Motor Age Roundtable: Changing tides

JEFF PEEVY: Another challenging area is major consolidation. In the collision repair business we’ve seen consolidation really rearing its head and becoming a player. I suspect we will see it on the mechanical side as well. Shops need to find ways to compete against consolidation.

MOTOR AGE: Finding quality technicians remains a challenge. What can be done to encourage more young people to enter the industry?

FIFFICK: The biggest thing is that we have to have more respect for ourselves, our industry, and our profession. We need to clean up our image. There are too many shops out there that only see their business model as being cheaper than the next guy. Some shops utilize bait and switch techniques and/or loss leaders solely to have high quotas to fill, which only hurts our industry. If you give everything away for next to free, you can’t afford training, the latest equipment, or to hire the best technicians in the industry. If we enhance the professionalism of our industry and bring the price structure up along with it, we can afford to pay more talented people in the industry and get them to stay.

MEIER: There are also a lot of old mindsets we need to get rid of in which it is expected that the newbie cleans the shop and takes out the trash. This young technician spent two years in a post-secondary program to learn a trade and spent a lot of money to do so. We should be mentoring these young technicians, not using them as day laborers.

JEFF MINTER: There is a further development of an apprenticeship model that has been brought up through the AYES programs with ASE. The big hook is getting the students early on. We have to change the outlook or career image and the industry. Parents have a huge impact on where their kids are going to go. If we can’t get the image improved in parents’ minds, it is going to be harder to get them and their kids interested and excited about the great opportunities the industry offers.

PEEVY: When I was with I-CAR we did research trying to understand what attracted technicians to a company or a small business, and we were really surprised with what we found. One of the best ways to attract the most talented of the younger generation is to make an expectation to learn and share knowledge as a top business cultural priority. As an automotive repair industry we often get beat by other industries because of the way they project themselves. One thing we found in the study is that when shops put an expectation to learn and share knowledge as top billing, it attracted a very different candidate. The shops that did that found better technicians. There will always be details—pay and other things—that will be a challenge to overcome. However, shops must be driven by the fact that learning is living and is the only source of sustainable competitive advantage.

TRUGLIA: Money is a big driving factor. Techs don’t see a good financial career. I’ve had many guys leave the industry and go into a computer field or construction. This is understandable—just look at the amount of money that a tech has to invest. An average B tech will have $50,000-$60,000 in tools and will have to keep buying those to stay up to date and move to the next level. How much money does he actually bring home? Also, there are too many independent repair shops that do not offer a good compensation package, including everything from health benefits to retirement, for technicians to want to stay in the business and want to come out to learn.

MEIER: This is a subject that has been discussed for decades. We learned a lot from Automechanika Chicago. There were a lot of people who came for training events that had never been to training events in their life. They were an excited, younger crowd. The interest and desire to learn is there; we just have to make it attainable for them.

MOTOR AGE: Technology, tools and vehicle repair is ever changing. What are some of the most important areas that shops should focus on in terms of training and with shop equipment in order to stay current?

PEEVY: The area where focus starts is in the front office. The management attitude, aptitude and education really drive success. They need to know where to invest, when to buy, when to hold, and what tools to buy. We’ve seen in our research over and over where the technicians will be frustrated because they didn’t have the equipment needed supplied by the shop.

FIFFICK: Three of the most important areas are diagnostics, training, and electrical. Today, everything is computer controlled. You need to understand electronics, how to diagnose them, and the skill set and tools to fix them. Anyone can change a set of brake pads. Seeking out and repairing tricky ABS or traction control problem in a timely fashion, not everyone can do.

PEEVY: In some of the research we did with I-CAR we found that the shop owner would buy equipment and the equipment manufacturer rep would train the technicians. When those techs left, no one would know how to use that equipment to its maximum potential. If new people were expected to learn equipment and then would share that knowledge, that feeds on itself and gets the most out of the equipment.

Discussion of new technology inevitably spurred conversation about how the upcoming generation of computer savvy technicians can change the automotive repair industry.

MEIER: These younger technicians have a lot of these skills already. To them, computer, phone, iPAD technology is second nature. For them to learn programming would take next to nothing. Some folks of my generation have issues even navigating a basic desktop. Shop owners benefit from understanding that a lot of these young technicians already have these inherent skills.

