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The revolution in the car trade is rolling through the country in trucks with glass loading spaces.
At least that's how the online retailer Autohero delivers used cars to customers.
It is reminiscent of the packaging of Matchbox cars, says founder Christian Bertermann.
His start-up Auto 1, which is also behind the wirkaufendeinauto.de portal, wants to turn the used car market upside down.
Everything runs online until the glass delivery van stops at the front door.
Auto 1 is expected to go public on Thursday.
The founders want to collect one billion euros there.
The total value of the company is estimated at more than six billion euros - although it has never made a profit.
This makes Auto 1 Germany's most valuable unicorn - that's the name of start-ups that are worth more than a billion euros.
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The evaluation shows how much growth imagination there is in online motor vehicle sales.
Auto 1 estimates that only one in 100 used cars is currently being sold on the Internet. Even with new cars, it has only been used to initiate a purchase.
The company sees this as its opportunity.
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The dealers place tons of classified ads for new and used cars, and the manufacturers invest huge sums of money in their digital presence.
In the end, however, the customers have to come to the car dealership to take a test drive under the supervision of a seller, to haggle the price and to sign the sales contract.
Arguments like those of the fashion retailers a few years ago
That will hardly change, say the dealers.
“The pandemic has given car sales a certain boost on the Internet, and dealers are increasingly using online tools.
But that won't be the only solution in the medium term either, ”says Antje Woltermann, Managing Director of the Central Association of the German Motor Vehicle Industry.
Customers needed advice on a product like a car and wanted to see it for themselves.
In addition, "direct sales by manufacturers via the Internet without the involvement of retailers are not acceptable".
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The arguments sound like those of the fashion or furniture dealers a few years ago.
They too could not imagine that their customers would order from the screen.
It turned out differently.
Cars cannot be delivered by parcel carriers.
But does that mean that e-commerce is not becoming increasingly important for the industry?
In any case, some manufacturers like BMW and Mercedes want to massively strengthen this sales channel.
They believe the number of internet buyers will grow rapidly.
Britta Seeger, Head of Sales at Daimler, announced at the presentation of the electric entry-level model EQA that the car could be ordered online in 17 countries.
"We expect sales of up to 50 percent via the online shop," said Seeger.
Car companies are under massive pressure
The car should appeal to an urban, internet-savvy target group.
Competitor BMW has given its sellers a system with which they can advise customers via video conference and demonstrate vehicles.
In the future, it should be possible to order the cars online and have them delivered to your doorstep.
In cooperation with the local dealers.
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At the moment it seems difficult to imagine that manufacturers can do without the car dealerships entirely.
It is they who bring the vehicles to the furthest corners of the republic.
Your advisors and mechanics are like the faces of the car brands for the customers: They have to solve the customers' problems - and endure the anger if something goes wrong.
The vast majority of the almost 439,000 employees in the motor vehicle trade are not employed by the car companies, but by companies that are only bound to the brands through hard distribution agreements.
These companies are under massive pressure.
You have to make the change from the internal combustion engine to the electric car and save your business in the new online world.
Many of the 36,600 car dealerships will not survive this.
New car sales fell by a fifth in the past year, and there were fewer accidents during the lockdowns than usual - so fewer repairs.
The federal government's crisis aid and the obligation to file for bankruptcy, which has been suspended until April, are still masking the extent of the problem.
Those who stay in the analog world will not survive
"Despite Corona, only 197 companies went bankrupt last year," says Jan Burgard, managing partner of the consulting firm Berylls Strategy Advisors.
In 2019, without a crisis, there were still 210 bankruptcies.
But: "With the end of the suspension we will see a surge in bankruptcies," says Burgard.
Then suddenly some of the currently "only existing as zombie businesses" disappeared.
Customers don't have to worry about a shortage of car salesmen.
In Germany there are 30 dealers per 1000 square kilometers, in Great Britain there are 18. On the island, according to advisor Burgard, a dealer sold an average of 540 new cars last year, in Germany only 330 cars.
To change that, says the consultant, companies would have to invest more in digital offerings.
His message: If you stay in the analog world, you will not survive.
Stefan Reindl, head of the Institute for the Automotive Industry in Geislingen, also expects the upheaval in the industry to accelerate.
"We have been observing increasing concentration for a long time and are seeing that many car dealership locations are leaving the manufacturers' sales networks," he says.
A lot is also changing in the workshop.
Modern vehicles last longer than before, they wear less, but they are also more complex.
“In the medium and long term, electromobility will lead to major cuts in the motor vehicle industry even more dynamically,” he says.
Electric cars require less maintenance.
This mainly affects companies that make money with repairs.
Tesla is expanding its network of its own stores
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Jürgen Keller, Managing Director of Hyundai Motors Germany, says the same.
"I don't need an oil change for an electric car, it has fewer wearing parts, and so fewer repairs are required," he says, who only sells her cars through authorized dealers.
"The workshops are of course thinking about how they want to shape their future."
Nevertheless, it is clear that the manufacturers still need a large network of service partners.
The 350 Hyundai dealers operate more than 500 locations nationwide.
Keller is convinced that you will remain the first point of contact for customers for a long time to come.
The pioneer of online car trading seems to see it similarly.
Tesla and his boss Elon Musk only sell their own models via online shop, without discounts, without haggling.
At the same time, however, Tesla is expanding its network of its own stores.
There are now 23 stores and 13 service centers in Germany, with three more to open soon.
In order to become a mass manufacturer, Tesla will need many more branches, say experts.
The old distribution still has enormous power.
According to calculations by the analyst Matthias Schmidt, Tesla sold 97,791 vehicles in Europe last year.
Volkswagen and Renault were able to sell three times the number of all-electric cars through their dealers.
Companies like Auto 1 benefit from Tesla
It is questionable whether Tesla will manage its own sales in the long run.
The strategy of handling as many processes as possible yourself is more expensive than outsourcing it to partners.
Because buildings and exhibition vehicles tie up a lot of capital, and the business hardly brings any profit.
In 2019, half of German car dealerships had a return on sales of less than one percent.
The manufacturers, on the other hand, are aiming for margins beyond ten percent.
Tesla can still afford such expenses.
The company has almost 20 billion dollars in its cash register, and the crazy high stock market valuation allows company boss Elon Musk to raise billions of dollars from the market at any time through a capital increase.
Either way, companies like Auto 1 benefit from Tesla.
The stock market environment could hardly be more favorable than now for a share that combines car buying and the Internet.
And as far as the location is concerned, the difference to the established car dealership couldn't be greater: The founders don't control their start-up somewhere on an arterial road, but from Bergmannstraße in Berlin-Kreuzberg, one of the most sought-after areas of the city.
On the other hand, the market leader of the established companies is the Swiss Emil Frey Group, founded in 1924 and managed by the founder's son to this day.
There is hardly anything further from the 77-year-old Walter Frey than an IPO with a glass truck.
This text is from WELT AM SONNTAG. We will be happy to deliver them to your home on a regular basis.
Source: Welt am Sonntag