How Can Auto Dealerships Evolve During The EV Transition? – CleanTechnica

Sign up for daily news updates from CleanTechnica on email. Or follow us on Google News!

---

Last Updated on: 26th February 2025, 01:57 am

Yesterday, I visited a dealership and posed this question to the sales rep who was showing me their latest electric vehicle. (How can auto dealerships evolve during the EV transition?) He agreed that it was a challenge. “New staff will need to be from a technical background, rather than a sales background.” He cited the example of a new salesperson who had come to the auto world from the aerospace industry. He was not a salesperson by trade, but he knew the technology and could explain it. “People want to be informed more than sold to. There needs to be an EV specialist on site.”

Like the BMW genius program, dealers can position themselves as educators in the transition. He sees continuing customer demand for servicing all vehicles, as well as providing accessories and, in many cases, finance for the purchase. “The current format needs to evolve (have a look at the models used by Mercedes and Honda) into an agency model where the product expert greets and guides. A fixed price is set by the OEM.”

This was also a theme in the many, many responses I received from several Facebook groups I contacted. I was amazed at the number and breadth of the reaction. Here are responses I received:

“A great customer experience is the most important part of purchasing the second biggest purchase you’ll likely make.”

“I have heard a lot of people saying here that you don’t need to do anything to electric car just top up the washer fluid, which is patently ridiculous and irresponsible. I suspect that unless there is a new vehicle warranty involved, some EV vehicles are not being inspected or serviced on a regular basis. I would be reluctant as a buyer to buy a secondhand vehicle unless I knew that it had some regular service record. I suspect the industry and dealerships need to develop a cost-effective “regular service model” which means that an EV is visiting a dealership at least once every 12 months.”

“Customer experience is must be number 1. It’s the Apple and Tesla experience.”

“The people that work there are incentivised to provide a great experience and are passionate about the product they are selling. The experience is seamless where I can order in 5 minutes and then think about accessories and plan the rest later. I think they could also run classes on using their products…. i.e. you can bring your car back to learn more about it with other drivers.”

“All cars should have a yearly once over with a mechanic, especially once they reach 3 years of age. Things like brakes and tyres still need to be replaced. My biggest issue is the cost – I’d happily pay $99 a year to service it at the dealer. But at $200 – $300 like some brands charge, I ask why bother.”

“There are always changes and this one will be different, but there will be plenty of jobs, just different.”

“The bigger dealerships will buy into the EV distributors such as TrueEv (Xpeng) or EvDirect (BYD) in some cases this has already happened.”

“Approved or managed service centres are the way to go. Focus on the quality of the service and train the techs so they know the product. There is quite a bit of difference between the service schedules of different brands. Tesla are very light on servicing, BYD are much more expensive and frequent. It makes no sense for Tesla to do anything but have centralised hubs, but BYD will still need many agents. But I expect the service  model will drift towards Tesla’s over time. Dealerships will succumb to direct to customer just like everything else.”

“You only have to look at the retail sector in general to see how social media and on-line shopping is changing the face of how we shop. Be it clothes shops, supermarkets, banks and even cars. Most are closing down, or trying to rebrand themselves, some successful, most flogging a dead horse. So, my take on dealerships is people are less and less inclined to take the time to go to dealerships, when it can be done on-line. Dealerships need a new angle, like software updates for MG4 only available thru them. Dealerships need to offer unique services. Even normal service intervals for EV’s are more and more being offered by “others” as knowledge grows, and done at a cheaper price. I see dealerships still existing, just downsized A LOT.”

“There will always be work for maintenance technicians and good mechanics. Adding value is important, perhaps the car can be checked while being detailed?”

“Instead of just a show room and service centre maybe they could add other services like Nio has, a Cafe, children’s play area, mini library, conference room, concierge service, mobile tyre and charging services. Might be less mechanics and a bit different, but might be a nice place to chill out and plenty of jobs and money coming in.”

“Perhaps dealerships could organise drive days when groups of people could try out different electric cars (right now these sorts of days are currently available through motoring organisations like NRMA and RACQ) and clubs like Australian Electric Vehicles association.”

“Perhaps manufacturers could gear up for trying to make these vehicles truly last as long as possible, and increase the amount of spare parts stock they manufacture in order to do this — as vehicles get longer in the tooth, the dealers could make their income from supply and fitment of parts to keep EVs humming for multiple decades.”

Some correspondents took the radical approach that dealerships should cease to exist!

“Quite frankly, they can all melt away. They are redundant and their service overpriced and not actually a service. I’m 100,000 km into driving electric. Not one service needed yet. The traditional mechanic’s role is dead and buried. Electric Vehicles designed them out.”

