New opportunities related to connectivity, advanced electronics, and computer technology are becoming increasingly important as vehicle technology advances. Auto dealers and lender partners are on the front lines in this new environment where customers need to understand the technology in their vehicles, the potential benefits associated with new data potential, and how to protect their investment.
The learning curve and risk rise as vehicle technology advances. In addition to putting a plan in place to educate their staff and customers about new technologies throughout their dealership, savvy dealers and lenders also look to their OEM partners to assist them in keeping up with the changing requirements for vehicle protection.
Understanding what’s possible with connected vehicles
The amount of information and data to digest when financing a tech-forward connected vehicle or truck can be overwhelming, just as it’s challenging to stay ahead of rapidly evolving personal technology. Training is ever important to help lenders offer financing and dealers sell these complex vehicles, as well as the consumers who take ownership.
Features are essential, but training shouldn’t end there. Consumers should be made aware of the software and data benefits associated with their vehicles, as well as the fact that just as it’s critical to keep the operating system on a phone and personal computer up-to-date, the same is true for connected vehicles. Manufacturers can ensure that the car has the most recent updates to keep it operating smoothly, to fix bugs, and to address potential security holes by using software over-the-air (SOTA) technology.
Selling the benefits to consumers
This connected vehicle data has a wide range of applications where resulting insights can be consumed and beneficial to everyone from the OEM, the lender, insurer, and the dealer’s service center. The most obvious use case is for parts and vehicle maintenance where effective algorithms can analyze the health of the vehicle in near real-time to suggest remedies for impending vehicle failures across vehicle assets like engine, oil, battery, tires and so on. Consumers leveraging this data can alert maintenance teams ready to perform service on a vehicle that returns in a far more efficient manner since much of the diagnostic work has been performed in real time. This data also helps better maintenance, which lowers overall risk levels for lenders in the long run.
Additionally, insurance and extended warranties can benefit by providing active driver behavior analysis so that training modules can be drawn up specific to individual driver needs based on actual driving behavior history and analysis. For fleets, the active monitoring of both the vehicle and driver scores can enable reduced TCO (total cost of ownership) for fleet operators to reduce losses owing to pilferage, theft and negligence while again providing active training to the drivers.
But there are other benefits to help dealers and OEMs better prepare to sell connected vehicles, as well as lenders when financing. Connected vehicle data can help dealers and lenders become closer to their customers as they will have personalized information that helps more closely understand their customer’s connected vehicle driving habits and automotive needs.
How dealers, lenders and OEMs can monetize vehicle data
This is important because today’s dealers, lenders and OEM partners continue to lose share of per vehicle profit. Therefore, the ability to monetize the data that connected vehicles provide will be critical for future revenue growth. It is critical for dealers and OEM partners collaborate on educational programs that help consumers see the win-win-win benefit for all involved in selling more connected vehicle technology.
This approach is not unlike the need for lenders, dealers and their sales teams to better educate customers on the strong benefits that many of today’s advanced F&I products offer. Customers may see it as just an “upsell” but when you boil down to the core of the offering, many F&I products can save customers money and help them protect their investment.
Connected vehicle technology offers the same possibilities for customers, and they can produce new revenue models for dealers and their OEM, insurance, and maintenance partners.
In fact, connected vehicle technology can offer benefits to automotive professionals even before a customer steps foot into a showroom. The data in connected vehicles can provide better visibility into tracking a vehicle in the supply chain, offering key timing insight into tracking the vehicle from production to shipment to arrival at the dealership. Currently, dealers must rely on tracking data from their shipping partners, which are not always reliable and in real-time. However, when a dealer can pinpoint the vehicle’s exact location in transit, they can offer better expectations to the customer in waiting or to make more timely inventory decisions to better manage days’ supply.
What’s more, even vehicles sitting at the lot waiting for purchase can lose tire pressure, or experience check engine light prompts. Connected vehicle technology and data can help dealers better manage the health of vehicles on the lot so that customer’s take delivery of properly conditioned vehicles, and minimizing conditioning requirements from service staff after the transaction is completed.
Powering the future of vehicle sales
AI-powered analytics leveraging IoT, edge computing and the cloud are rapidly changing how vehicle management is performed, making it more efficient and effective than ever. The ability of AI to analyze large amounts of information from telematics devices provides lenders, dealers and sales personnel with valuable information to improve inventory and sales efficiency, reduce costs and optimize productivity.
The more datasets AI collects with OEM processing via the cloud, the better predictions it can make. This means safer, more intuitive vehicles in the future with more accurate information and better real-time vehicle diagnostics.