As we head into 2026, the variable market is becoming increasingly unpredictable, which means fixed ops will play an even bigger role in dealership performance. Joining us on the latest episode of Service Drive is Shon Kingrey, VP of fixed ops at the Kayser Automotive Group, to share insights on the opportunities, challenges, and strategies that will define fixed operations success in 2026.
Maximizing fixed ops profits
With new-vehicle prices often exceeding $70,000 and interest rates rising, many drivers are keeping their cars longer, leading to more visits to dealership service lanes. Kingrey notes that the average vehicle on the road is now approaching 13 years old, with cars entering service departments averaging more than 70,000 miles, a dramatic increase from historical norms.
That reality creates a significant opportunity for fixed operations, but only for dealers willing to maintain discipline and accountability. Kingrey emphasizes that every repair order must be managed with consistency, as fixed-ops profitability depends on execution at the individual RO level. He frames accountability not as a slogan, but as a daily operational requirement that directly impacts absorption and long-term dealership health.
Longer vehicle lifecycles are also changing the service department’s role. Rather than pushing repairs, service teams are positioned as advisors, responsible for clearly identifying vehicle needs and explaining them to customers. Kingrey believes the decision to proceed remains with the vehicle owner, but dealers are responsible for providing accurate, transparent guidance, particularly as vehicles age and repairs become more complex.
Daily training and accountability
Additionally, technology is playing an increasingly important role in that advisory process. Video inspections have gained traction as vehicles remain in service longer, allowing customers to see issues firsthand and better understand recommended repairs. Automation and visual documentation build stronger trust and justify premium labor rates, reinforcing the idea that customers who pay more for service deserve greater transparency.
At the same time, Kingrey notes that dealers have fallen short in helping customers fully adopt digital tools such as online service scheduling. Despite years of investment, nationwide adoption remains low, suggesting that technology alone is not enough. Dealers must actively educate and guide customers through these changes rather than assuming adoption will happen organically.
Controllable metrics shape 2026
Training discipline remains a central theme in Kingrey’s outlook. He points to lessons from the pandemic, when sales teams became spoiled amid inventory shortages. Service departments now risk a similar level of complacency as demand increases. Daily training, he argues, is essential to maintaining standards, improving communication, and preparing teams for the next market shift.
Looking ahead, Kingrey’s forecasting approach focuses exclusively on controllable variables, primarily customer-pay labor and warranty work. He has intentionally removed used-vehicle sales from his 2026 outlook, citing ongoing volatility in the used-vehicle market. Instead, his expectation across stores is a 12.5% increase in customer-pay labor sales, an area dealers can directly influence through process, pricing, and execution.
“I think now more than ever, looking at the financials that are coming out and looking at the variable results for this year, 2026 is the year for fixed ops.”
However, while many economists and dealer groups are confident about 2026, manufacturers are projecting lower vehicle sales volumes. For example, Kingrey notes that Cadillac is forecasting a 25% decline in unit sales, reinforcing the importance of fixed operations as a stabilizing force.
Despite those challenges, Kingrey maintains an optimistic outlook. He views the coming years as an opportunity for disciplined dealers to strengthen operations, improve profitability, and build resilience.
