Warranty insurance and customer loyalty
This enables dealers and workshops to stay in contact with their customers in the long term
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The current market situation in the automotive trade is challenging, but it also offers opportunities. Johannes Höfflin, Sales Manager Germany at the warranty insurance company Real Garant, explains how dealers can build their companies to be future-proof in terms of customer loyalty.
(Image: Real Garant | Envato Elements article Z86M5UF9BS)
1. What challenges do you currently observe in the automotive trade?
Johannes Höfflin: Retail is facing a changed market situation to which it will probably react. In the area of e-mobility, the reduction in government subsidies for new cars, short development cycles for battery technology and an oversupply of used vehicles are leading to sales difficulties. We are also aware of uncertainty regarding the warranty periods for high-voltage batteries.
(Image: Real Garant Versicherung AG)
In addition, the discussion about the agency model is causing unrest in the market. This is because there is a lack of planning security for the future, while on the other hand standards are being raised or changed.
Finally, the shortage of skilled workers in the commercial sector is hitting dealers hard. With the current order situation, workshops are often not only at full capacity, but already overloaded. As electrification progresses, this situation will change in the long term. It is important to keep an eye on this today and to make appropriate provisions.
2. How can retailers meet these challenges?
Johannes Höfflin: Our aim is to offer future-proof solutions for the automotive trade.
For example, dealers can already make provisions for future workshop utilization today. We know from the latest DAT report that 34 percent of consumers assume that electromobility will be associated with fewer workshop visits: maintenance intervals will be longer, and oil changes will no longer be necessary. Many dealers have taken note of this, but due to the current high workshop utilization, they are not yet aware of it. This is where future-oriented measures to secure workshop utilization and customer loyalty come into play, such as those offered by Real Garant.
We help dealers bring their customers back to their dealership again and again – for a vehicle check, to extend an existing warranty, for maintenance work. That's why we offer long-term warranties and warranty extensions that can be easily taken out digitally and paid for in affordable monthly installments.
(Image: Real Garant | Envato Elements article K7A4JGX8U9) 
3. Digitalization and customer loyalty are big issues in the car trade. How can we as warranty insurers support this?
Johannes Höfflin: Real Garant relies on so-called multi-channel solutions that help car dealerships to address and retain their customers across all sales channels. Multi-channel solutions mean that our warranties can be extended directly in the dealership or digitally via our app; basic warranties can also be upgraded in both ways. Whether at the point of sale, at home on the couch or in after-sales – we reach customers at all touchpoints.
One of the most important levers in terms of customer loyalty is to ensure that customers return to the dealership. As part of our “mobi first” mobility guarantee, we bring customers within a 100-kilometer radius back to the dealership and, among other things, ensure regular returns to the dealership through our maintenance packages. Dealers can make attractive offers to their customers by offering Real Garant products at favorable conditions and giving them the opportunity to upgrade them according to their individual needs.
4. Electric or burner? Where is the trend going and how can retailers prepare for the future?
Johannes Höfflin: Politically, the shift to electromobility is desired. However, uncertainty on the part of consumers, the loss of subsidies and political uncertainty are causing the current revival of the combustion engine. According to an ADAC study, 22 percent of consumers who want to purchase a private vehicle in the next three years want to opt for an electric vehicle; this means that their share is likely to remain stable at the previous year's level.
But the electric revolution will come, all experts agree. Real Garant is well positioned to offer products for both sectors, including used electric vehicles. We know the dynamics in the automotive industry and adapt to constant technological developments, especially in the area of electric vehicles. We are currently working on solutions aimed at electric vehicles of different ages. In doing so, we are taking into account the longer warranty periods of high-voltage batteries and will help to create trust among dealers and customers. We recommend that dealers prepare themselves for the future utilization of their workshops with a strong portfolio of customer loyalty products for combustion engines as well as for electric vehicles.
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