What is wrong with the auto care industry?

Few industries can create the passionate conversation that can happen in and about the auto care industry. Being on the automotive parts side of the industry as long as I have has given me some long range perspectives about what is wrong with the auto care industry. To put it simply, I believe it is all of us. Let me explain.

Who makes up the auto care industry?Camshaft sprocket on what is wrong with the auto care industry

I look at the auto care industry as a number of different players. I’ll give a brief list of them here and the parts I think they have played or continue to play in what is wrong with the auto care industry. Understand that these are generalizations and that there are exceptions on both ends of the spectrum in all of the categories below.

  • Independent repair shops: There are a ton of repair shops in nearly every corner of the country. It is my opinion that there are a lot of them that participate in practices, either knowingly or unknowingly that do a disservice to their customers. This has made customers wary and has trained them to judge a repair shop on merely cost of repairs or labor rate, not on the full value they provide. If unchecked it will continue to make it difficult for those shops that try to do it right to stay in business, which would be a loss for everyone.
  • Independent and Regional auto parts distributors: As a whole, I think the parts side of the industry has done a great disservice to itself and the other stake holders in the industry by focusing on ways to disguise product offerings (blended lines, globally sourced, white box, etc.) instead of educating consumers and repair facilities to the relative value provided by the choices. There seems to have been a large shift to putting more resources into what the box looks like vs. the quality of the people behind the counter. While I don’t agree with the decisions made, it should also be noted that the pressure that forced these decisions came largely from external forces.
  • Automotive dealerships: I have limited experience and haven’t had a ton of opportunity to get very deep in this group, but some of things I have seen really stretches some ethical boundaries in my book. Automotive dealerships have done an excellent shop marketing their expertise and stretching the range of vehicles that come through their doors for repair. Where I think they have conveniently failed to educate their customers is the fact that many of the parts they are now installing are the same (or in some cases, lesser) quality than those being used by the independent repair shops.
  • Large chain auto parts distributors: The biggest contribution of this group, in my opinion, is the commoditization of auto parts. Much of the leadership from this group has traditionally either come from retail backgrounds or at the very least operate very much from that mindset. There is nothing wrong with advertising a water pump for $19.99, it is obviously their prerogative. Where I feel it has hurt all involved is that this has undermined the trust of the public when they find the one they need is $69.99. A $20 sweater and a $70 sweater both perform the same basic function for any given person and are largely interchangeable in purpose. The consumer understands how a sweater works, not necessarily so much about a water pump. Trust erodes, everyone loses. I believe this is one of the major factors creating the pressures I talked about in the independent and regional auto parts section above.
  • Buy here, pay here car lots: Admittedly, I do have a bias here due to what I think are some predatory practices in this little slice of the industry, but that is a topic for another day. As far as their contribution to what is wrong with the auto care industry, I think they generally help contribute to an overall distrust of the industry. In my experience, there are very few of these businesses that see themselves as adding value vs. just seeing how much money they can extract. In many of the markets I have worked in, many of these have evolved from what used to be a respected repair facility. Instead of investing in the tools and technology needed to move their business forward, they kind of “slid” into this model as sort of a path of least resistance.
  • Franchise automotive repair: Many of the same issues that I see with the middle to lower end repair shops I feel really manifest themselves with this group, but I think for some additional reasons. The staff at these types of repair facilities tend to be somewhat transient in my experience. Management is usually done from a ways away, so much of the day to day “guidance” tends to come in the form of a fax or an email letting you know whether or not you hit your numbers from the prior day, and off you go. I am a firm believer in the adage that you get what you reward. Not that being aware of numbers is a bad thing, but the emphasis at these facilities, in my experience, is on the selling, not on the creating value. What the retail automotive chains have done for the commoditization of parts, I think this group has done to the commoditization of auto care.
  • E-commerce auto parts distributors: Full disclosure, e-commerce is my day job. As you can see on the About Me page though, I do have a ton of experience on the traditional brick and mortar side as well.The great thing about selling auto parts via e-commerce is that just about anyone can do it. The bad part about selling auto parts via e-commerce is that just about anyone can do it. E-commerce has probably done as much or more to negatively influence the perception of the auto care industry than any of the other factors. Online auto parts is a Pandora’s Box. On the product side you have everything from closeout, changeover, overstock, recovery, recalled, and counterfeit merchandise to full warranty, top-quality, off the shelf product. On the supplier side you have everything from turn and burn, there’s always more customers out there to those with high skills and great service. Unfortunately, it is often hard to tell them apart. Suffice it to say that e-commerce has done a lot to further what is wrong with the auto care industry. As you might expect, I have a lot to say on this issue down the road.
  • Parts manufacturers: Where to start here. Parts manufacturers are the root of all of this evil, correct? From importing product from China, no vendor representation, warranty crackdowns, crappy parts, etc., the parts manufacturers have contributed to this a lot, right? Maybe some, BUT I would argue that the parts manufacturers, for the most part, have just given us what we asked for. This may not be what we wanted, but I do believe all these factors have come out of what we have asked for, and what we have voted for with our dollars. Again, there is a lot more discussion to be had here.
  • The consumer / public: Ah yes, you and I in our most basic form. Much of what the auto care industry is has been driven by where we spend our money and the decisions we have made. However, I think in large part we have made those decisions without full knowledge of the ramifications of those decisions, and also many times without the knowledge that there was even a decision being made. How can that be? Let’s discuss it!

