A situation like this seems way too familiar
If you own a car, or know someone who owns a car, a situation like this sounds way too familiar: you or the owner of the car takes it to the dealership for what should be a routine, $39, $49, or $59 oil change, but it transforms into a longer, full-on service that leaves a much larger hole in your wallet and your soul. The service advisor points out that the car needs “recommended maintenance,” which is a lot more expensive than what your neighbor pays at the local shop, and that they’ll need to keep your car all day for what should be a 45-minute job.
It’s the kind of demoralizing experience that makes you wonder if owning a car is even worth it in the first place; one that makes you wonder if it’s even worth bothering with the dealership. Turns out, you’re not alone, as millions of Americans are asking themselves the same question, and increasingly deciding the answer is “no.” A new study from Cox Automotive finds what many car owners already suspected: the dealerships are losing service department customers at an alarming rate, and their own practices are largely to blame.
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The numbers tell a troubling story
It is no secret that cars on American roads are getting older. According to data from S&P Global Mobility, the average age of a car has topped 12.8 years, which should mean that service departments should see more service visits from car owners.
However, Cox Automotive found that dealers have lost 12% of their service business since 2018, as a steady exodus of customers has chosen independent repair shops, quick-lube chains, and even mobile service providers over the place where they bought their vehicle. The trend is particularly stark with newer vehicles. In 2023, 72% of people with cars two years old or newer had their cars serviced at the same dealership where they bought their cars from, but by 2025, this had decreased to just 54%.
The “buy here, service elsewhere” mentality is costing dealerships more than just losses at the service department. The study found that losing customers at the service department could have a negative impact on sales in the showroom. Cox found that customers who get their vehicles serviced at the dealership are 74% more likely to purchase their next car from that same dealership.
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What’s driving customers away
Here’s the ironic part: dealership service isn’t actually more expensive. The study found that average repair costs at dealerships in 2025 were $261, compared to $275 at independent repair shops. These numbers indicate that, on average, servicing at dealerships is more cost-effective; however, customers often perceive dealer service departments as dishonest and overpriced.
Why the disconnect? Communication, or rather, the lack thereof. Cox data shows that 45% of vehicle owners reported dissatisfaction with their dealership service experience, with unexpected repair costs and poor communication as the top complaints. In essence, drivers find it frustrating when they drop off their cars expecting a service to be at a particular price, only to receive calls about additional work that’ll run them much more than they expected, with vague explanations and pressure to approve everything immediately.
“These findings 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.
What customers want and what dealers can do.
The study revealed that modern consumers aren’t necessarily opposed to dealership service; they just want it to be done differently and in a convenient manner that won’t put a significant dent in their wallets. Cox data shows that 55% of car owners think that it’s very important to compare costs online before committing to a particular service. They want transparent pricing, easy scheduling, and flexible options like after-hours drop-off, pickup, and delivery service, and rideshare integration while their vehicle is being serviced.
In other words, customers want the convenience and transparency they’ve come to expect from nearly every other service industry in 2025. Independent shops and chain services have adapted to these expectations. Many dealerships have not. With service and parts now representing 13.2% of total dealership revenue, up from 12.4% in 2023, and often making up for shrinking margins on vehicle sales, the service department has become too important to neglect.
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Final thoughts
It is up to dealerships to modernize and make their service operations friendly and transparent to avoid customers from running to their competitors. Currently, overpriced perceptions, communication breakdowns, and outdated customer experiences are leading customers to vote with their wallets and take action.
However, some brands are taking action. Earlier this month, Ford unveiled Ford Signature 2.0, a new retail concept designed to enhance the dealership experience, including the service department, to be more friendly and welcoming. With this rollout, it is promoting some new services to make servicing more convenient, including Ford Pickup & Delivery, where the dealership will pick up the vehicle, take it to the dealer, and return it once work is complete, while Ford Mobile Service dispatches certified technicians to perform routine services at a customer’s preferred location.
Customer experience extends beyond the sale, as servicing difficulties can be an ownership nightmare in itself. Ford boasts that, through the third quarter of 2025, it offered 3.8 million remote experiences worldwide, including Pickup & Delivery and Mobile Service.
