Where The Rubber Meets The Road Sheldon Sandler ssandler@belairpartners.com

Key Takeaways Auto Industry is at an inflection point in adoption of advanced safety technology. Semi-autonomous features and safety technology are the “Fine Corinthian Leather” and the “Opera Windows” of today. Customers increasingly knowledgeable about advancements and request it. Car salesperson less relevant. The digitally informed consumer knows as much if not more. Follow the money. Advanced technology is most often bundled as options with convenience options like navigation systems. But in coming model years competition will force all to be available and standard. Sales resistance with more price conscious consumers .

…we’ve got to figure out how to keep them safe. …polling indicates only half of (consumers) think automakers are doing what’s necessary to keep drivers safe from distractions. …we’ve got to figure out how to keep them safe. —What Do Car Consumers Really Want? Wards Auto, May 15, 2017

The Chinese feel particularly safe in their vehicles… More than U.S. counterparts advanced technology is more widely preferred and trusted in China than in the U.S…. The Chinese feel particularly safe in their vehicles… They think if the government allows a vehicle on the road, it must be safe. They are more trusting of government —What Do Car Consumers Really Want? Wards Auto, May 15, 2017

BMW salesperson… “there is a growing demand for any device that will react to avoid a collision. Client advisors are demonstrating the technology on test drives and more and more people come in asking for the technology as they see even that lower end brands with automated safety feature on TV.”

Toyota salesperson… “Toyota is promoting Toyota safety features as standard in many models and going forward all model revisions will have these features as standard. These are also one of the biggest differentiators of our products we use it to set Toyota apart from he competition

“Need more technology standard. Really helps to sell cars.”

Bentley salesperson… “The older models like The Flying Spur have limited safety features. But all will be available in the 2019 models. Right now the newly introduced Bentayga has a $7600 package that includes all and more. This is a popular option that we order in almost every car.”

Ford salesperson… “few customers make inquire for this or purchase it Ford salesperson… “few customers make inquire for this or purchase it. Our sale rate for this package would be in the 5% range. Most customers are fine with the BLIS system which is the blind spot detection on the side mirrors and includes navigation for around 1500. 65% of vehicles.”

Honda salesperson… “Even after explaining the benefits of the “HS” package which is only $1000 option and includes road departure mitigation collision mitigation lane keeping forward collision land departure warning and adaptive cruise control as on the 2017 accord civic and pilot customers are still primarily price driven.”

“A lot of manufacturers will go to all safety technology sooner which will lower insurance premiums which is good for the auto industry.”

Conclusion Safety technology is becoming a competitively and profit driven necessity in selling cars on today's showroom floor.