Dear reader!! The change in the automotive sector from internal combustion engine (ICE) to electric vehicles (EVs) is bringing about a new revolution. Similarly, quite a lot deeper change is being witnessed in the aftersales market. As many similarities exist between the maintenance needs of EVs and ICE vehicles, it is also likely that there may be some differences as well that must be addressed by the providers of Aftersales Services so that their special needs are catered to by the changing behavior of EV customers. In this regard, by better understanding the specific needs of the EV owner and through investment in specialist training and infrastructure, Aftersales Service providers can position themselves at the forefront of this industry. This will then enable the businesses to offer excellent customer service and support and thereby contribute to the successful adoption of electric vehicles.
Electric vehicles, or EVs as it is popularly termed, have been gaining popularity rapidly in the automotive sector. It has transformed and redefined how we consider transportation. These EVs have attracted consumers through a combination of technology, environmental concerns, and government support. Compared to the gasoline-powered counterparts, the most notable advantage of using EVs is relatively low operating costs. They are less expensive to maintain, incur no fuel costs, and often have lower road tax or registration fees in most jurisdictions.
EVs are cleaner and greener: since they are emitters of zero tailpipe emissions, something which becomes very important in urban areas due to a big air pollution problem. Performance-wise, EVs often outperform their gasoline counterparts in terms of thrust, operated quietly, and respond faster to acceleration. Several governments around the world have offered incentives on the adoption of EV’s through tax credits, subsides, and free charging infrastructure therefore are increased in recent years. Advancement in battery technology, development of charging infrastructure, and more sophisticated automobile designs make EVs appear as being made more accessible and convenient for consumers. Climate change awareness and sustainable transportation needs have fueled the trends of EVs. The International Energy Agency claims that there are 145 million electric cars on the road worldwide by 2030 and 10 million only in 2020-2021. This is a tremendous shift within the automotive landscape and endorses growing acceptance of EVs.
Electric vehicle adoption is gaining momentum at unprecedented speeds. Along with this, aftersales service for electric vehicles is growing at a tremendous speed too. In fact, the market of aftersales services for electric vehicles is quite promising with considerable opportunities to exploit rising demand for specialized knowledge and services. A lot of challenges remain in acquiring expertise and infrastructure to provide aftersales services in electric vehicles.
The rise of electric vehicles serves to change not only the method of designing and manufacturing cars but also the after-sales services profoundly. In comparison with ICE vehicles, it brings a different challenge for manufacturers, service providers, and customers in terms of aftersales services. The whole aftersales services have changed completely with the advent of electric powertrains. Routine maintenance activities like oil changes, exhaust repair, and engine diagnostics no longer dominate.
Changes in the service ecosystem-from the frequency and characteristics of repairs to tools, skills, and infrastructure supporting EVs-have all been impacted by the introduction of electrical powertrains. The main differences in the aftersales services between the electrical vehicles and the ICE vehicles not only mark the basis of the route parading the fundamental design of these technologies but also signify a direction that stands at the very core of development in industry-the shift towards digitalization, sustainability, and convenience for customers.
As those customers are more likely to rely on their vehicles for daily transportation, a need for reliable and efficient Aftersales Services is becoming the top priority for a regular inspection of the vehicle by skilled team. Global induction of electric vehicles has brought into view the necessity of Aftersales Service to become an important and emergent aspect of the modern automobile industry.
Unlike other traditional automobile vehicles, EVs are supposed to require unique maintenance and repair Services such as battery management, charging infrastructure support, and downloading software updates, among others. Aftersales service in EVs is entirely distinct from all the traditional internal combustion engine vehicles and thus poses challenges and opportunities in maintenance, repair, and customer support. Strong after-sales ecosystems assure customer satisfaction and brand loyalty, and higher long-term adoption of EVs. This new market calls for companies to transform business models, teaching skilled technicians and developing new services based on new generations’ needs to witness such a shift in vehicle technology. EVs have fewer moving parts and less wear and tear than an ICE vehicle.
Units like an engine, transmission systems, and exhaust systems are replaced by units like electric motors and battery systems. Routine servicing such as changing oil, replacing spark plugs, and replacing fuel filters are now considered obsolete, thereby reducing the regularity of maintenance. Routine checks of the health of the battery and its maintenance would allow it to operate perfectly with a maximum life span. The routines must check for voltage, state of charge, and temperature. In general, the performance and lifetime of the EV depend on the health of the battery, and hence diagnostics, software updates, and the monitoring of battery performance are integral components of an Aftersales Service.
The life of EVs is usually abbreviated by the degeneration of their batteries, which may become necessary to replace. Aftersales service providers should have the know-how and infrastructure to replace batteries cost effectively. Companies can offer battery repair, refurbishment, or replacement programs and also offer warranties for establishing goodwill with the customers. Ensuring Responsible and Sustainable EV Battery Disposal EV batteries need proper disposal and recycling methods for environmental sustainability. Aftersales service providers must tie up with facilities that recycle used batteries responsibly.
