[SulphurSmell]

I don't really doubt the numbers...in fact, I thought them a bit low. My feeling is that this will really change the automotive landscape for the overall lifecycle of a car. Seems to me that the dealership currently doesn't worry too much about immediate margin on a new car. They know that that car will come back to them for in-warranty service (which the dealer bills back to the manufacturer) and after-warranty service (loyal customers afraid to go to a less expensive garage). In a nutshell, all the real money is the recurring revenue for service. EVs will require less service...so I'm thinking the dealer will just keep their margin higher up front to make sure they don't lose after the sale. I would bet the dealers would rather sell some sort of EV that needs frequent/predictable/reasonable service...thus supporting the annuity model that has existed for decades. What to do? Build super high quality EVs that need almost no maintenance? Then you don't need that expensive dealer network. But consumers want that dealer to visit and complain to when things don't work...and that costs money. In the end, I think consumers will need to realize that their overall experience and expectations of car ownership are in for a big shake up over the next few years.

[stephendause]

Do you have data for the comparison of profits from sales to service? I never get my vehicle serviced at a dealer. I don't know what percentage of people do, but that would play a big factor in this analysis.

[SulphurSmell]

Here's a link https://www.edmunds.com/car-buying/where-does-the-car-dealer...

FTA:

"National Automobile Dealers Association (NADA), the new-vehicle department of a car dealership accounts for about 58% of a dealership's total sales but less than 26% of a dealership's total gross profit. "

"So where does the majority of a dealership's profit come from? It's not from car sales, at least not directly. It's from the service and parts department, which accounts for the other 49.6% of the dealership's gross profits, according to NADA"

My comment was based on what I have been told by people in the business. They all want to get cars out the door...and raw counts are more important than margins on each. I would say that any new car under warranty will absolutely be serviced at the dealer. After that? Agreed...people will find alternatives. Mind you, in my experience, only "car people" tend to find non-dealer service...many feel "safer" at the dealer. I am told that the manufacturers of the cars make the most profit on a new vehicle sale...not the dealer. This is also why the lease/used market is so attractive to dealers.