Technology rules the present By Graeme Stewart
Mexico’s auto industry has been urged to embrace new technology or face being left behind as customers look elsewhere for their technological needs.
New technology in all aspects of the motor industry was highlighted during MEXICONOW’s “Mexico Auto Industry Summit” held recently in Leon, Guanajuato.
Jorge Vallejo, Nissan Mexicana’s Director, Foreign and Government Affairs, raised more than a few eyebrows when he declared while making his address on Nissan in Mexico: “Electric cars are here to stay. There is no going back.”
He said research and development on electric cars was far advanced in the USA but admitted: “We still have a long way to go in Mexico.”
“But electric cars are the future – there can be no ignoring that.”
While his statement cause something of a stir throughout the summit, it was taken calmly by others such as Thomas Karig, Corporate Relations and Strategy Vice President of Volkswagen de Mexico, and Leo Torres, Ford’s Motor Company de Mexico’s Director of Purchasing.
Mr. Karig said he found Mr. Vallejo’s remarks interesting but insisted that the electric car theory was in its infancy and wouldn’t be a major issue for some years to come.
He said: “Of course, VW is not being slow in its reaction to the theory of electric cars but the introduction of such vehicles to the market is some way off.”
Mr. Torres admitted: “I don’t know about electric vehicles, nobody really does. But one thing is certain – it will be a few years, maybe eight or nine, before we see electric cars on the roads of Mexico. For a start, we have nowhere to plug them in. Practical things like that have to be examined.
“More research is required and Ford will be at the forefront of that. But, to be honest, I don’t see a change from fuel-driven vehicles to electric ones in the near future.”
Mr. Vallejo went on to say that one in every four cars sold in Mexico was built by Nissan and the company was now aiming to produce one million vehicles in 2015-16, thanks to increased demand in the domestic market.
He told the Mexico Auto Industry Summit in Leon, Guanajuato that his company was proud that one in every four cars sold in Mexico was a Nissan and added: “But we have no intention of resting on our laurels and we intend to continuing to expand in the domestic market and in exports,” he said.
The automotive cluster in the Bajio region of Central Mexico was truly dynamic, he said, and covered auto plants in Aguascalientes, Guanajuato, Queretaro and the State of Mexico.
He said: “The dynamism of the automotive sector has allowed Mexico to become the seventh largest vehicle producer in the world, leapfrogging Brazil which is now in eighth place.”
He said there would be ample opportunities for members of the automotive supply chain within the next few years and, from his point of view, the main challenge facing OEMs was the integration of suppliers.
But he added that other important issues included costs and the ability to improve the quality of the parts that make up the end product.
Back to new technology and Gerardo Gomez, Mexico Operations Manager of JD Power and Associates, told the summit in his address on Customer Satisfaction in a Changing Automotive Industry: “Technological advancement is a tidal wave – don’t fight it, embrace it.”
And he urged delegates: “Whether you’re a dealer or OEM, develop a technology strategy as soon as possible. CRM (Customer Relations Management), Tablets and Digital Desking are only the beginning and need to work together. Tools must be integrated within both sales and service. But don’t ‘Boil the ocean’, start with a small, targeted effort and build on it.”
“And make no mistake, dealers and manufacturers that don’t keep pace with customer needs may be left behind.”
There were, he said, three forces of change and each force presents unique and shared challenges and opportunities. But one thing was constant: Change.
He said: “The three forces are the consumer, the retailer and the manufacturer and the latter two must recognize the driving force of change. That means rapid, relentless change requiring perpetual adaptation. Resistance to change is futile.”
He cited voice activation as one area where there seemed to be a big demand but in which customer satisfaction had yet to be reached.
He said: “A reported 32 per cent of all Audio, Communication, Entertainment and Navigation (ACEN) problems are because Voice Recognition doesn’t recognize or misinterprets commands. Clearly, that has to improve.”
He told Mexico Now: “We have to keep coming up with new technology all the time. New customers already have that technology in their blood. The key thing is that we have to explore all the current ways to find the feedback from our customers.
“That means taking advantage of the smartphones and the tablets that they are connected to all the time – 100 per cent, 24/7. That’s something that can appear at the moment they are at the sales point. That’s the kind of thing that we are just trying to look after and we are always looking very closely at those advanced technologies.
“Customers want to have more equipment in their cars with all the communication and technology that people use nowadays. They are looking for more alternatives, more equipment and more accessories. Their expectations continue to rise and it’s up to manufacturers to give the customers what they want.”
Mr. Gomez continued: “We have to know exactly what new customers of this era are going to need. We have to be on social media and on all the other devices they use simply because they will be our future customers.
“Newcomers to the market on the retail side have to be extremely focused on what every person in every country is going to need. That’s a challenge for the OEMs – to try and fulfill with the same products a lot of diversity, customers and ages of customers.
“Technology will help in tracking that and help lead to the correct strategy.”
The top 17 rankings of the motor vehicle occupant safety survey (MVOSS) from JD Power for 2014 in Mexico shows that German brands take the lead with BMW in first place followed in second and third by Audi and Mercedes Benz, respectively.
Mini is in fourth place followed by three Asian brands, Mitsibushi, Toyota and Honda. Jeep, Mazda and Ford make up the top 10, as shown in the graph.