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By Cody Thacker, Vice President of Growth at Scout Motrs:
Forum members,
It's great to see all of the activity, enthusiasm, and discussion on the forum. By way of introduction, I serve as the Vice President of Growth at Scout Motors. In a nutshell, I'm responsible for retail strategy, customer experience, and commercial operations.
As many of you likely know, Scout Motors has selected a direct-to-consumer retail model. This means that Scout Motors will sell Scout vehicles to Scout customers. We believe it's the right strategy and, after talking to many consumers, believe it's what the market demands.
We would love nothing more than to build an Experience Center at the factory in Blythewood, South Carolina. From there, we could offer factory tours, driving experiences, product displays, and factory delivery of new vehicles. Unfortunately, antiquated regulations in South Carolina stand in our way.
We hope to get these laws changed and know that many state leaders see it the same way. To start the conversation in South Carolina, I posted the below article to LinkedIn today. I thought all of you should know our logic, vision, and requests of the state as well. Enjoy!
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From: LinkedIn
The Post & Courier has it right: Scout Motors is proud to manufacture in the Palmetto State and we'd be honored if our brand became synonymous with South Carolina.
Another thing they have right: Scout Motors believes that freedom in car buying should be restored for South Carolina consumers.
Selling vehicles through franchised dealers is exactly the right strategy for some automakers. No doubt, it has the potential to serve the customers of established brands well.
It is equally true that selling vehicles directly to consumers is the best strategy for other automakers, Scout Motors included. Many automotive new entrants have, after reviewing the costs and benefits, made the same decision.
These two business models do not need to be mutually exclusive.
Like in all other industries—where companies and consumers freely decide on the best distribution model, or choose to use both—automotive distribution need not be an all-or-nothing proposition. Economists, academics, consumer protection groups, free market advocates, and federal agencies roundly agree: the consumer and competition are benefitted when the direct sale of automobiles is permitted.
Scout Motors also agrees. Consumers deserve the freedom to choose how they buy a car for many reasons, including:
- Affordability - Eliminating the double marginalization of a middleman lowers the retail price of Scout vehicles by thousands of dollars. This benefits both consumers and Scout Motors. By being within financial reach of more Americans, Scout Motors can achieve higher market share, run our production plant at higher capacities, and employ more South Carolinians.
- Transparency - Consumers are incredibly frustrated at the lack of straightforward pricing in auto buying and servicing. Surprise markups and add-ons have many consumers feeling irate. A direct sales model solves this entirely. Scout customers will always know what they’re paying.
- Customer experience - A direct sales model allows Scout Motors to have one-on-one relationships with our customers. With this, we can create centralized customer accounts, apps, and records that make buying, owning, and servicing Scout vehicles incredibly easy and seamless. Further, only in a direct sales model does Scout Motors maintain the operational flexibility necessary to quickly scale and adjust our national retail network to meet rapidly changing sales and service needs. Finally, we foresee a future in which data privacy and protection becomes a significant consumer concern and purchase driver; in a direct sales model, we can ensure that our customers (and their data) never become the product.
- EV focus - Unlike the EV negativity that now permeates franchised dealers and their sales teams (alas, over 5,000 franchised dealers twice petitioned President Biden to “hit the brakes” on EV sales and 49% of dealer sales staff report being "not excited at all" to sell EVs), a direct sales model allows us to build a sales team that knows our products, understands the litany of benefits offered by EVs, and reliably delivers ambitious monthly sales targets.
- Progress – The basic dealership experience has not changed in the last 75 years. But the world around it has. Consumers expect a modern retail experience that blends in-person and online options. They expect services that leverage and adopt modern technology. Online vehicle purchases completed in minutes, mobile service in your driveway, and over-the-air diagnostics and updates, for example, are just the tip of the iceberg. Customers deserve access to modern technologies and experiences, and Scout Motors plans to provide them through direct sales.
South Carolina consumers, like all American consumers, deserve freedom in choosing how they buy a car.
South Carolina consumers, like all American consumers, deserve affordable vehicles that aren’t touched by a middleman.
South Carolina workers, like all American workers, deserve to be able to buy the products that they manufacture.
And South Carolina citizens, like all American citizens, deserve business friendly policies that generate economic prosperity and that do not attempt to snuff-out new market entrants.
As it stands, because of antiquated regulations kept in place by the dealer lobby, South Carolinians will have to travel to other states to purchase the Scout vehicles that are made in Blythewood, South Carolina. This would be tragic, and an affront to both consumer choice and the free market that South Carolina ordinarily embraces.
But, we’re hopeful change is on the way. South Carolina, its legislature, and its leaders (especially South Carolina Governor's Office and South Carolina Department of Commerce) are visionary on economic development, industrial trends, and the future of transportation. They tackle hard issues when they arise, and I believe this issue will soon get the scrutiny it deserves.
