Automotive Franchise Business Opportunities Remain Strong in the Face of Industry-Wide Struggles
This is a difficult moment for the US automotive industry, but an exclusive franchise business opportunity study by Franchise Direct (www.franchisedirect.com) has shown that automotive franchises are doing well regardless. Franchise Direct examined the Franchise Disclosure Documents (FDD’s) of 30 automotive franchises and found that more drivers are turning to franchise businesses to keep their car on the road.
The serious problems in America’s car industry are common knowledge. Yet Franchise Direct has learned that the serious crisis in the automotive industry, taking place alongside America’s worst economic downturn since the Great Depression, has actually created some business opportunities for aftermarket and car rental and sales franchises.
The truth is Americans are not buying new cars as often as they used to. The Franchise Direct automotive franchise study states that the projected new car sales for 2009 are 9.7 million units. This represents a 40% decline over the last 3 years. But America’s love affair with the automobile is undiminished. Because of the recession, more drivers are becoming reliant on services offered by automotive franchises as they need to get more miles out of their vehicle.
Aftermarket automotive franchise businesses are most likely to succeed from this trend, as consumers seek essential maintenance and repairs with greater need. They most likely turn to a company with a trusted reputation. Used car and rental franchise opportunities will also thrive from this new thriftiness.
Exciting new niche markets are also emerging for franchised businesses to exploit. In recent years, drivers have embraced automobiles with elaborate technology. This might mean evolved engine control, microprocessors and high-tech safety and entertainment equipment. There has also been a switch towards ‘green’ technology in automotive manufacturing. With these technologies become more and more prevalent, a new franchise business market is forming to suit these tastes. Drivers now lack the know-how to perform such complicated automotive work and instead turn to trusted franchise brands.
It is ironic that the global recession and the collapse of Detroit’s auto industry have created the conditions for the recent success of automotive franchises. America’s love affair with the automobile is still strong, but American attitudes towards car buying have radically altered. Franchise Direct’s research shows that consumers are relying on automotive franchises to keep their cars running. With the government’s stimulus plan providing some economic optimism, Franchise Direct believes that this is a rewarding time to consider franchise business opportunities in the automotive sector.
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