There’s no doubt that AI has been the hot topic of the year.
Across the industry, digitisation is driving change at an unprecedented rate. Increasingly, AI isn’t just an option, it’s a business essential.
Turning to tech and vehicles themselves, it’s interesting to see what’s happening in the EV market in Europe. With economic downturns leading to the removal of financial incentives, will the slowdown in sales continue?
In this post, Felipe Ospina – Market Engagement Manager for Iberia & Latin America explores some of the key trends discussed in the automotive industry in Southern Europe for 2024. Here are three key takeaways for automotive players to consider as we turn the corner on another year.
Digital transformation – how do we drive it?
AI isn’t simply about contributing to the increase of vehicle sales. OEMs and retailers today understand that AI can be used to enhance the entire car buying journey. From harnessing opportunities such as AI overviews, to addressing initial customer queries using tools like Chat GPT, AI can be used to attract new customers and close deals effectively online or in the showroom.
But should we also start to look at AI and digital tools from a wider angle? From general managers to sales advisors and technicians, these technological advances can help businesses to significantly cut costs, save time, create incentives for their employees and end customers, and facilitate complex business decision-making.
AI can help dealers identify these cross-functional opportunities and then put in place systems that will automate and improve their current methods.
This might be where we see digital and AI tools serving their greatest purpose. With a gradual, properly thought-out implementation process, the new wave of technology can help OEMs and retailers avoid silos and reduce bottlenecks, so that their businesses become more agile, responsive and free-flowing.
Financial institutions adapting to the new mobility
Banks are a key part of the automotive ecosystem, offering multiple products that facilitate sales and transactions for the sector, including leasing-renting applications, open banking, credit scoring and loans.
The benefits of digitisation in finance have already been widely felt. Technology enables banks to offer frictionless, 24/7 customer interactions, to reduce human error, improve loan underwriting and reduce financial risk.
In Spain, institutions like Santander, BBVA, and Caixa have been at the forefront of harnessing the benefits of AI. Today, Santander is starting to use it to tailor products based on a customer’s financial capability, offering varied terms, dynamic interest rates, and financing options according to customer needs. BNP Paribas is developing transparent, adaptable products, allowing customers to modify contracts without rigid terms. These solutions not only help banks and credit lenders make smarter decisions, they also offer the flexible finance options that today’s consumers require.
And, because dealers play a crucial role in connecting customers with banks, they help strengthen the relationship between a customer and the retailer. When the finance side of the deal is smoother for the customer, the sale becomes much easier for the dealer.
EV: environment vs economics
As Europe and Spain transition into the EV revolution, several factors begin to create scepticism at political, economic, and social levels about shifting towards vehicle electrification.
EV sales remain concentrated in just a few markets – around 60% in China, 25% in Europe and 10% in the US. In Spain, and across Europe, several factors are beginning to create scepticism around vehicle electrification at political, economic, and social levels.
First, it can’t be ignored that the combustion engine sector currently drives a large part of the economy. All the industries within this ecosystem – parts manufacturing, lubricants, spare parts, vehicle service, aftersales and more – will be significantly impacted by its ending.
Second, in Spain (and much of Europe), government incentives have been reduced, due to economic downturns and the growing trade tensions between Europe and China. Thus, the cost of acquisition remains high for the average Spanish citizen.
Lastly, the median age of the Spanish car park is 14 years old and currently generates significantly higher emissions than newer combustion vehicles which are more affordable than EVs. Therefore, climate objectives towards a zero emissions must be ones that are economically realistic, not just environmentally driven but also financially sustainable for OEMs, dealers, and the end customer.
Harnessing technology the Keyloop way
Keyloop’s intuitive platform allows users to access and mobilise customer data more effectively, enhance customer interactions and deliver a more personalised experience. It can also help to streamline day-to-day operations, drive efficiencies and reduce costs.
For more information on how Keyloop is harnessing technology and AI to fuse every stage of the automotive retail experience, learn more about Fusion, the industry’s first Automotive Retail Platform.
