Newsletter
ISSUE 4 | DECEMBER 2019
Looking Towards the New Year
Industry News & Trends
Growing repair service competition in 2020 In 2015, new car sales hit a record in the U.S. market with 17.5 million. Sales stayed stagnant in 2016, then dropped to 17.2 million in 2017, recovered slightly in 2018, and so far this year, sales have continued to decrease with an expected sales total of 16.9 million. This downward trend is expected to continue for the next few years, really putting pressure on dealerships to compete in the automotive service and repair market to make up for lost sales revenue. This may be difficult due to perceptions about dealerships and the changing automotive service and repair market. According to Cox Automotive’s Maintenance and Repair Study, nearly 72% of consumers visit an independent service and repair shop for their automotive needs after purchasing a vehicle. The top two reasons: customers felt they would be overcharged and that it would be less convenient at a dealership service department, which has become increasingly important for consumers within the last decade. Recently, Amazon has entered the aftermarket service and repair industry by partnering with several aftermarket
providers to sell parts and “mobile services.” This means customers can buy the parts they need from Amazon and then schedule a time for a mechanic to come to their house or their work to fix their vehicle, which for most customers, could be cheaper and more convenient than heading to a dealership. The good news for dealerships is that if a customer is introduced to the dealership’s service department during the buying process, the customer is 1.5 times more likely to return to get their car serviced. In addition, over half of consumers believe dealerships provide higher quality vehicle repair service than other independent repair shops. This gives dealerships an opportunity to create a superior service experience for their customer and keep them coming back.
teach them what they don’t understand instead of just telling them what to do. Teaching builds trust, credibility and faith in the service department. During the last decade, consumers have really shifted towards looking for and comparing services online. Making sure your business’s website and social media are up-to-date and helpful is a big step towards gaining and retaining customers. Also, using new technology can bring more convenience for the customer, such as text message reminders, apps and on-line help. A study done by DEMautomotive found that customers with a dealer-branded app made almost 25% more service appointments than those without.
In summary, there will be increased competition the next few years within the One of the biggest ways to stay on top of vehicle service and repair industry. the competition and grow service Consumers are increasing the demand for department market share is to earn trust on-line scheduling, apps and easier and build relationships with customers and information access for comparison shopping, the community. Sponsoring school sports so dealerships need to make sure they teams and local charities gets your provide what their customers are requesting. business’s name out there and creates a Don’t forget that small things matter too; a positive image with the community. When friendly welcome, an easy service process and a customer comes in, try to strengthen their honesty go a long way to create trust trust by being transparent and trying to between a customer and a dealership.
Industry fun fact: Did you know that according to the AAIA Aftermarket Fact Book, the average consumer spends $700 per year on automotive diagnostics, scheduled maintenance, and repair?
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