Fixed ops departments hold untapped potential for revenue, retention, and customer loyalty. On today’s episode of Service Drive, Cox Automotive Director of Product Consulting, Skyler Chadwick, breaks down key insights from the 2025 Service Industry Study and offers strategies dealerships can implement now to capture these opportunities.
Fixed operations remain a stabilizing force for dealerships when sales fluctuate. Chadwick highlights three trends reshaping the service lane landscape in 2025: intensifying competition, convenience, and retention challenges. Dealerships face increasing pressure from general repair shops and quick-lane operators, with market share for dealership service dropping from 33% in 2018 to 29% today, despite higher service revenue overall.
Convenience is a critical factor in customer retention. About 33% of consumers say they are highly interested in getting value from their service visits, especially when service recommendations surpass $3,000. Many of these customers consider purchasing a new vehicle after significant repairs, creating opportunities for dealerships to leverage service lane inventory as a source of pre-owned vehicles.
Retention is a growing concern. The study shows retention has dropped from 72% in 2023 to 54% in 2025. Customers often leave after the two-year mark, seeking service from independent shops. Mobile service options are emerging as a competitive differentiator, enabling dealerships to meet consumers’ demand for convenience and maintain loyalty.
"Your service lane is not just about checking customers in; it's about creating that amazing customer experience, building that trust and transparency."
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Service lane equity mining is becoming increasingly valuable. Dealers are recognizing the opportunity to acquire vehicles directly from service customers, leveraging knowledge of the vehicle’s history, maintenance, and service contracts. This practice reduces risk, creates predictable inventory, and strengthens the customer relationship.
Revenue and growth continue to climb, driven by parts and labor increases, which have grown 33% since 2018. Dealers that prioritize customer experience see results, with 46% of consumers reporting better experiences due to speed, communication, and professionalism. Technology plays a pivotal role. Tools such as video approvals, mobile apps, and digital scheduling streamline the consumer experience and increase loyalty. In fact, 88% of customers report that service experience impacts whether they return to purchase a vehicle.
AI adoption is another major trend. Dealers are using AI to handle scheduling, recalls, and follow-ups on declined services. Chadwick emphasizes testing AI with different customer segments, as responsiveness varies between brands like Toyota and Lexus. When used effectively, AI reduces wait times, improves workflow efficiency, and enhances advisor effectiveness.
As vehicles remain on the road longer, now averaging 12.8 years, dealerships have an opportunity to capture higher service volumes and drive retention. Chadwick encourages dealers to address misconceptions that dealership service costs more than independent shops and to integrate service and sales teams to create a seamless customer experience.
Dealerships that focus on convenience, transparency, and loyalty while adopting digital tools and AI will position themselves for success in 2026. Fixed operations are no longer just a revenue stabilizer; they are a growth engine, inventory source, and loyalty builder for dealers who prioritize customer experience.
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