The Cost of Keeping Cars on the Road
The average cost of a visit to the repair shop has increased over 2023, regardless of whether a customer visits a dealership or independent facility, according to J.D. Power’s 2024 Canada Customer Service Index—Long Term Study.
Higher Costs Pushing Canadians to Keep Vehicles Longer
Not only are repair costs affected by current macroeconomic conditions, added J.D. Power; Canadians are also opting to keep their vehicles longer. Forty percent of dealership visits in 2023 were for repairs, compared to 24 percent of aftermarket shop visits.
In 2021, 31 percent of visits to dealerships were for repairs; 21 percent of aftermarket visits were repair-related, implying that owners are opting to keep their vehicles longer, according to J.D. Power.
Repair Shops See an Opportunity
The organization pointed out that economic pressures are pushing consumers to make different financial decisions, potentially presenting an opportunity for independent repair centres.
“As more owners opt to fix their vehicle instead of buying a new one, auto repair shops have an opportunity to attract more lucrative business in a $13 billion market by excelling in the service factors that drive customer satisfaction, mainly saving time and convenience,” said J.D. Ney, automotive practice lead at J.D. Power Canada. “[Vehicle] owners are being hit with a ‘double whammy’ and have to make different decisions in order to balance their budgets.”
Convenience Still Reigns Supreme
Dealership Dominance Continues
Dealerships continued to hold the lion’s share of the auto service and repair service occasion market with a 48 percent market share. Independent shops and quick lube locations capture 27 percent and 11 percent respectively. Market shares remain changed from 2023, however. Average annual visits to the dealership stand at 1.6 visits per owner, per year, compared to 1.3 visits per year in the aftermarket segment.
Dealerships Take the Revenue Lead
As such, dealerships take a bigger share of auto service market revenue, capturing 61 percent of revenue compared to 39 percent for the aftermarket.
Lexus Tops the Dealership Ranking
From May to June 2024, J.D. Power Canada conducted a survey among 8,750 owners of vehicles that are 4-12 years old (still under warranty or not) to assess their usage and satisfaction of service shops. Dealerships’ overall score of 800 points on a scale of 1,000 is lower than that of aftermarket facilities with 813 points.
Lexus dealerships lead the way in 2024. In fact, they rank highest for the third consecutive year. Mercedes-Benz and General Motors (Cadillac, Chevrolet, Buick, GMC) dealerships round out the podium, while Subaru dealerships finish dead last once again, just below BMW dealerships.
Great Canadian Oil Change Wins Among Aftermarket Shops
Great Canadian Oil Change ranks highest among aftermarket service facilities. Jiffy Lube ranks second and Midas is third. Costco has moved up from last year, while Canadian Tire has slid to the bottom.
Study Provides Insights for Industry
The Canada Customer Service Index—Long Term Study measures service usage satisfaction among owners of vehicles that are between four years and 12 years in age. The study analyzes the customer experience in both warranty and non-warranty service visits. Overall satisfaction is based on: service quality (32 percent weight); vehicle pick-up (20 percent); service facility (17 percent); service initiation (16 percent) and service advisor (15 percent). The 2024 study is based on responses from 8,750 owners.
Click here for more information on the J.D. Power Canada Customer Service Index—Long Term Study.
