2023 Automotive Industry Trends: 7 Developments to Keep in Mind

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The auto industry has been tumultuous for two and a half years. The COVID-19 pandemic crippled supply chains in early 2020, a lingering chip shortage hamstrings new car production, and the drive toward electrification is redefining sales and service strategies.  

Add to that a push for further digitalization, and dealers have much to rethink and several 2023 automotive industry trends to consider as we approach three years since the world stopped spinning for a time.  

This article outlines seven such trends that dealers should understand and prepare for in advance of the new year. 

7 2023 Automotive Industry Trends You Should Know 


1. Dealers Will Offer More Digital Purchasing Options 

In today’s tech-heavy world, consumers of every industry expect online shopping options. While the auto industry has yet to experience significant demand for direct online sales, customers do much of their initial research via computer, tablet, or mobile phone and complete the final purchase in the showroom.  

However, industry pundits expect most (if not all) of the purchasing experience to occur online in the coming years. Many industries worldwide have experienced a similar digital transition, and it should only be a matter of time before the auto industry keeps pace. 

A comprehensive online purchasing experience might include the following: 

  • Researching inventories 
  • Completing virtual walk-throughs 
  • Choosing vehicle features 
  • Taking at-home test-drives 
  • Securing financing  
  • Making the purchase 
  • Receiving vehicle delivery at home 

As more customers demand expanded online options in the future, dealerships will have no choice but to comply and digitize more of their operations. 

2. The Pre-Owned Sales Boom Will Include Electric Vehicles  

The used market has surged in recent years—particularly for vehicles aged four years or less—as a chip shortage and supply chain dislocations continue to plague manufacturing. 

Additionally, refurbishing techniques have advanced significantly, resulting in certified pre-owned vehicles that perform and look like new vehicles but cost less. Many consumers subscribe to the mantra, “It’s new to me,” when choosing between new cars and well-maintained ones. 

Another compelling factor has been low APR financing, which has increased the allure of used cars. However, as the Fed raises rates to combat inflation, those borrowing rates will increase. 

A developing situation is the inclusion of electric vehicles (EVs) and hybrid cars. The industry is not ready for a surge in used EVs and needs time to prepare the pre-owned market for this transition. 

Automakers are making great strides in design, parts output, and production, but difficulties arise when those cars migrate from “brand-new” to “pre-owned.” Dealers and wholesale auctions must expand their operations to handle the imminent flood of used EVs. 

3. EV Weight Will Become Problematic Without Legislative Changes 

Car carriers are urging politicians and the Biden administration to raise the truck weight limitations on domestic roadways to allow for larger EVs. 

This plea is in response to claims that current domestic road weight restrictions will: 

  • Hinder EV deliveries 
  • Drive up costs 
  • Minimize EV types 
  • Jeopardize zero-emission initiatives 

According to a 2020 Environmental Protection Agency report, the average weight of automobiles and trucks on U.S. highways has increased from 3,200 pounds to nearly 4,200 pounds over the past 45 years, even before the recent surge in EV sales. 

Due to their large batteries, EVs weigh much more than even today’s heavier ICE vehicles. While President Biden wants EV sales to reach 50% by 2030, they currently account for a small fraction of all cars on the road. A change in weight restrictions might become necessary as the EV-to-ICE ratio increases.

4. Online Marketing Strategies Will Continue to Expand 

As mentioned, consumers conduct much (if not all) of their research online. Dealers who implement the best automotive digital marketing strategies can use these opportunities to build more personal relationships with those customers.  

Given the heightened competition in all aspects of dealership operations, selling more cars using conventional marketing techniques has become challenging.  

As such, dealers should consider expanding their online strategies, which might include the following: 

Website Development

Customer behaviors constantly evolve as the digital marketing landscape expands. Consumers want as much information as possible on items they are looking to buy, particularly big-ticket items such as cars.  

Dealers must implement solid online marketing strategies to build a user-friendly and visually appealing website that makes searches easier for potential buyers. These strategies might include: 

  • Landing page optimization 
  • Vehicle Inquiry forms 
  • Current inventory listings 
  • Responsive web designs 

Search Engine Optimization (SEO)

Search engine optimization is the practice of adjusting websites and related content—such as modifying blogs and adding hyperlinks, proper headers, and meta tags—to help dealerships rank higher on search engine results pages. 

SEO is a targeted and successful online marketing approach that allows dealers to target specific customers, unlike “broadcast” digital marketing methods that advertise to unspecified groups. 

Social Media Platforms

Social media is another area of dealership digital marketing that continues to grow. Millions of individuals – including car buyers – use social media sites like Facebook, Twitter, Pinterest, and Instagram. Dealers can generate high-quality leads by adequately promoting their dealerships on these platforms. 

Content Marketing

Today’s digital omnichannel approach grants dealers access to an expanded customer base of people looking to learn more about their automotive brand of choice.  

Target Marketing

If marketing teams execute the plan effectively, dealers can communicate with these target markets from the beginning of the process. As such, dealers should consider employing a content marketing strategy that includes the following: 

  • eBooks 
  • Articles 
  • Blog posts 
  • Case studies 
  • Social media posts 

Customers should be informed, educated, and engaged in automotive topics that are significant to them to help them solve their problems. 

