Canadian new-vehicle dealers continue to gain market share in the service segment but lag the aftermarket sector on initial repair work, according to a new survey.
The J.D. Power 2023 Canada Customer Service Index—Long-Term Study found that dealerships have grown their overall share of the $9.1-billion service market to 61 per cent, up from 58 per cent a year ago.
That incremental increase of three percentage points translates to more than $250 million in revenue.
However, when it comes to completing service work correctly the first time, aftermarket facilities continue to outperform dealerships. Aftermarket facilities correctly complete service work the first time 95 per cent of the time. That’s unchanged from 2022. But the success rate at dealerships is at 93 per cent, continuing a downward trend from 2022 (94 per cent) and 2021 (96 per cent).
The study also found it’s becoming more costly — especially at dealerships — to service a vehicle that’s four to 12 years of age. J.D. Power says the average cost per visit at a dealership is $432, up from $394 in 2022, while the average cost per visit at an independent shop is $262, an increase of $15 from a year ago.
RETURN TO NORMAL
“Inflation has certainly had an effect on automotive service,” J.D. Ney, automotive practice lead at J.D. Power Canada, said in a statement. “Average spend per service visit is up year over year at both dealerships and aftermarket facilities—yet the number of service visits is down. While the pandemic caused a decline in service visits and revenue, the market has rebounded strongly. Now, we’re seeing a return to pre-pandemic levels for service on four -to 12-year-old vehicles.”
The J.D. Power 2023 Canada Customer Service Index—Long-Term Study measures usage and satisfaction of service shops for vehicles that are 4 to 12 years old.
Amongst dealerships, Lexus and Volkswagen stores rank highest in a tie in service satisfaction. Each scored 842 points, based on a 1,000-point scale. Subaru dealerships finished last with 773 points. The dealership average score was 799.
Jiffy Lube topped the aftermarket service index rankings with a score of 818 while Costco finished at the bottom with a tally of 773.
Overall satisfaction is based on five factors (in order of importance): service quality (32 per cent); vehicle pick-up (20 per cent); service facility (17 per cent); service initiation. (16 per cent); and service adviser (15 per cent). The study is based on responses from 8,188 owners and was fielded from April through June 2023.
This report will be updated.
