Dealerships winning battle for repair dollars: J.D. Power survey

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Independent aftermarket shops are getting more vehicle service occasions in Canada, but dealerships are capturing a bigger share of the spend, according to an annual survey by J.D. Power.

According to the annual Canada Customer Service Index Long-Term Study, non-dealer service facilities won 53.4% of service occasions. But dealership service facilities capturing 53% of the total dollars spent on vehicle service over the past 12 months.

Spending at aftermarket shops has grown from an average of $223 per visit from $204 in 2017, while spending at dealerships has declined to $291 per visit, on average, from $303 in 2017.

The service market among 4-12-year-old vehicles in Canada is worth nearly $10 billion annually.

The study, which measures repair service satisfaction levels of original vehicle owners in Canada whose vehicles are 4-12 years old, also finds that younger vehicle owners (Gen X, Y and Z) are more likely to service their vehicles at non-dealer facilities, compared with Boomers and Pre-Boomers.

“The service and repair market among this lucrative set of vehicle owners in Canada remains highly competitive,” says J.D. Ney, Automotive Industry Practice Leader at J.D. Power Canada. “With the vast majority of these vehicles being out of warranty, customers are rethinking their brand loyalties and exploring their options.”

Prior experience plays a critical role in customer retention and is cited by half of vehicle owners as one of the leading reasons for choosing a service facility (52% of those who chose a dealership and 50% of those who chose an aftermarket shop). The reason is more prominent among Boomers and Pre-Boomers (60% and 74%, respectively), while Gen Z and Gen Y owners tend to choose service facilities based on a recommendation provided by a friend or relative (36% and 26%, respectively) more frequently.

“Customer satisfaction is critical for brand loyalty and advocacy of auto service facilities,” Ney said. “Service facilities that want to build customer loyalty need to provide positive experiences to meet this goal.”

Lexus dealerships ranked highest in overall customer service satisfaction for a fourth consecutive year, with a score of 826 out of a possible 1000. NAPA Autopro (799) ranked second and Great Canadian Oil Change (798) ranked third.

See chart details below.

https://canada.jdpower.com/resource/canadian-customer-service-index-long-term-study