How COVID-19 Will Change How You Buy Your Next Car

The car-makers are adopting a new strategy by going all digital to attract the potential buyers amid the Coronavirus lockdown.

New Delhi: There is no doubt that Coronavirus and its effects on many industries will continue for a long time to come and none more so than the automobile industry. Buying a car is considered the second biggest purchase decision one makes after buying a home so it goes without saying how much the auto industry needs to adapt here. While the economic and immediate effects are there the long term effect would be resulting in behavioral change amongst customers. Even before the lockdown, the fear of the virus and of course the need of social distancing has drastically reduced footfalls at car dealerships thus making car-makers adopting a new strategy in going all digital. Here the customer need not visit a dealer to go through the car buying process as everything would be digital. From selecting the model to configuring it to your exact specification along with selecting finance schemes- everything would be digital. Due to various technologies you can configure your car and get a clear idea plus of course there would be dedicated sales assistant. Scheduling test drives online is being offered by all car-makers currently anyways so this fits in with a full digital buying experience. Of course, in the end you can even get the car delivered to your home thus eliminating the need to even visit a dealership then. Hyundai was the first to start this in a testing basis in Delhi NCR for its 'Click to buy' scheme and now it has rolled it out across India where it is in combination with its various all India dealerships. Even Tata Motors have launched its scheme for a fully digital buying experience. So what does this mean for the car buying experience? Well it certainly means that with social distancing being the current norm, fully digital car buying will be on the rise. However unlike buying a mobile phone, buying a car is a much bigger decision and for most, getting to see and touch a car before buying is crucial so the car dealership is not going anywhere but the number of times you will visit one will surely go down. However a more pertinent question remains on how demand for cars would be post Covid-19. While sales remain flat currently and have been spiraling downwards due to the current times, the financial strain and the current economic scenario will hamper consumer sentiment further. But there is some light towards the end of this very dark tunnel for car-makers as post Covid-19 the demand for personal transport will likely see an increase as people would be vary of shared mobility. If anything shared mobility was a bigger threat to private car ownership but now people will gravitate towards buying a car rather than using a cab. What this means is that demand for affordable small cars would go up and first time car buyers would see an increase. Thus the entry-level small car which till now had falling sales due to car buyers gravitating towards more premium cars with only a small increase in EMIs, will see a resurgence. However the technology change will not stop there as in the future, car dealerships may not be the same as today. In cities use of technologies like augmented reality plus more digital use will mean car dealerships will get smaller and use less space which is important as the whole business model of a massive car dealership with all cars displayed is getting obsolete with rising cost pressures, lower footfalls and new technologies. So there you go, the next time you buy a car, it will be most probably be a different and a digital experience!