A new study from Cox Automotive revealed a concerning trend for dealership fixed operations: despite a growing number of service opportunities, U.S. dealerships have lost 12 percent of their service visit market share to independent competitors since 2018. The findings from the Cox Automotive Service Industry Study indicate that while an aging vehicle population is driving more repair business, customer loyalty to dealership service departments is eroding, presenting both a crisis and a clear opportunity for dealers to reassess their strategies.
Older Cars Need More Service
The average age of vehicles on U.S. roads is rising, trending toward 12.8 years in 2025. These older cars naturally require more maintenance and repairs, fueling a profitable service industry. Dealership service and parts departments generated over $156 billion in 2024, with fixed operations now accounting for 13.2 percent of total dealership revenue, up from 12.4 percent in 2023. However, this top-line growth masks a deeper issue of customer migration to independent repair shops, chains, and mobile service providers.
A key factor in this market share erosion is declining loyalty, even among owners of newer vehicles. In 2025, only 54 percent of owners with vehicles two years old or newer returned to their purchasing dealership for service, a steep drop from 72 percent in 2023. This trend not only impacts fixed operations revenue but also threatens future vehicle sales. The study found that customers who service their vehicles at the dealership are far more likely (74 percent) to purchase their next vehicle from that same store, making service retention a critical component of long-term business health.
“These findings from our market data and surveys underscore the urgent need for dealerships to reassess their service strategies to recapture market share and enhance customer retention,” said Skyler Chadwick, director of product consulting at Cox Automotive.
Customers Aren’t Happy with Dealership Offerings
The study identified customer frustration with unexpected costs and poor communication as primary drivers of dissatisfaction. Nearly half of vehicle owners (45 percent) reported being unhappy with their dealership service experience. This is despite data showing that the average dealership repair cost in 2025 was $261, lower than the $275 average at general repair shops. The issue, it seems, is not the final price but the journey to get there.
To win customers back, dealerships must focus on transparency and convenience. The study shows that 55 percent of vehicle owners consider the ability to compare costs online to be very important. Customers are seeking digital tools that simplify the service process, including easy online scheduling, clear communication, and flexible options like vehicle pickup and delivery or rideshare integration.
Dealers Are Missing Out
Beyond improving the customer experience, the study points to a significant, often-missed opportunity on the dealer side: inventory acquisition. Over half of vehicle owners facing a major repair would consider trading in their vehicle, yet few are presented with an appraisal during their service visit.
“Dealerships are sitting on a goldmine – over half of customers facing major repairs would consider trading in—yet most are never approached with an appraisal, leaving millions in inventory acquisition costs on the table,” said Chadwick. “There is a clear call to action here for dealerships to proactively address customer dissatisfaction, strengthen communication and improve sales to service coordination to build back market share through lasting relationships.”
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