Why the service department must evolve in EV era

Significant shifts are taking place in the auto services industry as electric vehicles, new customer attitudes and the adoption of digital retail evolve from the pandemic.

As a result, leaders across the industry are revisiting assumptions and challenging standard operating procedures to ensure that they align with the rapidly evolving needs of customers interested in new ownership — and service — experiences.

The J.D. Power 2021 Aftermarket Study and Customer Service Index Study reveal several important insights into how customers are reprioritizing their needs around:

• Payments. There is now a bias for remote or online options.
• Speed. Express service is increasingly the default expectation of customers.

While we are still in the very early stages of tracking the experience EV owners have with automotive services, the early results are not promising. Owners are generally less satisfied with general maintenance and service. This could be an early warning sign.

The onset of COVID-19 drove a significant increase in online automotive shopping, breaking traditional in-person interactions that have driven business to the auto service departments of dealerships. The implications could carry severe consequences for service operations.

Even as a gradual return to normalcy begins to emerge, many customers appear likely to continue supporting their new digital automotive buying habits. This is especially true of people looking to purchase EVs.

Looking ahead, service departments will have to start thinking strategically about turning digital engagement into new opportunities for establishing ongoing relationships with customers.

The true implications of these trends may be hidden by the severe imbalance that currently exists between supply and demand. Dealer gross profits have soared over the past several months, offsetting the anemic growth in service and maintenance.

However, as the supply chain begins to balance out — and inventory balances to match supply to demand — service departments will have to pull their weight once again. That is why J.D. Power expects to see more activity around improving customer satisfaction around maintenance and repair operations.

The good news for the industry is that there appears to be plenty of time for important adjustments to be made. While EV adoption — which triggers a much lower need for vehicle maintenance services — has a way to go to meet government objectives of 50 percent zero-emission vehicle ownership by 2030, demand for ICE automotive servicing will remain steady for decades.

A long time, however, is not the same as forever. Moreover, the pace at which consumers are embracing digital retail channels is accelerating. That is why the auto service community should begin now to develop opportunities for engaging with the EV and online shopping communities.

To establish a new base of loyal customers, dealers and aftermarket providers should create educational campaigns that build awareness around how dealerships can assist EV owners, and convince consumers that they are the best resource for managing any long-term ownership experience, regardless of vehicle type.

Mastering digital tools will also be essential. The ease with which consumers can schedule service, quickly understand technician-recommended work, view the status of their repair in real time, and easily view work completed and authorize remote payments are all opportunities to reduce friction in a typically inconvenient process.

We have yet to see what excellent EV and digital-first automotive services will look like.

As customer expectations evolve, however, dealers will need to elevate their go-to-market strategies and redefine customer service excellence.