Why Don Reed believes EVs could be a major revenue opportunity for fixed-ops

According to GreenCars.com, electric vehicles (EVs) do not need servicing for more than two dozen mechanical components found in ICE vehicles. In light of this, McKinsey & Company estimates that the cost of each repair order will fall by 40% to 50%. However, our guest today believes that EVs could actually be a major service-driven revenue opportunity for dealers.

Today on CBT Now, we discuss the impacts of EVs on the service department with Don Reed, CEO of DealerPRO Training, one of the nation’s top fixed-ops training platforms for dealers and host of the original CBT show Service Drive.

Reed says there are many guesses as to when the mass adoption of EVs will happen in the US, but he thinks that the proposals from the Biden Administration are mathematically impossible goals.

“I’m very optimistic about our service departments, and I look at electric vehicles as basically newfound sources of service and parts departments that we haven’t really had in the past. Even with electric vehicles, they’re still going to need tires, steering, and suspension,” says Reed.

One of the most exciting shifts is the development of an entire generation of highly-skilled auto technicians. But ICE vehicles will be around for a long time to come, adds Reed. Many forward-thinking dealers are already adjusting in the right ways like upgrading their equipment and facilities. Dealers are also aggressively recruiting technicians and reworking their compensation plans to prevent turnover.

Reed assures viewers that it’s not “doomsday” for the service department. There are many new strategies and tools to get excited about.