Lang: Loss of high-tech dealer bays creates ‘unprecedented’ opportunity for independent repair outlets
“The loss of approximately 45,000 high-tech Dealer bays since the 2008 Great Recession has created an unprecedented opportunity for Independent (non-Dealer) repair outlets.
“Vehicle complexity is increasing geometrically with each model year. Combined with the dramatic loss of Dealer bays over the past 10 years, this has created a high-tech auto repair gap. If Independent (non-Dealer) shops want to fill this growing repair market gap, they will need to acquire technical training and sophisticated diagnostic and repair tools and equipment.”
– Jim Lang, Lang Aftermarket iReport
Dealer High-Tech Bay Loss
As vehicle complexity grows, the number of high tech Dealer bays has significantly declined over the past 10 years.
Notwithstanding a modest uptick in the number of Dealer bays in the past two years, the Dealer bay population has declined approximately 45,000 over the past ten years (2008 to 2018).
Despite a growing need for sophisticated vehicle diagnostics and repair, the number of automotive service outlets capable of performing this high-tech work has shrink.
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Independent Repair Market Opportunity
The gap between the demand for high-tech vehicle diagnostic and repair and the shrinking number of Dealer bays capable of performing this work has created an unprecedented opportunity for Independent (non-Dealer) outlets to fill this growing multi-billion-dollar vehicle repair need.
Diminishing Convenience of High-Tech Repair
With fewer than 18,000 Dealers across the country, the drive time between the average consumer and the closest Dealer (servicing their nameplate) has increased over the past ten years. As a result, the remaining Dealer bays have become less convenient for consumers to reach.
Eleven Times More Independent Outlets
The Independent (non-Dealer) outlet population is nearly 11 times greater than the Dealer count nationwide. The growth potential is enormous for Independent (non-Dealer) repair outlets to fulfill the soaring need for technical diagnostic and repair services.
High-Tech Repair Needs
Independent service outlets will require both technical training and sophisticated tools and equipment in order to fulfill the growing need for high-tech vehicle repair.
In addition to increasing their technical repair capability, Independent repair outlets must attract and retain customers who own high-tech vehicles, convincing them that Independent outlets can deliver Dealer-level technical repair.
Along with the repair opportunities for high-tech bays of Independent (non-Dealer) repair outlets, Manufacturers and Distributors of tools and equipment have an extraordinary opportunity to provide Independent repair outlets with the diagnostic and repair tools and equipment they need to meet this market demand.
Similar opportunities exist for companies providing technical repair training that can enable Independent service outlets to attract and retain customers with high-tech vehicle repair needs.
How well Independent repair outlets meet this growing need for high-tech vehicle repair will determine their competitive position in the rapidly changing aftermarket as well as that of the Manufacturers and Distributors that supply them.
Record Number of Vehicles Under 6 Years Old
With new vehicle sales topping 17 million during 2015 to 2018, a four-year sales record, the number of high-tech vehicles on U.S. roads has never been greater.
The opportunities and challenges for Independent (non-Dealer) repair outlets to maintain and service these vehicles will increase sharply over the next few years as this population bulge in the new vehicle market works its way through the vehicle repair-age sweet-spot (vehicles 6 to 10 years old).
Six Major Takeaways
The number of high-tech Dealer bays has declined 13% over the past 10 years. At the same time, vehicle complexity has increased.
The gap between the demand for high-tech vehicle diagnostic and repair and Dealer repair capacity has created an unprecedented opportunity for Independent (non-Dealer) outlets to satisfy this growing multi-billion-dollar repair market need.
The Independent (non-Dealer) outlet population is now 11 times greater in number than the Dealer count nationwide.
Independent service outlets will need both technical training and sophisticated equipment and tools to fill the growing need for high-tech vehicle repair.
Manufacturers and distributors of tools and equipment have an extraordinary opportunity to enable Independent outlets to meet this high-tech auto repair demand.
As annual new vehicle sales have topped 17 million over the past four years, the number of high-tech vehicles on U.S. roads has never been greater.
Copyright 2019 by Lang Marketing Resources, Inc.
NOTE: Special thanks to publisher Jim Lang for granting us permission to publish the Lang Aftermarket iReport.