Automotive Dealerships Research Articles

Enhancing dealership management software with AI integration for improved customer service and future innovations

This review paper explores the integration of Artificial Intelligence (AI) into dealership management software to enhance customer service and foster future innovations. The primary objective is to synthesize existing research and industry practices to understand how AI technologies can streamline operations, personalize customer interactions, and drive business growth within automotive dealerships. The paper reviews key AI applications, including AI-driven chatbots and virtual assistants that provide automated support, predictive analytics for customer behavior and sales forecasting, and personalized marketing strategies. The analysis reveals that AI significantly improves customer service efficiency by reducing response times and enhancing customer satisfaction. Predictive maintenance and inventory management powered by AI algorithms ensure optimal resource allocation, minimizing downtime and operational costs. Additionally, the paper identifies potential future innovations facilitated by AI advancements, such as augmented reality (AR) for virtual vehicle tours and blockchain for secure transaction management. These innovations promise to elevate the customer experience and streamline dealership processes, creating a competitive edge in the market. The integration of AI into dealership management software presents substantial benefits in improving customer service and operational efficiency. The paper emphasizes the need for continuous investment in AI technologies and employee training to fully harness these advantages. Future research should focus on exploring emerging AI applications and their long-term impact on the automotive industry, ensuring dealerships remain adaptable and competitive in a rapidly evolving technological landscape. Keywords: Artificial Intelligence, Dealership Management Software, Customer Service, Predictive Analytics, Augmented Reality, Blockchain, Automotive Industry.

Evaluating regression techniques for service advisor performance analysis in automotive dealerships

Service advisors are a crucial contributor to the profit and loss of an automotive dealership. It is thus crucial that their performances are continuously evaluated to make decisions that ensure continued profitability. Artificial intelligence (AI) algorithms like the finite mixture of regression (FMR) have been previously explored as a tool for benchmarking the performance of dealerships. However, it is essential that the AI algorithm is trustworthy and that its predictions can be explained. This study aims to develop a performance analytics platform that is reliable and explainable. It develops and evaluates variants of FMR based on different regression techniques, focusing on both reliability and explainability. The results show that the implemented FMR variants not only provide accurate performance assessments but also offer transparent insights into the factors influencing dealership performance.

A strategic approach to the development of automotive dealerships in a changing market environment

The activities of automotive dealerships need to be strategically adapted to changing market conditions. The article examines the role played by the automotive industry in the Russian economy, presents an analysis of changes in the structure of new car sales in the period from 2021 to 2023.The strategic factors that dealerships should consider when choosing a brand are described. The necessity of analyzing the competitive environment is justified, the existing marketing tactics of manufacturers are presented, the importance of the availability of spare parts and opportunities for revenue growth from after sales-service are described. The article emphasizes the need to invest in the reconstruction of dealerships, despite the inevitable financial losses, to ensure the future profitability of the business. The study provides information for players in the Russian automotive industry, helping them to change their strategy for the future development of the company in a changing market environment.

The Role of Democratic Transformational Leadership Style in Supporting Clan Organizational Culture

Leadership plays a critical role in achieving organizational success and shaping its culture. This paper investigates the role of leadership in shaping organizational culture, specifically within a leading automotive dealership in Indonesia aiming to strengthen its clan culture. This paper aims to evaluate the existing leadership approach in the company and identify a style that would better support a clan culture. Primary data for the study was gathered through a quantitative survey of 324 employees, selected using Slovin’s formula. The questionnaire model that was employed is the Vannsimpco Leadership Survey (VLS). The tools that were used for analysis are descriptive analysis and gap analysis. Results show that the organization predominantly exhibits an Autocratic-Transformational leadership approach. In contrast, the expected leadership style that emerged from the results is Democratic-Transactional. Based on the findings, the company is advised to strategically realign its leadership to a Democratic-Transformational style, emphasizing participative decision-making, open communication, and collaborative, employee-focused approaches to foster a clan culture.

What the eyes don't see, the heart doesn't buy: the Premium Motors case

PurposeThis teaching case aims to encourage reflection on the formulation of the strategic repositioning of an automotive dealership.Design/methodology/approachBuilt on the teaching case method, it portrays the situation of the Premium Motors automotive dealership in the face of a strategic repositioning. Management and the board discuss ways to minimize the impact of the coronavirus disease 2019 (COVID-19) pandemic on sales figures. The situation presents the possibility of entering a new product segment.FindingsHow to make consumers correctly understand the new positioning? The case is structured to enable reflection and teaching of marketing strategies, with each student having the possibility of putting themselves in the role of company managers. The environment and trajectory are also portrayed, broadening the perception of the studied company and providing devices for solving the emerging problems of the case.Originality/valueThe case becomes a tool to promote knowledge, from the implementation to the management of strategic repositioning. Thus, the teaching notes offer directions on how professors can use the teaching case with their undergraduate and graduate students in disciplines related to strategy and marketing.

