New Car Dealership Service Departments: Pros and Cons
Having run service and parts departments for new car dealerships for over twenty years I have gained an "insiders look" on how to make those departments profitable. In this article I will share with you the Pros and Cons of servicing your vehicle at the dealership and what to look out for. In the spirit of full discloser, I no longer work in the industry but wanted to share my insights and experience with you.
- Most dealerships have access to your vehicles service history so long as the service/repairs were performed at a same brand dealership. This is a big plus if you've had on going concerns with your vehicle while under warranty and now find yourself outside of warranty and feel you should'nt have to pay for the repair. Most dealerships may not be forthcoming in sharing this information with you but you should ask them for a copy.
- Most dealerships use parts from the manufacturer of your vehicle. These parts are most commonly referred to as OEM parts. Most car companys have a warranty on these OEM parts where Non-OEM or Aftermarket parts do not. There are dealerships that will use aftermarket parts and not share that information with you. This is most commonly the case as it pertains to filters, brake pads, brake rotors and exhaust. Ask to see the parts or for the part numbers so that you may verify that you get what your paying for.
- Most dealerships require that their technicians be factory trained and ASE certified. Having a factory trained technician working on your vehicle means they know your vehicle inside and out, they are specialists. While there are many independents out there that do excellent work they don't know your vehicle as well as the technicians at your local dealership.
- The dealership is traditionally more expensive than the the quick lube and independent establishments. There is a tremendous amount of overhead at a dealership and somebody has got to pay for it. I have seen instances where an independent will charge $200 to $300 LESS on a 30,000 mile maintenance as compared to the dealership and in most cases the dealership cannot justify the difference. Maintenance at a reputable independent is not something you should shy away from. You will save money in the long run.
- Most dealerships today perform what they call a "Courtesy Multi-Point Inspection", I call it an up-sell inspection. Dealerships normally present this to you as a report card on your vehicle and rely heavily on it to boost up-sells and increased gross profits. I would always ask the dealer to show you what their recommending so that you may see it with your own eyes and if they balk then chances are you don't need it. If your vehicle is still under warranty there is no real reason for them to do this but if you have high mileage on your vehicle or it's just old there may be a value in having it done.
- Shop Charges is the equivalent of a DOC fee when you buy a vehicle. It's unnecessary and it's only purpose is to once again, boost profits. The dealership will tell you it's for disposing of your oil or tires when the fact is companies pay them for their waste oil and old tires for recycling purposes. Insist that shop charges be removed from any bill you receive. Depending on the size of the dealer this one charge can add between $5,000 and $10,000 a month to their bottom line.
These are just a few things you need to be aware of when making the decision on whether or not you service your vehicle at the dealership. Like anything, there are Pros and Cons so just be aware of the Cons and insist that do what you ask. The competition is tremendous and retention is the name of the game. Dealerships will jump through hoops to keep you.
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