Diagnosing the Future with LucasVarity

by Brian Taylor

The increasing use of electronics – both on-the-car and in the workshop - is changing the aftermarket and the way in which garages can respond to the challenge. Having discussed these issues with Lucas Aftermarket Operations (LAO), a division of Lucas Varity plc, what becomes clear, is that this trend is not happening in isolation. There are in fact four factors that are influencing change, and it’s worth looking at their inter-relationship.

Consumer Demands

The first is consumer demands. In truth, the consumer really wants a car that can be driven fast while maximising fuel economy and minimising pollution; one which offers total protection in the event of an accident and never breaks down. So driven by the needs of an increasingly discerning car owner, vehicle assemblers are competing to produce cars that offer lower emissions combined with greater fuel economy, better performance, more safety features and greater reliability. But consumers also want their service provider to offer ever-higher levels of service at ever-lower prices. Hence the provision of loan cars, attractive waiting areas and so forth which drive costs up while the relative price charged for servicing is at best static, and probably falling.

Legislation

The second factor driving change in the aftermarket is legislation. The environmental damage caused by vehicle emissions produced a flurry of legislation in the late 1980's as governments introduced ever tightening limits on the emissions which vehicles produce. European legislation is turning the screw further. In response to these stringent emissions controls, the vehicle manufacturers turned to electronics for a solution.

Electronics can optimise performance and reduce emissions - in effect they manage the engine so that the vehicle meets legal requirements and responds to the demands of consumers at the same time. This applies to both petrol and diesel engines, and increasingly sophisticated management systems have now become common features on all engines. Legislative influences have moved on in the last few years, and the requirement for vehicles to have on-board diagnostic capability will introduce yet more electronics content in the future.

But while electronics have helped vehicle manufacturers meet legal requirements, there has been parallel development to fulfil other functions. The result has been a rapid increase in the value of electronics in each car that is built. And this is expected to continue to rise over the coming years.

Electronic System Value on New Cars

Source; Lucas Aftermarket Operations

Technology Trends

And technology trends, the third driver of change, are set to become a very important factor for the aftermarket. At first electronics replaced only a small number of conventional mechanical operations, and each of the processes was discrete.

But over time, the reliability and flexibility of electronics has led to an explosion in electronic vehicle systems. The result is that stand alone electronically controlled operations like ignition and fuel injection which are shown on the left of the next diagram have developed into parts of an inclusive engine management system. We're now rapidly moving to the point shown in the middle of the diagram where electronic items combine to form systems. At the same time new products such as electronically assisted steering, which is lighter and cheaper to install than conventional power steering, and intelligent cruise control, which automatically maintains a set distance between vehicles, are now a reality.

Source; Lucas Aftermarket Operations

LAO research projects includes cars which operate with 'brake by wire' systems. That is brake systems that have no hydraulic element at all and are completely activated by electronics. Ultimately vehicles will run with fully integrated systems as shown on the right of the diagram, which combine and control many features together.

Product Quality

The final driver of change is product quality. The consumer demand for more reliable vehicles has caused vehicle manufacturers to seek more reliable components. Electronics has again helped, since electronic components tend to be more reliable than mechanical ones – less moving parts. However, even with more conventional components such as rotating electrics, improved product quality has caused market volume to fall significantly in the past few years.

Rotating Electrics Failure Rate

Source; GIPA

Although still a major factor in warranty claims on older cars in particular, the percentage of starters and alternators failing has dropped from 17% per annum in 1983 to around 8% per annum today and it is expected to fall still further by the year 2001. The result is clear - a smaller market in volume terms means less work for garages, since fewer failed units have to be repaired or replaced.

Effects of Changing Electronics on the Aftermarket

So as the level of business available to garages has fallen because of more reliable components, the consumer has demanded a better service that costs money to provide. But that consumer is only prepared to pay a relatively low price for the increased service. At the same time new cars contain an ever increasing proportion of electronics which the traditional garage cannot service. The effect is to make it more difficult for garages to stay in business and to increase the intensity of competition to win the service business that remains. Independent garages in particular are in danger - if they cannot meet the challenges of the changing market they will go out of business.

Lucas Autotech Centres

The programmes that have been developed at LAO are designed to help garages meet the challenge of the future. Although the need to be able to service electronics is a key factor for achieving success in the future it is not, the only factor. These programmes ensure that garages are equipped with the tools and know-how to deal with electronics, but they are more than that - they are complete packages intended to make garages more competitive in the round.

First there is the Lucas Autotech Centre. This concept is designed to provide an independent garage with the ability to compete effectively in the marketplace. Every Autotech Centre is part of a network of specialists, trained and equipped to meet the challenge of modern vehicle technology. Each is capable of dealing first hand with engine management and fuel injection problems for both retail and trade customers. The rate of change in vehicle technology is so rapid that many garages have been left without the equipment to diagnose faults on Electronic Systems. So this package is designed to give the garage the tools to do the job. All Lucas Autotech Centres are equipped with the company’s own Laser 2000 computerised hand held tester for fault finding on electronic vehicle systems. In addition an Autotech Centre has to have an engine analyser, an oscilloscope and four-gas tester.