Financial Statement Analysis to Assess Financial Performance Using Financial Ratios at PT.Citra Asri Buana Bogor

This study aims to find out how the company's financial performance at PT.Citra Asri Buana Bogor Workshop & Spare Parts from 2017 to 2021 by using financial ratios and to find out the performance of PT.Citra Asri Buana Bogor Workshop & Spare Parts compared to the average standard company industry average. The object in this study is a company engaged in the automotive dealership with subjects related to financial reports in assessing financial performance in the form of financial reports, namely income statements and statements of financial position. The method used in this research is descriptive quantitative. The results of this study on the liquidity ratio, solvency ratio, activity ratio in general are not in good condition while the profitability ratio is in very good condition because every year there are increases and decreases which are still above average. Meanwhile, the results of financial ratios when compared with the industry average standard illustrate that the company is still difficult to compete with other similar companies.

Automotive Salespeople Performance: Political Skill, Relationship Building, and Deviance

This study explores the relationship between political skill, customer-relationship-building competence, customer-oriented selling, and customer-directed deviance, and investigates whether these relationships affect the sales performance of PT. Astra International Tbk. This study included 220 automotive salespeople as sample using nonprobability sampling, purposive sampling method technique, with various showroom branches of PT Astra International – Tbk’s automotive dealerships as the study’s setting. Structural Equation Modeling is used to test the study’s hypotheses. Results suggest that political skill positively affects customer-relationship-building competence and sales performance yet negatively affects customer-oriented selling and customer-directed deviance. Customer-relationship-building competence positively affects sales performance yet negatively affects customer-oriented selling and customer-directed deviance. Customer-oriented selling positively affects customer-directed deviance and customer-directed deviance negatively affects sales performance. Theoretical and managerial implications for future research are provided.

Analysis of advertising media in automotive dealerships in Guasave, Sinaloa, México

This article is oriented on conducting a study of advertising media used in automotive dealerships in Guasave, Sinaloa, Mexico, to analyse the advertising media they use, the method used was mixed, with a descriptive approach, and data collection was carried out from November to December 2022. The results showed that automotive dealers increased the implementation of advertising resources through the Internet, adapting to the changes of consumers. However, they expressed that it is advisable to make a combination of both traditional and digital, to improve the massification of advertising information. The analysis obtained relevant information on the advantages and disadvantages of each advertising medium used, which supports companies in making decisions concerning media planning.

Automotive dealerships 2019–22: dealer markup increases drive new-vehicle consumer inflation

Automotive dealerships 2019–22: dealer markup increases drive new-vehicle consumer inflation

Role of change leadership styles on cognitive rigidity at selected automobile dealerships in Durban, South Africa

Leadership is a core component of organizational management, but its functions are getting more complex with the increasing involvement of changes taking place in the world. As such, the complicated operation of managing cognitive rigidity as a form of resistance to change amongst employees is very critical. On the other hand, resistance to change is described as one of the impediments to organizational expansion due to its negative consequences. To cope with change, there is a need for an effective leadership style. This study focuses on the association between change leadership styles, i.e., transformational and transactional leadership styles with cognitive rigidity as a form of resistance to change. The study further seeks to investigate the impact of these leadership styles on employees’ resistance to cognitive rigidity at the selected automobile dealerships in the Durban Metropolitan Region of KwaZulu-Natal in South Africa. Theories on change and leadership styles have been considered in this paper. A descriptive survey design was adopted to collect information from a stratified sample size using self-administered questionnaires to 170 staff at automotive dealerships in the metropolitan of Durban in South Africa. Pearson correlational and regression analysis were employed to analyze data. Results indicated significant correlations between these change leadership styles and cognitive rigidity as a form of resistance to change. However, the transactional leadership style revealed a more substantial possibility of increasing resistance to change. The study recommends that management practice the transformational leadership style to encourage employee participation in the decision, build confidence, accept constructive criticisms, effective communication and transparency, thereby reducing rigidity.

