The way we buy cars is changing. For starters, millennials are accustomed to the instant gratification of the internet. They don’t want to have to drive to a dealership and fight for a parking spot. They also don’t want to deal with a pushy salesperson.
According to the J.D. Power Automotive Performance, Execution and Layout (APEAL) survey, which looks at how customers like to interact with car dealerships, millennials would prefer to purchase their next vehicle online. The survey found that millennials were more likely to purchase a car online than any other generation.
“Younger buyers are typically more comfortable with technology than baby boomers. As such, millennials who make up nearly a third of the car-buying population, are more likely to buy a car online than any other generation,” said Pietro Gorlier, president of J.D. Power.
Millennials also want to know the price before they go to a dealership, but this has been a sticking point in the past. Dealers have been able to mark up cars as much as $5,000 more than the manufacturer’s suggested retail price, and this practice is coming under fire from state attorneys general in New York, New Jersey and Florida.
Additionally, car manufacturers are joining in on the online sales push. Ford, GM and Fiat all offer websites where customers can view the price and specs of a car before visiting a dealership.
The push for online sales is also a way for automakers to cater to millennials, who are more likely to shop for cars online. According to a 2014 study, millennials are almost twice as likely to use a smartphone or computer to research a car purchase than any other generation.
In the end, millennials are more tech-savvy than previous generations, and this trend will likely stay for the next generation. Millennials want to be able to buy a vehicle online, and they want to be able to view the price upfront. Car manufacturers are taking note and creating an online environment that is convenient for millennials.
The bottom line is that millennials prefer to do things online, and automakers are getting on board.
What the future holds
With the number of vehicles sold online increasing, the number of vehicles sold at brick-and-mortar dealerships will likely decrease. This is a huge blow to the dealership model, which relies on new vehicle sales to stay afloat.
The push for online sales will certainly be good for customers, but it could be a death knell for dealerships.