MINTER: I heard from a lot of OEMs at a recent conference that their new technician students of the younger generation are very computer literate, but are not business computer literate. They are used to the iPad world, which is different from doing a software update. And a lot of what we’ve taken for granted with what these kids know doesn’t necessarily apply to how software needs to be handled in a business setting.

TRUGLIA: But young technicians are easier to train. If they’d work with an older technician, they can trade knowledge and make a great team.

MOTOR AGE: New telematics systems are helping track service intervals and vehicle health and are encouraging drivers to come back to the dealer for service. How can shops work to overcome the advantage that these dealerships have in getting customers in their door? 

TRUGLIA: Pete and I are doing a webcast on this very subject. LaunchTech USA is one of the first companies to move to get car owners back into the shop. They have a device similar to the insurance dongle that goes into the OBDII port that the owner can plug in. OEMs have come out against leaving it plugged in all the time, but if you plug in once a month with the dongle, you can look and tell them what is going on with their car, similar to OnStar.

To learn more about LaunchTech USA’s telematics device, GOLO, and to watch the webcast—Diagnostics from a Distance – Giving Your Shop a Telematics “Edge” with GOLO—visit MotorAge.com/golo.

MINTER: Some have stated that telematics systems cause communication errors or slowdowns on the network of the computer if you leave it plugged in all the time. It is a marketing tool and a customer relationship builder to keep the customer from going back to the dealer. With the Right to Repair Act, the OEMs can’t require the notification to only be sent to the dealer. There should be a way customers can choose another shop, such as through an email address. But that shop is going to have to get that customer to want to add them. The dealer is going to be added by default to try to push the revenue into their shop. Shops need to learn how to use it to their advantage instead of as a business deterrent.

FIFFICK: There is no doubt that this is the changing aspect of the industry that scares me. If we fail in any aspect of building client loyalty, this system is going to steal the client away from us. If the client needs an oil change, they think of us. If they don’t need something, they aren’t going to think of us. But these systems will send them a reminder to go back to the dealer network. However, the bigger their machine gets, the less personal it becomes. We need to continue to build our reputation one client at a time. We need to respect our clients and they will come to us for anything that is needed. That is the only way that I can envision beating the system. If you look at what happened in the last three to five years, new car sales have been through the roof. They all come with maintenance packages and longer warranties, yet we have been maintaining and growing our client base and sales, because our clients know, trust, and respect us.

MOTOR AGE: Is it a good time to be in the service repair industry? What are the strengths of the industry today?

MINTER: The service repair industry always provides new challenges and exciting times. It is going to be a changing market and changing population in the coming years. Whether or not we see a mass consolidation, and thus see these smaller shops going away, is definitely going to change what the industry looks like. I think we will see a very different technician in the future due to the specialization required. It’s hard to grow—shops may have to specialize in types of repairs or lines of vehicles to avoid keeping up to date on all vehicles. It is going to be an exciting time if people are investing in continual training, education and growth. It will not be a fun time for those who don’t want to change.

FIFFICK: I’ve been doing this for forty years, and I think it’s a great time to be in the industry. The industry changes, and we have to reinvent ourselves all of the time. We are in a flux right now—we’re coming off some huge years of brand new vehicles being sold that are now coming off their free maintenance and warranty period. I’m hoping to see an increase in car count for the first time in many years.

TRUGLIA: Cars are built better, and it is not the same type of repairs even as recently as 5 years ago. With leasing of a lot of vehicles, you aren’t going to get a lot of work out of the leased vehicles. It will be difficult for independent shops to stay in business, and they may have to specialize in a few different car lines. Trying to keep all your techs updated on all the equipment alone will cost a small independent shop a lot of time and money. I think the future brings opportunity for those who are willing to do it and invest.

PEEVY: The independent repairer will find a place. There is a niche that they will find in specialization. As I stressed before, learning is the only true source of a sustainable competitive advantage, and we have to accept it and become students of our industry.

MEIER: When I started in this business, it was the end of the muscle car era. If you saw 100,000 miles on a car, you shied away from it because it was just about done. Now 200-300,000 miles is not uncommon; they are not failing as often. I would have never thought that forty years later we’d be talking about robotic, autonomous cars. But all those cars are going to need some kind of repairs, attention, and maintenance when they don’t work the way they are supposed to. No matter the technology or our age, we all still have that love of cars and that is where the future of the industry is going to be—finding that same passion for things on four wheels.