A major shift is underway as OEMs realign their dealers to prepare for an all-electric future. 

Many automakers are going all in on electric vehicles (EVs). As a result, dealers are preparing to make significant investments in charging infrastructure, technology and staff training to support the ongoing expansion of the EV market.

Recently, Ford announced that 1,920 of their roughly 3,000 U.S. dealers have signed up for their EV certification program, which involves investments in public fast chargers, employee training and no-haggle sales programs. General Motors (GM) is requiring its Cadillac and Buick dealers to invest upwards of $300,000 on dealership upgrades to accommodate the sales and servicing of EVs.

In the coming years, EVs will transform the way dealers operate. 

In conversations with car buyers, dealers and OEMs, we’ve identified ways in which dealer roles and revenues will shift. We’ve also identified five key areas of focus for dealers as they prepare for an all-electric future.

A paradigm shift: From salespeople to consultants

The move toward electrification reflects a changing market and new ways of serving customers through digital means.

In the future, as OEMs increasingly sell directly to customers and provide post-sales services and support, dealers will transition from acting primarily as salespeople (and intermediaries) to acting as sales consultants.

The current linear sales model vs. the future circular sales model

Although OEMs will have more direct access to customers than they had in the past, dealerships will still play a critical role in the customer journey. 

Customers will increasingly turn to dealers for education on charging and EV ownership, software support and branded experiences. In turn, dealers will provide these services in a seamless, convenient and personalized manner in an effort to build trust and comfort around EVs. 

Revenue generation for dealers will change significantly as a result of these changes.

New dealer roles and revenue opportunities 

In the new sales consultant model, dealers will no longer depend solely on sales margins, service repair and maintenance business for core revenue. Instead, dealers will have more frequent interaction with customers, creating new opportunities for revenue generation. 

For example:

• Guiding shoppers through the digital purchase process
• Educating consumers on the benefits of an EV lifestyle
• Offering remote test drives and delivering new vehicles
• Providing publicly accessible charging stations
• Providing technical support for charging, battery life and software issues
• Delivering experiential charging and retail locations for car owners
• Renewing software on previously owned vehicles

As dealers shift to a sales consultant model, customer interactions (and revenue-generating events) will change throughout the sales process

In the future, there will be more touchpoints and a more circular flow of information to keep customers engaged throughout the entire lifecycle. To develop active, continuous customer relationships throughout this journey and, in turn, open up new revenue opportunities, OEMs, dealers and sales consultants must maintain strong partnerships.

For dealers moving toward a sales consultant model, here are five key areas to begin implementing in 2023:

As EV sales continue to rise and new technologies enter the vehicle market, dealers need to train consultants and tech specialists to offer in-depth knowledge of the benefits and nuances of EV ownership. These experts can answer customer concerns in a no-pressure, welcoming environment by offering education instead of pushing for a sale.

Sales consultants will also help guide customers through digitally enabled experiences, from vehicle configuration to purchase paperwork to financing applications and approvals.

Offering knowledge is increasingly important as the buyer profile for EVs shifts from millennial, tech-savvy early adopters to a broader demographic across age groups with a varying range of familiarity with technology.

Dealers will need to provide ongoing training for sales consultants in topics such as home charging, journey planning, software updates, battery maintenance and more.

To create a retail experience around selling and servicing EVs, dealers need to invest in digital retail displays, public charging stations, in-dealership and remote servicing equipment and branded experience centers that encourage customers to keep coming back.

Digital retail displays allow customers to compare features and functionality, configure vehicles, browse software packages and complete paperwork for purchase and financing.

Charging infrastructure—including increased energy capacity from utilities—supports the charging demands for test drives, vehicle sales and servicing.

Branded retail showrooms combining cafes, restaurants, seating areas and entertainment options create a welcoming environment where customers can comfortably wait for their vehicles to charge or shop while their cars are serviced.

Dealers can expand the OEM or in-dealership experience to their local communities by setting up satellite experience centers near interstates, grocery stores, shopping areas and other public spaces. As experts on their local markets, dealers are well-positioned to take on this role.

Dealers can ensure that they’re always at “arm's length” when it comes to EV charging, servicing and software upgrades, which will provide added value and help alleviate mileage anxiety among many customers.

Such initiatives require cultivating partnerships with local and state governments, retailers, utilities and more. Both a long-term outlook and long-range planning are essential for successful partnerships and infrastructure expansion projects.

Across the customer journey, dealers will need to integrate a variety of tech systems to streamline workflows in digital commerce, vehicle purchasing, financing, servicing and trade-ins.

Through open data sharing, OEMs and dealerships can create a seamless customer experience. A customer could start the process of researching and configuring a vehicle on an OEM site; test drive and apply for financing at the dealership; complete the purchase paperwork on the dealer site; and then purchase add-ons through the connected vehicle platform.

Open data sharing can reduce customer pain points in the shop and purchase stage by addressing issues such as non-transparent pricing and inventory, long wait times at the dealership and delayed purchase or financing approval.

In the post-purchase stage, connected car tech enables customers to create a route plan, schedule service appointments and purchase products and services using in-vehicle shopping. At the end of the ownership period, customers can receive trade-in quotes, schedule a pickup for their used vehicle and arrange for delivery of a new one—all remotely.

As OEMs build unified retail platforms, it will be important that dealer partners follow suit for a cohesive customer experience.

Rewarding high-quality service and customer experience will require a significant culture shift across many dealerships. Incentives will no longer be based on commissions or quotas but instead on delivering excellent experiences that build customer loyalty and lifetime value for both dealers and car manufacturers.

Dealership staff will be rewarded for effectively addressing customer concerns and giving customers the support they need to make the best purchase decisions.

Dealership staff could receive incentives for hosting events for potential customers and new car owners. Or they might receive bonuses if they frequently leave the dealership to take remote test drives, deliver vehicles or provide remote servicing.

A diverse sales consultant workforce ensures that all groups within a local community are well represented. This helps dealers better understand the needs of their customers and helps customers feel more confident, comfortable and trusting in their relationships with dealer personnel.

Dealers who embrace electrification, new sales models and other upcoming technologies are poised to transform their entire dealership experience. To manage the risks and rewards of this exciting journey, dealers need to build the foundation for this industry-wide transformation now.