The Organizational Change and Development Practices in Automotive Dealership

The Organizational Change and Development Practices in Automotive Dealership

ЕКОНОМІКО-МАТЕМАТИЧНЕ МОДЕЛЮВАННЯ ЦІНОУТВОРЕННЯ НА ВТОРИННОМУ РИНКУ АВТОМОБІЛЕЙ

Today, in an era where mobility is highly sought after, owning a car has become a necessity to avoid reliance on alternative modes of transportation. However, the cost of purchasing a new car and the expenses associated with its maintenance are considerably high. That`s why a significant number of individuals and companies have shifted their attention towards the secondary car market. Consequently, it has become imperative to conduct a comprehensive analysis of the used car market, develop effective pricing models, and formulate strategic pricing approaches for car dealerships and other key participants in the market. In order to address these challenges, the authors of this study have implemented advanced statistical methods to meticulously examine the numerical data at hand. The technique of multi-factor linear regression has been employed to forecast the price formation trends in the secondary market. Additionally, econometric methods have been utilized to assess the precision of the price indicators. Moreover, a meticulously devised model has been extensively analyzed and formulated to accurately calculate the optimal price for used cars in the secondary market. The economic advantage of developing such a formula lies in the ability to effectively compare the approximate value of a used car obtained from the secondary market with that of a brand-new vehicle for the company. The findings of this study aim to guide individuals and automotive dealerships in making well-informed decisions by selecting the most suitable options based on their cost and quality. The developed pricing formula offers a distinct economic advantage by facilitating a direct comparison between the approximate value of used cars in the secondary market and that of new vehicles available to companies. In summary, this comprehensive study provides invaluable insights into the intricate dynamics of pricing within the secondary vehicle market. By shedding light on these dynamics, it significantly contributes to the informed decision-making process for various participants in the market, ultimately leading to better outcomes for all stakeholders involved.

Performance evaluation of automotive dealerships using grouped mixture of regressions

Finite Mixture of Regressions (FMR) are among the most widely used models for dealing with heterogeneity in regression problems. FMR is a model-based clustering approach that models the data by assigning individual observations to one of the K latent regression clusters. In some applications, it is desired to cluster groups of observations together rather than individually. We present an extension to the regular FMR, that we call the Grouped Mixture of Regressions (GMR), which allows for a known group structure among observations, in addition to their possibly unknown heterogeneity. The research is motivated by a large financial longitudinal dataset from a brand of automotive dealerships across the United States. The task was to cluster the dealers based on their financial performance and also improve performance prediction for individual dealers. We derive a fast and salable algorithm for estimating the model parameters using Expectation–Maximization (EM). We also show how the group structure can improve prediction by sharing information among members of each group, as reflected in the posterior predictive density under GMR. The performance of the approach is assessed using both synthetic data as well as the dealership data. Among our findings are the superior predictive performance of GMR and the ability to correctly detect the number of clusters using simple cross-validation.

Automotive dealerships 2007–19: profit-margin compression and product innovation

From the 2007–09 Great Recession to the onset of the coronavirus disease 2019 pandemic, the new-vehicle market in the United States changed significantly. Consumer and producer price trends examined in this article show how dealers’ profits on new vehicles declined and, subsequently, how dealers successfully expanded financial services to improve revenue and profit.

Corporate Social Responsibility and the National Culture in Automotive Dealerships

Objective: this study seeks to analyze the relationships between dimensions of national culture and corporate social responsibility (CSR) practices in automotive dealerships. Theoretical framework: the theoretical bases used correspond to the contents of CSR and Hofstede’s cultural dimensions. Method: a survey-type quantitative study design was employed and classified as field research; 108 questionnaires were applied, and 43 were answered by managers and 65 by employees of seven organizations in Rio Grande do Sul State. The answers were validated using structural equations. Results and conclusion: our findings showed a positive relationship between long-term orientation and CSR practices; a negative relationship between masculinity, power distance, and uncertainty avoidance and CSR practices was also observed. Hence, the dimension of national culture, long-term orientation, and uncertainty avoidance were positively associated with CSR practices. Research implications: the implication is in implementing CSR practices and their relationship with the cultural dimensions, seeking to encourage management procedures in automotive dealerships, serving as support for decision making. Thus, this study contributes to expanding knowledge about the subject studied. Originality/value: The study’s originality lies in analyzing the relationships between the dimensions of national culture and CSR practices in automotive dealerships. Furthermore, it provides subsidies for understanding how organizations behave from changes in the environment and understanding concepts about ethics and corporate responsibility involving CSR practices and national culture.

