In the name of helping businesses and, by extension the U.S. economy, by cutting regulations, the new administration aims to roll back fuel efficiency standards and cut support for developing alternative powertrain vehicles.
These moves may make some sectors happy in the near term by boosting businesses’ income and/or reducing demands for expensive innovation in some areas. In the longer term, however, they will make those very businesses less competitive. Europe and China, among other nations, will continue to pursue the targets the U.S. is abandoning.
Hopefully automakers will also continue to pursue those goals even without regulations. Transportation experts seem to feel that progress towards those goals will continue regardless. A recent survey by the Institution of Transportation Studies at the University of California at Davis found a majority see significant moves towards driverless vehicles and ride-sharing – mainly in electric vehicles — within the next two decades of so. That may seem like it is a long time away. But, to quote a magazine cover I read long ago (which actually referred to GM and Toyota, I believe), “Objects in rear view mirror may be closer than they appear.”
Dealers are likely pleased with these regulatory aims. Consumers like to buy cars that get good mileage, but lately gas is cheap and consumers are more interested in buying nice big cars with many bells and whistles. And electric vehicles are hard to sell. Let’s face it, dealers mostly hate them. But getting too complacent would be a mistake. Whether you think the transportation wonks’ timeline for more autonomous and/or shared electric vehicles is correct or not, they are surely the trend of the future.
In the nearer term, the dangers to dealers are more sales-model related as sales increasingly move online. This week I talk with Alex Klein from Autolist.com about its recent study on the “amazon.comification” of the car buying process. It contains both good and bad news for dealerships.
Also this week we have a new contributor. Steven P. Gibson of Dealer Risk Services discusses the risk of not insuring against unforeseen dangers that can arise in the insurance space during a buy sell.
We also have Transaction News.