Tire Business
By
William Schertz

Automotive service businesses that aren’t taking advantage of the growing hybrid vehicle market may want to get a jump start on entering that arena — before they get tossed in unprepared.

Mark Quarto, chief technical officer of AR&D, a Port Angeles-based firm specializing in the development of electric vehicle (EV) and hybrid electric vehicle (HEV) propulsion systems, said dealers who are turning away owners of hybrid vehicles are not only losing business, but they’re doing so in order to stave off an inevitability.

“This is sneaking up on the technicians fairly quietly,” he told Tire Business. “Back in 2002, we only had two hybrid models—we had the Prius and the (Honda) Insight. Today you’ve got over 80 hybrid models. If you look at hybrid, plug-in and electric there’s over 100 different models out there today.”

According to a study released last June by the Environment America Research & Policy Center, more than 220,000 already are in use throughout the U.S. Despite flat hybrid vehicle sales in 2014, combined sales of EV and HEV vehicles have remained on an upward trend.

During his comments at the 15th CAR Symposium last month in Bochum, Germany, Volkmar Denner, chairman of the board of management for Robert Bosch GmbH, said the company expects that about 15 percent of all new vehicles built worldwide will feature at least a hybrid powertrain by 2025.

As car makers work to comply with higher Corporate Average Fuel Economy (CAFE) standards in the U.S. and strict CO2 emission targets set by the European Union, they will continue to build vehicles with these technologies “whether techs want to service them or not,” Mr. Quarto said.

“Eventually (technicians) won’t be able to turn away the business or ignore it anymore because it’s going to be a fairly significant part of their business,” he said. “Even today in some areas, if you go to major metro areas, there’re hybrid cars everywhere.”

In addition to lower gas consumption, one of the major selling points of hybrid vehicles has always been lower maintenance costs. Specifically, brake pads are generally thought to last three times longer than those in a conventional vehicle because of the use of regenerative braking technology, an energy recovery feature that slows down the vehicle electronically.

Though pressing the pedal feels like it would during normal braking, the friction brakes are used less frequently, which Mr. Quarto said translates to reduced brake wear.

Hybrid vehicles, he said, also don’t come equipped with alternators.

“The alternator is replaced by the DC-DC converter, which supplies all of the electrical energy for the 12-volt systems on the vehicle,” he said, adding that most of the vehicles also don’t have a 12-volt cranking motor like that found on a conventional car.

These differences make HEV maintenance less appealing to some dealers, but these vehicles come with their own range of special requirements and potential maintenance concerns, Mr. Quarto said.

One of the biggest expenses for hybrid owners is replacing the battery pack, which can cost upwards of $4,000.

“When you get out of warranty is when the hybrids can become more expensive because of the battery pack,” Mr. Quarto said. “To a second owner or a first owner that keeps their car for a long period, there can be some additional expenses.”

AR&D developed a hybrid battery reconditioning service that the company licenses to Gainsville, Va.-based The Hybrid Shop, a “fractional franchise” business that sublicenses the service to its dealers. Battery reconditioning is “probably our major hitter,” Mr. Quarto said, but there are other areas where technicians can make money.

Some hybrid vehicles have special filters that need to be cleaned or replaced, he said.

“As an example, the Ford Escape has a filter just for the battery pack itself, which is a maintenance item, according to Ford,” he said.

In addition, hybrid models tend to have multiple cooling systems in place, which need to be maintained.

“You have a cooling system for the engine, but you also have a cooling system for the power electronics,” Mr. Quarto said. “In some cases it’s the power electronics and the transmission that have their own separate cooling loop. In other words, it’s got its own pumps — they use electric pumps — and its own radiator.

“If you start getting into other vehicles that have liquid cooled battery packs, you also have a separate radiator for the battery pack and separate pumps for those,” he continued. “If you get into a car like the Chevrolet Volt and you look up front there are four heat exchangers up front on that car. There is a radiator for the engine, there’s a radiator for the power electronics, there’s a radiator for the battery pack and then there’s a condenser for the air conditioning.”

Other possible revenue streams include hybrid battery conditioning and rebuilding; motor-generator testing, diagnosis and replacement; power inverter and control system testing; and DC-DC converter testing, among other things.

“The aftermarket is missing a huge opportunity here to get into the market and let the hybrid owners who are out of warranty know that they can provide services to them,” he said.

According to Mr. Quarto, there are three levels of hybrid service.

“The first step with hybrids would be to offer the customer regular maintenance on it,” he said.

“This would be no different than doing a traditional vehicle, so there’d be no cash outlay at all for doing regular maintenance.”

The second level would be to implement a state-of-health check.

“That does get into using some specialized tools — not real expensive ones — but it does provide (dealers) a way to get into some additional services for the customer by checking the state of health of some of the high voltage systems and components,” he said.

Tools required for this would include a scan tool that is able to read all the hybrid information, an insulation tester and a mileometer.

By investing about $45,000 to $65,000, auto service businesses can get into “the real stuff,” which includes battery pack reconditioning, transmission repair and other “heavier stuff, where most of the dollars are.”

According to Mr. Quarto, the biggest hurdle for most shops is simply learning how the systems work.

“It’s not so much difficulty as that it is different,” he said. “If you take a look at the hybrid vehicle, and you take a look at the high voltage system in particular, this is something that traditional technicians have never seen before. It’s not that it’s difficult — it’s more that they have no experience with it.”

The problem is twofold.

“One, there is no legacy knowledge that you can pull forward to work on the vehicle…. As the traditional vehicle iterated through its life, technicians kept up with that technology,” he said. “When you introduce hybrid technology, there’s nothing in their legacy knowledge they can pull forward for serving the hybrid vehicle.”

The second issue is a lack of “technology transfer,” Mr. Quarto said.

“There’s nothing on a traditional vehicle that is there currently that can be ported over to a hybrid vehicle on the high-voltage powertrain side,” he said. “None of their knowledge really transfers over. They’re learning automotive 101 all over again when they start learning hybrid systems…. There’s a huge chasm here between what they know and what they need to know to work on the cars.”

But the chasm is correctable through proper training, he said.

AR&D itself operates a state-of-the-art dedicated hybrid training center, located in Fitchburg, Wis. The training schedule at the facility features a variety of course offerings, including a test preparation course for the ASE L3 Certification (light duty HEV specialist) and SAE International Certificate of Competency: Advanced HEV Diagnostics—the first and only recognized industry HEV credential requiring four days of hands-on training with both practical and written proctored final exams on day five, according to AR&D.