5. Dealers Will Explore New Revenue Streams for the Service Lane 

EVs will soon become a fixture in the service lane, but they require different and less frequent maintenance and service than their ICE counterparts. As such, dealerships need to develop new revenue streams related to EV services

These new tactics might involve making better use of data to provide both EV and ICE consumers with a steady cycle of repair and maintenance opportunities. 

More precisely, dealers can leverage technology and data in the ways listed below to lessen the effects of expected lower service profitability brought on by the impending EV surge: 

  • Use machine learning and artificial intelligence to upsell. By interacting data with AI (Artificial Intelligence) and machine learning, dealers can automate communications and sales without increasing the labor associated with manual data entry. 
  • Reduce operation challenges and costs. Dealers should consider technology that unifies cross-departmental data, streamlines processes, and simplifies third-party add-ons, all of which reduce expenses. 
  • Embrace cutting-edge technologies. Dealers ought to collaborate with a solutions provider that offers advanced, ground-breaking technologies that optimize processes and operations. 
  • Utilize OEM APIs (Application Programming Interfaces). Working with OEMs is not something all data management system (DMS) suppliers see as a potential for industry innovation or augmenting data integration. As such, dealers should search for vendors that support continuous improvement and work with OEMs to enhance the user and customer experience by incorporating real-time data. 

Leveraging alternate revenue opportunities is vital to keeping a healthy service lane business model. 

6. Fuel Cell Technology Will Offer Another Option 

The market expects the global introduction of fuel-cell electric vehicles (FCVs) in 2023, which analysts expect to be popular for many environmental and practical reasons, including: 

They Still Reduce Reliance on Oil

Hydrogen can be produced domestically with readily available resources, meaning FCVs might help the U.S. become less dependent on oil imports. Those resources include: 

  • Biogas 
  • Coal 
  • Water  
  • Agricultural waste 
  • Natural gas 

Leveraging these resources would make the U.S. economy less reliant on outside competitors, helping safeguard markets from the rising volatility of the oil market. 

They Still Emit Fewer Greenhouse Gases

Vehicles fueled by gasoline or diesel release greenhouse gases, primarily carbon dioxide. Meanwhile, hydrogen-powered fuel cell vehicles emit heat and water from the tailpipe. 

While greenhouse gases are still a risk depending on the chosen technology to produce hydrogen, those amounts still pale in comparison to the amounts that regular gasoline and diesel cars can deliver. 

They Still Produce Fewer Air Pollutants

FCVs driven by pure hydrogen do not release the same harmful pollutants emitted by ICE highway vehicles. While the production of hydrogen from fossil fuel produces some pollutants (as mentioned above), the amounts produced are far fewer than those made by conventional cars. 

However, on top of traditional EVs’ expected environmental benefits, FCVs offer a more extensive driving range (up to 5 times that of an EV) and recharge more quickly. 

7. Manufacturers Will Partner with Tech Companies to Keep Pace 

Cars are evolving into enormous mobile computers with various chips, sensors, and artificial intelligence platforms. As that happens, manufacturers are looking for partners in the technology sector to boost capabilities and keep pace with competing automakers. 

Vehicles of all shapes and sizes now need this sophisticated software and innovative technology to operate correctly and safely. Manufacturers must either make significant investments in their technology departments or collaborate with tech companies to create the new operating systems these sophisticated vehicles will require.  

Technological advancements because of these partnerships include: 

  • Software upgrades. The software will have a larger influence on the mobility experience than the internal workings of the vehicle. Automakers must evolve into software-enabled organizations by partnering with tech firms with the right industry expertise. 
  • Autonomous vehicle progress. Driving assistance is developing quickly, and the future of mobility will undoubtedly include autonomous driving. However, getting there requires significant technological investment, specialized knowledge and skills, and cost-sharing—all of which are more easily accessible via partnerships. 
  • Advanced backseat entertainment. Not all advancements involve driving performance. Incredible advances are also happening in the rider’s experience. Automakers and tech giants are combining vehicle data and physics with XR (extended reality) to create immersive gaming experiences for backseat passengers, raising the bar for in-car entertainment significantly. 

Technology will continue to drive vehicle enhancement, and partnerships with big tech will become a critical part of continued progress. 

Meeting These Challenges Requires the Best Solutions 


These 2023 automotive industry trends might redefine how dealers manage their day-to-day operations. Customer demands for expanded online options, the need to incorporate EVs into sales and service strategies, and continuously evolving technologies present tall hurdles. 

However, born from these challenges are a wide range of new opportunities, from innovative digital marketing campaigns to new fixed-ops processes. Identifying and implementing these strategies is critical to keeping pace in a fast-moving and ever-evolving landscape. 

The best way to meet these changes is by equipping your dealership with digital and data-driven technologies that will best prepare you for the inevitable changes that lie ahead. 

Contact us today and learn how Affinitiv’s innovative data-driven solutions can help you prepare for the 2023 automotive industry trends that might reshape the market and force dealers into unexplored territory. 

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