Service America, an Independent EV Service Center

[Albal]

I posted this idea as part of another thread, but thought it was worth its own thread in the Suggestion Box.

The problem:
How to quickly and efficiently ($$) provide a widely available repair service for a new automotive brand. To make service financially efficient, customers need to take their vehicles to a service center, but that will be inconvenient until you have lots and lots of service centers, and the very large number of vehicles sold to support them.

The solution:
Form an independent company (perhaps "Service America", or SA) that provides service to more than one brand of EV, including warranty service for Scouts and other select startups.

While at first glance, this might seem to be a bad idea as it would be more complex than just doing service entirely "in house", there are some key advantages.

- By handling service for multiple EV brands (warranty service and otherwise), the SA service centers will more quickly become profit centers instead of cash dumps.

- Because service centers will support themselves financially much more quickly, you can scale things up a lot faster.

- Because SA will be a separate company not entirely dependent on SM, it can be started immediately instead of waiting till certain SM milestones are achieved, thus speeding up the availability of SM service when the time comes.

- SA will be able to achieve greater financial success than an in-house solution because it will service a lot more vehicles due to handling different brands.

- SA can contract out with other startups, not just SM, to provide warranty service. (though perhaps enabling competitors is not a good idea?)

- This could be done by VW directly, with a budget that does not affect the SM budget.

- This might also be done as a franchise to further stretch the budget.

- There's going to be a vacuum as traditional independent service centers try to transition to the EV world. This will be well timed and placed to step into that vacuum.

When all is said and done, you will have created two profitable businesses instead of just one, and they will be synergistic, helping each other succeed.

Thoughts?

 

[J Alynn]

I posted this idea as part of another thread, but thought it was worth its own thread in the Suggestion Box.

The problem:
How to quickly and efficiently ($$) provide a widely available repair service for a new automotive brand. To make service financially efficient, customers need to take their vehicles to a service center, but that will be inconvenient until you have lots and lots of service centers, and the very large number of vehicles sold to support them.

The solution:
Form an independent company (perhaps "Service America", or SA) that provides service to more than one brand of EV, including warranty service for Scouts and other select startups.

While at first glance, this might seem to be a bad idea as it would be more complex than just doing service entirely "in house", there are some key advantages.

- By handling service for multiple EV brands (warranty service and otherwise), the SA service centers will more quickly become profit centers instead of cash dumps.

- Because service centers will support themselves financially much more quickly, you can scale things up a lot faster.

- Because SA will be a separate company not entirely dependent on SM, it can be started immediately instead of waiting till certain SM milestones are achieved, thus speeding up the availability of SM service when the time comes.

- SA will be able to achieve greater financial success than an in-house solution because it will service a lot more vehicles due to handling different brands.

- SA can contract out with other startups, not just SM, to provide warranty service. (though perhaps enabling competitors is not a good idea?)

- This could be done by VW directly, with a budget that does not affect the SM budget.

- This might also be done as a franchise to further stretch the budget.

- There's going to be a vacuum as traditional independent service centers try to transition to the EV world. This will be well timed and placed to step into that vacuum.

When all is said and done, you will have created two profitable businesses instead of just one, and they will be synergistic, helping each other succeed.

Thoughts?

My only concern with this is warranty services and how to tie through between manufacturer and service provider. If I have a service item on Scout and ‘SA’ messes something up how does that get covered? If it’s a warranty and doesn’t get fixed correctly how does that get solved.
I like the concept but just thinking there would be new hurdles in the automotive industry.

 

[Albal]

It's actually a better situation than the current "dealer provides warranty service". The dealer is an independent 3rd party, even though they get to paste the brand logos everywhere. At least with SA, the company is owned by SM (or VW) and so their interests are aligned. Think of it like SM providing their own in-house service centers, but then opening them up to service other EVs and changing the name from "Scout Motors Service" to "Service America". Doing that will allow them to scale up service much more quickly.

