Automotive News Canada - February 2024 - 11

* FEBRUARY 2024
11
EV upstarts must adapt to survive
THE LONG-EXPECTED SHAKEOUT IN
electric vehicles appears to be under
way, with dealers becoming the next
refuge for startups looking to regain
traction in an increasingly flooded market.
U.S.
consulting company
The directsales
model
AutoForecast Solutions expects the
number of large-scale auto companies
to double by 2030, company CEO Joe
McCabe told me
last fall.
pioneered by
Tesla Inc. is
not working for
all players, and
time is running
out to make
course
corrections.
But with all this
change, there's
plenty of room for
five or more EV
startups that have
sprouted up over
the past 10 years to
" die off in the
weeds, " McCabe
said.
The jury's still
out on which
upstarts have staying
power, but
recent course corrections
by Vietnam's VinFast and
California's Fisker Inc. to enlist dealers
are clear indications that the directsales
model pioneered by Tesla Inc. is
not working for all players.
Last fall, VinFast announced plans
to build a dealership network in North
America. It signed up its first U.S.
dealers in January and expects to do
the same with its initial Canadian
retailers in the coming months. The
match the experience that dealerships
offer.
DAVID
KENNEDY
TORONTO
BUREAU
CHIEF
fate of its company-owned showrooms
is unclear, but VinFast said it will " consider
transferring " the stores to its
retail partners.
Fisker disclosed similar plans in
January and said it began talks with
prospective dealers in the fall. It plans
to have 50 dealerships across the
United States and Canada plus another
50 in Europe.
Other new entrants, conversely, are
staying the course on direct sales.
Rivian Automotive, for one, has no
intention of moving away from its
model, which has showrooms and service
centres, but transactions are
completed online. In fact, it's extending
its reach across Canada. After
more than a year of serving just British
Columbia, the company in December
began delivering vehicles in Ontario. It
will follow up with shipments to Alberta
and Quebec as local service centres
open in the coming weeks.
Lucid Motors has likewise given no
notice of a change to its direct-sales
sales tack.
This isn't a nonstarter, McCabe
said, but companies opting for a
direct-sales approach need to at least
A place to interact with vehicles and
get reliable service are two pieces of the
puzzle, he said. Better yet, to stay top
of mind, brands can set down roots in
locations that match their customers'
behaviours.
" They've got to hit the consumer
where the consumer's going to see
them all the time. "
Tesla stands out as an example to
follow, he said, as it has found new
ways to interact with the next generation
of vehicle buyers. In the process,
McCabe said, the
Tesla brand becomes
a not insignificant
part of its customers'
lifestyles.
But as the EV
McCabe:
Direct sales
can work, but
automakers
must offer a
dealership
experience.
FILE PHOTO
market tightens and
growth capital runs
thin, the clock is ticking
for startups still
searching for a winning
sales strategy.
The retrenchment
from VinFast and
Fisker is a pretty
clear sign that their
original sales plans
were falling flat. If
local retailer experience helps the two
companies get back on track, more of
their competitors may also throw over
direct sales for the tried-and-true dealership
model. - ANC
Karaoke today, what's
coming for tomorrow?
CONTINUED FROM PAGE 6
booking revenue in the
millions of dollars, and
Tesla has quickly become
one of its top five customers,
Riley said. For
Karaoke, Stingray charges
automakers a per-car fee,
though it is also exploring
other payment models as
it expands in the sector, he
said.
Much of Stingray's
automotive work is managed
from its headquarters
in Montreal, including
app development and
IT. Industry sales, meanwhile,
are often managed
market to market, with
teams in the United States
and Europe typically taking
the lead. The company
has 11 offices globally
and employs nearly 1,000
people.
TRANQUILITY AND TRIVIA
Karaoke is just one of
several products Stingray
has begun rolling out in
vehicles, as automakers
aim to provide drivers
a greater range of fun
or functional apps in the
cabin.
23_011331_Automotive_News_CN_FEB_CN Mod: January 15, 2024 2:47 PM Print: 01/16/24 page 1 v2.5
On Jan. 5, the company
announced that it was
expanding its partnership
with BYD to include
Calm Radio. The app is a
" no-brainer " for city drivers
who want to dial back
the aggravating sounds of
traffic, Riley said.
The deal marks the
first deployment of the
Stingray channel with a
major EV maker.
A trivia game is another
company product gaining
ground in automotive,
Riley said. The app
uses artificial-intelligence-assisted
voice recognition
for prompts and
answers from drivers or
passengers.
More offerings that
leverage the Canadian
company's content rights
portfolio are expected to
follow.
Stingray is already
working on several new
apps with BYD, Riley
said. It's also preparing to
launch with several automakers
based in North
America and Europe in
2024, though Riley would
not point to specific
brands. - ANC
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Automotive News Canada - February 2024

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