The unexpected onset of Covid-19, and all of the changes it has forced onto our lives and society, has been a jarring example of how quickly things can change. Practically overnight, many people lost their livelihoods and plenty of businesses were unable to keep their head above the water due to the drastic nature of lockdowns and the consequential societal shift to a predominantly online environment. Though humanity doesn’t usually undergo overhauls of the systems it has in place that quickly, every once in a while we are reminded that our ways are fragile and subject to change. In an increasingly competitive business environment, the businesses that can adapt and stay ahead of emerging trends will be the ones left standing.
It is no secret that, whether pushed by conscious choice or pressuring circumstance (climate change), society is progressively shifting towards clean energy. This means that industries that rely heavily on fossil fuels, such as oil production and automotive services, have the most to suffer in the coming years. Electric vehicles are the fastest growing trend that the first world population is pursuing- becoming more and more affordable each year, and government incentives making them increasingly appealing to the public. If you crunch the numbers, as one auto shop owner in Hamilton, Ontario has, the rise in popularity of electric vehicles has the potential to cut annual revenue by as much as 50.3% for automotive shops. This is due to the fact that a lot of the services offered by these establishments do not apply to electric vehicles- in other words, they’re a whole different beast.
There are not many businesses out there that can withstand having their revenues cut in half. This raises a problem for many who make their bread and butter running small service centers for vehicle service. What exactly is the way forward?
The answer is not simple, but it is doable. In order to stay afloat, auto service and repair shops will have to redirect their attention towards the ever-growing demographic of EV (electric vehicle) owners. Just because the services required by gas-powered cars do not apply to EVs, it does not mean that EVs do not need servicing at all- they just need different things. The job of the business owner is to adapt their list of services offered in order to accommodate the new demands. For example, EVs do not require oil changes or spark plugs like gas-powered vehicles, but due to their heavier weight and dimensions they do require more frequent tire changes and rotations. They also require special types of tires, built to withstand the heavier load. Alignments are also a frequent requirement. Though it is unclear if merely centering these services can offset the loss of revenue from a decrease in demand for gasoline-engine services, having a forward looking vision for a fusion shop which services both types of cars and accommodates the increasing demand for EV services is a good way to secure your business’s future to the best of your ability.
In addition to the increase in EV owners, a new trend is emerging that may play a factor in small service auto center longevity- and that is automated vehicles. Though the technology is new, it cannot be overlooked. Electric cars were once new as well. An automated vehicle has the potential to remove all human contact from the customer-shop transaction: one can request a service online, program their car to arrive at the shop by itself, process payment through an online service, and receive their car back without having to interact with a single live human being. This poses a problem for local auto shops, simply due to the fact that they rely on human interaction and word of mouth for their success. Most make their living relying on their good reputation within that community and also their proximity to potential clients. If one can program their car to drive anywhere, does that change which auto shop they will send it to? With no human connection to their local shop owner, there is nothing tying customers to a certain establishment. If you can get a better deal at a shop farther away, since you don’t have to waste the time driving to and from, you would probably send it there since it is of no consequence to you. The prospect of automated vehicles takes the humanity out of the auto shop experience, which may prove detrimental to the health of small, local auto shops.
There are no concrete answers in this ever-changing, fast-paced society we have created for ourselves. All we know is that we must keep moving forward. Business owners in the industries that are changing the fastest are tasked with a tremendous challenge- keep their business alive and going along with the times. Some things business owners can to do keep their businesses thriving are to invest in new technology, training, and expand their repertoire of services. The general consensus among auto shop owners, as discovered through multiple discussions, is that nothing is certain- except that change is coming, and probably sooner than most people expect. One must be ready to change with it.