 

[J Alynn]

It's actually a better situation than the current "dealer provides warranty service". The dealer is an independent 3rd party, even though they get to paste the brand logos everywhere. At least with SA, the company is owned by SM (or VW) and so their interests are aligned. Think of it like SM providing their own in-house service centers, but then opening them up to service other EVs and changing the name from "Scout Motors Service" to "Service America". Doing that will allow them to scale up service much more quickly.

But that scenario then creates a concern with the other brands coming in because they are no longer direct to their manufacturer. I think the concept is good and maybe it is a center that handles all the VWAG brands from an EV point of view but if I bring a Ford in the warranty issue arises again unless they just come in strictly for service but then I think that opens other brands dealerships to refuse warranty or they blame SA for mistakes. If just VWAG I can get behind the concept you are suggesting. That said as much as I hate dealers I prefer servicing with them directly vs the mom/pop shops so I wonder if other brand buyers feel the same and would they come. It’s a great idea just some hurdles I worry about.
I love the concept as a company for handling the battery tech portion, maybe outside of the service aspect. Master battery service/replacement and then every brand has opportunity?

 

[Albal]

The idea is for SA to just handle warranty claims on the Scout and perhaps one or two small startups, but the actual bulk of their action would be non-warranty repairs on other cars (older teslas, leafs, bolts, whatevers). I imagine the vast majority of the repairs being for other cars, which would increase the repair volume dramatically and allow SA to spread without burning cash. Instead, it will be a viable independent national service business on which the Scout warranty service would piggyback. It's a little unusual. You're kinda leveraging non-warranty telsa repairs in order to provide more widespread warranty Scout repairs.

Who knows? Maybe it's just crazy. Maybe it's better to just stick with the initial service technique, which is great for customers but not-so-good for the manufacturer (ie, roving repair plus flatbed as needed, with a loaner), until you become so wildly popular that establishing traditional service centers everywhere is not an issue. I actually like the idea of service coming to me, so never mind!

 

[LastDayScout]

I have a somewhat unique perspective as I own a dealership for two major Japanese construction and tractor brands and I have personally owned two Teslas and now a BMW iX.

Yes, we are able to put up logos. Yes, we make money over dealer invoice. Yes, we provide parts and service and make a profit on that too. But, we also send our staff to training and schools to know our products and to provide the best customer experience possible. We also make significant investments in tools, delivery trucks and payroll to keep the best people. Not easy. We have in house and on-site service depending on the machine and the issue. We try to not be like the negative, stereotypical automobile dealer. I will admit that dealers in general have earned that negative connotation. But, not all are that way.

As for my EV service experiences. On day 3 of having my first Tesla a rock on the interstate cracked the windshield. Three months later I got it replaced at a Cadillac dealer because they were the only Tesla certified collision center. I tried to get my normal windshield replacement company to do it. He said they could not even order the glass unless they paid Tesla to be certified. That same car had the back glass crack too (known warranty issue). Tesla said I would have to drive it 75 miles away and leave it. No loaner, no nothing. I finally got it replaced at the Cadillac dealer after a bunch of back and forth to get the warranty coverage. I did have one other on-site warranty visit to replace a taillight that got condensation in it. On the second Tesla I had some squeaks and rattles that were fixed on site. But, I always worried that I could be stuck without a vehicle for a long time if something major happened. Now, I have the BMW iX which came from a dealer. Not too long into having it I had a high voltage cable warning light appear and it cut off in traffic. I was able to reboot the car in the median and drive it to the dealership. They were quick to get me a loaner, stayed in constant contact and relayed what the BMW service team was getting the dealership technician to do. I was not worried at all and it was great piece of mind.

Manufacturers don’t always make good dealers. In many places it’s actually illegal. Yes, it would be nice to cut out unsavory dealers. But, every time I’ve seen an equipment manufacturer buy and try to run a dealership, they fail on a spectacular level.

