Dealership Newsmaker Q&A Jim Lang

July 13, 2015
Lang Marketing Resources issued an update on service bay trends, noting that even though millions of additional cars and light trucks have hit the road over the past 10 years, the light vehicle service bay population shrank by 36,000. 

Earlier this summer, Lang Marketing Resources issued an update on service bay trends, noting that even though millions of additional cars and light trucks have hit the road over the past 10 years, the light vehicle service bay population shrank by 36,000. 

From 2004 to 2014, the number of dealer service bays dropped by more than 55,000 (largely because of dealer closings). Service station and garage bays, however, have rebounded as many closed dealers converted to used car locations. Repair specialists also gained more than 30,000 bays.

President Jim Lang spoke to Aftermarket Business World about the data.

Explain some of the service station and garage population changes in context of the dealership closings.

One phenomenon was that dealers with canceled franchises opted to stay in business as used car outlets with service bays, and in that sense they became classified as service stations, garages or repair shops. That gave a boost to a group of outlets that had been declining in population. That also shifted outlets and bays from the OE category to the independent category.

What other independent outlets are growing?

Foreign specialists have experienced organic growth and increased in number. Repair specialists that focus on a more limited menu of repair are also organically growing. There has been an uptick in the number of dealer bays, but most of those are Korean dealers so they don't have many vehicles out there that are five years old or older.

Do you see the number of dealer bays returning to their previous peak?

No, they won't get up to anywhere where they were, but what they've done is change and focus on an all-brands, all-years approach. They also started selling used vehicles, and that in turn creates service bay volume for them. Many of those vehicles are not their own nameplates.

They are making more money servicing vehicles than selling vehicles, but if you provide service that people like they are more likely to remain loyal to that nameplate. They are taking a more holistic approach to vehicle ownership and developing loyalty.

What types of challenges will dealers present to independent repairers moving forward?

There will be much more aggressive dealer bay competition. Dealers now are no longer content with just working on newer vehicles. They have also taken a more realistic approach to what customers are willing to pay for a repair. Many of them now have parts available that are not OE brands. Those are much more price competitive.

They are becoming more responsive and some even have different pricing schedules for older vehicles. It's much more competitive out there in terms of price. They've also extended dealer bay hours dramatically, or added quick lube services. The perception of the dealer bay offerings is different than it was six or 10 years ago. They are much more competitive to the aftermarket than they were prior to 2008.

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