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About the Author:
Terry Kiwala
Vice President
Terry Kiwala has worked in finance and investment for more than two decades and joined First Analysis in 2019. He works with entrepreneurs as an investor and as an advisor on growth transactions to help build leading enterprise productivity software businesses. He is a thought leader in his sector, having authored widely read industry research. He serves on the boards of Insellerate, PCMI, SmartCommerce and Visage. Prior to joining First Analysis, he was chief financial officer of Vokal, a software development company, senior vice president at Tribeca Flashpoint Media Arts Academy, and associate vice president at National-Louis University. Earlier, he was an investment banking analyst at Lehman Brothers. He earned a bachelor’s degree in economics and government from the University of Notre Dame. He is a CFA charterholder.
First Analysis Enterprise Productivity Technology Team
Terry Kiwala
Vice President
Corey Greendale
Managing Director
Richard Conklin
Managing Director
Matthew Nicklin
Managing Director
First Analysis Quarterly Insights
Enterprise productivity
Opportunities for tech providers as automakers increasingly sell direct
May 27, 2022
  • While electric vehicle technology grabs auto sector headlines, other substantial changes underway include the shift toward automakers selling directly to consumers and the introduction of alternatives to traditional sales and leasing business models.
  • As this shift continues, we expect to see strong demand for technology that enables automakers to initiate, manage and optimize direct interactions with car buyers and owners.
  • We profile several companies we see as among the leading innovators in the market for such technology, some of which also serve franchise dealers and independent repair shops.
  • Alternative consumption models, such as subscription auto services, appear to be a natural extension of this transformation, representing another compelling opportunity for enabling-technology providers.

TABLE OF CONTENTS

Includes discussion of six private companies

Incumbents following Tesla's lead toward more direct selling

Expect strong demand for tech that connects automakers to buyers, owners

Some leading innovators

Alternative ownership and service models: The next wave?

Another round of winners in the world's tech transformation

First Analysis Enterprise Productivity Index sinks again

Enterprise productivity M&A pace in line with recent levels

Enterprise productivity private placement pace slows

Incumbents following Tesla's lead toward more direct selling

The auto industry is evolving at a pace not seen since the early days of its existence. While electric vehicle technology grabs the headlines, other substantial changes underway include the shift toward automakers selling directly to consumers and the introduction of alternatives to traditional sales and leasing business models.

Tesla has been at the vanguard of these changes. It eschewed the traditional dealer sales model and instead engages with its customers digitally and uses its own stores to deliver and service vehicles. In 2012, when Tesla detailed the rationale behind this strategy, the industry was skeptical it could succeed given the capital investment necessary to build a retail footprint. But it has succeeded. Tesla sales have been robust, and the company has navigated customer satisfaction challenges, including pandemic-driven disruptions, quite well.

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