The history of car sales

Today, the car is such a central part of our everyday lives that it’s almost impossible to imagine a time without it. However, automobiles have only been around for less than 150 years, and in that time they’ve changed a lot.

In this article, we’ll look at the history of car sales as a timeline and cover some important milestones as the car industry has grown up. Let’s start at the beginning.

When Was the First Car Sold?

The history of the automobile began in the 1880s. In 1886, in Germany, Karl Benz registered the first patent in the industry for the first gas-powered vehicle. This “horseless carriage” was called The Motorwagen and between 1888 and 1893 around 25 Benz vehicles were sold. Meanwhile, the first commercial car sales were made by Charl and Frank Duryea in 1893. It was more a gas-powered carriage than an automobile as we would understand.

Who Sold the First Car?

The first major car seller is a name you’ll probably recognize even today — Benz. Named after Karl Benz, the company soon expanded from Germany into other European countries like France. By the end of the 19th Century, Benz was the largest car company in the world, manufacturing 572 vehicles in 1899.

Where Did the Car Industry Begin?

The car industry first started in Europe. In 1903, France became the world’s leading automaker, producing 30,124 cars (almost 49% of the global market). At the same time, the USA managed to manufacture only 11,235 cars.

How Did World War II Affect the Car Industry?

For the duration of World War II, almost all car manufacturers were forced to curtail production, reducing car sales dramatically. After the war ended, as soldiers returned to their hometowns, they started to buy cars. As the rationing of metals and other components lessened, automotive production started to ramp up. This period of increased demand and supply is often referred to as the “Car Boom”.

What Was the Monroney Sticker, and What Did It Mean for the Industry?

During the “Car Boom,” there was no control over pricing for cars in dealerships. This was the case until 1958 when Senator Almer Stillwell Monroney introduced legislation requiring dealerships to place a sticker on every vehicle from any given manufacturer with a recommended retail price and a list of specifications. It came to be commonly known as the Monroney Sticker and was a significant development in how cars were sold. Fundamentally, it was the first regulation designed to protect consumers in the automotive industry.

How Did the Car Market Change in the 1950s and 1960s?

Throughout the 50s and 60s, the automotive market flourished. However in the early 70s, due to the increasing price of gasoline, production costs rocketed, and customers were made to feel the pinch. To offset rising costs, car manufacturers slashed the number of models on the production line. Despite this, the cost of manufacturing kept increasing, forcing up car prices. As a result, dealers started to push the concept of leasing.

How Did Leasing Change the Car Industry?

Prior to the 1970s consumers typically changed cars every 5-6 years. With the advent of car leasing, however, the average buying cycle decreased to 2-3 years. This sparked a revival in production that saw many different models entering the marketplace again. Together these factors led to the birth of the used-car market.

How Did Computers Impact the Car Industry?

The next big change came in the 90s when the first wave of computer technologies became mainstays. Buyers started to shift to online at the beginning of their shopping experience. Selecting the right car became a much harder decision than previously because of the availability of the huge amount of new options. Websites of dealerships that at the beginning acted only as an online brochure started to act as almost the whole online dealership. And everything was developing well until the financial crisis of 2007-2008.

How Did the 2008 Financial Crisis Affect the Car Industry?

2008 and 2009 were very hard years for the car industry. Total production dropped by 3.7% in 2008 and still further (by 12.4%) in 2009 when just 61 million cars were sold.

However, car sales and the automotive market, in general, have now started to recover. In 2014 car sales started to bounce back and 89 million cars were sold.

How can car dealerships adopt the new agency model?

Digitalisation is key these days, and it’s forcing companies to change their business models and adapt to the ‘new normal’. The way to engage with new audiences can be done through many channels, but real-time communication should definitely be a part of them. Online is becoming a portal to a showroom. 83% of consumers want to do one or more steps of the purchase process online and 7 out of 10 are more likely to buy from a dealership if they could start the process online. What’s more, nearly 30% of U.S. new car sales last year were completed online, according to Alan Haig, an automotive retail consultant and president of Haig Partners. Before the pandemic, less than 2% of vehicles were purchased digitally.

Digitalization, paired with an increasing end-customer affinity with e-Commerce, has led to the emergence of new digital touch points throughout the customer lifecycle. By digitizing their traditional business processes, dealer networks can engage and interact with their customers in many new ways. Find out more about the changing automotive customer journey here.

According to Capgemini there is an increasing demand for an upgraded, convenient online-offline sales journey that matches buying expectations and service standards in other industries. The traditional three tiered sales model, however, does not fully accommodate such consumer demands. That’s why it’s important to keep an eye out for e-vehicles. Companies like Tesla have proven that electric vehicles are not only viable, but might even replace traditional cars in the coming decades. Moreover, a general awareness regarding environmental issues has also impacted the sales trends in the automotive sector. Interested in knowing more upcoming trends? Learn more about the top 5 trends that will accelerate the future of the Automotive industry.

What Does the Future Hold for the Car Industry?

What is the future for dealers and consumers? How will the car buying experience change? The shift towards online sales and omnichannel technologies is inevitable. But the human element remains a prevalent part of the sales process. Tangible experiences like sitting in a car, test driving and talking with a salesperson are integral parts of the buyer journey.

Whisbi is the only company that integrates all of these into one Live Commerce Platform, making the research process easier and combining live chat, live video and real-time engagement to make each test drive booking as convenient as possible. With Whisbi, car dealerships can instantly connect your online leads with your dealerships & sell more. It offers everything you need to digitise your sales journey and bring the dealership experience online. This way, you can sell cars directly to consumers online, using your own digital showroom!

Find out more about how Toyota‘s clients books around 400 test drives per month through their website and increased qualified leads by 59%!

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