Okay, now that I have honked of most everybody in the industry, what’s next?

What IS wrong with the auto care industry?

Wordle regarding what is wrong with the auto care industryWhat I would like to find solutions for.

  • Better communication about product quality. I really think this will require some sort of classification of quality on the parts side of the business. Does the family with the minivan that hauls their kids really want the cheapest brakes that can be installed? Maybe they do, maybe they don’t. In today’s world more times than not that decision is never taken to them. Then on the occasion when a customer asks the difference between two or more choices, the answer is often “price” or “about $20. No mention that one will likely stop you 5 feet from the car in front of you, but the other might stop you 5 feet into the car in front of you. We have to do better.
  • I think we need to figure out a system of grading repair facilities that is meaningful. Right now in most cases the shop that sends their techs to regular training, pays good benefits, and invests in information and equipment is graded on the same scale, in the public’s eyes, as the lone tech with purely hands-on experience. I would argue both are needed and have their place, but the public should know which makes sense to them based on more than just price. In the medical world there are specialists, general practitioners, and those that can administer first-aid. All are needed. The problem with our industry is that the public largely sees us as first-aid, so the public tends to think that a conversation about a higher priced, quality part is just somebody trying to pad the bill. A better solution has to be out there.
  • We need to have more open dialogue with the parts manufacturers. On the parts side of the business I get calls all the time from people wanting domestically sourced product, but I can almost guarantee the manufacturer’s perspective is that people want it but don’t want to pay for it. Are there ways we could start a dialogue and have a manufacturer do a “short line” offering of domestic product within a product line and let the market show if the demand is truly there? It isn’t easy, but that is how we transitioned into imported product originally. 20 years ago you could only get about 20 numbers of Chinese rotors as the manufacturers tested demand. Today you can’t find a domestically produced rotor. I believe if we talk, we can work together to stem this tide, which would have a ton of additional benefits as well.
  • We need to quit de-engineering the vehicles that roam our streets. From the factory, vehicles are higher quality and more technically advanced than ever before. Due to some of the things described above, our industry often times reduces that quality each time it is touched. Four or five years of installing just what breaks, and then replacing the part with a product that is “almost” as good as what came on the car takes it’s toll. What rolled off the line as a dependable, technologically advanced vehicle has now been reduced to a piece of crap destined for the auction. Education is key.
  • The auto care industry has some good track record for recycling, but there is a lot more that we can do. Much of what gets pulled off a car, especially from the do it yourself customer, tends to make it’s way into a landfill. I have some ideas that can help all parties involved both environmentally and financially. We operate as if our resources are infinite, but our kids will pay the price if we don’t make concerted efforts to change that.
  • Our industry uses the terms DIY (do it yourself) and DIFM (do it for me) to classify the customer base, but it is much more complex than that. What about DIFFWIHT (do it for fun when I have time), or DIUIGIOMH (do it until I get in over my head). I’m being a little ridiculous for effect there, obviously. But what if there was open conversation between the shop and the consumer and we could give him or her a vehicle specific list of the things that they might be able to handle themselves in order to save a few dollars. That would free up dollars that could then be spent properly maintaining the rest of the vehicle, keeping that car on the road longer, making the road safer for all of us, and having a positive financial impact for EVERYONE involved. What if the customers felt the freedom to call up their technician and say “I am thinking about changing out one of my head gaskets on my Expedition this weekend, do you think this is something I can handle?” That dialogue is an opportunity to provide value and quite possibly generate a positive sale, vs. him towing it in on Monday morning with his cams all out of time and him only bringing it in because he has to. Again, I am a big believer in communication and collaboration.

