Independents continue to hold ‘high ground’ over main dealers

Service retention is strongest among independents but the gap is closing with fears of market value decline

Independents continue to hold ‘high ground’ over main dealers
The average expenditure per car per annum in 2015 on servicing and repairs, including VAT and MOT testing, is estimated to have been £436 based on licensed cars.

Customer retention continues to be strongest in the independent sector, according to the latest findings from The Castrol Professional Car Servicing and Repair Trend Tracker 2016.

The survey asked 1,000 motorists each month about where they last had their car serviced, revealing a strong retention of customers at independent garages.

However, the results show that franchised workshops have increased their servicing retention by nearly two per cent, bringing an end to a decline that started back in 2005.

Main dealers

With 10.6 million new registrations since the beginning of 2012, the four-year parc has increased by well over a million cars, boosting the number of potential customers most likely to use franchised dealer workshops which are now experiencing an up-tick in their fortunes.

In the report, Trend Tracker’s Chris Oakham wrote: “Franchised workshops apparently turned the corner in 2015.

“However, in the long run, independent garages will continue to hold the high ground because of the business gained from DIY.”

Audi, Kia, Hyundai and Skoda dealers were the only franchises that boasted higher servicing retention than independents in 2015 – all four have grown their new car sales substantially, hence their four-year car parcs.

Market decline

Trend Tracker’s wider consumer survey of servicing, MOTs and repairs suggests that the number of retail repairs has been declining since 2013 but the number of routine services has been increasing – consistent with the surge in new car sales.

Oakham said: “Quite simply, owners of new cars buy routine services, but most repairs, other than wear and tear such as tyres and brakes, are covered by warranty.

“Repairs are, on average, 60 per cent more expensive than routine services, so more services and fewer repairs will have a negative effect on market value.

“As these [new cars] age through the car parc, and it will obviously take time, demand for servicing and repairs will be reduced.

“Thus the outlook for the retail servicing and repair market is a slow decline in real terms.”

Do the survey results ring true for you? Are you concerned about the new car sales figures and what this could mean for service retention? Leave your comments and any concerns below.

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