Monday, 11 October 2021 15:29

Parts Shortages, Staffing Concerns Hold Back Dealership Service Departments


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Despite current headwinds and market conditions, dealership service centers remain resilient and continue to be among the most preferred service providers.

According to the 2021 Cox Automotive Service Industry Study released Oct. 11, 34% of consumers prefer dealership service centers, a 1 percentage point increase from 2018, and ahead of general repair shops.


And while this is great news for franchise dealers, there is still a majority of the market dealerships aren't capturing---translating to $214 billion in potential revenue.


Dealership service centers are the most preferred because of their existing relationships. In fact, 55% of consumers say it is because the dealership knows their vehicle.


On the other hand, dealerships continue to combat the perception they are overpriced and expensive. The top barriers to returning to the dealership are not only cost, but also location according to consumer rankings, all of which makes way for what owners consider easier and more convenient options, like general repair shops.


On top of that, nearly one in four consumers also say their dealership service visits take longer than expected, adding to their frustration.


Exacerbated by the pandemic, service departments cite part delays from manufacturers (58%) and finding or hiring the right technicians (45%) as their top operational frustrations, and both can directly impact the consumer experience, including the notion that service departments take longer than expected.


On average, dealerships cite a decline in the consumer satisfaction they deliver, with only 55% of dealers believing satisfaction has improved in the past 12 months (down from 71% when surveyed in 2018).


Specific to staffing, 57% of dealership respondents say their service department is not fully staffed, and 80% expect these labor shortages to continue or worsen in the future. The majority (60%) also say the service technician is the top role they plan to grow this year, so there is a focus on investing in this area of the business.


"The industry is ripe for transforming the consumer experience," said Tracy Fred, vice president of operations for Xtime. "Despite a challenging marketplace, opportunities exist to...

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