How Market Power Affects Dynamic Pricing: Evidence from Inventory Fluctuations at Car Dealerships

This paper investigates empirically the effect of market power on dynamic pricing in the presence of inventories. Our setting is the auto retail industry; we analyze how automotive dealerships adjust prices to inventory levels under varying degrees of market power. We first establish that inventory fluctuations create scarcity rents for cars that are in short supply. We then show that dealers’ ability to adjust prices in response to inventory depends on their market power, that is, the quantity of substitute inventory in their selling area. Specifically, we show that the slope of the price–inventory relationship (higher inventory lowers prices) is significantly steeper when dealers find themselves in a situation of high rather than low market power. A dealership with high market power moving from a situation of inventory shortage to a median inventory level lowers transaction prices by about 0.57% ceteris paribus, corresponding to 32.5% of dealers’ average per-vehicle profit margin or $145.6 on the average car. Conversely, when competition is more intense, moving from inventory shortage to a median inventory level lowers transaction prices by about 0.35% ceteris paribus, corresponding to 20.2% of dealers’ average per-vehicle profit margin or $90.9. To our knowledge, we are the first to empirically show that market power affects firms’ ability to dynamically price. This paper was accepted by Juanjuan Zhang, marketing.

Dealer loyalty and brand loyalty: United or divided?

This study is an effort to shed light on the relationship between dealership loyalty and brand loyalty. The research questions posed in this study: What effect do dealership loyalty and brand loyalty have on consumer’s intention to switch brands? Are consumers more loyal to the dealer or to the actual brand they purchase at the dealership? An automotive dealership group located in the Midwestern US allowed the researchers to survey its customers. Findings of this study demonstrated the higher the brand loyalty of the consumer, the lower the likelihood to switch brands. The higher the dealership loyalty of the consumer the higher the likelihood to switch brands. Brand loyalty appears to be more important than dealer loyalty. Brand loyalty and dealer loyalty are complementary at lower levels of likelihood to switch brands and are less complementary at medium to high levels of likelihood to switch brands.

‘Are they out to get us?’ Power and the ‘recognition’ of the subject through a ‘lean’ work regime

Critical studies of ‘lean’ work regimes have tended to focus on the factory shop floor or public and healthcare sectors, despite its recent revival and wider deployment in neoliberal service economies. This paper investigates the politics of the workplace in a United Kingdom automotive dealership group subject to an intervention inspired by lean methods. We develop Foucauldian studies of governmentality by addressing lean as a technology of power deployed to act on the conduct of workers, examining how they debunk, distance themselves from and enact its imperatives. Our findings support critiques of lean work regimes that raise concerns about work intensification and poor worker health. Discourses of professional autonomy allow workers to distance themselves from lean prescriptions, yet they are reaffirmed in their actions. More significantly, we illustrate the exercise of a more encompassing form of power, showing how lean harnesses the inherently exploitable desire for recognition among hitherto marginalised workers, and its role as a form of ‘human capital’. The paper contributes to critical studies of lean by illustrating its subtle, deleterious and persistent effects within the analytical frame of neoliberal governmentality. We also demonstrate how studies of governmentality can be advanced through the analysis of contested social relations on the ground, highlighting the ethico-political potential of Foucauldian work.

Use of Artificial Neural Network for Inquiry Follow Up System in Sales Operations for Two-Wheeler Automotive Dealership.

Artificial neural network can be the good classifier based on its capabilities of supervised learning and back propagation of the error. We have used this capability of ANN for distinguishing buyers and non-buyers in the automotive industry sales to save the time of the sales consultant in order to provide the better services to the potential buyer and convert the inquiry into the sales. Based on the six parameters with the ANN consisting of one hidden layer and 4 hidden units we have checked the results which is satisfying.

AN EMPIRICAL STUDY ON THE RELATIONSHIP BETWEEN EMOTIONAL LABOR, SALES CALL ANXIETY AND WORK PERFORMANCE

Emotional labor research has focused on employees' interactions with customers that is a significant part of organizational life. It is a fact that during this interactions emotions are regulated and managed by employees. Regulation of emotions produces positive outputs such as performance improvement in terms of businesses, but also negative psychological consequences such as anxiety in terms of employees. In this context the purpose of this empirical study is to investigate the effects of emotional labor strategies, superficial and deep acting, on sales call anxiety (SCA) and performance. The data was collected from 277 salespeople who worked in banks and automotive dealerships by using survey method. The research hypotheses were tested with structural equation model. The findings confirm that all scales, particularly SCA, are reliable and validate in Turkey. However, the results show that the effect of emotional labor strategies on SCA are different. While surface acting strategy has a positive effect on SCA, deep acting has a negative effect. Although the relationship between emotional labor strategies and performance was not supported, it was found that SCA has a negative impact on the performance of salespeople. These findings have been based on the literature and suggestions are provided for future research and administrative applications.