Tough Times Ahead? What the bumpy ride of Brexit could mean for the Automotive Industry

21 September 2018

BREXIT FOR THE car INDUSTRY

In just over six months’ time, Britain will officially leave the European Union. For the Automotive industry, an overwhelming amount of uncertainty lies ahead.

Every year, EU customers buy about £13bn worth of British made cars. This is largely due to the EU’s free trade regulations and customs union – the future of which hang in the balance for the UK.

In a recent BBC article, Honda have reported that a ‘no deal’ Brexit would cost them tens of millions of pounds. This is because manufacturers rely on frictionless trade with Europe and Honda, alone, relies on ‘350 truckloads’ of car parts from the EU every day. Admittedly, if the UK leave the EU without a formal exit deal, it looks like there could be significant supply problems for UK car manufacturing plants.

THE RISE OF THE USED-CAR DEALER?

If no-deal Brexit takes place, then there could be a shortage in the supply of new cars. Whilst this spells huge problems for the manufacturers, it could create an opportunity for used car dealers and car supermarkets. If your forecourt deals in older makes and models, it seems like the ideal time to begin a digital marketing strategy that really pushes the sales of these vehicles.

Start now with an SEO strategy that ensures your used-car dealership or used-car pages are appearing higher in the SERPs. Remember that SEO is a long-term strategy, and so beginning to accommodate now for possibilities next year is normal. Targeting keywords such as ‘used-Volkswagen models’ or ‘used car dealership’ could be the way to gain entry into what may become an even more competitive marketplace if there are stock issues for automotive manufacturers.

With SEO in mind, one would also expect to see a shift in google ads towards used cars. Starting a paid search or PPC strategy in anticipation of the short-fall of newly made vehicles will ensure that you stay ahead of your automotive competitors. If no-deal Brexit does take place, then the paid search arena is set to become even more competitive for the car industry, meaning that CPC (cost per click) will increase. Because of this, dealers must be prepared to pay higher for keywords in order to get higher up the page.

Furthermore, your dealership website could create content pieces which push for the sale of used cars. Use compelling copy to explain why a 2016 or 2017 model of a car could offer a great but cheaper alternative to a brand new car, convincing the customer why they still make a great purchase. Remember to optimise your content too – still using your dealership’s keywords in order to get rank on the SERPs. Furthermore, use metadescriptions to emphasise the sale of used cars.

KEEP TALKING

Threats to car manufacturers may mean customers lose confidence in investing in new cars. The use of continued digital communication could be effective in retaining your automotive customers. If not using already, consider email marketing to keep in contact with an existing client base to let them know of any updates that may happen because of Brexit.

EYES ON THE ROAD

In this upcoming time of uncertainty is it more important than ever to pay attention to your competitors and what effects that Brexit may have on the automotive market. Be ready to make quick changes to your digital marketing strategy.

Having a strong PPC team available will be of great benefit. Unlike SEO, the beauty of PPC is that you can make almost immediate short-term changes to keep up with the market. If Brexit causes a spike in a certain vehicle sale, PPC can quickly adapt keywords that the ad uses and change what appears on the SERPs. Moreover, your car dealership can use PPC to divert the audience’s attention away from new vehicles towards your stock of high standard used cars.

PLAN YOUR ROUTE

Currently, it is still unclear what Brexit will spell for the automotives, so it is important to plan ahead and implement revenue growth strategies now, in case of shortcomings next year. The Mini factory in Oxford has chosen to bring forward its summer closure to immediately after Brexit next year in case of ‘possible short-term parts-supply disruption’.  Your dealership could use SEO and PPC strategies to accelerate revenue growth ahead of what could be a tough time.

Additionally, consider other directions from your car retailer to gain revenue. If you are a manufacturer spend extra time trying to raise awareness of your supply of used vehicles. If you are a garage that does servicing and MOTs, perhaps use SEO or email marketing to push sales in these areas to generate extra revenue ahead of chaos. All in all, be prepared for your marketing strategy to steer in another direction.

PREPARE FOR THE WORST, HOPE FOR THE BEST

It is fair to say that there may well be some tough times ahead for the automotive industry. If the UK can formulate an exit deal that facilitates continued free trade perhaps there is nothing to worry about. If not however, car dealerships and manufacturers must be prepared, and must stay alert to the effects that Brexit could have on the automotives.

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