Fixed Ops Journal - December 2020 - F11

Volkswagen's ID4, aimed at the Nissan
Leaf, arrives early next year.

That sound
you don't hear
is a rising
wave of BEVs

Fewer moving parts, no oil changes, brakes
that don't need frequent servicing and overthe-air-updates will make electric vehicles
a rare sight in the service lane. But fixed
ops can still be profitable in the EV era.
FIXED OPS JOURNAL ILLUSTRATION

Company spokesman Max Muncey said LaFontaine has recently inked several fleet
maintenance deals with rental car companies.
Also, one of its body shops is an official Tesla
certified repair center, and the company will
sell and service Bollinger's line of off-road
electric vehicles in the Midwest region.
At Bozard Ford-Lincoln, Roberts estimates
he needs an 80 percent retention rate just to
hold the line on service department revenue
in the BEV era. Currently, about 70 percent of
Bozard's customers return to the store for service after their vehicle's warranty expires,
Roberts says.
" We are going to have tire rotations. We are
going to have some level of brake work, which is
going to be less than it is today, " Roberts says.
" We'll have cabin air filters. That kind of stuff is
not going to change. And not everything is going to be able to be updated over the air. "
Roberts and others in fixed operations are
certainly justified in gearing up for what could
be one of the biggest service department disruptions since World War II.
According to consulting firm AutoPacific,
the 15 BEV nameplates on sale in the United
States in 2018 will grow to 86 by 2024. By the-

following year, BEV sales are projected to
reach 800,000 or about 4.9 percent of the U.S.
new-vehicle market. Looking out to the end of
the decade, that percentage could grow to as
much as 25 percent of new-vehicle sales in the
U.S., according to a McKinsey study.
BEVs, with their infrequent and low-dollar
repair tickets, are coming in high volumes at a
time when purchase consideration is growing. If fixed ops directors don't adjust, their
service and parts revenue is very likely going
to shrink as sales of traditional vehicles fade.
Just boosting retention is not a permanent fix
as internal combustion engine vehicles are replaced with BEVs.
Here are seven strategies from fixed ops experts for offsetting the revenue declines
brought about by higher sales of low-maintenance BEVs. Service directors can start rolling
them out now.

Improve customer service
Because BEVs require special tools and
training, franchised new-vehicle dealers have
the advantage over independent shops, says

n the last two years, consumer purchase consideration for an electric
vehicle has increased by 24 percent,
according to a McKinsey & Co. report. And judging by the number of these
vehicles in automakers' pipelines, consumers will have plenty of options.
General Motors and Volkswagen Group
dealers will see their showrooms begin to
fill with electric vehicles in the coming
months. Volkswagen is spending $37 billion on BEVs - $12 billion of which is
dedicated to grow VW's EV sales to 1 million a year by 2023. Volkswagen's ID4,
aimed at the Nissan Leaf, arrives in the
first quarter of 2021.
GM is investing $27 billion in BEVs and
is launching 30 battery-powered vehicles
by 2025, 20 of which will be sold in North
America. They include the electric Hummer, several Cadillacs, a revamped Chevrolet Bolt and more.
Ford's $11.5 billion BEV investment is
part of its plan to launch 40 BEV and hybrid nameplates globally by 2022. Other
brands, such as Jaguar, Porsche and Audi,
have already launched their first BEV in
the U.S.
Eye-catching new entries - such as the
Rivian R1T electric truck and battery-powered R1S SUV, the electric GMC Hummer
EV high-performance off-road vehicle,
Tesla's extraterrestrial-looking Cybertruck
and other BEVs from startup companies
- have some consumers reaching for
their checkbooks without even taking a
test drive.
- Richard Truett

see ELECTRIC, Page 12

DECEMBER 2020

PAGE 11

Fixed Ops Journal - December 2020

Table of Contents for the Digital Edition of Fixed Ops Journal - December 2020