Automotive News Canada - June 2024 - 15

EXECUTIVE INSIGHTS
SPONSORED CONTENT
DEALERS MUST KEEP UP WITH
EVOLVING DIGITAL TOOLS
As digital retailing tools continue to evolve and gain
broader acceptance, dealers may be wondering what lies
ahead in this ever-changing technological landscape. What
do they need to do to prepare for these tools? And how
do they mitigate the kinds of cyberthreats that these tools
can expose them to as digital retailing becomes more and
more widespread? Michael McGhee, Senior Vice President
and Head of TD Auto Finance Canada, provides answers
and insights.
Q: How has the auto industry changed over the past
year and into 2024? What are retailers looking for and
what do their customers expect, particularly in regard
to digital tools?
Michael McGhee: Throughout 2023, the Canadian auto
industry recovered to near pre-pandemic levels. We saw
some normalization in global supply chains, which fueled an
increase in vehicle production and subsequently, dealer inventory levels. Pent-up
demand and strong population growth helped bolster sales initially, but this plateaued
as debt-servicing costs began to elevate. In total, there were 1.76 million
automobiles sold in Canada in 2023, which is about 11 percent below pre-pandemic
levels. While North American auto production did increase nine percent
compared to 2022, it was still four percent below 2019 levels.
As we consider the performance from recent years and look
ahead to the rest of 2024, it becomes clear that recovery in
the automotive market is well underway. Automotive sales
are expected to increase by close to 10 percent this year,
before converging with the pre-pandemic level of sales in
2025. This growth will be moderated by a slowing economy
and various economic headwinds.
One of the largest changes in recent years is the use of
technology. Dealers can now use enhanced technology
to augment their sales processes and reduce operational
expenses. With digital resources, they can widen their scope
of potential customers. We believe that digital tools should
enhance the overall experience and efficiency of dealership best practices, not
disrupt them.
Q: Are dealers doing enough to combat the cybersecurity threats that will
only increase as digital retailing becomes more widespread?
McGhee: It's tough to say if dealers, or anyone for that matter, are doing enough
when it comes to cybersecurity. The advances in modern technologies undoubtedly
create more opportunities for cybercrimes. And as dealers shift more towards
digital retailing, these threats remain prominent.
As cybercrimes and digital fraud threats increase, the most important thing for dealers
is to stay vigilant and know the signs that indicate potential cybersecurity threats.
Education is a critical step in identifying and preventing threats. It's important to
have a fraud-prevention strategy in place, as well as payment policies and procedures
and controls for cash deals. Dealers should regularly revisit these practices
with their employees to raise awareness and ensure compliance. And if you need
support, TD Auto Finance offers fraud-awareness training.
Q: The growth of digital retailing has been well-documented. How do you
see this trend evolving in the next five years and what should retailers do
to prepare?
McGhee: It's clear that the industry will continue to evolve and adopt new technology.
The pandemic caused a dramatic acceleration of digital purchasing tools and
processes and thrust the Canadian auto industry into a new way of doing business.
We needed to identify new ways of conducting business. And we quickly discovered
the benefits of doing so as customers wants and expectations shifted toward
a digital approach that elevated and streamlined interactions.
Michael McGhee
Given the rapid shift in the industry, dealers should continue
to focus on evolving and enhancing their processes, best
practices and tools. It will become increasingly important to
stay up to date on the latest technologies to remain relevant
and capitalize on important customer feedback. For example,
customers increasingly want self-serve options and digital
solutions. Our TD Wheels app provides customers with
vehicle information, connects customers with dealers and
provides dealers with pre-qualified leads at no cost.
The same can be said for retailers as their buying and selling
models have adapted to fulfill the new expectations of
today's consumers. No one knows exactly what the automotive
landscape will look like in the next five years, but being
proactive and open-minded to new ways of doing business
will almost certainly catch the attention of consumers that
seek a more modern vehicle-buying experience.
We believe that digital
tools should enhance
the overall experience
and efficiency of
dealership best
practices, not
disrupt them.
Q: What are dealerships that have successfully transitioned to digital or omnichannel
sales processes doing?
McGhee: Dealerships that have successfully transitioned to a digital or omnichannel
sales process are finding streamlined and secure ways to connect with
customers. Investing in digital tools gives them a significantly wider reach and
the ability to efficiently and effectively provide the services
their customers want. This may range from e-signatures to
secure automation.
Finding technologies that align with your core values is key.
The goal should be augmenting services, not just changing
them for the sake of change. Technology is a powerful tool
and should be viewed as a way to enhance the dealer and
customer experience.
Q: What digital retailing tools are essential and what
tools are on the horizon?
McGhee: I can't speak to all of the digital retailing tools
available today or what's coming down the pipeline in
general, but I can predict that the successful tools will
focus on providing secure and efficient resources that enhance the overall
car-buying experience.
Our focus at TD Auto Finance is exactly that: Providing resources to enhance the
overall car-buying journey without disrupting it and keeping customer information
safe and secure.
Today's essential digital retailing tools enable a simple and effective process for
lenders, dealers and customers alike. These tools will continue to evolve as this
is a critical time in the auto industry. And I am so excited to see how this industry
continues to evolve in the coming years.
ABOUT THE PANELIST
Michael McGhee
Senior Vice President & Head
TD Auto Finance Canada
With more than 30 years of banking experience, McGhee is known for his strong
track record of driving growth and his extensive financial, commercial banking and
sales experience.
To learn more about TD Auto Finance, visit https://www.linkedin.com/showcase/
td-auto-finance-canada/?viewAsMember=true
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Automotive News Canada - June 2024

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