Older vehicles still dealer serviced: Report

13 November 2013  

ONE in six of 10 year old car owners (16%) still use main dealers to service their cars despite having to pay a significant premium in labour rates. That figure more than doubles for drivers of three-year old vehicles – often just out of manufacturer warranty – with 37% choosing to have their car looked after by a franchised workshop, according to a new study by Warranty Direct.

The company’s analysis of more than 70,000 policies shows that, overall, more than a fifth (22%) of motorists with 3-10 year old cars take their vehicles to a main dealer workshop instead independent garages, despite higher charges.

Even when the car is three years out of warranty – typically at six years old – around a quarter of drivers continue to choose franchised over non-franchised for servicing and repairs.

By brand, Lexus, Porsche and Mercedes-Benz owners are most likely to take their vehicles to franchised premises with 58%, 54% and 49% respectively choosing main dealer workshops. By contrast, just 10% of Fiat owners and 11% of Vauxhall owners have the same inclination.

In September, Warranty Direct reported that average labour rates for garages had increased by 33% in the last decade to around £75 an hour for franchised and non-franchised combined. The insurer found the average price difference between franchised and non-franchised premises was around 23% more for a main-dealer workshop’s hourly rate, though for some premium manufacturers it was as much as 35% more.

Duncan McClure Fisher, Managing Director at Warranty Direct, said: “Once cars leave the protective umbrella of the manufacturer warranty and are on their second or third owners, they are typically lost to the manufacturer network and that has a negative effect on extended warranty penetration, customer retention and workshop absorption rates.”