The Fall 2024 CVB Summit hosted a fireside chat called “What We Want for Dealers, and from Them.” The discussion between industry leaders explored the evolving relationship between commercial vehicle dealers and their partners, focusing on the dealer’s role in the shift to bundled services, EV adoption, and offering complete lifecycle support to customers.

The overarching theme of the CVBS Fall 2024 was “Reciprocity,” and sometimes, that’s as hard to define as it is to say. Although the dictionary definition of reciprocity is “the practice of exchanging things with others for mutual benefit,” reciprocity doesn’t necessarily mean quid pro quo. In the context of this fireside chat, reciprocity could be interpreted as “working together for the greater good in a mutual way.”

What We Want for Dealers

This is an essential time for us to talk about what we want for commercial vehicle dealers. Because of the transformation that’s occurring in terms of new powertrains, new vehicle manufacturers coming online, increasing levels of competition and cost pressures, entirely new business models are emerging to help everyone contend with the changes; these are challenging times for dealers.

So, what do we want for our dealers? What we want for our dealers is continued success and profitability, and this CVBS Fall 2024 fireside chat prioritized the centrality of reciprocal relationships in promoting the success of our commercial dealerships.

Reciprocal relationships within the commercial vehicle industry are essential for fostering trust, promoting growth, and driving innovation. By establishing strong partnerships built on mutual understanding and shared goals, stakeholders can create a more efficient and sustainable ecosystem. All of this is based on the foundation of open and honest communication.

“Chevrolet and GMC  Business Elite dealers are our commercially focused dealers, and they are going along on this journey with us,” said Jennifer Costabile, General Director, Marketing and Sales Enablement at General Motors. “We’ve learned a lot from dealing with our larger fleet customers, and the more information that we give our dealers on looking at the entire fleet life cycle and being able to help them identify customers’ needs throughout that life cycle, it’s really kind of training and forming and showing them a different model and how to best serve customers.”

What We Want From Commercial Vehicle Dealers

What do we in the commercial vehicle industry want from the dealerships that sell commercial vehicles, i.e. what do we want and expect for dealerships to provide for their customers’ best outcomes? The answer to that requires some unpacking. It turns out that the entire sphere of transportation within business operations is getting as complex as the vehicles used in modern commercial fleets.

Holistic financing for fleet electrification

There is a growing desire among business owners and fleet managers for solutions to simplify their operations. In the case of fleet electrification, businesses want financing options to address both the initial vehicle purchase and the appropriate charging solutions in one package. When a dealership can offer suitable financing solutions in-house, it goes a long way in relieving a customer’s journey.

For instance, Kirk Mann, EVP & Head of Transportation at Mitsubishi HC Capital America (MHCCA), noted a universal imperative among vehicle buyers: financing for both new commercial EV vehicles and commercial-level charging solutions in one bundle.

“Four years ago, we did a survey specific to EV and mobility issues,” recalls Mann. “And we heard from our dealers that they needed the financial offerings to help their customers acquire the truck and also the appropriate charging solutions. So, we started the process of developing products that would address that need. I joke about this by saying that before this, no one had ever asked me to finance the truck and the gas station! But that’s sort of being asked of us today with commercial EV trucks and charging solutions.”

The fact is that businesses exploring fleet electrification must delve into commercial charging solutions, which can range from purchasing level 2 charging equipment all the way up to installing an onsite charging station. The latter option would entail onsite consultation to determine how much power can be accessed. Then comes construction consultation and planning for the placement of the equipment to charge the trucks. Not to mention the construction itself.

In this instance, we see reciprocity in action as MHCCA is developing solutions that enable dealers to provide solutions their customers are looking for.

“We have focus groups that are geared towards listening to our dealers and their needs and what they expect from us going forward,” says Mann. “So we bundle solutions into one offering where the dealer can access solutions their customers need. We really want to create an easy button for every single dealer for any situation that exists. You really have to think about more than just the vehicle.”

Bundled services for commercial vehicles

The desire of commercial vehicle buyers for a more holistic approach to fleet operations is also encouraging solution providers to bundle services, software, fleet management, and hardware into ecosystems of ownership.

Mark Hazel, Associate Director at S&P Global Mobility, likens the idea to standard software as a service, or SaaS, but expands the concept to “anything as a service.” 

“Everything from vehicles as a service, to transportation and mobility as a service, charging as a service, power as a service, or battery as a service. All of these are services,” explained Hazel. “The forecast that I saw from McKinsey is that by 2030, about 60% of the profit generated from commercial vehicles will not be from the sale of the product but from these bundled services as well.”

General Motors is another organization that recognizes the value of bundling various aspects of commercial fleet operations. As fleet operations have become more complex, operators’ search for streamlining has intensified.

“Our commercial customers were telling us, ‘It’s getting really difficult to do business with you,” explains Costabile. “They said, ‘It’s not simple. We don’t know how all these products and services interact with each other.’ So, we made a real decision to change the way we were doing business with customers.”

The result of GM’s customer research culminated in the creation of GM Envolve in 2023, which, 

according to GM, “leverages the total power of GM to create a one-stop shop for customers’ unique business needs. Tailored solutions draw from the entire GM enterprise portfolio of commercial products and services. The new customer experience will feature an efficient, single sales touchpoint for holistic account management.”

“We changed our business model so that we would have our account executives with GM Envolve be the tip of the spear for the customer,” says Costabile. “Customers now have one person to go to who can really help them assess their needs and then bring subject matter experts into the conversation to address the customer’s total needs rather than just sell them a vehicle.”

Now, GM is urging dealers to adopt a holistic, customer-centric approach throughout the entire lifecycle of commercial fleet vehicles. This involves assigning dedicated account managers to guide customers through every stage, from assessing their needs and facilitating purchases to providing ongoing support, training, and proactive maintenance. This approach leverages data and insights to minimize downtime and maximize customer satisfaction, ultimately fostering long-term relationships and loyalty.

“Vehicles are just tools for people to get their jobs done. We want to make sure that we’re helpful all along their journey. So now it’s really time to take that model to the dealer level. And if you look at a dealer, a dealership itself is based upon that whole model.”

Purpose-built commercial EVs

Jim Press, a senior advisor at Work Truck Solutions, moderated this fireside chat. As the conversation turned to the vehicles themselves, Jim asked GM’s Jennifer Costabile about the response from commercial customers concerning commercial EV options. For GM, those options include the electric Silverado and Equinox and the BrightDrop delivery van, which was initially a subsidiary of GM before being moved under the umbrella of the Chevrolet brand in August of 2024.

“The Chevrolet BrightDrop has been very well received. Customers who actively use BrightDrops in their fleet cannot speak highly enough of the vehicle,” said Costabile. “Before rebranding as a Chevrolet product, customers saw BrightDrop as more of a startup, and I think our customers really like the sense of safety afforded by an OEM dealer network. It gives customers a level of comfort and confidence to try something new.”

Jennifer’s overall message was one of optimism and excitement about Chevrolet’s position in the EV market.

Conclusion

The keys to a successful future in the commercial vehicle industry are to be found in reciprocity. All parties in the value chain—OEMs, dealers, financial organizations, and data providers—working together for the greater good in a mutual way, working together to remove friction and bottlenecks that disrupt the end user from doing business; that’s the blueprint for a successful future.

Join the conversation shaping the future of commercial vehicle dealerships. Click here to watch the total “Fireside Chat: What We Want for Dealers, and from Them,” or see the full CVBS Fall 2024 playlist here.