How can automakers preserve margins amidst market disruptions?

In golf, the difference between winning and falling behind often comes down to precision. A drive that strays just a few yards off the fairway can add unnecessary strokes to your score. In the same way, automakers must manage their margins with accuracy—because even small leaks in profitability can make the difference between success and setback. 

Lining up the shot

Even as global auto volumes stabilize, the margin game is getting harder. Growth through 2030 looks modest in mature markets, and while many OEMs are leaning into the EV transition, consumer adoption hasn’t kept pace with expectations. Inventory swings, shifting tariffs and pricing pressures continue to test profitability. To stay competitive, OEMs must unify pricing, incentive and partner programs into a single revenue system that can be measured daily and adjusted quickly.

Margins may be invisible, but like a golf handicap, their impact is real. Protecting and growing those margins requires both the right revenue management tools and the right pricing strategy.

Reading the course: Hazards facing automotive margins

Just as golfers evaluate wind, sand traps, and rough, OEMs must anticipate the challenges that erode profitability, such as:

• Volatile input costs: Prices for metals, batteries, and semiconductors swing widely, straining cost structures.
• Incentive leakage: Inconsistent incentive and rebate management can cut 2–4% from margins—an industry already operating on razor-thin returns.
• Incentive complexity: Incentives fine-tune vehicle pricing based on market conditions. An “aged” vehicle sitting on a lot may get additional rebates to free up space, while newer models use incentives to match demand.
• EV transition pressures: Regulatory timelines, consumer hesitation, and early-stage EV program costs demand significant upfront investments.
• Supply chain disruptions: Inventory swings and logistics bottlenecks create uneven costs.

Choosing the right club: Technology as a competitive edge

A golfer wouldn’t use a putter on the tee box, since it’s only used on the putting green. Likewise, manufacturers can’t manage billions in programs with outdated spreadsheets. Manufacturers must use data-driven solutions to make real-time adjustments to dealer and distributor claims, incentives, aftermarket revenues and EV cost management that keep margins in the fairway.

With predictive analytics, automated claims validation, and “what-if” modeling, manufacturers can test different strategies before swinging, reducing risk and ensuring every shot counts.

Scoring big on the back nine: The aftermarket opportunity

Many golfers know the back nine is where you can make up ground. For automakers, the aftermarket is the back nine—the place where margins are strongest.

What makes the aftermarket so critical right now is its ability to offset disruptions across the rest of the value chain. In this environment, the steadier margin profile of aftermarket parts, repairs and digital services provides a cushion that helps OEMs stabilize their financial scorecard even when the front nine is full of hazards.

Yet, the opportunity is not without its challenges. Subscription fatigue is a genuine concern, and parts pricing is under pressure from both inflation and competitive discounting. To stay competitive, auto manufacturers must balance innovation with discipline, shaping aftermarket pricing strategies that drive sustainable growth and customer loyalty, not just short-term sales spikes.

Finishing under par: Turning margins into measurable growth

Every golfer knows the importance of closing strong. It’s not enough to start with a great drive, you have to stay focused through the last hole. For OEMs, finishing “under par” means navigating market disruptions, cost pressures and uneven consumer demand with discipline, strategy and precision. Misaligned incentives or over-aggressive discounting may spike short-term volume but can erode brand equity and long-term profitability. 

In this industry, success comes with consistency: applying data-driven insights to price management, keeping incentive programs aligned with demand, and ensuring aftermarket strategies support, not cannibalize, core revenue streams. This measured approach not only will preserve margin today but also build resilience for tomorrow’s disruptions.