As gross profits from selling cars fall from pandemic-era highs, dealerships are pushing customers to return for every oil change in an effort to protect their bottom line.

The days of constrained supply and weak competition that produced unusually high dealership profits in the early 2020s are gone. As margins normalize, partly because vehicle supply is moving closer to demand and competition among car sellers is increasing, dealerships have had to lean on other parts of the business to support earnings.

For many dealers, that means service. Despite a reputation for expensive repairs and mixed value, some dealerships are investing more heavily in the customer experience to compete with independent chains such as Jiffy Lube, Meineke, and even Walmart . The stakes are significant: 42% of Americans identified one of those chains as their “primary service provider” in 2025, up from 20% in 2020, according to a report by consulting firm Ducker Carlisle .

Tim Pohanka, executive vice president and chief operating officer of Pohanka Nissan Hyundai, a dealership group in Fredericksburg, Va., told Fortune that the compressed margins in dealerships’ core car-selling business have made service “the biggest opportunity.”

The numbers support that view. While car sales margins have eased, dealerships’ combined service and parts sales rose 48% over the past five years and reached $164.6 billion last year, according to the National Automobile Dealers Association . In the trade, that line of business is known as “fixed operations,” and it has long carried higher gross margins than new-vehicle sales, one reason it is the natural place for dealers to turn when selling cars becomes less lucrative.

Dealerships can no longer depend on the strong margins and pricing power that came with the pandemic-era inventory shortage. Instead, they are trying to compete with independent service providers that offer oil changes, filter checks, tire rotations, and light repairs on flexible schedules. In many cases, those chains have become the preferred option for Americans seeking vehicle maintenance.

Pohanka said his dealerships also offer walk-in appointments and financing options for service work. For added transparency, every vehicle serviced at the dealerships receives a video update showing the full car.

Dealers say such efforts can increase the lifetime value of each customer, even years after the original purchase. That is becoming more important as Americans keep their vehicles longer, extending the period during which service can generate revenue. The average age of a passenger car on U.S. roads was 14.5 years last year, up from 11.5 years a decade earlier, according to the Bureau of Transportation Statistics .

Pohanka said recurring service revenue helps keep dealership operations steady even as the auto industry faces disruptions ranging from tariffs to supply chain issues. He also noted that customers who already use a dealership for service are more likely to return there when they need another car.

The shift toward service comes as pressure on dealership profits builds. Average pretax profit per public dealership more than tripled to $6.8 million in 2022 from $1.9 million in 2018, according to a study of publicly traded dealership groups by Kerrigan Advisers, cited by CNBC . But in 2025, average gross profits for dealerships owned by public companies fell to about $3.9 million.

That decline reflects a market that has continued to normalize after the severe supply shortages of the pandemic period. At the beginning of August, U.S. dealers had about 2.73 million new vehicles available, according to Cox Automotive, roughly unchanged from a year earlier. Cox said in a report earlier this month that the market may be moving toward a healthier balance between inventory and demand. That is a sharp contrast with the supply-constrained pandemic environment, when dealers could command unusually high prices because buyers had far fewer vehicles to choose from.

Cars, however, remain expensive. The average new-vehicle listing price was $49,249 at the end of July, while the average transaction price was $49,855, up 1.9% from a year earlier, according to Kelley Blue Book .

Pohanka said high prices make concerns about a decline in overall sales a priority. But they also make it harder for dealers to persuade customers to continue regular service at the dealership, given the longstanding perception that dealers are expensive. Dealers counter that any price difference is justified by factory-trained technicians, specialized equipment, and access to manufacturer data. They also hold one structural advantage: warranty and recall repairs, which automakers reimburse only when performed at franchised dealers, cannot be taken to an independent chain.

During the pandemic-era vehicle shortage, focusing on car sales alone was a strong strategy. Now, dealers are under more pressure to emphasize service and keep customers for the long term as they prepare for a potentially tougher future. The vehicles themselves are changing, too: electric cars, which have no engine oil to change and generally require less routine maintenance than gasoline models, account for a growing share of new-vehicle sales in the United States.

“If you’re not engaged in the service industry, and you’re relying only on sales, then you’re really setting yourself up for a potential problem if something goes wrong,” Pohanka said.

This story was originally featured on Fortune.com