I’ve recently started to get a lot of phone calls and questions from shops when I’m doing seminars asking, “Mike, should I renew my shop’s OEM certifications?”
I say the answer is absolutely yes. Here’s why.
The forecast for OEMs is that a key future revenue stream is going to be app-based subscriptions. It’s going to be a little like what GM has done with OnStar, or how SiriusXM radio operates. As I’ve researched this, here are some quotes I’ve heard or read:
“At least five automakers---Audi, BMW, Cadillac, Porsche and Tesla---are rolling out a subscription model for certain options, meaning consumers would pay monthly or annual fees to use features such as active driving assistance or voice recognition, even if those features are already built into the car," according to Consumer Reports in December 2021. "Industry analysts tell Consumer Reports that subscriptions could become a more mainstream way for automakers to deliver features.”
“How would you feel about paying $5 each month for the ability to lock and unlock your car from a distance through an app? What about a $25-per-month charge for advanced cruise control or $10 to access heated seats? As vehicles become increasingly connected to the internet, car companies aim to rake in billions by having customers pay monthly or annual subscriptions to access certain features," Insider reported in February.
“We have 50-some value-added products and services that we’ll be rolling out over the next 36 to 48 months,” Steve Carlisle, president of GM North America, said in February.
I’m not sure how consumers are going to feel about such subscriptions, but I think it is important for collision repairers to understand drivers are going to increasingly be tied to the automakers' apps.
Well, guess what is also likely to be inside those apps? A shop locator helping drivers connect with that automaker’s network of certified shops. I think that bodes well for collision repairers with OEM certifications.
Here’s another thing to think about: Remember when aluminum-intensive vehicles were being more widely rolled out? Some automakers began restricting the sale of certain parts for those vehicles to their certified shops, to better insure major repairs on those vehicles were only done by shops with the equipment and training to do the repairs properly.
With ADAS and the ramp up of electric vehicles, collision repair work is only going to become increasingly complex. I think we’re going to see more automakers restricting more parts sales only to certified shops.
So that’s why I think giving up on OEM certifications now would be short-sighted. You have to look into the future.
It also makes it important to check the shop locators for the automakers that certify your shop. Make sure your profile is correct, and you have really good photos in there of your shop and your lobby. Keep pushing for positive customer reviews online. All that is becoming all the more important.
Check out my earlier column on “social proof."
Listen, I understand some OEM certification programs provide more value than others right now. But I can tell you the automakers are hearing the message loud and clear from collision repairers that the programs need to provide more value.
I think as we see this OEM subscription model come into play, it’s going to be really good for certified collision shops. So don’t give up. Stay the course.
Mike Anderson