December 2023Automotive & Assembly PracticeRoadwork ahead! Commercial vehicles face new go-to-market challengesAs shifting customer preferences, innovative business models, and new entrants transform commercial vehicle sales, OEMs must change with the times.This article is a collaborative effort by Niels Dau, Thomas Furcher, Anna Herlt, Philipp Maximilian Lühr, and Matthias Schyma, representing views from McKinsey’s Automotive & Assembly Practice.Innovative go-to-market strategies are beginning to transform the commercial vehicle (CV) industry. One early example involves light commercial vehicle (LCV) players moving toward direct-sales models, rather than relying on dealers for their go-to-market approach, as they have traditionally done. Many more changes are on the horizon across CV segments, driven by five core trends (Exhibit 1): — the growth of omnichannel sales — new value pools and business models — increasing cost pressures — stringent regulations and the shift to zero-emissions vehicles (ZEVs) — the emergence of new entrantsThese trends raise two questions: Why do OEMs in the CV segment need to change? And why does this change need to happen now? After exploring these issues, this article describes emerging go-to-market models and guiding principles that can help CV OEMs select the best approach.Why change?Of all the factors promoting change within commercial vehicle go-to-market, three stand out.Omnichannel sales are becoming standardAs in the B2C sphere, B2B customers increasingly demand an omnichannel experience that seamlessly integrates offline and online channels. McKinsey’s Global B2B Pulse Survey shows that B2B customers use an evenly divided mix of traditional, digital self-service, and remote human interaction channels,1 with 35 percent of respondents rating e-commerce as most effective. B2B customers also are increasingly willing to engage in large e-commerce transactions, with roughly 70 percent of respondents prepared to spend up to $500,000 on a single purchase.Based on experience in other industries, B2B customers also demand greater individualization during their interactions with companies. More than half of the respondent companies in McKinsey’s Global B2B Pulse Survey stated that they increased their market share by investing in individualization via sophisticated marketing tactics, technology stacks, analytics, and prescriptive insights.21 McKinsey Global B2B Pulse Survey, December 2022, n = 3,862; Australia, Brazil, Chile, China, France, Germany, India, Italy, Japan, South Korea, Spain, United Kingdom, and United States (2022 only).2 Ibid.Exhibit 1Five core trends are prompting changes to go-to-market models for commercial vehicles.McKinsey & Company2/366%<515–25%>10Greater emphasis on omnichannel salesNew value pools andbusiness modelsIncreasingcost pressureStringent regulation and expected shiftto ZEV feetNew entrantsof B2B customers pref...
