Fiat Launches Virtual Dealership Service in December 2022

Fiat has launched its virtual dealership service, which allows customers to chat with a real person live and experience the car in a “metaverse store.” While some may view this as a gimmick or distraction, Fiat’s European boss Gaetano Thorel sees it as one of many new digital offerings that car makers need to create in case the market moves that way. However, Thorel emphasizes that a strong core car-selling business is essential before making such hedged bets for the future.

Car Makers’ Struggle to Articulate Mobility Plans

Many car makers have struggled to articulate their plans for mobility and diversifying their businesses. While the car sales industry is worth $2.3 trillion a year, transportation services around mobility (ride-sharing apps, etc.) are worth $5.4tn. However, car makers seem to forget that they are car makers and get bogged down in mobility jargon. For example, while Honda’s statement is clear and reasonable (“dedicated to supplying products of the highest quality, yet at a reasonable price”), BMW’s statement (“to become the world’s leading provider of premium products and premium services for individual mobility”) drifts.

Car Makers Need a Dual Mindset

Thorel emphasizes that car makers need a dual mindset. They need to be strong on internal combustion engines while creating new digital channels, such as subscriptions and the metaverse, in case they miss the boat. However, a strong core car-selling business is essential before making such hedged bets for the future. Car makers must move forward and create new digital channels, but they must also focus on making cars people want to buy at prices they can afford to pay, with technology and services that are actually useful.

Disruption in Car Sales and Electrified Propulsion Methods

Disruption has come most of all in the way cars are sold (the likes of agency and online brokers) and electrified propulsion methods, rather than any great digital mobility revolution. Investments in electric vehicles can be planned, but trying to predict which way the wind will blow in terms of the digital world around cars still feels like guesswork.

Conclusion

Car makers must focus on their core car-selling business while creating new digital channels in case the market moves that way. While some car makers struggle to articulate their plans for mobility and diversifying their businesses, a dual mindset is essential. Disruption has come most of all in the way cars are sold and electrified propulsion methods, rather than any great digital mobility revolution. Car makers must move forward and create new digital channels, but they must also focus on making cars people want to buy at prices they can afford to pay, with technology and services that are actually useful.