The Roll of OEM Scan Tools in Aftermarket Repair Shops C.A.S. of New England

? Who is C.A.S. ? Mission Statement To provide only the best quality scan tools, information and after sales support to the automotive aftermarket repair industry through an organized network of professional automotive consultants… C.A.S. of New England

? Who is C.A.S. ? Offices located in New England 16 years of learning & growing [“Pach Kaahs”] Direct Technical Sales Force Direct coverage of eastern half of USA Web presence : www.oemtools.com Scan Tools are our only focus Aftermarket / Specialty / OEM / HD / Laptop’s We Offer ‘Turn Key’ VAR Solutions Hardware - Software -Training - Support … C.A.S. of New England

? Who is C.A.S. ? Our Typical Customer? Aftermarket Repair Shop Fleet Garages Multi Store Chains New and Used Car Dealers Vocational Schools Currently support 4,200 shop locations representing an estimated 5,700 ‘active’ scan tools including 700-800 laptop based platforms… C.A.S. of New England

Topic Areas Scan Tool Linguistics What drives I/A towards OEM level tooling What drives them away from OEM tooling Future trends that one can expect to see Items and issues that can shift the future… C.A.S. of New England

Definitions of Scan Tools OEM Scan Tool: The current or past scan tool that is the exact same item as used in the franchised dealer service department OEM Level Scan Tool: Any tool that any aftermarket scan tool company wishes to term as such. Aftermarket Scan Tool: Any scan tool built for industry use that is not a recognized OEM scan tool. Coverage to include Dom / Asian / Euro. Specialty Scan Tool: A scan tool with a particular car line(s) focus. Euro only, Euro/Asian, VW/Audi only, Volvo only, etc. Typically if it does not attempt to cover the ‘Domestic Big 3’ it is not considered ‘general purpose’… C.A.S. of New England

What Drives Shops Towards OEM Tooling? Frustrations with Aftermarket Tooling What vehicles does it actually cover? What sub-systems are in the coverage Special Functions missing Data Errors Cost of updates w/out improvement in operation Some still are looking for the ‘Holy Grail’… C.A.S. of New England

What Drives Shops Towards OEM Tooling? Efficiencies Realized with OEM Tools 38% Tech Productivity Increase w/ OEM scanners (?) Topology Map of the car ECU’s! Who’s reporting? Who has codes? Pending Calibration files indicated and available! Key Coding / Security System access! Maybe 38% isn’t that hard to believe!… C.A.S. of New England

What Drives Shops Towards OEM Tooling? The Desire to Compete and Stay Current Costs associated with sending cars out 50/50 Parts - Labor mix $80/Hr Labor = $160/Hr lost revenue Poor experience at dealers / Closing dealers Prior experience with OEM Level Tools Past Dealership experience with an OEM Tool… C.A.S. of New England

What Drives Shops Away from OEM Tools? Initial Cost of Entry as a % of GPM NE Shops $300-850K Gross Revenue Confusion over what tool to buy DRB-III / StarScan / StarMobile / Wi-Tech Confusion on compatibility between tools One laptop for every tool? Who co-exists with who on the PC? C.A.S. of New England

What Drives Shops Away from OEM Tools? Lack of Comfort in the Windows/PC world Who sets it up? – How do I repair it? Fear of OEM tools obsolescence Ford IDS Noise?! – GM Tech-2 / MDI Cost of Maintaining Multiple OEM Tools Subscriptions must be paid or function stop ‘Time Bombs’… C.A.S. of New England

Individual Responses to ‘The OEM Situation’ Stay the Course (aka: Do nothing) Stick with Aftermarket Tools only Specialize in one/two/three car lines Honda/Acura – GM/Ford/Chrysler Contract OEM Level Services out ECU Reflash / Security Issues (keys) Buy as many tools as business will allow - Wife will allow -‘Tool Freaks’ found here… C.A.S. of New England

