Experts say dealers shouldn't panic over transition to EVs

Experts say dealers shouldn't panic over transition to EVs

- in Automotive

Despite dire predictions that the internal combustion engine is running on fumes, the transition to electric vehicles will be gradual and dealership service departments will have plenty of time to adapt, industry leaders say.

Scott Keogh, president of Audi of America, wants “reality” in EV forecasts.

“There are alarmist headlines,” Scott Keogh, Audi of America’s president, told Fixed Ops Journal. “You’ve got to put some reality behind it. I am not a doom-and-gloomer.”

Audi, like other automakers, is gearing up for a huge spike in sales of electrified vehicles. But even so, Keogh says the fixed ops business is not in danger.

“Even when our mix in 2025 goes to 30 percent EV,” Keogh says, “you are still going to be dealing with at least double the amount of [internal combustion] engines [from today], because we are still going to continue to grow.”

Ramping up body shop operations and selling collision repair parts — especially glass — to independent shops are among the ways dealers could offset revenue losses from fewer service visits by EV owners, analysts say.

“Dealers have a big advantage in supplying genuine collision parts,” says Nate Chenenko, head of the mobility practice at Carlisle & Co., an industry consulting firm in Concord, Mass.

But Chenenko adds: “The collision parts profitability window closes when semiautonomous technology becomes more widespread, because cars will stop crashing into each other.”

Wally Burchfield, vice president of aftersales for Nissan North America, says dealership technicians still will have plenty to do during and after the transition to widespread EV use.

“We are still dealing with a population of early adopters,” Burchfield says of EV owners. “They are generally cautious.”

And even when EVs enter the mainstream, he predicts, the instant torque of their electric motors will cause drivers to push them hard.

“Aggressive driving will cause more maintenance to be needed,” Burchfield says.

Jim Roche, senior vice president of marketing and managed services for Cox Automotive’s Xtime, also counsels dealers and fixed ops managers not to panic about the switch to EVs.

“How many gasoline engines [in vehicles] are on the road in the United States today? 250 million,” Roche says. “How many more will we sell in the next 10 years?”

Larry P. Vellequette contributed to this report.

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