Currently reading: Analysis: A return to business as usual?
The switch to electric is overshadowing other big changes on the automotive horizon
Autocar
News
5 mins read
17 May 2021

The automotive industry is emerging from the pandemic reshaped by the events of the past year. Will things slowly return to normal or – like the switch to electric – is the rate of change only going to accelerate? We’ve asked key industry figures how current trends are informing the direction of travel.

Online sales

It’s no surprise that new companies such as Cazoo and Cinch have appeared and announced that online sales are booming and are here to stay.

One firm that launched during the height of the pandemic is Carzam. Its CEO, Kirk O’Callaghan, believes the future of online car buying looks strong, with sales having increased even after showrooms reopened on 12 April.

“The pandemic has accelerated a change in customer behaviour,” he said. “When customers understand the benefits of buying a car online and how they can purchase with safety and confidence, they do so.”

For car manufacturers and consumers alike, it’s fortunate timing that the technology was on hand to allow car buying to continue during the lockdown.

“More than a year into the pandemic, we’ve seen some major trends gather pace in the new car market, most obviously in the enforced reliance on online sales,” said Mike Hawes, the CEO of the Society of Motor Manufacturers and Traders. “The success of click-and-collect services has provided a lifeline for the sector by sustaining sales through much of the outbreak.”

As ever, it isn’t a case of one or the other: customers are using hybrid methods to shop for their next car. For many, then, at least part of the buying experience will continue to be at a physical dealership. Hawes said: “The recent reopening of showrooms could not come soon enough, and as much as digital car buying has been proven to work, it can’t replace the excitement of choosing and test driving a new car in person.”

Some operations are even investing in new facilities. Porsche GB told Autocar that investment by its retail partners in Porsche Centre development will continue in 2021 and 2022. It said this underlines its commitment to physical retail showrooms and follows three new Porsche Centres opening in 2020.

The same is true of large dealer groups, with Vertu Motors CEO Robert Forrester finding the use of e-commerce to be very low. According to Forrester, people are going online for initial viewing and video chats, but most are then visiting the physical dealership to see the actual car and complete the deal.

That’s reflected in the figures: Vertu sold 130,000 cars through its dealerships in 2020, but just 428 of them in purely online transactions.

As a further indicator of where Vertu sees the market heading, the firm is investing in new showrooms. “The death of the dealership is an easy story to write, but I’m not sure it’s true,” said Forrester.

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The direction of design

Design is likely to become increasingly important for car makers. In a world where EVs will deliver similar powertrain characteristics, brands will need to distinguish themselves from others by creating cars that look different. It’s no coincidence that as Jaguar Land Rover embarks on its Reimagine strategy, Gerry McGovern (now chief creative officer) is front and centre of where the firm sees itself.

Equally, Polestar has won plaudits for its laser-locked focus on clean design and purity of corporate message, managing to separate itself from sister company Volvo, a brand already acknowledged as being clear on what it is. And Polestar’s CEO? Designer Thomas Ingenlath.

Not that standing out should be confused with courting controversy: you only have to look at BMW for proof of where that gets you. Frank Stephenson, creator of the modern Mini and Ferrari F430, told Autocar that he hopes the ideas around radical and polarising design will subside and said it’s being driven by marketing departments.

“It’s almost like they [car makers] are in a state of panic a little bit,” he said. “Most of them are trying to really justify their presence in the market through design. If they sell the car and it looks the way it is and it sells well, they will continue with it. They won’t rein it back in. [They’re hoping] we will, as a general public, eventually get used to it, accept it and see it as the modern way to treat design.”

Stephenson admits there have been design trends that have broken with tradition but said the conservative styling Tesla implements shows that car makers don’t need to take a radical approach, especially with EVs.

However, the hottest design trends, said Stephenson, will be inside the cars. Personalisation used to be about seat covers and stereos, but now technology allows owners to create their own interior ambience, including specific lighting, sounds and heating settings.

Some fear that car interiors could become too complex, but Uday Senapati, executive director of corporate and product strategy at Lotus, believes the key is to include all the technology without losing the design simplicity, pointing to the firm’s new Evija electric hypercar as an example.

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“You’ve got to have voice control, gesture control, eye tracking – all of which are trends that are coming out in technology,” he said. “The packaging will bring some compromises, but we would still like to focus on simplicity.”

Corporate social responsibility

Senapati said that Lotus and others have started taking corporate social responsibility more seriously since they saw customers buying into brands such as Tesla for what he calls “more conscious reasons”.

That view is shared by Bentley CEO Adrian Hallmark. “Across the world, our customers are telling us that they want sustainability at the core of our business and we are committed to lead in the luxury sector,” he said. “We’re reinventing every aspect of our operations towards a carbon-neutral future, with only battery-electric vehicles by 2030. They [customers] are also looking for deep and meaningful relationships with socially acceptable brands, sometimes prioritising experiences over goods and more purchasing online.”

Sustainability also extends to the increasing research into low-carbon fuels. Porsche announced earlier this year that it is moving ahead with development of synthetic fuels. Further investments are planned by fuel companies, as well as by manufacturers such as Audi, BMW and Mazda. It’s unlikely that synthetics will stop the rise of EVs, but the UK government is looking at ways to incorporate them into a wider strategy of reducing harmful emissions.

What’s clear is that, with an industry in flux, the role of the state is becoming as important as the role of consumers in shaping how it looks in the future, particularly in areas such as safety, efficiency, advanced driver assistance systems and sustainability.

Mark Smyth

READ MORE 

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UK car industry needs "significant investment", says SMMT 

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275not599 17 May 2021

More tech = less reliability and less repairability.  Ceiling fan with a little on/off chain runs for ever, one with a remote craps out after a year.  Washing machine with rotary controls runs forever, one with microchips craps out after a year.  Light bulb operated off a wall switch lasts forever, one that comes on when you tell Alexa to turn it on craps out after 3 months.  I'm not a luddite, I try to adopt new tech, but it continues to disappoint in so many ways.  I am really starting to dislike cars that are always bleeping at me, grabbing the steering wheel, making me signal to change lanes when there's no one around etc. Car interiors are just becoming annoying, fussy, stressful places. Do I set my BMW's electric windows to comfort, sport or track? Etc. Etc.  Only Rolls Royce seems to have the right idea.  Good service is discreet, not in your face.  Pour me another one, love.