Electric cars can make car dealerships a thing of the past

There is car news from Sweden: Volvo Carr says it will be completely electric by 2030. There is no better internal combustion engine, no better hybrid. Batteries or bust.

In making this commitment, Volvo is betting on trends. As EVs get cheaper and new traditional cars get more expensive, consumer calculations of electricity and internal combustion will soon be in favor of electricity.

But Volvo’s position in EVs is more than just changing the powertrain. Automakers say their pure electric models are only sold online and the first fully electric vehicles are currently receiving wireless software updates.

Its first plan affects the environment in which it is built. Second, about emissions and the global climate.

I talked about what the increase in electrification means for gas stations, which are a symbol of the American landscape. With over 100,000 of them and over 900,000 employees, not all will survive in a world of increasing numbers of electric vehicles. The same lens can be applied to the car dealer’s landscape. Then the number will be even larger.

There are approximately 118,000 auto and parts dealers in the United States. It is now less than it was before the global financial crisis, but above the 2011 lows.

These retailers employ about 2 million people (more than double the gas stations) after a dramatic decline and recovery in 2020. Prior to Covid-19, that number was the highest ever after nearly a decade of growth. ..

More than half of those employees work in sales, and the remaining 30% are technicians and mechanics. This is a different distribution than gas stations, where almost everyone works as a clerk or prepares meals, and also shows what is at stake for electrified dealers.

Volvo allows retail partners to continue to participate in “car sales, preparation, delivery and service”, but “significantly simplifies the process for signing up for electric Volvo and reduces the number of steps required. It means that anyone reading it will have fewer people involved.

Digital sales channels change not only the number of people needed to sell a car, but also the nature of the job and the workplace. That means there are no people waiting for people to stop by in the showroom, no office managers, no janitor. EVs also have far fewer moving parts than internal combustion engine vehicles, so they are much less likely to require the same level of service.

This is part of the logic behind the Michigan bill, which bans private electric vehicle companies from selling directly to consumers. The bill died quietly at the end of last year.

And there are updates. Modern automobiles include dozens of electronic control units with built-in software. In other words, it’s like being able to update wirelessly. Remotely renewable cars aren’t driving pointless miles to fix something that actually prevents them from driving safely.

This can also help reduce costly recalls. Last year, Toyota recalled 2.9 million cars in January due to a problem with one of its electronic control units.

But perhaps more important than avoiding millions of miles of driving for a recall, and therefore millions of miles of unwanted emissions are a vehicle promise to improve over time. Again, Tesla has set the standard, not only updating wirelessly, but also upgrading.

These are more than just patches and fixes. These are permanent enhancements that require less maintenance and allow your car to stay on the road longer. This is another blow to dealers, but a benefit to consumers and the climate.

  • Nathaniel Bullard is a Bloomberg NEF analyst who writes the Sparklines newsletter on the global transition to renewable energy.

read: Huawei plans to manufacture electric vehicles under its own brand

Electric cars can make car dealerships a thing of the past

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