It is critical for OEMs to start planning for the emergence of battery electric vehicles (BEVs) as this trend has the potential to have the biggest impact on aftersales in the short term. Global sales of BEVs reached more than one million units for the first time in 2017 increasing 54 per cent over 2016 and surpassed two million units in 2018.
Evolving aftersales networks will include both ICE and EV vehicles for the foreseeable future. Although EV market share will continue to grow, service revenue opportunities from ICE vehicles on the road will remain strong for years to come.
The available aftersales revenue on a three-, four- or five-year old and older EV will be considerably less than for an equivalent ICE (internal combustion engine) vehicle meaning that the potential revenue available will decline.
One such opportunity is, with EVs in Europe more likely to be bought on lease or through a Salary Sacrifice Scheme (where payments for vehicles, servicing and insurance are bundled together), retailers can seize the opportunity to become the default service provider at the time of purchase to create guaranteed regular revenue streams.
Mobile service and Over-the-Air (OTA) services are particularly appropriate to servicing electric vehicles since EVs have fewer parts, more electronics components and a higher proportion of software and diagnostic work that can be done remotely.
The EV market is attracting a number of start-ups and new entrants (including established brands with no automotive industry experience). However, from the outset, their future revenue potential from aftersales will not be at the same level that established OEMs have been able to achieve.