AKRON-Taking the numbers at face value can lead to the appearance that tire dealers are getting lapped by the field when it comes to performing automotive service.
But contrary to popular belief, figures sometimes do lie. Or in this case, they certainly disguise reality.
Tire Business, with the help of six independent surveys, answers the question of where people are going for auto service. Compiled by Lang Marketing Research, the AAA, and two each by the Aftermarket Industry Association (AIA) and the Motor & Equipment Manufacturers Association (MEMA), the surveys vary somewhat, but reveal a consensus nonetheless.
Repair specialists such as Jiffy Lube and Precision Tune (23.5 percent), independent garages (23.2 percent) and new-car dealerships (23.0 percent) are neck-and-neck-and-neck atop the ``who-goes-where'' list of automotive service. Tire dealers are logging 6.3 percent of auto service business, but that leaves them in sixth place overall, also trailing auto parts stores (8.2 percent) and discount stores (7.7 percent), such as Wal-Mart Stores Inc.
Therein lies the false impression. Fact is, there just aren't very many tire dealerships, relatively speaking, compared to the universe of automotive repair outlets.
Tire retailers comprise an even smaller percentage of service locations. There are an estimated 20,000 to 24,000 independent tire outlets nationwide. This compares with 76,000 independent garages, an increase of 20 percent in the last five years alone, according to statistics compiled by the Automotive Service Association (ASA).
>From those numbers, it can certainly be surmised that tire dealers are doing fine.
``Tire dealers are always looking for new ways to improve profitability,'' said Ross Kogel Jr., executive vice president of the Tire Association of North America (TANA). ``The latest statistics suggest dealers are taking more and more advantage of what is a growing segment. (Auto service) is crucial. It's become for many TANA members an important source of revenue for their businesses.''
Where auto service is concerned, things have changed drastically across the board since the days of four guys dressed in white uniforms running around your car washing windows and checking the oil. So have the places mainstream America goes to replace an air filter.
Strutting to the fore along with new-car dealers are auto service chains-the fast food of car repair. In today's instant gratification, drive-thru, scratch-off society, auto service is certainly not immune.
A proliferation of quick-stop shops-primarily for oil changes and an assortment of other minor maintenance services-has dotted the landscape. While the specialty shops' share has leveled or even dropped over the past decade, they have made a huge dent in the marketplace since their inception in the early '80s.
Extended warranty plans, better-paid mechanics and a number of other factors have allowed car dealers to maintain an upper hand when it comes to servicing the vehicles that Americans drive. Meanwhile, down on the corner, ``Joe's Garage'' also is faring well, since trust and loyalty will always play a role with a public that's ever-skeptical about who repairs their vehicles and how they do it.
``If you have to leave your car to be serviced, it's becoming more difficult,'' said Steve Christie of the Automotive Oil Change Association, as to why his business' sector has boomed. People today are ``much more dependent on automobiles than we used to be.''
Car dealers represent a similar number of outlets to tire dealers, according to the National Automobile Dealers Association (NADA), but they have a home-field advantage, so to speak, since they're where folks buy their cars in the first place. And in terms of auto service, familiarity does not breed contempt. AAA's John Nielsen said his organization's numbers show car owners are likely to return to the dealerships where they bought their cars for the balance of the vehicle's warranty. It's not until a car or light truck is 5 years old that people are more likely to head elsewhere.
``They're certainly going to specialty shops (between the warranty and the fifth year), but not necessarily to the dealer,'' he said. ``After the warranty, it really does go to the aftermarket, where at that point it is primarily decided by specialty service.''
The biggest losers in the auto service wars are gas stations. Once referred to as service stations, gas retailers no longer are that, for the most part. Instead they're mini-marts, where car repair is about the last thing on anyone's mind. One-time bays have been drywalled. Racks of pretzels and chips have replaced lube racks and motor oil and vegetable oil share shelf space.
``By all means, they're all turning into convenience stores,'' AAA's Mr. Nielsen said. ``The primary reasons are, with the small shop, it's hard to attract technicians... and there's a lot of (profit) margin in convenience stores.''
The proliferation of specialty outlets has hampered gas stations' efforts, but the technician shortage could be hurting all service outlets. The ASA estimates a technician deficit of 66,000. But that may only be part of the problem.
``What I've seen within our surveys is, there is not necessarily a difficulty getting technicians, but technical information,'' said the ASA's Denise Casperson. ``You have (fewer) trained techs. The information becoming more and more difficult to get comes from the (original equipment manufacturers).''
Advantage: car dealerships.
``What's happened, if you look at how the aftermarket has operated over the last 20 years, is foreign (car) dealers were more interested (in service) than domestic dealers and wanted to maintain a relationship throughout the lifetime of the vehicle,'' said Jim Lang, of Lang Marketing Research. ``Back in the '80s, what domestic dealers had done was encourage dealers to get people back to increase nameplate loyalty.''
Seeing that service could provide a nice windfall, domestic dealers have added service to their outlets in droves. The ``nameplate loyalty'' edge of which Mr. Lang spoke was magnified by the surge over the past decade or so in the popularity of leased vehicles. He said people who lease are more likely to return to dealerships during the lease period for their service.
Where tire dealers and other outlets can perhaps stem car dealers' advantage, Mr. Lang said, will be through e-commerce options, such as iCARumba.com, Mechanic net.com and AppointmentZone. That quell may only be temporary, though, as Mr. Lang noted that telematics-on-board communication between car dealers and vehicles-could be available on most cars by model year 2005. OnStar, an in-vehicle satellite communication system, already is loaded on a million vehicles. Telematics will allow remote diagnostics.
``The early indication is it would play to the advantage of OE's,'' Mr. Lang said.