Jim Roche, CEO of warranty processing platform WarrCloud, on the FixedOps Chops podcast saud warranty work on EVs will grow and provide opportunities for dealership service departments.
“Let me put it in a bigger context, where we’re looking at what’s happening in the industry going forward. And I say this with a smile — last week, about 17,000 dealers walked out the front door of the dealership, looked up and said, ‘Hey, it’s not raining money anymore.’ Of course, everybody looks to fixed operations; fixed ops is always the backstop, right? There are two primary revenue streams in fixed ops — customer pay and warranty. We’re in a rising interest rate [so] people pull back on expenditures; that has a [customer pay] effect. Warranty — my company, Warrcloud [is forecasting] — a 19 percent increase in warranty dollars between now and the end of 2025. Two things impact that. We’re going to start selling more new cars [so] we’re going to see millions more warranty-covered vehicles on the road. That’s the obvious reason. The not-obvious reason is, according to JD Power, we predict the average warranty costs on an electric vehicle are 300 percent higher — you heard us right, 300 percent higher — than an internal combustion engine. And there’s going to be 156 new EVs and hybrids introduced in the next three years.” — Jim Roche, CEO of warranty processing platform WarrCloud, on the “FixedOps Chops with Dave Boyle” podcast. The episode was recorded during the NADA Show in January and aired July 18.
