Should the growth of Thailand's After Sales services through Used cars dealership or independent

​In my earlier posts, I explained and highlighted the current shortage of repair and maintenance services. Total vehicle population has increased by more than 30% since 2011 but the service and repair support network has not kept pace, and this is putting a lot of strain on customer service personnel and PR staff. Of course, the technicians are also under tremendous pressure to deliver both in terms of the service quality as well as timeliness.

Automotive players in Thailand are keenly aware of this imbalance between demand and supply, and are actively taking measures to address this issue. The most significant stakeholder in this must be the OEMs themselves. They have to get the customer satisfaction part right in order to enhance their brands in this cut-throat market. In the car business, we know that the sales department sells the first car but it is the service department that sells the next.

OEMs face challenges in the effort to expand the after-sales network, some being external factors not within their control but nonetheless they have to overcome to be successful in their endeavors. Once of them is the shortage of qualified technicians, especially electricians. Thailand’s schools do not produce enough technical graduates that can quickly become productive automotive technicians. The percentage of students in technical courses are far less than those in the social sciences and business schools. Every year Thailand also produces a lot of lawyers but just not enough technician and engineers.

As cars become more complex, the industry needs technicians who can diagnose and repair a mal-functioning hill-assist, keyless start, or active cruise control, just to name a few examples. Every new model across all brands introduced comes with more sensors and electrical parts, so for older mechanics they have to be trained and retrained, and younger ones have to be equipped with the necessary skills in order to hit the ground running from day 1.

Some OEMs are also challenged by head office cost-cutting policies so they have to raise the dealer network technical capabilities while at the same time maneuvering round the lower budgets, all with very specific and tight deadlines. Imagine a combination of tight deadlines and tight budgets, not hard to see the amount of pressure here.

To get round the budget cuts, some OEMs work with third party service providers like TTi and MSXi so that these outsourcing do not appear in the headcounts. However, this adds to the layers of work as the OEMs now also have to manage the relationship with and the work of these third party service providers. Usually, OEM suppliers get included in some of the technical problem solving as the repair issues usually involve them.

I will talk more about the difficulties and challenges facing the OEMs when it comes to repair and maintenance service network expansion for the OEMs in a later post, and why I foresee independents as the fastest and most practical short term solution to fill the gap in the current mismatch between car repair and maintenance services demand and supply.