When your car conks out, where do you take it for TLC? According to a new study from DMEautomotive, the answer may depend on when you were born.

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DME surveyed 4,000 vehicle owners across the U.S., collecting data about their cars and their auto service spending. What they found should be of interest to every dealership in the country that wants a share of the $215 billion auto service market.

DME divided the service sector into three distinct categories: dealerships, independent shops (like your local mom-and-pop garage), and aftermarket chains (like Pep Boys and Sears Auto). They also tracked the age of survey respondents and the age of their vehicles.

  • Older drivers — particularly those over 65 — were most likely to be dealer loyalists, meaning that they were likely to visit dealerships and spend money there. A considerable chunk of that population were also “swing loyalists”, meaning that they either visited dealerships or spent money there, but not both.
  • Younger drivers — particularly those under 34 — were most likely to be loyal to aftermarket chains. However, the youngest end of that demographic was also found to be “disloyal” to those chains, meaning that respondents neither visited nor spent money at chains. So go figure.
  • Mid-age drivers — those 34 to 65 — were most likely to express loyalty for their local garages. However, this group spanned a gap, with some also pledging allegiance to dealers, and others to aftermarket stores.

Also of note: DME found that the age of a person’s car had a dramatic impact on dealership loyalty. When vehicles were new and under warranty, consumers were more likely to take them to dealerships for service. After about three years, though, dealers lost a whopping 47% of “bread-and-butter” services like oil changes and tire rotations.

Not surprisingly, this poses problems for dealers. Doug Van Sach, DMEautomotive’s Vice President for Strategy & Analytics, put it in plain terms: “If dealerships don’t replace their aging loyalists, and aftermarket stores are successful in retaining their loyalists as they charge towards their prime spending years, a share-of-wallet sea-change is looming that would greatly favor aftermarket stores, while eroding dealerships’ lifeline service profits.”


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This news may not be as ominous as it seems for dealers. Many of the older drivers we know (including some on the TCC staff) have spent years if not decades building relationships with their preferred dealerships, and it makes sense that those relationships would result in dealer loyalty. We expect that, over time, younger drivers may develop similar patterns.

Similarly, it’s not surprising that younger drivers prefer aftermarket chains. After all, those stores tend to offer good service at bargain-basement prices, which is important for young people early in their careers who are trying to stretch every dollar. Also, aftermarket chains are often located throughout a metro area, while dealerships sit in one location that may be inconvenient for young working people to reach on an hour-long lunch break.

And we should point out that the most interesting part of DME’s study gets slightly glossed over in the report: loyalists make up only a fraction of any sector’s income. For example, though loyalists spend an average of $224 per year on service at dealerships, a far greater sum — $604 — is spent by disloyalists. In fact, disloyalists spend roughly three times as much as loyalists at all three types of shops.

Bottom line: there’s a lot of money at play here. Do dealerships need to do a better job of bringing in younger customers?Absolutely. Are they down for the count? We wouldn’t bet on it.

Got some time to kill? You can download a complete copy of the DMEautomotive study at http://www.dmeautomotive.com/userfiles/files/Changing-Service-Loyalty-Landscape.pdf.


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This story originally appeared on The Car Connection.