“A few experiences I’ve had that suggests the customer experience is far from the most important thing at a dealership. The last time I bought a car, I got the whole, ‘let’s see if we can do a better price’, salesman walks into another room with the ‘manager’. We’re left waiting for about 15 minutes in a separate room. When I wonder what’s happening, and walk into the room the salesman went into, they were just chatting about something unrelated. i.e. we got the make them sweat tactic.”

“I went to a Hyundai dealership to test drive an IONIQ 5. When I asked a few basic questions, they said ‘I don’t know much about this one’. When I asked about the range, ‘well it’s at 71% and it’s got this much range showing, you can do the maths’. After I’d completed the test drive, they took the poor IONIQ 5 back to its home on the back street. I didn’t feel that the customer was put first. Customer experience aside, I can watch a few YouTube reviews on a car and go into a dealership and know more about the car than the salesperson. The knowledge available online has made dealerships redundant for selling a car.”

And the opposite viewpoint: “I think the ability to negotiate on the price with a dealer is something that is of benefit compared to buying online, there is a chance that the ability to make deals will go away without having dealers, and access to check out vehicles. If the dealer model turns out to be doomed, manufacturers will need to provide locations that people can visit to see and try out cars though.”

“I’ve spoken to one national dealer manager for one of the newer players who did online sales and wanted local dealers to just do the delivery handover for a fee, and he told me most dealers weren’t interested.”

“More than any other car we’ve owned I’m inclined to take our Tesla to a Tesla service place as they’re the only ones we trust with it, including for glass etc. and they are easily and useful to deal with. We hate Musk and want to get rid of our Tesla… but we can’t while it’s the car we’ve rely on for interstate travel (regular) and knowing if we have problems they’ll be addressed and usually very well and quickly.”

“Dealerships will be ok, service centres, not so much. Established brands are clinging on to scheduled servicing for warranty . After owning a Tesla and having used mobile service twice in five years, I think the others are taking the piss with warranty service requirements. Maybe a comprehensive service check at 1 year and then every 2 after that, but no more.”

“Heavy diesel mechanic here. Pretty sure that dealerships will be ok as they will still have vehicles to sell, and their service departments will be kept busy doing warranty services/claims. Smaller independent shops will have older ICE and EV vehicles to service and repair. Although the servicing requirements on an EV is a lot less than an ICE, they still have components that require servicing. So pretty sure that most modern technicians will pivot quite easily and be fine.”

“Perhaps they could pivot towards converting ICE cars to electric, or providing battery upgrades to older models. There may even be a market in the future for converting HEVs and PHEVs to full electric. Lots of work there for Toyota mechanics!”

And a response from a dealer: “I’m an EV dealer, and often people appreciate good service. A car dealer is often open every day of the week, filled with passionate specialists. I’ve helped people keen to go electric, and often made friends for life. Ultimately people would choose to be car dealers because they like helping people.”

And to round it off — a great summary from Steve as posted under my last article:

“For new car sales ‘Showrooms / Sales Centres’ will have to evolve and be more agile given the new products like EV’s are far smarter. The ‘Smart’ sale rep will have to be intelligent about explaining not only the tech, features & functions of the car but also how to address suitability to peoples lifestyles. Obvious example, do not sell a City Commuter car to a long haul commuter or someone who takes long trips frequently. They are going to have to be able to show & discuss the Tech & Features.

“For used car sales: Same as above as well BUT they will have to be able to use the TECH to show the service history (show update history and services performed etc) and even show Battery State & Condition using software to potential customers. Some vehicles keep drive metrics that will be able to show IF it really was a little old Lady from Pasadena who only drove to church on Sundays, or a Hot-Rod Harriette who mashed the pedal at every light. The smarter customers will want to see the Real Time data showing BATT health/Condition and more diagnostics as available per model.

“Many GOTCHA’s will remain of course but fortunately a LOT less than with ICE because there is simply just so much more than can be busted/worn with an ICE. Ball Joints, Tie-rods, Shocks & Springs , brake systems ETC will all still need service & maintenance. Service Inspections & Maintenance Records will always be important and increasingly so.

“Dealer Evolution MUST occur and it is quite possible to ‘Update & Refresh’ the whole sales model for both New & Used EV sales & service. The service side has to change and be more flexible.

“My Ideal View of Sales would be to have Dealerships that sell Multiple Makes & Models and have service departments that are Multi-make and ‘not exclusive’ to the dealership. It may even be prudent & wise split Sales & Service to have E-AUTO Service centre ‘Franchises’ that only service EV’s spread out. We are starting to see such beginning and evolving…”

Can dealerships evolve? If so, evolve into what? Can they change their persona from being a dealer to being an authorized service centre? The EV rEVolution is moving slowly down under, dealerships and others in the auto industry have time to ponder and change. They can choose to see it as an opportunity. But the time will come when they must face the question: “Why should an existing business survive if there is a radical reduction in the requirement for its services?”