There is much more that can be done, but honestly I think I have taxed my brain as much as I can for this page. So what is wrong with the auto care industry? Nothing we can’t fix, but it is going to take all the effected parties looking at the issues collaboratively and then moving forward together with deliberate steps.

Now the moment you’ve been waiting for. I am done talking, now it is time to listen. Please share your thoughts on what I’ve written or possibly what I have overlooked. Thanks, I am looking forward to the conversation.

Bill

  4 comments for “What is wrong with the auto care industry?

  1. Alex
    October 6, 2015 at 9:20 pm

    Bill,

    I was doing some research for an Entrepreneurial course I’m taking for my Automotive Business Degree, and I stumbled upon this page. I’m trying to determine what’s missing in the Auto Care Industry. You’ve made some very good points. If you could narrow it down to one major problem that you could solve with the industry, what would it be? I believe the industry is missing compassion, and honesty. I loved your point in regards to the “Do it until I’m in over my head” customers. I currently work in the Motorcycle Service Industry while finishing my Degree, and I get the question “Do you think I can handle this?” from customers on a daily basis. I take five minutes out of my day to go through things with said customer, and they’re so grateful. More importantly, THEY KEEP COMING BACK!

    – Alex

    • partsadviser
      October 6, 2015 at 10:51 pm

      Thanks for writing. I think you are on to the one biggest thing when you talk about the customers coming back after helping them, even if they were working through it themselves. The first part of that is the customers largely have no idea the technology involved today. The concepts are still fairly simple, the same physics still apply, but the way they are managed are incredible. So you have the consumer who still thinks it should be tightening a spring or adjusting something, and you couple that with an industry that has a perception that a mechanic is a mechanic and you start out from a point of very low trust. I don’t know of another industry that deals with this level of technology that has such a range of training and education, high to low. The public wouldn’t think of letting a doctor open a practice if he just went and bought a stethoscope and figured they would just learn on the job. Anyway, my answer to this (and most issues the world has if the truth be known) comes down to open, honest communication. You help the customer, it builds trust, hopefully he gets jazzed about doing some of his own work so he keeps his car longer, when he does run into something he can’t or doesn’t want to do, he comes to you. He understands the complexity so you can make a fair margin, and there is plenty for everybody. Sorry for the long answer to a simple question, but I could go on for days! Thanks again, touch base anytime.

      Bill

      • Jamie
        October 17, 2015 at 3:15 am

        Fantastic article/rant :) I must say that one of the most confusing things about car ownership is one of your key points. There is no line drawn between original quality parts and after market parts that may or may not be of equal quality. Mass out sourcing has muddied the water even further by having ‘OE’ parts made by the same companies that make aftermarket parts. You would naturally expect say, an AC Delco product to be more expensive because you’re paying a premium for that ‘OE’ quality. It’s really disheartening to find out that the AC Delco part came off the same assembly line at the same factory that the muchh cheaper Moog brand part did. The only difference between them being the stamp on the part itself. The AC Delco part being $46, and the Moog being $24. I find this is often the case, but not always. This makes buying parts a crap shoot at times. You really don’t want to cheap out and buy inferior parts if you can help it, but at the same time you don’t want to feel like you got ripped off by going ‘OE’.

        • partsadviser
          October 19, 2015 at 2:53 pm

          Jamie, thanks for the feedback. You seem to have a lot of knowledge of the industry, what do you do if you don’t mind my asking?

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