Fixed Operations Plan For The Next 10 Years

Written by Ashley Murray | ashleymurray@m5ms.com | 321-693-7480

My job as a fixed operation consultant is to help clients work to be better now and in the future. As a consultant I analyze dealerships’ current processes and how to improve them and their financial structure. Often, a dealer has fallen under the curse of the death plan which states: “This is how we have always done it.” As you can guess, times change and the dealer does not. Sometimes the reverse happens where a dealer GM has read about and or been told about a great new way to do things without understanding the underpinnings of how the new plan works. This can also lead to less than stellar results, or even worse, cause the whole service department to back-track financially.

Our job as consultants is and always will be to get the department back on track financially with the right plan implementing the right processes. Cars have been an internal combustion engine vehicle for over a hundred years. Routine maintenance, the backbone of the service department, is something that must be done for the vehicle to continue to operate in a safe and reliable manner. We build entire dealership garages and hire people for this purpose. We hire techs and advisors for the one purpose of express maintenance service. If done correctly, it is a profitable piece of the modern dealership service department. I don’t know if there is even a reliable count of how many independent garages are out there performing basic maintenance on cars. I know there are more independent garages than dealerships out there working every day.

So where is this story going? Well, I read a short piece the other day that is something we all think about but really have not grasped yet. One paragraph that is going to change how we all think sooner than later:

LONDON (Reuters) – Electric vehicles could account for two-thirds of all cars on the road by 2030 in wealthy cites such as London and Singapore due to stricter emissions regulation, falling technology costs and more consumer interest, research showed on Tuesday.

Not much to read about at first. We all know it’s coming and are expecting electric charging stations everywhere. In fact, we see them already in various parking lots around wherever we are at that moment. But do we stop and think about the true ramifications on the modern dealership service department that is going to happen in the very near future?

What is the modern express department’s major goal? Change oil. One article I read stated over 30 million electric cars in 10 years. No oil changes on the car of the very near future. Another fact, no air filters, no transmission services, no differential services, no belts; not a lot of maintenance items at all. There will be repairs and tires are still going to be a must. But a lot more will be gone than added. Mufflers…gone, catalytic converters…gone, four-wheel drive transfer cases…gone. It is truly a long list of car parts as we know them that will no longer be in play. Even the tried and ever failing water pump will be gone. Oil leaks gone. Need I say more? The modern electric car will break and need repairs, but the concept of a low-cost tech to work on these cars will for the most part be gone. Because of the dangers that come with high-voltage battery systems, techs will be required to have very specialized training.

So, our jobs as consultants will be to lead the way into the future of making money on this vehicle. Dealerships will be selling them, and people will be buying them, so let’s take a moment and think this through. Ways that the service department can continue to still make money:

  1. Make the dealership a charging station for travelers.
  2. Make an exclusive lounge for travelers because the network of dealerships for a manufacturer is coast to coast.
  3. Create a VIP lounge like a Delta lounge. Sell the membership in F&I with continual monthly billing. Also, you will be collecting money on the charging process.
  4. Make your dealership the premier dealer in the area for home charging stations. Know it all and do it all. It’s out of our norm but we must be the best at this. It will sell more cars.
  5. When vehicles come into a dealership for recharging, a multipoint inspection must be performed to check tires, brakes, and windshield washer-fluid and wipers.

I am sure as this time comes upon us, we can find more ways to try and bulk up our service maintenance department. It is a must for us to continue to pay for our buildings and keep the store financially viable. It will be our job as consultants to make this happen then as we do now.

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