EVs rely heavily on software systems-including battery management, driver-assistance features, and infotainment-they would hence require best-in-class OTA software updates releasing new features or improving performance. They also now include in their Aftersales Services software-based troubleshooting as well as cybersecurity support-where these aspects are less prominent in classic ICE aftersales.
After-sales Service revenue from standard activities such as oil change and filter changes usually have a consumption ratio of 100%. The revenues from service are therefore said to be completely consumed by the dealership’s costs in terms of labor, parts, and overhead.These are standard maintenance tasks that must be undertaken for the proper functioning and durability of the vehicle; normally, customers will pay for them. Although EVs also require periodic maintenance, the type and frequencies of such services might differ from those for ICE vehicles. Thus, the aftersales revenue absorption ratio might be affected by such differences. In terms of maintenance needs, the aftersales revenue absorption ratio for EVs compared with ICEs might be lower. However, the potential revenues of dealerships through service activities for EVs are quite visible.
They can focus on battery management, charging infrastructure support, software updates, and general maintenance. All these can help dealerships really build out profitable aftersales business for EVs. While some revenue streams are going to be limited by a reduced need for traditional forms of maintenance, new opportunities created by such factors as battery diagnostics, software updates, subscription services, and sustainability initiatives are exciting. Companies embracing digitalization and working on innovative service models will be well positioned to realize this increasingly dynamic EV market. Strategic investment in training, infrastructure, and customer engagement programs will help businesses navigate this shift and unlock new sources of aftersales revenue.
Challenges and Opportunities
The EVs Aftersales Service market presents challenges and opportunities at the same time, as this shift to electric vehicles has brought some unusual challenges but tremendous amounts of growth and innovation. Adaptation to change by infrastructure retooling, staff upskilling, and customer-centric services and digitalization, sustainability, as well as emerging new business models, will only have service providers service providers ready for success. New revenue opportunities will be unveiled relative to customer satisfaction. For EV aftersales service to be successful, the bottom line includes answering ahead of the curve about the challenges and making an opportunity to create seamless, reliable, and sustainable customer experience.
- Skilled technician: A fully qualified and experienced technician is needed to acquire deep knowledge of the subtleties of EV technology to ensure effective maintenance and repair tasks. There is a requirement for specific tools and infrastructure for handling high-voltage systems, with tremendous investments needed in retooling workshops and erecting EV service networks. Technicians have to undergo recurring training and certification on aspects of electric drivetrains, battery diagnostics, and software troubleshooting among others, which increases the cost of operations. Smaller, independent service providers may have some issues sustaining the capital expenditure that is necessary to service EVs. The number of qualified EV technicians created by this expansion requires an outgrowth in the labor side. This often leads to a shortage. Mechanics who have regularly prepared on the maintenance of ICE vehicles require intensive retraining to handle the EVs safely and efficiently. This slows the transition.
- Charging Infrastructure: The development of charging infrastructure is mainly in demand as far as the ramp up of EVs and the growth of the Aftersales Service market are concerned. Customers are mostly dissuaded by the lack of charging infrastructure as they cannot get swift access to charging when opting to have repairs done. Remoteness and lesser developed regions in terms of their network continue to pose significant difficulties in the effective service of customers for service providers.
- Battery replacement, disposal, Warranty and Liability Issues: These usually include long terms for battery warranties, which would provide significant responsibility to manufacturers and dealers to ensure the health of the battery for a long time. Recycling technologies for batteries are still under development; presently, extraction of raw materials, like lithium, cobalt, nickel, etc., is hard and costly. Since most consumers are concerned about battery degradation or other performance-related problems, warranty management and consumer expectations increase complexities in aftersales processes.
Takeaway from this article:
Electric vehicles have in the past few years experienced a major transformation in the automobile industry, changing the face of the automobile world, as the shift towards electric vehicles (EVs) changes the after-sales service industry. Very soon, there will be a drastic change in transportation, energy consumption, and much environmental change.
The automotive industry is moving in the direction of electric mobility, a new reality that changes dynamics. Businesses can play leading roles in a growing EV aftersales service market by capitalizing on opportunities and addressing challenges. As overall EV penetration increases, the aftersales service industry is in for transformation.
Businesses can make money out of the expanding market for EV aftersales services only if they understand the special demands electric vehicles have. Differentiated by specialized training and infrastructure, aftersales service providers can play a pivotal role in supporting the successful adoption of electric vehicles by going an extra mile in customer satisfaction and with being ahead of the technological curve.
Exclusive article written by Muhammad Rafique for Automark Magazine’s October-2024 printed/digital edition