By Tracey Schelmetic
In the United States, one out of every 17 jobs touch the automobile industry in some way. While auto manufacturing and sales may not currently be labeled “essential jobs” in the fight against COVID-19, it’s critical that the industry remain healthy for the sake of the economy and Americans’ livelihoods. Americans seem eager and willing to purchase vehicles: they simply want to do it in a different way than in decades past.
An Industry in Transition
This quest for a new way has led the auto industry to transition mode. Manufacturers are finding new and different ways to make and deliver vehicles while keeping their employees safe, and dealerships are finding new ways to sell them in response to both necessity and customer demand.
“Transition” is also a theme at many dealerships at the owner level. As many multi-generational dealerships are being handed down to younger family members, new generations are having to build new business models that involve significant technology investment. Technology solutions providers are adapting their products to life in the COVID era.
One significant transition is happening at Cox Automotive. Sandy Schwartz, the company’s CEO, recently announced that he would be stepping down as head of the company at the end of the year. In a podcast interview with Dave Cantin, Schwartz noted that he’s not leaving the Cox family, but instead taking a different role to support a family company that’s been in business for 125 years. As CEO of the Cox Family Office, he will help to transition the organization for the next generation.
“I was very fortunate to work for the Cox family for 35 years,” Schwartz told Cantin. “They’ve taken really good care of my family and me. They asked me at the capstone of my career if I’d come take care of them. So, I’m moving from CEO of Cox Automotive to the Cox family office. I’ll take care of the family, helping with generational things. We’re a fourth-generation family, and we want to keep that going.”
Sanchez will be succeeded by Steve Rowley, the former executive vice president of Cox Business. Keith Holmes, the current senior vice president of Residential Sales for Cox Communications, will step into the role of EVP of Cox Business.
“He’s just a great leader,” said Schwartz of Rowley. “He worked for Cox for more than 10 years. His company, Cox Business, is the one that provides connectivity in a lot of markets to small and medium-sized businesses. He’s been a technology and product guy. He is going to take this thing to the next level. I just felt good that this is the right time for me and the right time for Cox Automotive.”
Navigating Disruptive Changes
The transition will happen as the vehicle sales industry is seeing several disruptive changes. Schwartz noted that Cox plans to keep the pressure on its dealer-partners to move their businesses to where they need to be to compete and succeed in a new world of technology-based auto buying, marketing, and selling.
“We know that there are lot of first-, second-, and third-generation automobile dealers,” said Schwartz. “The way that grandpa ran the business is not the way the son is going to have to run the business. You had better be a progressive leader. You had better be willing to take chances. You had better embrace technology, and you had better understand your customer.”
Understanding what customers want, and when and how they want it, will be a key to success. Dealers can use technology to become proactive, helping the customer at all points of the customer journey, rather than reactive, taking action only when the customer approaches them. Removing the friction from the buying process will go a long way toward achieving success, said Schwartz. This can be accomplished with the right mix of people and processes.
“We have to have an amazing blend of humanity and technology at all times,” said Schwartz. “AI [artificial intelligence] is all important stuff in the future. But who sets all those parameters? People do. You’ve got to have the spirit to change, but you’ve also got to understand how you’ll use technology to your advantage, and how the customer will use it.”
Schwartz noted that pent-up demand has put the vehicle sales industry in a good place to recover quickly from the pandemic-induced recession, but that dealers shouldn’t get complacent.
“We have some tough times ahead of us, but they’re not devastating times,” he said. “Don’t go back and get comfortable where you were. Keep innovating. Keep understanding what your customer needs. We’ll have a few rough months, but we’re going to get there, and it’s going to be great future for the auto industry. Don’t be afraid of the new stuff: embrace it.”