Evolving Technology Challenges Independent Auto Service Providers

Jun 6, 2013

Independent auto service providers’ fears regarding access to connected car data were addressed May 22-23 at the Automotive Aftermarket Industry Association (AAIA) Aftermarket eForum in Chicago.

“The growth of embedded vehicle connectivity systems by auto manufacturers is a tangible threat to the aftermarket automotive service and parts industry,” says Scott Luckett, chief information officer (CIO) for AAIA, “The aftermarket industry must develop effective connected car alternatives to assure that drivers have a real choice when it comes to auto repairs, maintenance and parts.”

Because original equipment manufacturers (OEMs) claim ownership of most of the data generated by embedded telematics systems, car dealers are the first in line to get repair and maintenance data. As a result, car manufacturers are potentially building a closed ecosystem for the entire vehicle ownership lifecycle, according Fred Blumer, CEO of Vehcon, a telematics company that extracts data from vehicles using smartphone technologies.

Blumer, who was a keynote speaker at the eForum, said OEMs are steadily improving their marketing efforts by first gaining control of consumers and their vehicle data. An embedded vehicle diagnostics system sends data packets back to the OEM’s customer relationship management (CRM) system, which analyzes the data. Then, customers are sent emails about maintenance or emergency needs, and directed to OEM dealers.

Blumer encouraged the aftermarket to side with consumers on data rights and, more than anything else, to provide the consumer with alternative, attractive options to OEM systems.

“The cost to the consumer is cash, as many of these systems have monthly fees; control, as consumers’ rights to their own data gradually are eroded; and choice, as consumers may have gotten a better deal by going somewhere else for service,” Blumer said. “”The key is to partner with the consumer.”

The aftermarket could leverage existing hardware for accessing consumer data. Options include UBI, fleet connectivity, and subprime lending/GPS tracking systems. However, these systems may be costly as they involve manufacturing, distribution, repair and other expenses that are borne by the companies using the data, according to Blumer.

As an alternative to hardware-based systems, Blumer mentioned the emerging field of smartphone data and vehicle connectivity solutions.

“Smartphone solutions have no hardware costs, provide real-time car and consumer data, enable location-based offers, and work on every car,” Blumer said. “This enables the right offer, at the right time, in the right place.”