How electric vehicles will change your business model
By Craig Van Batenburg
Let me explain how I ended up writing this article, as it can set the context for those who don’t know me. My relationship with tires, which are the most important part of any vehicle, begins with the fact that when I was a teenager I only had two. They were riding a Honda Scrambler that I drove in high school.
Later, I opened an independent repair shop, Van Batenburg’s Garage Inc., where I sold tires. I’m also the CEO of the Automotive Career Development Center, a leading provider of electric vehicle (EV) and hybrid vehicle training resources.
From my experience, I can tell you that the world around us is constantly changing. This includes the switch to electric vehicles. (The sponsor of this article, Hankook, makes a variety of tires for electric vehicles.)
Is your dealership ready to service these vehicles? Are you in an “EV state of mind?” How you answer these questions will help determine the future success of your business.
I also know that as a business owner you need data to make the right decisions for the future of your business.
So first, let’s take a look at the growth rate of electric vehicles globally.
Growth rates have been extraordinary in the first six months of 2021, reaching 157% in Europe, 197% in China, 166% in the United States and 95% in other global markets. Japan is the only market that has not seen an increase.
What happened in the first half of 2021 that made such a jump possible?
A new focus on electric vehicles in Washington DC and many new electric vehicles on the market including the Ford Mustang Mach-E and some sleeper cars like the Kia Niro EV.
New electric vehicles like Rivian, Ford (with the Ford F-150 Lightning pickup) and other companies will also be available.
And we’ve seen more and more owners of hybrid vehicles move away from fossil fuels.
There are also greater forces at play.
In 2019, the United States’ annual energy use from renewable sources exceeded coal use for the first time since before 1885, according to the US Energy Information Administration’s Monthly Energy Review.
This result primarily reflects the continued decline in the amount of coal used for power generation over the past decade, as well as the growth of renewables, primarily wind and solar.
Compared to 2018, the consumption of coal in the United States decreased by almost 15% and the total consumption of renewable energy increased by 1%.
The COVID-19 pandemic did not have much of an effect on sales of electric vehicles, which were less than 2% when it started. Meanwhile, sales of conventional vehicles fell 20%.
Many buyers of electric vehicles have a sense of responsibility towards the environment. And many have responded financially, as the cost of more electric vehicles is within their reach.
How temporary is this? Most likely none, as more bad news about fires and floods will continue and the cost of electric vehicles will drop.
Now, if you are not convinced that we will be fully electric at some point in the future, you are not alone. But here is the problem. By sitting down and doing nothing, your competition can outsmart you. What if you wait too long and the tire store down the street all-in and captures the EV market before you do? Then what ?
If you want a bigger share of the electric vehicle market in your market, here are 10 tips for you to consider. (I recommend putting one on each month.)
- Meet with all of your staff and get feedback on what they think about EVs and EV service;
- Rent or borrow a modern electric vehicle and have it at the store for all employees to see and drive;
- Find out if you have local competition;
- Find training for everyone, including your service writers, salespeople, and technicians;
- Look for government programs that will help finance workforce development;
- See if a DC fast charger or a level two charger can be installed in your parking lot;
- Check with your local utility provider for charger installation and payment assistance programs;
- Visit your local technical college or high school that offers an automotive program and see what they are doing with electric vehicles;
- Attend an EV event and talk to EV owners about what to expect, and;
- When you launch your EV program, make sure you are ready. Go all out.
Let me leave you with this story. On October 15, 1999, I walked into my local Honda dealership with my checkbook and said to the salesperson there, âI want to buy a Honda Insight.
She replied, âWhat is a preview? “
I told him it was a hybrid car.
His response was, âWhat is a hybrid car? “
“Will you take my money?” I then asked.
This exchange led me to open the Automotive Career Development Center, which offers hands-on courses in hybrid cars. In 2010, we naturally added electric vehicles to the mix. (By the way, this 2000 Honda Insight I bought still works.)
Make sure your dealership is equipped to service electric vehicles and sell replacement tires for these vehicles. Torque is immediate and tire wear is immediate too, so watch electric cars and trucks carefully as they can wear tires out faster than conventional vehicles.
I have seen many changes in our industry and you have to change with them to stay in the game and win. Today is a great day to start kitting yourself out.
To learn more about Hankook, click here.
Craig Van Batenburg is the CEO of Van Batenburg’s Garage Inc. dba Automotive Career Development Center (ACDC), which is based in Worcester, Mass. automotive service facilities that serve–or wish to maintain–electric and hybrid vehicles. For more information, visit fixev.com, email them at [email protected] or call 508.826.4546.
This article is part of MTD Tire Dealer Survival Guide Series. As more articles are published they can be found below:
Compensation for Technicians â How to Stay Competitive
How to get the most out of every phone call
How to build a strong leadership pipeline
How to manage inventory and cash flow