The supply chain system and organizational structure of traditional automobile enterprises remain unchanged

We review the origin of the new energy vehicle direct model, because Tesla these new car brands at the time of its creation, there is no channel itself, so gradually explore out of a suitable for their own road, and the existing traditional car companies, especially with strong competitiveness of these companies should consider: How to make good use of its existing channels and systems, while using digital technology to improve efficiency, so as to achieve the effect of brand development. The transformation of dealers should also keep up with the pace of brand transformation, if the transformation is successful, I think the value and competitiveness of the authorization system can not be underestimated.

Think tank Jun: So far, have there been successful cases of authorization system transformation? What do you think of the Volkswagen ID series agency system attempt? For new energy vehicles, is the agency system really a particularly good model?

Shen Jinjun: Actually, the agency system was introduced in China as early as 25 years ago, and it is not a new concept. At that time, the automobile industry in the implementation of the reform of the marketing model, the first reference is Japan and South Korea's commission agency system, and finally gradually evolved into the current "buyout agent" that is, the authorization system, and the current commission agent, in fact, is the agent model, but the dealer to buy the product first.

Back to Volkswagen ID. series, in order to adapt to the changes of consumers' consumption habits, Volkswagen has taken the lead in online sales in the EU market since 2019. Seeing that consumers have the willingness to buy online, Volkswagen began to try online sales in order to meet the demand, but the delivery and service are still completed in offline 4S stores. Therefore, a commission should be paid to the dealer who provides the service. At the same time, it is not limited to online channels, but still continues to sell in 4S stores, which not only meets the needs of different consumer groups, but also gives full play to the role of channels.

This change is adjusted with changes in consumption habits, and there may be less and less offline sales in the future, but this is a gradual change process, not a one-size-fits-all. In the Chinese auto market, the sales of the ID. series may be a one-size-fits-all approach, but the success remains to be seen.

The premise for companies like Tesla to successfully achieve direct operation is that their supply chain system can support the development of enterprises, that is, according to the model of "production according to sales" to schedule production and supply, how many orders to produce how many products, there is no problem of large inventory. Its supply chain is a continuation of the original system of planned production.

There are three differences between the new forces and traditional car companies: the first is the supply chain system, the second is the organizational structure, and the third is the marketing model. Frankly speaking, the existence of these three factors is the reason why it is difficult for traditional car companies to copy the new power model, and the existing supply chain and organizational structure is not a system that can support the direct operation model.

Think tank Jun: SAIC Audi also adopts the agency system, what do you think?

Shen Jinjun: Although SAIC Audi has adopted a direct sales model since its "birth", if it does not change the supply chain system at the production end and still follows the existing mode of operation of SAIC Volkswagen, then in today's fierce market competition, the challenges faced by the enterprise are probably very big.

Think tank Jun: Mentioned new energy, in fact, there are some cross-border car building forces, such as Huawei, Xiaomi. How do you see the impact of these cross-border forces on the automotive distribution industry? Is selling a car in a mobile phone store subversive?

Shen Jinjun: I have not had direct communication with Huawei, but when Huawei's products were preparing for listing, they invited a large number of dealers to participate in their activities, mainly auto dealer groups. So, this is not simply using mobile phone stores to sell cars. In the long run, it is still necessary to rely on dealers to achieve delivery and after-sales service through channels.

In fact, the role of circulation is by no means to increase costs, on the contrary, the pursuit and realization of circulation is to reduce costs and improve efficiency, so we must not misunderstand the role of dealers and circulation.

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Think tank Jun: Back to the dealer transformation, entering 2022, has the dealer out of the dilemma?

Shen Jinjun: Since the development of authorized dealers, we have been calling for the production mode to be changed, from "production to sales" to "sales to production" transition, in fact, Tesla is sales to production. If the way of "production and sales" does not change, in the face of huge inventory pressure, the dilemma of dealers will always exist.