It’s official. We are keeping our vehicles longer. Studies by the AIA Canada and U.S.-based research firm Polk all show that North Americans are holding onto their vehicles longer.
According to Polk, the average age of an American vehicle on the road today is 11.4 years, even with annual vehicle sales in the United States running at a rate of 15.5 million, which is near what it was before the recession hit. Polk even predicts that in the next five years, the average age of vehicles on the road will be 12 years or more.
The trends are similar in Canada.
In this issue of SSGM Magazine, Murray Voth (pg. 28) tackles how shops can better grab business from this growing segment of vehicle owners. The challenge, as Voth sees it, is that the mantra of competing on price, service and convenience, will only go so far, especially in a market where new vehicle leasing options are making it more attractive for people to exchange an older vehicle for a new one.
The conversation has to move away from vehicle maintenance costs to vehicle ownership costs over the long term, comparing the savings of regular maintenance against the cost of leasing payments and vehicle depreciation. It is a more complex formula to explain, but one has to do it when you get a vehicle owner coming in and balking at the cost of replacing brakes and ball joints, and eyeing the low rates for leasing a new vehicle.
I know it is a hard sell. I see it amongst people I know who are absolutely convinced that leasing is the best option. You’ve probably heard all the arguments: it’s cheaper than owning a new vehicle, you avoid the cost of big repairs, and the clincher, you get a new vehicle for the same leasing cost every few years. For many the cost of leasing is sold to them as a way of avoiding having to go into a service shop, except for such maintenance work as an oil change. Anything more and it is time to send the car out to pasture. I have people who ask me all the time when my family will ditch our 12-year-old family car. No matter how many times I tell them my decade-plus vehicle works just fine because we do all the recommended maintenance work and fix problems right away before they become serious using quality parts, many are convinced the vehicle is a money pit, just minutes away from complete and utter failure. How wrong they are.
I just can’t seem to convince them that the total maintenance cost of this vehicle, over its history, is significantly less than any leasing option available today. In fact, the most expensive maintenance work I have ever had amounted to about two months or less of a typical leasing payment.
My family and I plan to keep this vehicle for a very long time still.