August 12, 2018 — Sources have confirmed CDK Global will announce Monday morning it is partnering with ride hailing company Lyft to provide a transportation solution for dealership service departments to integrate into their loaner fleet programs.
Lyft Business’ Concierge dispatch solution — already being used by approximately 300 dealerships — will be integrated into CDK’s dealer management system using the Fortellis platform. The integration will allow service departments to secure rides seamlessly through CDK’s service solution for their customers.
Making it easier for service departments to incorporate Lyft Concierge into their normal work processes, should enable dealerships to reduce insurance, rental, and shuttle costs associated with managing a loaner fleet — which often exceeds hundreds of thousands of dollars. Other benefits likely include better customer satisfaction due to reduced wait times for transportation along with increased options for transportation. Having an integrated solution should also create more efficiency in the service departments by making it simpler to arrange transportation for their customers.
The real story, though, in tomorrow’s announcement is what the partnership with Lyft means for CDK’s Fortellis platform — and possibly, how new solutions are brought to market in the future.
One of the more vexing challenges in the auto retail space for decades has been the lack of a seamless method for exchanging data between the hundreds of software solutions that serve dealers. And few of the solutions are connected resulting in confusing and frustrating workflows in the dealership. The current state of affairs also makes it harder to create seamless customer experiences and makes true online transactions nearly impossible.
It’s not so much about where the industry is today, but where it will be in three to five years. Automotive retail is entering what may be the most critical and dangerous period in its history. In five years, connected vehicles will dominate the roads and dictate much of what happens between the manufacturer, the dealer and the customer.
While most of the conversation seems fixated on the when and what impact autonomous vehicles will have on the industry, the connected vehicle era is what should scare dealers the most. Connected vehicles will provide OEMs direct access to the customer they have never had before. Furthermore, there will be the growing use of over-the-air service updates which may bite into service revenue.
And that era is coming quickly. The problem today is that a chasm exists between the giant tech players from outside the auto industry that are developing the connected vehicle systems and solutions and the auto retail industry. Dealers aren’t part of the conversation.
Other than Dealer FX and Cox Automotive’s xTime (both service-related solutions) that have participated in and sponsored the TU Automotive events in Detroit, there is little conversation regarding the dealer’s role in the coming connected era.
There is the obligatory lip service from OEMs and some of the tech firms at the myriad autonomous and connected (mobility) conferences in Silicon Valley, but dealers largely are ignored. Worse, much of the start up activity and conversation is focused on circumventing the dealer.
The retail industry needs a platform on which all players –retail, OEM along with those outside the industry such as Lyft — can develop solutions and APIs that work well with each other.
CDK says Fortellis will solve this problem. According to the March press release announcing the platform, “Fortellis, a technology engine with universal connections and protocols, enables a true exchange of information and data in an open, secure and accessible, global network.”
Through the use of APIs (application programming interfaces) developers from — vendors, dealers and OEMs — can build and integrate new (or current) solutions and workflows. APIs are standard protocols developers can use to better connect software solutions from different companies.
It’s not a new concept. SalesForce, Oracle, SAP and Microsoft all have had their own developer platforms for years that allow other companies to create APIs and solutions on those platforms.
CDK executives said at the March launch they started developing the concept following a meeting with one of their largest clients who complained about how the complicated the workflow process is stemming from having to use several different vendors.
The Fortellis moniker dates back to early summer 2014 when it reportedly (based on a July 2014 Trademark application) was one of three finalists in the running to be the new name of ADP’s Dealer Services once it became a separate public company. History tells us CDK Global won out.
CDK dusted off the name and refiled for a new trademark for Fortellis in March of this year while applying for a second trademark dubbed,” Fortellis Automotive Commerce Exchange.”
Despite its potential, Fortellis’ ramp up has been somewhat slow. That has created skepticism that CDK can execute the strategy — or worse, used the launch to distract attention from the antitrust lawsuits it is battling along with the corresponding Federal Trade Commission investigation.
But the partnership with Lyft indicates CDK is committed to making Fortellis a credible platform in the space. Furthermore, Lyft is the second large player from outside automotive retail to publish an API on the Fortellis since CDK launched it in March. As part of the platform’s launch at the National Automobile Dealers’ Association expo, SiriusXM introduced an integrated connected car app dealers can offer their customers.