It would seem like now is the perfect time to own a shop that works on cars. Vehicles on the road have never been older, but “older” in this sense means a car that was built in the early 2010s. These are cars that often require more specialized knowledge to repair than even my early-2000s car needs.
You won’t be surprised to hear that service is the biggest chunk of revenue a dealer is likely to earn, but the actual amount some dealers are seeing may surprise you. The Morning Dump is thinking about dealerships today, as the big National Auto Dealers Association annual conference is about to start.
Right now, you wouldn’t want to necessarily be a Volkswagen dealer, as that brand has been in rough shape. Could a name change for an existing model help? Maybe VW, as a brand, could learn from Renault, which has continued to find ways to grow in a challenging environment.
The most challenging environment in the automotive world might be Le Mans, and this year’s Goodwood events will have three of the most famous cars.
85% To 90% Of Revenue At Stake
Last week, I talked about how direct sales were a threat to dealers. This week, I want to talk about service. If there’s a commonality between both, it’s that dealers have long had a huge advantage that’s slipping away due to both consumer preference and technology.
There’s a piece from Automotive News talking about the importance of dealer service centers:
Service departments can generate between 85 and 90 percent of revenue for a majority of dealerships, Rick Wegley, an instructor and consultant at NCM Associates of Kansas City, Mo., told Automotive News.
“There is not a department in any dealership in America more important than the service department,” said Tom McCollum, chairman of the Audi National Dealer Council and CEO of Forbes Todd Automotive Group.
For most brands, margins on new cars are slim, and used cars represent yet another challenge. Service centers aren’t necessarily a slam dunk, though. There’s the ongoing technician shortage, and parts are getting more expensive, plus less foot traffic to stores means fewer chances to grab customers.
The older the car, the more cautious the owner, said Alan Dibre, chairman of the Acura National Dealer Advisory Board and dealer principal of Acura dealerships in New York and New Jersey.
“Customers are very cautious in terms of what their spending is,” he said. “You’re seeing less traffic.”
There are lots of concerns being voiced here, but this can still be a profitable business, as Car Dealer Guy reported last year:
According to Reynolds and Reynolds’ recently released Fixed Operations Golden Metrics, profit per repair order jumped for dealers in nearly all markets with some variation depending on volume levels.
- As of May, major urban stores averaged $414 per customer pay repair order (RO), up $33 year-over-year.
- Metro stores rose $23 to $349 in total, and community-based stores accrued $268—adding $9.
- Rural location gained $2 and averaged $225 per RO.
As always, there’s an upper limit to what someone with a 2014 Nissan Rogue is going to want (or be able) to pay for repairs. There’s also an issue of convenience. Bringing your car to a dealer to be told that it can’t easily be fixed now, and that the fix will be expensive, is a terrible outcome.
One growing solution is mobile service and more technology to reduce errors/labor needs, which automakers like Ford are pushing with its dealers. Here’s Bozard Ford explaining how it works:
Our strategy mirrors a hospital system’s model, that utilizes urgent care centers to manage less severe cases. Similarly, our mobile vans, equipped with Wi-Fi, handle minor issues like computer downloads or quick fixes directly at the customer’s location. This prevents these simpler tasks from occupying valuable bay space in our main service center.
This strategic division allows our primary service center to focus on its core strengths: major repairs like transmissions and engines, and supporting our used car and accessories departments. It’s an efficient approach that maximizes profitability. While our Quick Lane provides fast maintenance, mobile service extends this efficiency by taking an even broader range of services out of the shop, significantly boosting our overall capacity.
Perhaps it’s because I have an old BMW, but I’d be hesitant to take my car to a BMW dealer out of fear of what they’d tell me. I’m not sure yet what I’m going to do with my Honda as it ages out of its warranty.
VW ID.4 To Become The ID.Tiguan?
Volkswagen’s naming convention for its EVs is kinda terrible, right? The ID.Buzz, the ID.4, the ID.7. Whatever. Maybe you like it, but it’s such a shame when the brand has such fun names as Beetle, Tiguan, and Polo.
