Listen Now

The automobile, which can be considered one of the preeminent consumer products of the Industrial Revolution, is facing its greatest moment of change ever! This change is being driven by Automated Driving Technologies (ADT), consumer preferences, industry pressures, government influence, and regulations. This digitalization of the automobile is one of the most important developments in the world today.If ever there was a product ripe for disruption, it is the automobile. This scenario is a nightmare for many traditional car manufacturers and is the reason why many tech companies can’t wait to get a piece of the multi-trillion (yes, with a “T”) dollar global automotive industry.As the vehicle becomes another computing and connected device on the network, the future business model for the automobile will be a software and services model. In other words, we’re moving toward the “computer on wheels”.

In this week’s podcast and for the next 6 episodes I am going to focus on 6 disruptions the collision industry will experience in 2020 and beyond and what industry participants must consider to survive and thrive. These 6 episodes were recorded during a webinar on May 6th 2020. In today’s episode I am going to focus on how COVID-19 is disrupting the collision industry and what industry participants must consider to survive and thrive. 

When I wrote my book, “Auto Industry Disruption, who and what will be disrupted and what to do about it”, back in 2019, there is no way I could have predicted what and how the automotive industry could be disrupted by the COVID-19 virus! Today, as I sit here looking “over the proverbial hill” I see what our industry might expect over the next 12-24 monthsThe major takeaway we all need to consider is….we should all prepare for a much longer rebound than what we might be hearing “in the news” or on TV. Let me start with major disruptions that are occurring OUTSIDE of the automotive industry that will have a major impact on the automotive industry and what our industry must consider going forward..

In this episode I will share many ideas on how to utilize different technology platforms and tactics to generate more sales. 

In today’s podcast I want to share my thoughts on How COVID-19 Disrupted the Automotive Industry During the Week of as of April 6th thru 10th and What we should Expect AC (After COVID) As I record this podcast at least 316 MILLION people in at least 42 states are being urged to stay home and more than 16 million have filed for unemployment benefits! If consumers are being asked to “stay at home” and are not working, they are not going to drive….One thing ALL businesses MUST do is stay connected to their customers via email, social media and the good old fashion telephone…to keep their brand top of mind and encourage customers to utilize their services.. So, what does all this mean?  It is my belief that the entire automotive industry is in for another 6-12 weeks of COVID disruption leading to drastically reduced car manufacturing, new car sales and repair car counts due to increased unemployment, curtailed vehicle production, lack of miles driven, reduced accidents and claim volume.  Business that do not have “runway” ie: cash flow to support their business during this period are going to struggle…and even go out of business!Repair volume at all automotive repair businesses will be suppressed until sometime very late in 2020 or 2021! I also believe there will be an increase of acquisitions between now and the end of 2020 and into 2021! Businesses that do not have “runway” / cash will look to be acquired…. If they don’t get acquired there is a good chance, they will exit the business. In the longer term I think we can expect miles drive to remain suppressed because a large percentage of companies and employees are figuring out the “work at home thing”. This will ultimately lead to lower new car sales, less service repair, less accidents and lower claim volume!The automotive industry should also expect to see the acceleration of all types of technology implementation such as online sales and F&I platforms, an increase of mobile apps, image-based estimates, artificial intelligence, more online scheduling, increased use of digital communications technologies such as Zoom, text and video. When it comes to planned industry events and trade shows scheduled between July and the end of the year I would suggest the organizations planning these events should plan for low attendance or move to a virtual event. While the virus MAY BE on the downside by July or August the question that needs to be asked is…will owners of businesses be ready to travel and ready to spend money in new equipment, products and services? Here is a bigger question..What about SEMA in November? I will tell you this…online sales and event marketplaces will become MUCH more popular..stay tuned for more news on this There is light at the end of the tunnel, and it is not a train. For automotive businesses that have a “runway”, are willing to “pivot”, get creative and “do whatever it takes” to survive, they will come out of this as a winner.  This is a time to ·      Look in the mirror and objectively evaluate your business. Complete a SWOT analysis to determine how and what you need to do to survive and thrive. ·      Learn about and implement digital technologies that increase revenue, reduce costs and improve customer service ·      Improve your company’s success quotient through online training·      Look for and add other services your business can offer to your market place·      Stop offering services that do not generate a profit ·      Dig in your heals and make a commitment to yourself and your employees that you will get through this!!

In our inaugural podcast we introduce you to why we have created the podcast and your host Frank Terlep. Today, as I record this inaugural episode the world is being disrupted by the COVID 19 virus! Before COVID and after COVID, (This virus will be defeated!) the automobile, the automotive industry, and the surrounding ecosystem is in the middle of a major digital disruption. I have created this podcast to share why and how I believe the automotive industry ecosystem will be disrupted, and, most importantly, to help you, the listener, understand what you need to do to survive and thrive during this and future disruptive periods! 

As most of us know, last Friday the US congress passed the Paycheck Protection Program and the EIDL (Economic Injury Disaster Loan Emergency Advance) to help small business retain their employees and to stay in business. As I record this podcast the SBA is also presenting SBA Express Bridge Loans and an SBA Debt Relief offering as funding options associated with the COVID-19 outbreak. I strongly recommend you visit SBA.gov for yourself to learn more. I also recommend you speak with your company’s accountant determine the best path for your business. Today, the Federal Reserve also just announced an additional $2.3 TRILLION in loans which includes… With all of the fluidity going on in the market, Here are 10 Do’s and Don’t’s related to seeking financial assistance from the government…1. Don’t hesitate to apply for the PPP. The only businesses that shouldn’t apply are those that haven’t been impacted by COVID-19. 2. Do move fast. There are 5 million employer companies in the U.S. that are going to be vying for this pot of money [through the PPP!  So, don’t just make sure you have your ducks in a row in terms of documentation. Make sure you file your application from the moment that your bank window opens.”3. Don’t worry about loan forgiveness right now. Instead, take advantage of the opportunities afforded by the PPP. This is very cheap, 2-year money. There is no collateral. And there are no personal guarantees. This will probably never happen again in your lifetime. 4. Do apply for the EIDL Program in addition to PPP. You can always turn down the money if you don’t need it or find it’s not beneficial to you. 5. Don’t expect your loan to arrive swiftly. In the case of EIDL, the government has promised to deliver the first $10,000 to businesses within three days of applying. However, the remaining funds are likely to take much longer.When Hurricane Katrina hit, it took businesses 4 to 5 months to get these funds. Prepare, and understand that when you’re dealing with the government, you’re dealing with a different and slower timeline!6. Do explore additional funding through state programs. For example, in New Jersey, businesses can take advantage of $5,000 and $10,000 grants. 7. Don’t take out a loan through a credit card. Although credit cards can deliver funds within 24-48 hours, many loans have terrible terms, such as 300% interest rates. Talk to your financial advisor before you accept any money that isn’t offered through a bank.8. Do scrutinize your cash flow. This will help you determine if you should explore the SBA 7(a) Loan Program in addition to the PPP or EIDL program!9. Don’t make big decisions until you see the big picture. I’d hope that none of us would be making any drastic decisions right now around things like layoffs or furloughs until we have a clear picture of this relief and how it applies to you. 10. Do what’s right by your employees. I remind everyone we’re all under stress, and our employees are under tremendous stress.". Make sure you take care of them. Make sure that you are using this stimulus to share some good news and try to inspire some confidence in your workforce