Diehl Automotive Group, operating 21 auto stores in Pennsylvania and Ohio, is an example of how diversifying car dealerships’ services by offering collision repairs can result in substantial growth. In 2019, the Diehl Collision Center was founded in Pittsburgh with a building cost of approximately $2.5m. Offering high-profit margin services with little competition from other dealers, Diehl’s collision center has seen doubled-digit percentage increases in annual revenue, despite the pandemic disrupting the industry, and is always booked months ahead. The center’s success not only benefits Diehl in revenue streams and diversifying services but also provides advantages for salespeople by introducing the center’s customers to new-car sales via totaled car replacements.
Over the past three years, Diehl has acquired three suburban Pittsburgh auto-repair shops to complement the collision center, all generating profits and convenience for Diehl’s Pittsburgh-area dealerships’ customers. The collision center has also increased the sales of purchased parts from the dealerships, and its five-year guarantee on repairs and quality of work has attributed to their excellent reputation.
The center’s success can be partly attributed to Diehl’s ownership of the land where it’s located, offering a significant advantage considering real estate costs. Additionally, offering spacious facilities, dual certification for technicians to perform repairs on electric vehicles and fleet vans, and efficiency maximization all promote a competitive edge.
With the ongoing parts shortage leading to some vehicles spending months stranded at Diehl’s facilities and loaner vehicles hard to find, communication with their customers helps them manage their expectations. However, despite the worries of staffing the new center, with 16 new hires, Diehl experienced no hurdles due to the appeal of the new facilities, effective recruitment platforms, bonuses, and partnerships with local vocational and trade schools.
In conclusion, Diehl’s success can serve as a blueprint for other dealerships considering diversifying service offerings by entering the collision repair market. By leaning hard into such services and hiring qualified managers with extensive repair business knowledge, dealerships can reap the benefits of high-profit margin services and acquire a valuable marketing strategy for new vehicle sales.
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