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How to Benefit from the Growing Mobile Service Market

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In February 2016, when Ratchet+Wrench spoke with Tesla spokesperson Alexis Georgeson, she noted how, as part of the company’s growth strategy, it planned on offering Tesla car owners unparalleled service.

“We take care of our owners unlike any other automaker with 24-hour service, free pickup and delivery, and free loaners leading to a service experience satisfaction rated consistently above 95 [percent],” Georgeson says.

And a huge part of ensuring that “24-hour service” was Tesla Rangers, which has since been renamed, simply, Tesla Mobile Service. After the automaker rolled out its long awaited Model 3, Tesla made it clear mobile service will be a huge part of its pitch to drivers, as the company announced it was adding 350 mobile units and 1,400 technicians in July.

Mobile service isn’t just some phase, said Ed Petersen—it’s the future. And soon it will be less of a trend and more of an obligatory service drivers expect.

“I think it’s going to be the only way people do it,” said Petersen, who founded the mobile repair service Wrench. “I don’t know why you would do it any other way.”

But Petersen isn’t looking to put brick-and-mortar repair shops out of business—he’s looking to partner. He envisions a future where mobile service companies and physical shops partner, funneling more light repairs through mobile units and high-dollar work through shops.

Here is what you need to know about the rising mobile repair market, why Tesla is embracing it, and how your shop could possibly profit from a partnership.

 

The Market

While some brick-and-mortar shops have employed their own mobile service units in the past, it is now gaining steam as its own market as Tesla doubles down, Petersen said.

Tesla claims it has taken 325,000 Model 3 reservations, which represents potential sales of over $14 billion. Thus, the automaker plans to triple its global service capacity. In addition to adding 100 retail, delivery and service locations by the end of 2017, Tesla decided to up its mobile service van increase from 100 to 350 between May and July to keep up with that demand.

There are plenty of companies looking to challenge Tesla, however, including Wrench, which was incorporated in November 2015 and in March 2017 raised $4 million in Series A funding through the Madrona Venture Group for its app.

While Wrench continues to add mobile technicians in Seattle, Portland, San Diego and Phoenix, Otobots is expanding significantly and is currently available in Chicago, Houston, Dallas and Austin, Texas.

Other startups have cropped up to offer auto repairs in your own driveway, including YourMechanic and Fiix.

 

The Appeal to Consumers

Petersen doesn’t consider himself a “car person.”

“We’re car consumers. We drive cars. We get them fixed a lot,” he says of his Wrench team. “So, this company was started out of that consumer-centric perspective. How would we build a solution to the hassle of car ownership that comes at it from a consumer perspective? That was the beginning stage of it.”

So, with no experience in automotive repair shops, Petersen’s viewpoint is entirely driver-focused. With Wrench, he hopes to sidestep the stereotypically stressful repair transactions experienced in shops. He notes a AAA survey, where two out of three people claimed to not trust auto repair shops and more than half claimed to have negative past experiences.

The Wrench app allows drivers to book car repairs at home or at work, and will soon offer a subscription for regular upkeep, said Petersen. The company provides a 12-month, 12,000 miles warranty on all work performed by its technicians.

Petersen said he and his Wrench team studied cities across the nation for optimum markets, which often involved cities where dealers struggle to remain near population bases. While drivers experience a day of back-and-forth communication and loaner cars with repair shops, Petersen’s technicians offers a one-time meeting that doesn’t require anything more than meeting with the technician.

 

The Partnership

And while Petersen is clear on the advantages Wrench offers consumers, he’s also aware of his technicians’ major shortcoming.

“There are certain things we can’t do in the field,” he said. “If we can’t do it, we have partnerships with shops.”

Wrench concentrates on light repair work that produces a low ARO and has a quick turnaround. While its mobile technicians will perform diagnostic work, their days largely consist of oil changes, tune ups, brake jobs and no-starts. But for certain jobs, like transmission work or rim repairs, Wrench must refer work to independent repair shops or dealerships it partners with in the area.

This, inevitably, becomes Petersen’s pitch to automotive repair shops: Instead of competing with mobile repair services, take advantage of those companies’ appeal to consumers and replace low-dollar work with high-dollar jobs as a result.

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