What's driving the motor market?

I’m delighted to be presenting next week at the National Dealer Convention of the Australian Automotive Dealer Association . One of the topics I’m going to explore in my address is the state of the market.

At Deloitte, we have a particularly well-developed oversight of the local automotive industry because more than 20 vehicle brands report their data to us. We then collate this information to develop insights for our clients, which they use to improve their businesses.

At the conference I’m going to be delving deeply into some of our most recent findings about the automotive market in Australia.

Those of you on the frontline will probably know instinctively where the market is at. You’ll be well aware conditions were flat in 2014. But that’s certainly not the case in 2015. When I deliver my presentation you’ll find out why that is. Here’s a clue: volume is up, yet does volume drive profit?

One section of the market in particular has been a key disruptive force – but it’s not the part of the industry you might expect.

What has been more predictable has been the continued dominance of the SUV sector, which now comprises 31 per cent of total sales. Given this, dealerships have to be forensically assessing how their SUV offering compares to competitors’ offerings to ensure they are capturing sales from hungry SUV buyers.

Our data clearly shows the best performing dealerships all share a number of traits. These include the ability to have a brutally simple plan to be the best yet applied with fanatical discipline in people, process and performance management. But there are also a selection of other characteristics the most profitable dealers share, according to our research, that I’ll be exploring next week.

The good news is that every dealership, even the best ones, have an opportunity to review their operations to increase sales and profits.

But to achieve this it’s critical to be able to adapt to market conditions. The message is: don’t sit back and let the market drive you. Instead come and hear about what the best dealerships are doing and how you can apply brutal simplicity and fanatical discipline to your business to be a true leader in your field.

Dale McCauley is addressing the Australian Automotive Dealer Association’s National Dealer Convention, held between 10 – 12 August in Melbourne.

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