What happens now?

What happens now?
Posted by: Guy on 21/11/2008 16:12:57

Career Tips and Advice Well if the motor industry thought September was uninspiring, October does not look great either.

With banks failing, stock markets oscillating wildly and rumours that motor manufacturers may well have to merge to survive, it is not the most stable of backgrounds against which to budget for 2009.

And how will we look back on these seemingly cataclysmic events in 10 years?

Much as we look back at every economic upheaval, I suspect. We will say that, however much of a surprise it has come to many, there were obvious warning signs within the system. (In hindsight).

That it was a necessary correction to get banks and financial markets back to some semblance of sanity after a decade of ignoring the fundamentals. That it did much to take away the feeling of invincibility from the consumer, and taught them once again to live for tomorrow as well as just for today.

And I suspect it will look at the motor industry and say that it was the shock it needed to change the way it did business. (Quite a bold statement, and you canít prove Iím wrong for at least another decade.) But it must have become increasingly clear to everybody in this sector that the traditional method of distribution is increasingly complicated, over prescriptive, centralised and dictatorial.

So, as we all marvel at the power of the emerging economies like India and China, who take massive bounds as they liberalise their economies, we go in exactly the opposite direction in one of the most important retail sectors in Europe.

But this could change. Downturns always mean that there is a slight but subtle shift in power between the dealers and the manufacturers. In times of plenty no one is worried about the prospect of failure, just on missing out. So strong manufacturers are seen as meal tickets and are able to make big demands of their dealers when the market booms.

Turn off the tap, however, and rather than dealers playing to manufacturersí tunes they are just concerned with survival. The badge above the door becomes less important than financial reality, and manufacturers themselves begin to wonder about their networks and their coverage.

Because bad times also tend to clear out inefficient distributors. Those who over expanded, or failed to take quick, decisive action may find themselves in trouble a few months or a few years down the line. And those who built the bigggest palaces can leave the biggest dent in the network.

Whatever happens, itís going to be a tough ride and such markets are really unpleasant to live through. Everybody who survives probably has to make a number of very tough and difficult decisions, and has probably had to work twice as hard as they have ever done before.

But those who fall by the wayside take the greatest hit. Their lives, their companies and their very futures can be turned upside down in the blink of an eye, in a sharp stock movement, in a decision made on the other side of the world.

In the end, there will still be a big new car market in this country. And there will be a car parc to be serviced and repaired. And that is why this industry has always come stronger out of any recession than it was before, why certain individuals flourish in really tough times and why they are worth their weight in gold (about double their worth three years ago, both literally and metaphorically).

They say this will be one of the toughest shocks are economy has ever suffered, but they always say that. All we know is that in 10 years time we will look back on this as another experience, another path we have had to follow in our careers.

Many just wish we could fast forward.

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