufacturing, offering fewer vehicle options, or stockpiling semi-built vehicles with plans to retrofit the shells later. Ford, for example, has stockpiled unfinished vehicles in various sites expressly to maintain manufacturing staffing, to be ready to quickly meet the pent-up demand of new vehicles, and per the words of Wayne State Univesity’s Tim Butler, associate professor of global supply chain management at Wayne State University’s Mike Ilitch School of Business, to avoid “…suffering the long-term effects of not keeping [suppliers] sustained with business…”

Full story on Forbes

View all news stories