Industry insight: The future of aftersales in the electric era

Mark Busby, Director of Commercial Operations at Hendy, agreed that the switch to electric poses challenges for dealer workshops. “The degree of complexity that we're going through right now is challenging,” he said.

“We've got plenty of technicians in workshops that have all learned and developed their skills working with ICE vehicles. Now, because of electric cars, they’re having to go through a sort of ‘unlearn and relearn’ process, and that obviously presents some challenges. Another factor is the level of investment required, both in terms of the development of our people and tooling and facilitates needed to work on electric vehicles.”

Mark went on to explain that another challenge comes in the form of customer education around the maintenance of EVs. “The two most common questions that we get asked are about range anxiety and, oddly, how much a new battery costs. That’s quite a strange question when you consider that the battery generally has a longer warranty than the vehicle – eight years minimum for most manufacturers. 

“If I think back to my days in a showroom and selling vehicles, no one ever asked me how much a replacement engine was. This is the sort of nervousness that's been put into people's minds when it comes to electric cars and their upkeep.”

However, it’s not all bad news. As Keyloop’s Tom Kilroy explained, state-of-the-art software can help dealerships better manage the pressures of working with electric vehicles, while also providing an enhanced customer experience. “We’ve recently demonstrated some of our new aftersales software to Ford UK and how it can help customers effortlessly manage their online service bookings and on-the-day check-ins,” he said.

“We also make technology that helps our customers serve their customers better and keep them loyal and happy. I'm conscious that technology can at times be infuriating, but when done well it’s definitely an additive to the entire aftersales experience.”

With technology comes opportunity

Despite the challenges in staffing, infrastructure and customer education, the advanced in-car technology that comes with the latest electric and hybrid models does offer significant opportunities to the aftersales market – especially when it comes to customer service and diagnostics.

“One really exciting thing is the connectivity that comes with electrification,” said Ford UK’s Lisa Brankin. “It brings a new degree of prognostics, and this means that when vehicles come into workshops our technicians are able to see fault codes ahead of time so they can better prepare for what comes through the door, and that ultimately allows us to offer better levels of customer service. It also lets us equip our customers with better live information about what's happening with their vehicles, while giving them the knowledge on how to look after them in a more proactive way.”

Keyloop boss Tom Kilroy agreed. “When it comes to electric cars, over-the-air telematics updates and diagnostics are a critical part of keeping a vehicle healthy and ensuring that customers are looked after properly.”

However, this newfound connectivity might prove to be a double-edged sword. Many new electric and hybrid vehicles offer over-the-air updates, so software like navigation and AI integration can remain as relevant and usable as possible without the need for a car to come into a service centre. On the other hand, this also closes off potential engagement and revenue opportunities for dealerships. And that brings us neatly onto profitability.

Aftersales will remain profitable in the electric era

As we’ve already mentioned, the improved reliability of electric models over internal combustion engine cars – allied to longer service intervals, fewer moving parts and over-the-air updates – may all result in cheaper running costs and better service for customers, but can aftersales remain profitable for dealerships? Mark Busby from Hendy seemed to think so.

“I do believe that EVs present the franchised dealer network with many opportunities,” Mark said. “I think it's going to be more difficult for customers to find independents that can work on multiple electric vehicles brands, and that in itself is good news for dealers. Another key statistic I saw recently was about labour. In Q1 of 2024, 71% of the invoiced work done to electric cars in our workshops was labour, whereas that figure was about 60% on an average ICE vehicle. That’s a very interesting dynamic in terms of cost and profitability.