Taking initiative to fill service need

In late 2019, Warren Henry Auto Group opened an 800,0000-square-foot service center in North Miami for its Infiniti and Jaguar-Land Rover stores. The expansion nearly tripled the number of service bays from 28 to 82.

To help find technicians to staff up for the additional capacity, Warren Henry Auto Group launched two different initiatives — part of an ongoing effort by the seven-store group to recruit skilled talent.

In January 2020, Warren Henry instituted a deferred-compensation plan that pays service techs a bonus based on hours billed and seniority with the company. Employees become fully vested in the program after three years of service.

The group also partnered with Miami-Dade County Public Schools to host an ASE certification program to train candidates.

The tenure-based bonus program so far has helped Warren Henry nearly double the number of technicians at its North Miami location to 70 employees.

"The technicians who have been with us for a good period of time are appreciative," CEO Warren Henry Zinn told Automotive News. "They've also put a bug in the ear of friends who are working in other facilities."

During the pandemic last year, the group made an effort to demonstrate its loyalty. The company has not reduced its technician work force and has guaranteed techs 40 hours of pay a week.

"For several months, we didn't know what was going to happen from one day to the next," Zinn said. "We didn't know what kind of shutdowns we were going to experience."

Zinn played the long game with his hard-to-source talent pool.

"We know a lot of different groups that laid off large numbers of technicians," Zinn said. "From our perspective, it seems pretty difficult to understand why you would lay off revenue-producing individuals at a store."

A chronic shortage of service technicians is an intractable problem that bedevils the auto retail industry.

At the end of 2019, franchised new-vehicle dealers and body shops had a total of 267,087 technicians, according to the National Automobile Dealers Association. About 39,000 new service techs graduate from U.S. technical colleges and training programs each year to help fill those ranks, NADA said. But the industry needs 76,000 new techs annually to meet new demand and replace personnel lost to attrition, the association said.

Warren Henry Auto Group CFO Erik Day said dealership margin compression has put more pressure on fixed operations to produce profitability.

"To get that work through the shop, you have to have technicians that are productive and proficient," Day said.

Following the North Miami service expansion, Zinn and his team had to get creative with finding ways to ramp up tech recruitment.

The idea of the bonus program came from the financial services company UBS, which manages the dealer group's 401(k) and other compensation programs.

"That's when the lightbulb went off about maybe creating something to support technicians as a way to help us with recruitment and retention," Day said. "It's an additional layer of compensation beyond just the normal comp that technicians typically earn."

The bonus program cost Warren Henry about $60,000 last year.

"The return on investment is certainly there when you look at the dollar spend versus the incremental volume you're getting," Day said. "We've seen substantial growth in our service revenue and gross profit year over year. "

At the same time, to prime the pump for future techs, Warren Henry Auto partnered with Miami-Dade County schools for the retailer to host a two-year certification program on-site.

The group provides classroom space, service bays and equipment for hands-on training, and technician mentoring, while the school system provides the instructor and computer equipment.

"Our goal is working with the instructor to identify students who have demonstrated sufficient competencies," Day said. "We can then introduce them on a part-time basis to do some work at the dealership so they can gain even more experience outside of the classroom environment," Day said.

Zinn is hopeful he'll be able to hire 75 to 80 percent of the graduating class.

"Certainly we're looking to keep the best," he said.