New research released by Cox Automotive on the U.S. vehicle service industry shows that franchised dealerships continue to lose share to general repair shops. In the latest report – Under the Hood: Opportunities and Challenges in the Service Industry – franchised dealerships are shown to retain their position as the industry’s top service provider but have lost ground to service chains (e.g., quick lube locations, service centers.) In 2023, dealerships accounted for 30% of all service visits in the U.S., down from 35% in 2021.
The auto care industry continues to be very important to the U.S. market, with consumer spending in the sector expected to surpass $400 billion in consumer spending within the next two years. With the global COVID pandemic now mostly in the past, the report from Cox Automotive suggests vehicle owners are driving more and holding onto existing vehicles longer due to high prices and loan rates for new vehicles. Owners are also visiting service centers more often, according to the Cox Automotive study: In 2023, the average owner had their vehicle in for service or maintenance 2.5 times a year, up from 2.3 in 2021 (the last time the service study was released), but down from an average of 2.8 in 2018, before the pandemic.
“The service business continues to be a key part of any dealership operation,” noted Vanessa Ton, senior manager of market and customer research at Cox Automotive. “And while our report lays clear some of the challenges facing service providers today, the good news is that the industry continues to grow with more customers going in for service visits, and most providers are seeing a boost in revenue for service as well.”
The Cox Automotive service study research was undertaken during the second half of 2023 and surveyed 2,493 vehicle owners, including 182 EV owners, who had at least one service performed in the past twelve months, accounting for over 5,500 service visits. Additionally, employees with…
Read the full article here