Watch Out, Dealers: Aftermarket Services Are Gaining on You!

Wait times are among the key reasons service customers avoid dealers, reports J.D. Power.

Nancy Dunham, Principal Analyst/Retail

May 8, 2024

3 Min Read
IndependentService
Service and repair customers seek short wait times.Getty Images

Dealers who want to boost their service department profits need to provide fast, courteous service or risk losing their customers to aftermarket providers, according to the just-released J.D. Power U.S. Aftermarket Service Index Study results.

While dealers’ services are still in demand, survey respondents rated aftermarket services higher than in previous years. The major satisfaction levels for aftermarket services include full-service maintenance and repair, which saw the greatest improvement (+12 points on a 1,000-point scale). That was followed by tire replacement (+5) and quick oil change (+4) (See J.D. Power chart at end of the story).

“Franchise dealers have advantages over aftermarket service providers – from superior facilities and manufacturer-trained technicians to (original equipment) parts, loaner cars and mobile service,” Leonard Martin, J.D. Power’s director of Automotive Retail, tells WardsAuto. However, to keep business, “they must do a better job of communicating the service value proposition while providing an exceptional service experience.”

Although the J.D. Power 2024 U.S. Customer Service Index (CSI) Study found that overall dealer service satisfaction improved five points to 851 (on a 1,000-point scale), parts and labor shortages contributed to long wait times.

“It’s encouraging to see an improvement in service satisfaction, but, unfortunately, the capacity and wait time issues have gotten progressively worse since the pandemic and show no immediate signs of easing up,” says Chris Sutton, vice president of automotive retail at J.D. Power. 

“Excluding Tesla owners, the service experience for BEV owners is underwhelming. As sales of BEVs continue to grow and the industry moves out of the early-adopter phase, the typical owner will not be as willing to tolerate a less-than-stellar service and ownership experience.”

Adding to the concern that franchised dealers’ services are threatened by aftermarket services is the lack of trust among non-Tesla owners, specifically in areas involving complex repairs and guidance, J.D. Power says. Overall, dealer trust among non-Tesla BEV owners is 5.62 (on a 7-point scale) but jumps to 6.00 among gas-powered vehicle owners and 5.74 among plug-in hybrid (PHEV) owners.

Still, consumers find franchised dealerships are more trustworthy than aftermarket facilities in some areas. For example, ratings by dealership customers for the use of technology to make service more efficient average 6.09 (on a 7-point scale), 

Here are some key sticking points J.D. Power offers service directors and dealers who want to smooth their roads to profitability:

  •  Appointment wait times for mass-market vehicles continue to increase: On average, owners of mass-market vehicles wait 5.2 days for an appointment at the dealer, up from 4.8 days in 2023, while owners of premium vehicles wait 5.4 days—slightly better than a year ago. Wait times in both segments are still significantly higher than pre-pandemic levels.      

  • Customers want prompt service appointments: Longer wait times at dealers drive more customers to aftermarket service facilities. Among customers in the mass-market segment, 35% now choose aftermarket service because of the ability to be seen right away, surpassing lower costs (34%) as a reason for choosing such service. Notable, too, is that 55% of customers select aftermarket service due to the convenience of locations. 

  • Photo/video documentation for recommended repairs: One area some franchise dealers excel at is providing photo or video documentation during multipoint inspections. Fewer than one-fourth (23%) of aftermarket facility customers receive any accompanying photo or video documentation. While doing so is more time-consuming for service staff, providing photo/video evidence of recommended repairs has a significant payoff, especially for tire replacement providers. Of the customers who receive an MPI with photo/video, 51% have the recommended work done. Without photo/video, only 24% of customers who receive an MPI have the job done.Wait times.jpgSource: J.D. Power

 

 

 

 

About the Author(s)

Nancy Dunham

Principal Analyst/Retail, WardsAuto

Nancy Dunham became an auto journalist more than twenty years ago. She has worked as an editor and writer for the National Automobile Dealers Association, US News & World Report, CarFax, and various newspapers in Washington, D.C. and Baltimore. Her work also appears in Costco Connections, AARP, the New York Times, Rolling Stone and other publications.

Before specializing in automotive retail journalism, she was a newspaper reporter, magazine editor and publisher.

She lives in Tucson, Arizona, with her three beloved cats.

Contact her at [email protected] or https://www.linkedin.com/in/nancydwrites/.

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