How warranties, schedules and service department upsells informed my business model - The Globe and Mail

2022-07-23 08:45:24 By : Mr. David liu

Cars on the lot of the Stratford Honda dealership in Stratford, Ont., on July 28, 2021. Fred Lum/the Globe and Mail

I would like to make a comment rather than ask a question. I typically buy a new car every five years now that I am in a position to do this after many years of driving older used cars. I’ve had tremendous success with Toyotas and have owned several of them.

Currently, I have a 2019 Ford F-150 and a 2020 Subaru Outback. My issue is with the service schedules. In the past, the manufacturers service requirements were different from what the dealer wanted to do. I always follow at least the minimum requirements of the manufacturer.

Subaru has taken this to another level now and included these service schedules in the maintenance manual. Of course, the Subaru dealer makes these schedules out to be gospel and implies that this work is required to maintain warranty. Ridiculous. I took our six-month-old Outback with 3,000 kilometres on it for its first service, which really should have been just an oil change. However, they insisted on lubricating hinges, servicing the battery, inspecting the tires and on and on. I needed a simple oil change that should cost less than $100, and I received this unnecessary list of services that costs much more. I have a very good oil change shop where I live that also does coolant flushes, transmission fluid change and differential fluids. They are quick, reasonable and friendly. These guys do the job right and never try to upsell me on unneeded work. I won’t be going to the dealer for regular service, just warranty if needed. I will make sure that the required maintenance is completed to maintain the warranty. The constant pressure to upsell unnecessary servicing just makes it an unpleasant transaction.

Great column, keep up the good work.

Fred S., Nanaimo, B.C.

As a young Honda dealer technician in the 1990s, I learned the dealership owner I worked for was originally a technician like myself who had started his own businesses. Jump back twenty years for him; it was the 1970s and Honda and Toyota had just come to Canada. Both companies were unknown and unproven in the North American market that was dominated by domestic manufacturers. He would have been taking a huge gamble when Honda asked him to sell and service their product. Timing and his willingness to take a risk paid off. At last I heard, he now owns more than a dozen differing dealerships in the greater Toronto area.

Early in my career as a repair shop owner I thought I too would like to do the same. However, import manufacturers were well established by this point, no longer giving away dealerships for free. I might have been able to pull it off financially if I was willing to move to a small, northern Ontario community. Though, the need to stay close to family meant it never happened, however I held on to that dream for many years. As the years dragged on, financial requirements to own a dealership grew exponentially and the dream started to fade.

One of my best friends was the director of dealer operations for a major import manufacturer for many years. It was his team that vetted and placed dealership owners across the country. He finally put my dream to rest when he explained to me that to be even considered for a dealership in a major urban area, a prospective candidate had to own at least six other dealerships. He said that without the financial resources and experience that came along with owning those other dealerships, they knew a new single franchise dealer would never survive. The overhead to operate a dealership was just too high for their manufacturer to take a chance on any newbie.

With that in mind, my business model became simple. Wait for the owners of newer vehicles to get frustrated with their dealer and go looking for an alternative. The most common complaint, they are tired of the upsell. The service department at any dealer, regardless of brand carries a huge burden of overall revenue generation for that operation. The upsell will never go away and most new car owners are indeed held in fear until their warranties expire.

I recently had my 2014 Chevrolet Sonic RS repaired while under manufacturer’s warranty to replace the positive crankcase ventilation pressure regulator valve. Within a few weeks the “check engine” light came back on, and it has been determined that the turbo is now shot and also needs to be replaced. The vehicle has approximately 45,000 miles on it.

My regular mechanic suggested that the turbo failure may be related to the warranty work that was performed by the dealership, especially because the car has fairly low mileage. All regular maintenance including oil changes and filters is done on schedule according to manufacturer’s recommendations.

The dealership says there is no relation between these two problems even though they occurred only a few weeks apart.

What do you think? Your professional opinion would be much appreciated.

The job of the positive crankcase ventilation pressure regulator valve is to relieve blowby pressure from within the crankcase. When the crankcase ventilation fails other problems can arise, especially in turbocharged vehicles.

The turbocharger has both an oil-supply line, which delivers fresh oil to the turbocharger, and an oil-return line that dumps the oil into the oil pan. An engine with a clogged pressure regulator valve will see a pressure increase in its crankcase/oil pan area. This elevated crankcase pressure will negatively affect the turbocharger by means of its oil return line, which cannot return oil as easily because of this unwanted, elevated pressure. The cascading result is that when the oil cannot drain as quickly as it was designed to, the supply of fresh oil is also slowed down as it enters into the turbocharger. Lack of sufficient, steady oil supply is always the most common reason for the failure of a turbocharger.

So yes, to answer your question specifically, it is entirely reasonable to suggest that the turbo failure is related to the previous condition. It is not likely associated with the actual work performed by the dealer technician, but to the previous sustained elevated crankcase pressure as described above. To put it in simpler words, your turbocharger was most likely operating with decreased fresh oil supply for an extended period, ultimately causing its failure.

Lou Trottier is owner-operator of All About Imports in Mississauga. Have a question about maintenance and repair? E-mail globedrive@globeandmail.com, placing “Lou’s Garage” in the subject line.

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