Lyft proposes to auto dealers’ ally for service department transportation

Kipp Stienecker had a dilemma.

His service shop at Stevinson Imports, a Porsche and Jaguar dealership in Littleton, Colo., was drawing plenty of business from the store’s affluent clientele. But it had to turn some customers away for lack of loaner vehicles.

This meant the service center, a key profit hub, couldn’t reach its full potential.

Investing in more loaners wasn’t a cost-effective answer. Stienecker, the service manager, said the store’s loaner fleet already had 45 Porsches and Jaguars with a minimum list price of around $60,000. Getting more, and maintaining them, would further eat into profits.

Hiring more shuttle drivers, for $3,000 to $3,500 per month each, was equally unattractive.

So in late 2017, Stienecker turned to ride- hailing service Lyft as an alternative, allowing him to take on more service business without the cost of more loaners or shuttle drivers.

“So far, it’s a been a positive,” he said.

Lyft, like rival Uber, has been stamped by some as a disruptive threat to the auto industry, on the grounds that the popularity of ride-hailing services will reduce the need for personal vehicle ownership and cost automakers and dealers business.

But Lyft is turning to the dealer world with a different proposition: Let’s do business together.

Last month, Lyft set up shop at the National Automobile Dealers Association Show for the first time to make the case that its network of drivers can provide dealers a transportation option that’ll make their service departments more convenient for customers.

“What we’ve heard from dealers is that the shuttles lead to poor customer experience,” said Tom Leahy, a strategic account executive for Lyft Business, Lyft’s commercially focused unit, who was staffing the company’s NADA booth. “Nobody wants to wait 45 minutes.”

Plus, he said, “there’s high liability involved with the shuttle as well. It puts a strain on your service revenue.”

Stienecker attests to that.

“I would rather use Lyft than employ two or three [shuttle drivers] to do the same job,” he said. “From the risk, there’s so many things involved with having a shuttle driver on the road 10 hours a day. There’s accidents, expenses for the car, everything wears out.”