I hope there is a happy medium. I’m closely following the EV America and Scout Post ideas. But, I’ll throw in another one. Scout could select dealers (probably VW, Audi, Porsche, but also maybe International truck) in areas that need service coverage. But the dealer would need to meet some specific parameters and prove their buy-in to the Scout way. That would include the dealership paying Scout for training, tools etc. In other words, your possibly terrible, local VW dealer does not automatically get to service Scout. Sorry, lots of thoughts in one post!

 

[J Alynn]

I have a somewhat unique perspective as I own a dealership for two major Japanese construction and tractor brands and I have personally owned two Teslas and now a BMW iX.

Yes, we are able to put up logos. Yes, we make money over dealer invoice. Yes, we provide parts and service and make a profit on that too. But, we also send our staff to training and schools to know our products and to provide the best customer experience possible. We also make significant investments in tools, delivery trucks and payroll to keep the best people. Not easy. We have in house and on-site service depending on the machine and the issue. We try to not be like the negative, stereotypical automobile dealer. I will admit that dealers in general have earned that negative connotation. But, not all are that way.

As for my EV service experiences. On day 3 of having my first Tesla a rock on the interstate cracked the windshield. Three months later I got it replaced at a Cadillac dealer because they were the only Tesla certified collision center. I tried to get my normal windshield replacement company to do it. He said they could not even order the glass unless they paid Tesla to be certified. That same car had the back glass crack too (known warranty issue). Tesla said I would have to drive it 75 miles away and leave it. No loaner, no nothing. I finally got it replaced at the Cadillac dealer after a bunch of back and forth to get the warranty coverage. I did have one other on-site warranty visit to replace a taillight that got condensation in it. On the second Tesla I had some squeaks and rattles that were fixed on site. But, I always worried that I could be stuck without a vehicle for a long time if something major happened. Now, I have the BMW iX which came from a dealer. Not too long into having it I had a high voltage cable warning light appear and it cut off in traffic. I was able to reboot the car in the median and drive it to the dealership. They were quick to get me a loaner, stayed in constant contact and relayed what the BMW service team was getting the dealership technician to do. I was not worried at all and it was great piece of mind.

Manufacturers don’t always make good dealers. In many places it’s actually illegal. Yes, it would be nice to cut out unsavory dealers. But, every time I’ve seen an equipment manufacturer buy and try to run a dealership, they fail on a spectacular level.

I hope there is a happy medium. I’m closely following the EV America and Scout Post ideas. But, I’ll throw in another one. Scout could select dealers (probably VW, Audi, Porsche, but also maybe International truck) in areas that need service coverage. But the dealer would need to meet some specific parameters and prove their buy-in to the Scout way. That would include the dealership paying Scout for training, tools etc. In other words, your possibly terrible, local VW dealer does not automatically get to service Scout. Sorry, lots of thoughts in one post!

Really like the way you put it into words as many of my thoughts mirror this. I like the international approach (that said I have one 6 miles from my house so easy for me to say that). It will be the biggest hurdle and may be the make or break for SM reputation.
I’ve been thinking that as EV’s are new-ish still in the overall market maybe an approach like Saturn used to have. No haggle, stand alone under an umbrella manufacturer and only serviced Saturns. Was a touch too young to buy when they were around but their business approach was a novel way of selling cars

 

[Albal]

I have a somewhat unique perspective as I own a dealership for two major Japanese construction and tractor brands and I have personally owned two Teslas and now a BMW iX.

Yes, we are able to put up logos. Yes, we make money over dealer invoice. Yes, we provide parts and service and make a profit on that too. But, we also send our staff to training and schools to know our products and to provide the best customer experience possible. We also make significant investments in tools, delivery trucks and payroll to keep the best people. Not easy. We have in house and on-site service depending on the machine and the issue. We try to not be like the negative, stereotypical automobile dealer. I will admit that dealers in general have earned that negative connotation. But, not all are that way.