Oh, hey, speaking of Tiguan and Polo, VW already announced it’ll use the name Polo for its ID.2-sized subcompact, and there’s maybe a name change coming, according to CarExpert:
It’s expected the ID. Tiguan will follow suit with a redesigned cabin where the much maligned capacitive buttons and sliders will be binned. Like the ID. Polo, the ID. Tiguan should also feature the company’s latest touchscreen infotainment system with faster response times and an improved interface.
Under the skin, the rechristened ID. Tiguan will use a heavily updated version of the MEB architecture. Cheaper lithium iron phosphate (LFP) battery technology is likely to be adopted for some variants, with nickel manganese cobalt (NMC) lithium-ion batteries to continue in longer-range versions.
So ID.4 becomes the ID.Tiguan. It’s not clear if this will happen in the United States, but it makes sense. [Ed Note: ID.Tiguan is not a great name. Just call it Tiguan EV and be done with it. -DT].
Renault’s Five-Year Plan Is Working
Renault is the most interesting European automaker right now, and while my focus has been on the clever EVs they’re building, the long-term plan from the company was to shift from dependence on China and Europe towards emerging markets.
This plan goes back a few years to after the pandemic, and according to S&P Global, it’s working:
Among the expected outcomes of this plan is the launch of eight new products by 2027. Several have already been launched and have contributed to the sales uplift in 2025. A key product has been the Renault Kardian, a compact crossover that is based on the automaker’s long-standing CMF-B architecture. Renault highlighted the model’s contribution to the growth it saw in Latin America and a 44.8% y/y uplift in Morocco.
Another product contributing to this improvement is the Renault Grand Koleos. Built in South Korea and born out of the relationship between the French automaker and China’s Geely—from which this model sources the GEA—the midsize crossover helped boost Renault’s sales in South Korea by 55.9% y/y in 2025.
Overall, this has meant that sales in Renault’s international market represented a 30.5% share of its worldwide sales, up from 28.6% in 2024.
The whole world wants cars, but the whole world isn’t going to be buying electric cars yet. Being able to build cars for the EU market and emerging markets isn’t a giant business, but it ain’t a small one, either.
Goodwood Is Getting The Le Mans 1-2-3 Ford GTs
I don’t know if I’m going to Goodwood this year, but there’s at least one more reason why I’d consider it: The 1-2-3 finishing Le Mans Ford GTs from the 1966 24 Hours of Le Mans will be there.
For the first time in a decade, the three Ford GT Mk IIs driven by Bruce McLaren and Chris Amon, Ken Miles and Denny Hulme, and Ronnie Bucknum and Dick Hutcherson will not only appear together, but also run.
These legendary cars – chassis P/1046, P/1015, and P/1016 – will take to the Goodwood Hill during the Festival of Speed as the event celebrates some of motorsport’s greatest showdowns with the theme ‘The Rivals – Epic Racing Duels’. Entirely apt, as 2026 marks the 60th anniversary of the intense battle between the combined forces of Ford Motor Company and Carroll Shelby’s Shelby American, and Ferrari.
In September, the trio will reunite once more at Goodwood Revival, where they will run on the historic Motor Circuit, offering fans a rare chance to witness these icons in action.
Sweet.
What I’m Listening To While Writing TMD
I just learned that the opening orchestral sound from Portishead’s “Mysterons” is from a British TV show called Captain Scarlet and the Mysterons. There is just so much incredible and weird puppet-based TV from the ’60s I never knew existed (I learned this from Bandsplain, FYI).
The Big Question
Who was the last person to fix one of your cars?
Top photo: Ford
I prefer local independent shops.
When I must use a dealer…I challenge every invoice line.
This started when my local Audi dealer charged me $400 for a simple oil change. When I dug into it, they replaced the gasket for the oil filter housing (joint between the oil filter housing and engine block)…and claimed that it was required. Since the car was under warranty, I challenged that if this part needs replacing, Audi needs to cover. Alas, they said I was wrong.
The internet is a weapon.
Audi service manual for the oil change DID NOT require replacement of this part. Furthermore, when I searched online for the part cost…the Dealer’s own parts department charged 50% less for each part they used.
