AutoPoint Blog

Amazon Enters the Auto Repair Business… Sort Of

Posted by Manuel Soto Thursday, April 16, 2015

At the end of March, Amazon announced the launch of what they’re calling “Amazon Home Services.” This new service by Amazon enables customers to order services for their homes without the inconvenience of having to search for these service providers, obtain references and obtain pricing. Services range from television installation, painting contractors, electrical work and… you guessed it… auto mechanics. No, Amazon isn’t hiring a workforce of skilled employees waiting to come to your house. In essence, Amazon is simply the middleman in this new arena, facilitating transactions between participants in the program and the consumer. These services all have up-front pricing so the consumer knows exactly what the costs are. In addition, each service provider is reviewed by a previous customer.

I’ve written a lot about how convenience and transparency are important to today’s consumers. This has become increasingly evident in the proliferation and success of automobile pricing portals, as well as other consumer resources for vehicle purchasing. Now, it seems, consumers will have the ability to go on Amazon and order up an auto mechanic to come to their house and fix their vehicle. I would think it is difficult to price out the repair completely on Amazon -- a mechanic has to diagnose the vehicle, potentially buy parts, and ensure that they have the proper equipment to make the repair. Perhaps Amazon’s auto mechanic service will be limited to basic services such as an oil change, or changing a flat tire. Or perhaps the pricing will simply be based on an hourly labor rate.

Amazon has a lot of knowledge about consumer buying habits. They are well aware that customers want low prices and convenience. They’ve rolled out same day delivery service (in some markets), will do your grocery shopping for you, experimented with drone delivery -- they even recently released the Amazon “Dash” button. This small button actually sticks to a surface and allows you to order an item by simply pushing a button. Need some more laundry soap? Push the Dash button attached to your washing machine and Amazon will send you some right away. Seems as if the mere act of logging into Amazon and ordering the laundry soap is even becoming too inconvenient for some people.

Consumers have been price shopping automotive service for a long time now. Up to this point, franchised dealerships have typically only had to complete with independents and other dealers. Don’t be surprised if, in the near future, a consumer whips out their smartphone, launches their Amazon app and attempts to negotiate based on a labor rate from a mechanic in your area. While the process, logistics and experience consumers will receive by ordering up a mechanic on Amazon have yet to be revealed, one thing is for certain – your customer loyalty, retention and experience are going to quickly dictate whether your dealership service bays stay full or become a ghost town.


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