As the average car on the road has never been older, it’s come as no surprise that all of those old cars need service and repairs—and the auto repair business has never been better. With that in mind, car dealerships are placing a renewed focus on making more money from their service departments, sometimes via questionable tactics, including classic upselling and proactively reaching out to customers about problems they might have but don’t even know about. “The front end of the store is sexy,” says one dealership CEO, “but we make our money in the back.”
That quote comes from WardsAuto, a trade publication whose target audience works in the auto industry:
“Parts and service carried us through the recession,” says Craig Monaghan, CEO of Asbury Automotive Group, a chain with 79 dealerships. “The front end of the store is sexy, but we make our money in the back.”
A follow-up story details some of the “creative” ways dealership service departments are boosting revenues. One strategy may come as a surprise to customers who keep bringing their cars back to the dealership to get serviced partly because they assume the parts used for repairs are top notch. Instead, dealership executives say they are now more likely to be utilizing cheaper, second-tier parts in service jobs. Cheaper parts help the dealership keep costs down, which allows them to compete better on price with repair chains and independent mechanics, while at the same time increasing service sales.
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Dealerships are also carefully mining their customers’ data, and then contacting those who are most likely to be good candidates for service work. The proactive approach works best, says one dealer owner:
“Opportunities like this don’t just slap you in the face,” he says. “My advice is look for owners of cars in your database that are four to five years old. Find out the repair Achilles heel. For Jeeps with the 4.0L engine, for instance, it’s the rear main seal. For PT Cruisers, it’s the steering rack and the water pump.”
While such strategies boost dealership service numbers and may help drivers whose cars are in genuine need of repairs, some auto industry insiders aren’t fans of the proactive approach. “They’re using scare tactics, preying on consumers‘ ignorance of their vehicles to increase sales,” says Pam Oakes, owner of an automotive service center in Fort Myers, Fla., and the author of the Car Care for the Clueless book series. “You don’t have to do business this way. Problems will manifest themselves in cars, and if it ain’t broke, don’t fix it.”
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Oakes, who, it must be noted, competes with auto dealership service departments for business, says that the concept of upselling at the service department counter is “definitely on the rise” for the industry as a whole. One reason this is so is because often the person at the counter is working on commission, so there’s a direct financial incentive for him to get customers to spend more. “These workers, or ‘service advisors,’ as they’re called, aren’t necessarily auto technicians either,” says Oakes.
Her advice for drivers confronted with a questionable service recommendation starts with what she calls a “show-and-tell.” “Ask them to show to you what’s wrong, and tell you how they’re going to fix it—in layman’s terms,” she says. Next, “I can’t recommend it enough: Get a second opinion.”
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Oakes advises consumers to be wary of inflated fees and parts charges tacked on at the bottom of service bills. The best defense against such fees, which sometimes add 11% or more to the total, is to ask in advance about the possibility of extra charges above and beyond the original service estimate. Oakes says consumers should be especially on guard when they’re drawn in by coupons for a cheap oil change or buy-one-get-one-free tire sales. “Sometimes, there are extra charges that aren’t advertised, for things you might not need,” she says. “These deals are also used just to get customers in the door, so they can look at the car and upsell you on other services.”
Brad Tuttle is a reporter at TIME. Find him on Twitter at @bradrtuttle. You can also continue the discussion on TIME’s Facebook page and on Twitter at @TIME.
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