loaner cars - featured image

Here’s Why Your Auto Dealership Needs to Offer Loaner Cars

Featured image by Mikbiz

When your customers need alternative transportation while their cars are in your service department, you should come to the rescue by offering loaner cars.


If you own or run an auto dealership, here’s a question for you: How do your customers get around while their cars are in your service department for repairs? An oil change or other quick service is one thing. But what happens when a customer’s car needs more extensive repairs? Or you need to order parts that aren’t in stock?

If your answer is, “I don’t know,” or “It’s not my problem,” then you’re missing an opportunity to build customer loyalty. You could be expanding your customer base through glowing online reviews and great word-of-mouth advertising by offering loaner cars.

When one of your customers needs alternative transportation while their car is in your service department, you should come to the rescue by offering a loaner car. Offering loaners can create more satisfied customers and strengthen customer loyalty. Also, it can lead to more profitability for your dealership.

Customers Need Loaner Cars

It probably doesn’t come as a surprise to you that customers put off getting their cars serviced, especially when they think the repairs will be expensive. However, it’s not just a budgeting concern. People need their cars to get to work and school. They also need to run errands and generally get to the places they need to go during their day-to-day lives.

The inconvenience of giving up a car voluntarily for service can lead people to put off car repairs.

But when you offer loaner cars to customers who are having their cars serviced at your dealership, you’re meeting their needs. Many will be pleasantly surprised.

Unless you sell high-end cars, many of your customers may not be expecting the offer of a loaner. So they may be happy about a loaner when their car needs to be in the shop for several hours. But they will be especially appreciative when their car needs repairs that will take a few days or longer.

Word will get around that your service department offers loaner cars to those who need them. Then you’ll find that customers no longer procrastinate about their automobile service.

You might even find that you get more customers coming to your dealership to buy cars. That’s because customers will want to come to your dealership when they hear you offer your customers loaners when their cars need repairs.

You Can—and Should—Sell the Loaner Cars

Some dealers balk at the idea of having a fleet of loaner cars on hand. This is understandable, because they’re worried they won’t be able to sell those cars. They think they will have to keep dumping money into a fleet of cars while not even being able to charge customers for their use.

And it’s true that if that were the case, maintaining a dealership loaner fleet might be too expensive to be worthwhile. If a car on your lot is losing you money, you don’t want a bunch of loaner cars sitting around for months or years.

Fortunately, you can still sell loaner cars with dealership incentives. However, they must remain below mileage requirements as set by the manufacturer or local legislation. Usually, the limit is 2,000 to 5,000 miles and 90 days of use.

You can’t sell these cars as new in many places. And you may have to offer a discount off the sticker price in recognition that these cars have previously seen some use.

However, many people would be happy to buy a loaner car. Usually, these cars have seen only light use. Plus, they represent the best of both worlds to many buyers. These people understand they’re buying a practically new car at a used-car price.

By adhering strictly to mileage and age requirements for selling loaner cars, you can maximize fleet turnover and keep your loaner fleet profitable.

Loaner Fleet Management Tools Can Help Reduce or Eliminate Almost All Risks

Offering loaner cars can foster goodwill and strengthen customer relationships. It can even bring you a lot of new business. But it’s not without its risks.

Customers might damage loaner cars, exceed the mileage limit, get traffic tickets, or have unpaid tolls. Some might even go AWOL with a car, requiring you to track them down to get it back. But strong dealership loaner fleet management can help you reduce or eliminate all of these risks.

For example, with GPS fleet tracking, you’ll always know where your cars are. Then if you need to track one down, it will be easy. Tracking where each vehicle goes can also help you hold customers accountable for damage to loaner cars.

You’ll be able to set speed alerts or toll alerts, too. These can help you recoup those costs from customers. You can also receive automatic fuel level alerts when customers return cars, so you can hold customers accountable for those costs, as well. With these aids, you can do away with embarrassing car walk-arounds in front of your customer.

Of course, you should make sure customers understand before they take the car that the dealership will hold them responsible for any damage to it. Also, you should make sure they know they’ll be held accountable for tolls, tickets, gas to refill a car if it isn’t brought back full, fines for exceeding mileage limits, and so forth. Customers will be happier with your loaner service if you spell out their obligations upfront.


Bringing a car in for service can be stressful for customers. They may have to scramble to meet their transportation needs, especially if your service department keeps their car overnight. Offering loaner cars is a solution that can work for your customers by meeting their transportation needs. Moreover, it can work for your dealership as well, by building your reputation and securing customer loyalty.