I put this together in a package and chased down the dealer GM. He begrudgingly refunded my money…but never ONCE apologized.
So, its no surprise that the service departments are a major source of dealer profits and also reinforced my poor opinion of dealerships in general.
“85% To 90% Of Revenue At Stake”
Which is exactly why dealerships are so reluctant to sell EVs, with their lower maintenance needs/costs.
Even folks doing maintenance themselves or using independent shops: Most of the parts used are still coming thru dealer channels.
I do 99% of my own mechanical work. Pretty much only go to a shop for work I can’t do myself, like changing tires.
The last person was myself. I only take the car into the shop for work I cannot do myself due to tools or equipment that only the dealer has.
I’ve used a local shop for a long time for the larger repairs I can’t do myself. The owner just retired, but most of the mechanics are still there, with one of them now the owner, so I’ll stick with them. All of my cars and trucks are older, and I’ve never been to a dealership, except for specific parts I needed.
I go a shop that has one guy to give me an estimate, one guy to take my keys, one guy to do the work, one guy to text me that the car is done, one guy to take my money, one guy to give me my keys.
Yes, they are all the same guy.
My cars are older Toyota products, so not difficult for him to work on. There is a Toyota dealer down the road for OEM parts if needed, and he gets them. I don’t go to the dealer, because I want to talk to the person who works on my car, and there are three people between him and me. The person at the front tells me I need this and that, but they were simply told to tell me that, and they haven’t even looked at my car. They have the smiling face that gets me to agree to do work that may or may not be needed.
Have I plugged Taylor Automotive in Chesapeake lately? Because I love them. My Olds passed VA State Inspection with no issues and they also passed my Miata and did rear brakes for me. I’ve been “part of the family” there for a couple of decades and they do everything properly. It’s a 20 minute drive to get there. Totally worth it for someone I trust with my 1968 Olds.
If you think about it, it would seem that all OEMs have to do is wait it out until Dealers decide they dont want to sell as middlemen…
I had the oil changed in my truck at the local dealership. The showroom is pretty empty so there are plenty of empty desks to work while waiting.
Most recent repair was done by the dealer.
All fluids except oil (transmission, transaxle, differential and brake) for $600.
Also found problem with the fuel injectors and that replacement was covered by the manufacturer extended powertrain warranty.
Needed tires and they quoted $1600 plus installation. Got a set of Michelin’s from Sam’s Club for $900 and have free rotation and balance for the life of the tires.
I was the last to work on my car.
Sounds like VW bought lot of extra chrome Is and Ds.
Captain Scarlet
He’s the one who knows the Mysteron game
And things they plan
Captain Scarlet
To his Martian foes a dangerous name
A Superman
They crash him, and his body may burn
They smash him, but they know he’ll return to live again
Captain Scarlet
As the Angels are flying wing to wing
Into the scene
Spectrum is green
Captain Scarlet
Though the Mysterons plan to conquer the Earth
This indestructable man will show what he’s worth
Captain Scarlet
Indestructable Captain Scarlet
High margins on service because they don’t pay the actual workers shit and overcharge the hell out of the customers, hence the shortages of both.
I worked on my car last. There’s an open recall for a rapid blinking tail light that can happen if the sunlight hits them just right at a low angle, but they won’t just hand me the parts to do this 10-minute job myself and I don’t feel like driving 1/2 hour to wait in the sitting room for hours wondering if the one guy who claims he can drive a manual will eat 100k miles off my clutch pulling it in only for the actual work to take 10 minutes, then drive another 1/2 hour home, so I live with the 3 times a year it flashes and the annoying weekly calls informing me of this bullshit “safety” issue. Anyone convinced it’s a genuine safety issue has had it far too easy.
I grew up in a household with multiple people working in the back of the house at a dealership. It has always been the case that the service side carries the sales side, and sales are really just there to make new customer relationships. But it seems like now the actual relationships don’t matter anymore.