As for my EV service experiences. On day 3 of having my first Tesla a rock on the interstate cracked the windshield. Three months later I got it replaced at a Cadillac dealer because they were the only Tesla certified collision center. I tried to get my normal windshield replacement company to do it. He said they could not even order the glass unless they paid Tesla to be certified. That same car had the back glass crack too (known warranty issue). Tesla said I would have to drive it 75 miles away and leave it. No loaner, no nothing. I finally got it replaced at the Cadillac dealer after a bunch of back and forth to get the warranty coverage. I did have one other on-site warranty visit to replace a taillight that got condensation in it. On the second Tesla I had some squeaks and rattles that were fixed on site. But, I always worried that I could be stuck without a vehicle for a long time if something major happened. Now, I have the BMW iX which came from a dealer. Not too long into having it I had a high voltage cable warning light appear and it cut off in traffic. I was able to reboot the car in the median and drive it to the dealership. They were quick to get me a loaner, stayed in constant contact and relayed what the BMW service team was getting the dealership technician to do. I was not worried at all and it was great piece of mind.

Manufacturers don’t always make good dealers. In many places it’s actually illegal. Yes, it would be nice to cut out unsavory dealers. But, every time I’ve seen an equipment manufacturer buy and try to run a dealership, they fail on a spectacular level.

I hope there is a happy medium. I’m closely following the EV America and Scout Post ideas. But, I’ll throw in another one. Scout could select dealers (probably VW, Audi, Porsche, but also maybe International truck) in areas that need service coverage. But the dealer would need to meet some specific parameters and prove their buy-in to the Scout way. That would include the dealership paying Scout for training, tools etc. In other words, your possibly terrible, local VW dealer does not automatically get to service Scout. Sorry, lots of thoughts in one post!

Lots of great info and thoughts here. I guess if the manufacturer doesn't care about service then it's perhaps random chance whether you get good service, either through them or somewhere else. Bad foundations make for shaky construction. But assuming that SM does care about service, and assuming they want to have third parties handle that service, how can they ensure the quality of that service? I'm thinking buy in is not enough to guarantee it. In fact, the bigger the buy in, the more the dealer, once they've jumped through the hoops, can relax about things. And even if they find great service companies to begin with, what happens when management of a service center goes downhill? At least if it's in-house, they can fire the bad team and hire a fresh one. I think that's the quandry that many car companies have found themselves in recently, with the dealer experience getting worse and worse, and their reputation largely in the dealer's hands. That said, I don't think dealers are necessarily bad (I like my local Stihl dealer), but car dealers around here are out of control. The SA idea was to run a path halfway between in-house and out- ummm... traditional dealer service, hopefully getting benefits from both ends.

As for BMW... I ordered an i4, waited a long time with little to no communication despite my attempts and when it finally did arrived I found out they ordered the wrong one. That said, I've had better luck with service departments than sales!

 

[shawnpcochran]

Question, are they going to design the scout to keep repair bills reasonable. It might be good to make sure that a fender bender does not cost tens of thousands of dollars. I would like to know if they are going to consider something like that when they design the vehicles.

 

[Ecca]

fever bender

Is that an all-night pub crawl with the flu?


More seriously, fundamental engineering considerations like repairability that go beyond just showroom features to move units are what makes a revitalized classic continue on as a classic. If the long term isn't prioritized, that's how people get the impression that a company wants to burn a brand into the ground to make a quick buck from its name.

Scott Keogh pushing "respect" as a foundational pillar of Scout Motors suggests they'll value this type of long-term commitment.

 

[shawnpcochran]

Thanks for catching that. I really hope they do, I know Tesla’s and Rivian both cost thousands of dollars just to fix minor damage on the vehicle. I hope they get ahead of something like that

 

[Ecca]

Thanks for catching that. I really hope they do, I know Tesla’s and Rivian both cost thousands of dollars just to fix minor damage on the vehicle. I hope they get ahead of something like that

If you want a more specific indicator than the vague idea of respect and long-term considerations, I believe there was community staff talking about pushing for easily removable/replaceable wheel arch cladding since it always gets beat up over time. I'll need to double check.

Whether that type of cladding makes it to production might be one litmus test for repairability, I guess?