AUTOMOTIVE FRANCHISING: BRIGHT FUTURE PROMISES STABILITY AFTER CHALLENGING YEAR FOR AUTO INDUSTRY

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By Thomas A. Wolfe, Ziebart

 

Just as the industry was seeing signs of recovery from the chip shortage and other supply chain struggles, inflation hit the country in a big way. Meanwhile, interest in electric vehicles skyrocketed just as workers at the big three auto dealers took to the picket lines. With a new year on the horizon, the auto industry faces a mountain to climb.

On the Picket Line

Of course, perhaps the biggest story taking over the automotive industry as of late is the United Auto Workers strike, impacting the three largest car manufacturers in the country: General Motors, Stellantis (formerly Fiat Chrysler) and Ford Motor Company. After six weeks of negotiations, workers came out with a record 33 percent pay increase. But the damage to consumers had already been done. The strike cost GM alone roughly $1.1 billion, and triggered a shortage of parts that many local dealers rely on to make repairs.

Cost-Saving Measures

Adding to the pain in consumers’ pockets throughout the year, inflation continues leading to sticker shock at car dealerships — with the average price of a new car reaching record highs of nearly $50,000, according to Kelley Blue Book. Consumers are now looking for alternative options, like purchasing a more affordable, pre-owned vehicle, or re-investing in their current vehicle in attempt to preserve it and delay a large purchase.

However, this shift in dynamic greatly impacted the automotive aftermarket industry in a positive way. Instead of shoppers embarrassed at the thought that they just bought someone else’s trash, or feeling like they’re stuck with their old, beat-up car, drivers invested in services like detailing and paint correction to still fulfill that new car look and feeling for a fraction of the cost.

Electric Vehicle Movement

Though it was a trying year for the automotive space, there’s much to be said about the industry’s bright future ahead, particularly when it comes to updated technologies in the form of electric vehicles (EVs). While automakers push to boost EV production, the auto aftermarket sector of the industry is quickly learning and adapting to ensure they can still provide the same quality, protective services without compromising the unique technology found in EVs.

The Future of Automotive Franchises

That continuous innovation is exactly where we find stability in the automotive franchise space, setting franchisors up for success for years to come as long as they’re willing to stay up to date with the latest trends. A thorough dedication to adaptation is what’s helped companies like Ziebart International Corporation accomplish a milestone 65 years in business, with no signs of slowing down.

 

Thomas A. Wolfe is the CEO of Ziebart. For more information about IFA franchisor member Ziebart, please visit franchise.org/ franchise-opportunities/ziebart.

 

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