Industry Wide Trends that will Shape the Future Shop C.A.S. of New England

Industry Wide Trends That Will Shape the Future Shop A Single Location Aftermarket Shop ? 1st General Purpose Aftermarket Scanner 1st line of attack! Quick - Easy - Dependable 2nd Specialty Scanner This tool is there to fill the holes of 1st scanner 3rd OEM Scan Tool or tools 4th J-2534 device... C.A.S. of New England

Industry Wide Trends That Will Shape the Future Shop Meet the ‘Mobile Diagnostic Super Tech’ Multiple OEM tools on board his mobile truck Internet enabled (3G/4G) Lots of on-going experience w common problems Non-Compete situation with independent shop Allows a fix that includes some profit for the shop Transparent to the customer/vehicle owner!... C.A.S. of New England

Industry Wide Trends That Will Shape the Future Shop Increasing # of ‘Pods of Shops’ Small groups of independent shops Combined purchase of needed OEM tooling Tools/Laptop shared between shops ‘as-needed’ Designated central location as ‘home’ UPS / Parts House / Employees act as ‘mules’ Tool costs are shared… C.A.S. of New England

Industry Wide Trends That Will Shape the Future Shop ‘Hub and Spoke’ Arrangements Typically used by multi-store chains Multiple OEM scanners at central ‘hub’ location Other stores ‘Spokes’ send work to ‘Hub’ shop Advice is provided by ‘Hub’ on viability of repair Leverages chains ‘Top Techs’ skills Helps uncover internal issues… C.A.S. of New England

Industry Issues That Can Alter The Future C.A.S. of New England

Issues That Can Alter the Future Single Channel Source for OEM Tooling Trend is for OEM’s to direct all orders to 1 party Lack of competition produces poor results DRB-III’s months to obtain any due to ‘parts’ IDS’ Typically on back order every 60 days Subaru Tool – 12 weeks typical wait time Delivery deadlines routinely not met Providing dual channels for delivery would help… C.A.S. of New England

Issues That Can Alter the Future Method of providing service to aftermarket Web based solution for tools delivery is easy Web based solution for tool repair not so easy I think it’s broke? Send an e-mail and wait for response Receive an e-mail response with suggested C of A Send an e-mail with results of C of A Receive an e-mail with directions of next step Repeat above steps - OR - - Tool is shipping out for repair… C.A.S. of New England

Issues That Can Alter the Future Trend to shut down tools / penalize owners Ford’s IDS Subscription Policy $500 - $550/yr updates and cal files Expire and you eventually lose ability to re-flash (60-90) Renew after being out of subscription for months (8 months) Penalty fee of $500 for back filling past months Plus $500-550 renewal fee 180 days later and you have to renew again at $500-550 This situation drives I/A away from OEM tooling C.A.S. of New England

Issues That Can Alter the Future Telematics ‘On-Star’ or ‘Non Star’ Some feel this is a huge threat to Aftermarket Scan tool manufactures wonder if it will effect them Aftermarket shops fear being out maneuvered Access to OEM level Telematics may be a huge game changer depending on direction of OEM’s NASTF / ETI involvement may be critical… C.A.S. of New England

Issues That Can Alter the Future Cloned OEM hardware and software Continued issue for all parties OEM’s Aftermarket Shops Scan Tool Manufacturers Actions to limit/stop cloning will effect what the future of scan tool development looks like… C.A.S. of New England

Issues That Can Alter the Future J-2534 Type Device Developments Will this be the ‘Holy Grail’ ? Laptop / iPad / Tablet PC J-2534 device Common interface for multiple OEM’s Daily day pass for any car line Cloud Computing at it’s finest…!?! C.A.S. of New England

SUMMARY Technology changes will continue as we have all come to accept. The future in some cases is fairly clear, but in other areas still fuzzy and uncertain. What is certain is that the wants, needs and desires of the aftermarket repair shop owner have not really changed at all over the years. There is great opportunity for all who listen and respond to those customers wishes...! C.A.S. of New England

The Roll of OEM Scan Tools in Aftermarket Repair Shops ? Questions / Comments ? ____________________________________ Contact info johnj@oemtools.com C.A.S. of New England