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Fixed ops gross profit is up 5.2% YoY: Now 52.8% of total dealership gross, up from just 1.4% growth in Q1.
During the 2008–09 downturn, gross fell 35% in new, 15% in used, and just 5% in fixed: Safe to say fixed is the department built to withstand trials and tribulations.
Fixed ops success is not reliant on reinvention: Across five different stores, tactics like tire retention programs, parts robots, and onboarding overhauls are driving lifts.
(Source: Presidio-NCM Q2 2026 Benchmark Report / CDG’s LinkedIn / Daily Dealer Live)
Fixed ops is finally getting its recognition as MVP of the industry.
If we’re starting with the stats, Q2 fixed-ops gross profit was up 5.2% vs. last year, now 52.8% of total dealership gross profit, according to Presidio-NCM's Q2 2026 benchmark report.
By comparison, that’s up from the first quarter’s 1.4% growth.
What this tells us: Dealers are finding plenty of success within their fixed ops departments, especially as new and used margins continue to bounce around.
What those stats don’t tell us, though, is that this has always been the case for some dealers. And the appreciation for fixed ops, and the opportunity in it, is overdue.
Take it from this guy: “Fixed Ops has always been the MVP,” Chris J. Ferguson, Sr., wrote in the comments of CDG’s LinkedIn post last week, which highlighted the fixed-ops growth data. “It just doesn’t get the applause when Variable is printing money.”
On a similar note, Tim Lazzara, Jr., CFO at Premier Automotive, wrote:
Also from Lazzara: “The biggest thing that opened my eyes was a discussion I had with an audit firm partner about the financial challenges from 2008 and 2009. They said the grosses went down as follows during that time period - new vehicles went down 35%, used vehicles went down 15%, and fixed went down 5%. I know which one I'd want to grow as large as possible in the future...”
NOTE TO DEALERS:
Fixed clearly provides stability, which means there's no excuse for not investing in simple, repeatable processes that hold up whether it's six months from now, a year out, or a market like '08–’09.
A quick word from our partner
How Upstart Became Tracy Honda's #1 Lender
Frank Esparza, GM at Tracy Honda, joined the Car Dealership Guy Podcast to explain why Upstart is now his top financing source, adding $1M in incremental revenue yearly.
His take: Upstart's AI underwriting looks at the full customer picture, not just credit score, pricing deals accurately across the spectrum.
Result: more approvals on creditworthy customers who don't fit a rigid box.
On the subject of fixed ops being the MVP, we’ve pulled five strategies/changes shared during segments of our Fixed Ops Friday episodes in recent weeks.
Here are each of those tactics, plus what went into them, and how they’re holding up.
Tactic 1: Define your own retention play before new-car margins do the deciding.
Danny Negalha, corporate fixed ops director at McGovern Automotive Group (40 rooftops), rolled out a group-wide "Buy Three, Get One Free" branded tire program after realizing declining new-car sales meant retention had to happen elsewhere.
How it works:
One program, every rooftop, "regardless of what make or brand.”
Customers get a 4th tire free after buying three, absorbed as a cost.
Pushed across the website and every customer touchpoint so buyers know they sell tires.
The result: "We've seen about 119% more customers... our revenue per RO went up about $8, $9... tire sales went up about 24% year over year,” Negalha said.
Tactic 2: Avoid letting 'frozen assets' hurt your operation.
Luis Malespin, parts director at Premier Hyundai, built a system to liquidate obsolete stock before it becomes dead money.
How it works:
Pulls an aging report, flags anything sitting 12+ or 24+ months, and puts it out to bid with parts brokers rather than writing it off at zero.
Uses Hyundai's 45-day return window, eating the 15% restocking fee rather than getting stuck holding the part forever.
Runs one full physical inventory count a year specifically to catch buildup early.
"Frozen assets is the worst thing that can hurt your operation... when I look at my inventory, I don't just see parts on the shelf, I see money,” Malespin said.
The result: Called his store "the cleanest it's ever been," while warning that unmanaged obsolescence can cost “thousands and thousands of dollars, even millions."
Tactic 3: Rebuild onboarding before advisor turnover erodes trust.
Chris Skinner, fixed ops director at Granbury Nissan, rebuilt advisor onboarding and added a dedicated sales-to-service handoff role to fix their declining RO count.
Changes made:
Retrained advisors on walkarounds and word tracks, using an outside AI tool (Tim Marvel's) that grades how advisors actually talk to customers.
Hired a person whose sole job is introducing new-car buyers to their service advisor at delivery by walking them through hours, warranty terms, and maintenance plans before they ever need service.
Backed it with a lifetime brake warranty ("pay once, never again") so a declined repair today still brings the customer back later.
"The service team is there to imprint on them... talk to them about the hours, how warranty works... what to expect," Skinner said.
The result: Customer pay RO count was up 19% year over year as of June.
Tactic 4: Automate the walk, not the wrench.
Damon Egan, service director at Sherwood Ford, added a parts-delivery robot from Reynolds and Reynolds that carries parts straight to the technician's bay, cutting the walk to and from the parts counter.
How it works:
Runs a night shift that pre-pulls parts for the next day's jobs, so the robot has everything staged before a car even hits the lift.
Replaced rushed phone-camera MPI videos with a dedicated videographer using proper mics and editing through MyKarma.
Hires for "on-base hitters," not stars, with 47 techs now, and none under 180 hours a month.
The result: "It saved us over 30 hours of time of guys walking back and forth to the parts department," Egan said, adding that on video MPIs, "we're sitting well over the $500 mark" in approvals and lift per view.
Tactic 5: Fix the process before recall dollars are left behind.
Jay Trivedi, dealer principal at Jay's Chevrolet GMC, found recalls were being left uncollected after taking over his first franchise store.
Changes made:
Confirms remedy parts are physically in stock before ever contacting the customer about the recall.
Assigns one in-house person to hold the part until it's confirmed, then schedules the service — no more calling customers in empty-handed.
The result: “The number one [issue] that I have seen, in my own experience, is leaving the money on the table, which is the easy money,” Trivedi said. “Lack of process… that adds up to $74, $80, $90, $100 grand that you can pick up by just investing in something. You don't have to reinvent the wheel; you just have to fix the process."
The best part about what we just covered, and I hear it constantly from operators, is that there’s nothing flashy required right now.
It’s just execution via scheduling, technician efficiency, advisor process, etc.
Aka the stuff that’s easy to do the same way forever, until you’re in need of change to stay profitable.