Once equipped the garage staff needs to be trained. Neil Fryer, Lucas Aftermarket Operations General Manager Sales and Distribution, Europe says,

"For some, electronics is a completely new field that brings a whole new set of challenges. To help meet these challenges LucasVarity offers a complete range of training courses at its international training centre. These courses can take a technician from basic electrics to advanced diagnostics. Training lasts for between 1 and 10 days depending on the experience of the technician. And the emphasis of the courses is hands on, so trainees are encouraged to spend as much time in the workshop as possible".

Once equipped and trained an Autotech Centre needs ready access to technical information and support. Interpreting the data generated by test equipment is part of the expertise needed to be an Electronics specialist and the technical information LAO supplies plays an important part in helping to understand the data as well as providing a starting point for fault finding.

They offer an electronic data book as a principal source for information. The data book is provided on disc for use with a PC and gives access to a wide range of detailed information that is updated regularly. They also have a telephone help line staffed by experienced engineers to help where there is a particular problem or a 2nd opinion is required. In addition they run a scheme to circulate useful suggestions for fault finding sent in by other Autotech Centres to the whole network.

One of the benefits of the concept for the independent garage owner is that he or she can gain identity as part of a national network, without losing independence. So access to a network identity is part of the package.

Auto Intouch

However, to be truly successful and secure its future, the Autotech Centre needs to take a further step. How to develop new business is one of the greatest challenges facing any garage. What is the best way to do this? Unfortunately, there are no easy answers. What LAO does is to help the garage make people aware of what it is that makes that particular garage different from its competitors, by promoting its abilities as an Autotech Centre. This can involve mailshots, local advertising, and use of directories or trade evening. All of these are designed to project the Autotech centre as the specialist in its local area, which can deal with the challenge of servicing Electronics. This activity can be enhanced by the computerised garage management system that LAO recommends to its Autotech Centres.

The system is called Auto Intouch and is a most complete computer garage management system. It is capable of producing, estimates, job cards, and invoices, and of sending MOT and servicing reminders to customers. It provides automatic VT12 updates and it takes care of the bookkeeping including VAT. Auto Intouch allows the garage owner to make significant improvements in the efficiency of his business, and increase his control over it, as well as helping to capitalise on opportunities to grow business. For example, it offers the opportunity to develop a database of customer information, and then to contact those customers regularly by mail shot.

Store Within a Store Approach

Jackson & Phillips in Leighton Buzzard was established as an independent garage in 1971. The two partners – Dave Jackson and Ron Phillips – were both very experienced automotive mechanics at the time. One of the keys to the company’s success over the years has been the constant re-investment in new technology and the necessary staff training to ensure they could capitalise on the full capabilities of the new equipment.

The company has always leaned towards diagnostics and recognised the value of a well-known national name to badge this increasingly important specialism. So in 1993, with a view to strengthening their position in the local market place, they decided to apply for appointment as a Lucas Electro Injection Centre. This they achieved and the relationship has progressed to Jackson & Phillips now being part of the Lucas Autotech Centre network – the programme that recently replaced the Electro Injection Centre concept.

But Jackson & Phillips is not just about diagnostics and electronics. It is very much a one-stop-garage, offering mechanical repairs, servicing, fast-fit, etc. And unlike many independents, they have not only recognised the need for their suppliers to provide an ever broadening range of business support activities – they also recognise the value of marketing their offers using national brands to signify their approved specialism in each area. Primarily the business is a Lucas Autotech Centre, but they are also part of the Unipart Car Care Centre network and a Bosch Motorplus Centre. They plan to join the Lucas Brakecheck network shortly and expand their diesel product capabilities as well.

95% of their customer base is accounted for by retail customers – with a high proportion of new customers routed to them via personal recommendations. This has to be a reflection of a good reputation and the quality of staff is an important part of providing that competitive edge. Dave Jackson says,

"All our mechanics go through the basic Lucas and Bosch training courses, but two specialists go through the highest level of training available from both sources. The quality of our staff is crucial to delivering a quality product and we invest in our own 5 year apprenticeship to provide a stream of people we know will fit the bill".

In a way, Jackson & Phillips are a good example of a store within a store approach to selling service and repair. Under the Jackson & Phillips umbrella name they provide their specialisms via well known national brands linked to each specialism. Lucas and Bosch for diagnostics and electronics – Unipart Car Care Centres for mechanical work and fast-fit. The design and layout of the site may not be ideal, but this sort of programme approach has to represent the most viable route to the future for independents.