But the service experience seems to be declining for decades now. My last out-of-warranty dealer visit was for a somewhat complex BMW repair. They took literal months to complete the job and ultimately botched it leading to a different broken part due to high wear a couple months later. That drove me to an independent shop that gives a way better experience (I really don’t car that they don’t have a latte machine) and exudes more confidence, and 0 screw ups so far. They also explained exactly how the dealership screwed up my previous repair, and why they have a different procedure for the same fix.
Throw on top that I of course received an automated survey from BMW for the dealer fix that I answered honestly, and subsequently received a tirade from the service manager, and that closed the books on any non-warranty dealer service ever again. Even when it seems like you want to go to the dealer for more knowledge, by the time the warranty is up, it seems like they are actually at a disadvantage.
My parents kept going to the dealership for oil changes and even tires after their ToyotaCare ended on their 4Runner. They were getting frustrated at long waits for service they scheduled well in advance, but the real kicker was when changing the tires took hours longer than expected and the reason they were given is that they were heavy tires. My dad has a log truck and the tire guy can come out and sell him more tires, all of which are heavier, and get them all mounted in the driveway in half the time it took them to do the change. They’re back to home oil changes and buying tires at tire shops.
My Kia warranty work soured me on both Kia and Dennis Dillon dealership service departments. I had a solenoid clicking sound coming from my charging port. Over the course of a few months, they had me in there several times so that they could break the charging port door in 2-3 different ways (wouldn’t close, wouldn’t open, and they replaced the whole door because I think they cracked it) and only give me a loaner after I called them out on all the ways they had screwed up over the course of the repairs.
Having been disappointed by the service of every Lotus specialist within reasonable range I’ve now found a garage I’m happy with.
The train ride back from dropping it off for its last service took 4 hours.
It’s a lesson I’ve learnt from my Triumph but it was only 1.5h instead of your 4h; I should have got a Honda.
I was the last person working on my cars. I honestly can’t remember the last time I had a shop do anything outside of an alignment. Even tires I do myself as I am lucky enough to have a friend who owns tire machines.
Whats funny about that citation from Reynolds and Reynolds is that it says PROFIT from every division of the market is up. In an article also describing how parts prices are up and they are tech short. So they are paying more, but still making sure they are charging enough to not only cover those increases, but net their own increases as well.
Dealerships survive on the timid and the uninformed consumer. Customers with a small amount of gumption and knowledge will leverage the internet and their personal contacts to find local independent shops to do work for half the price.
I do take my cars into local dealerships for recall or warranty work, but the last three dealership visits have resulted in the following: A.) an etched windshield (some sort of caustic fluid must have splashed onto it during the service?) that they didn’t fix, B.) about five pounds of mystery gravel in the bed of my truck (what were they doing with gravel in my truck that was in for a wiring recall?), and C.) grease marks from dirty hands all over the car’s interior. Who wants to experience this sort of bad service on the regular, while paying far more for the pleasure?
I’m not buying the “fuzzy math” with which dealers claim they don’t make much when selling a new car. Sure, there may not be much profit in selling the car itself, but there are gobs of profits on all of the add-ons like paint protection, nitrogen tires, window tint, along with the shenanigans of the F&I office and the financing kickbacks and extended warranties. I’m not weeping for new-car profits.
Paid a shop to replace front wheel bearings on the daughter’s Prius. Probably pay my shop to replace the front stuts on the partner’s Corolla this spring. Rust belt suspension work is no joy without a lift and heavier air tools than I own.
For our daily-driven cars (both of which are less than 4 years old), we always take them to the dealerships as both cars came with included service for several years (from the OEM, not talking about a high-margin 3rd party dealership service package). None of the dealerships have ever given us a reason to take our business elsewhere, with service being quick, transparent, and the bigger dealerships have loaner cars, shuttles, mobile service, etc.
I took my old YJ to a small independent shop for the rear main seal and a transmission tune-up, and while they did a good job for a fair price, I had to take Ubers to drop it off / pick it up, there was no waiting room area, and it took an extra day. Not the end of the world as it’s not my daily, but dealers due have scaling advantages for perks like that.
I work on my DeLorean myself, as no shop in the area has ever seen one before, let alone understands K-Jet fuel injection…