There is clearly a limit to the number of programmes that can be incorporated –depending on the size of the business in turnover and acreage. But in consumer terms, a large site that offers a range of new cars, used cars, all-makes mechanical service and repair, diagnostic & electronics, accessories, MOT, fast-fit, windscreen replacement; has to be the ideal. If they are all under national network brands, with mobile support as necessary, even better. And if they all operate as separate businesses but linked for customer base handling, then we are really getting close to something that can satisfy customers across a broad range of motoring needs. This is something that dealer groups are looking at as well as forward thinking independents. And although they might not like to admit it at the moment, you can be assured that several vehicle assemblers would also find it interesting.

A Developing Concept

To summarise, LAO has put together a package of diagnostic equipment, training, signage, technical support, business development and the computerised garage management system - Auto Intouch. To date, the focus has been on addressing the issues around servicing electronic ignition, fuel injection and engine management systems. However it will not be enough for garages to reach this level and then relax. The aftermarket will continue to change and garages will want to keep up with it. LAO has already developed material and test equipment to deal with ABS, and in the future they will extend the Autotech concept in line with the developing technology.

Lucas Diesel Diagnostic Centres

In reality, the Autotech package is specifically designed to address the issues around servicing petrol injection. But LucasVarity is a significant supplier of diesel fuel injection systems to the vehicle assemblers, and electronics are playing an increasing part in the management of these injection systems. LAO has a network of specialist diesel distributors throughout the world designed to provide back up to its original equipment customers, and able to deal with any problems which may arise in the field.

Increasingly sophisticated electronics are now being used to manage diesel engines so that they meet emissions control limits. The pumps themselves remain essentially mechanical, and therefore the skills required to carry out mechanical repairs need to be maintained. But generally speaking, the number of purely mechanical systems being fitted as o.e. is declining fast and this will effect aftermarket service providers over the next few years. The LAO network of diesel distributors therefore needs to add new skills so that it is able to diagnose the faults in electronically controlled diesel systems. If it is survive and prosper in the future, this combination of skills is vital. LAO has given a great deal of thought to the way in which they can equip their diesel service network right the way across the world to face up to this change. The result has been the creation of the Diesel Diagnostic Centre concept.

Neil Fryer highlights an important point,

"In the past, diesel distributors very often only worked with Test Benches in a quasi laboratory atmosphere, and had no workshop facilities to handle vehicles. With the Diesel Diagnostic Centre this is changing. We are encouraging our distributors to develop their premises to include vehicle bays so that they can take cars into their premises and work on them rather than simply remove the pump and work on it on a test bench. This is vital because the introduction of electronics has created integrated diesel systems and faults in these systems can often only be diagnosed while the pump is on the car".

As with petrol injection, one of the key areas is workshop equipment and Lucas Aftermarket Operations has developed diesel test benches capable of servicing the new electronic pumps. Diagnostic equipment is based on the Laser 2000 hand held computer that can pinpoint faults in electronic systems. With this equipment, faults in the fuelling system of the diesel vehicle can be diagnosed rapidly so that the distributor can undertake the necessary repairs.

Once again LAO does not under estimate the value of training, and continually runs training courses to keep diesel technicians up to date with the latest developments in original equipment. And technical information is vital to the Diesel Diagnostic Centre. LAO provides constant updates as its diesel fuelling systems develop - both in hard copy and CD ROM form.

The aim is for the LAO diesel network to become the natural reference point for diesel fuel injection problems. In particular, they seek to ensure that vehicle assembler dealers and other garages refer diesel fuelling problems to the network. An aggressive programme of marketing has been underway for some time in order to create awareness of the network. Coupled with this they offer the same type of business development support as they do to Autotech Centres.

Significant investments in workshop equipment are required if distributors are to keep up with the development in diesel technology. Like any businessman the Lucas diesel distributor wants to make a good return on his investment, and Lucas Varity believes it falls to them as the key product manufacturer to provide business development support to enable the distributor to do that - the same philosophy which underpins their commitment to the Autotech concept.

Electronics Diagnosis and Fix – an Opportunity Rather Than a Threat

Some see the increasing use of electronics in vehicles as the death knell of the independent aftermarket, because independents won't be able to afford the investment in equipment required to be able to service cars in the future, and because the vehicle manufacturers will restrict access to technical information. LAO don't see it like that - they see a big opportunity and its concepts are designed to help independents capitalise on it.

An interesting example of the value of the network in practice concerns a main dealer sending a car of its own marque to an Autotech Centre for work on the engine management system because the dealership didn't have the workshop skills to do the work. When the Autotech Centre phoned to ask for some technical information the dealer referred them direct to the manufacturer's helpline, which refused to give the information as you would expect. But LAO was able to provide the necessary information through its own helpline, and the Autotech Centre completed the job. It shows that good independent specialists can match or exceed vehicle assembler franchised dealers in terms of skills and expertise. (7/99)