Payment choice and flexibility are of critical importance for dealerships with an eye on long-term growth. This key finding is an overarching theme from a recent survey commissioned by PayJunction, that surveyed 500 U.S. consumers who own a vehicle, possess a credit card, and have visited a dealership within the past 12 months.
The strongest lesson from the data is not that consumers prefer one payment method over another. It's that consumers want options. Whether they choose a credit card, debit card, cash, check, or Buy Now, Pay Later solution depends on their circumstances, financial goals, and stage of life.
The Importance of Payment Flexibility: Consumers Continue to Value Credit Cards
Despite growing use of surcharge fees in the auto industry, consumers continue to see significant value in paying with credit cards.
When customers were asked to select which dealership purchases they would most likely place on a credit card (despite a surcharge of up to three percent) 73% selected routine maintenance and 67% selected repairs.
Even for discretionary purchases such as accessories (38%) and vehicle detailing (31%), a substantial share of customers said they were more likely to pay with a credit card.
73% of respondents selected routine maintenance as a dealership purchase they would be most likely to pay for by credit card despite an up to a 3% surcharge.
Especially noteworthy is that many survey respondents chose more than one dealer expense that they would consider paying for with a credit card, even when surcharged, suggesting that credit cards remain an important payment option across a range of dealership transactions.
Repairs also ranked among the dealership purchases respondents were most likely to opt for credit card payment despite an up to 3% surcharge (67%).
The reasons why were equally telling for dealers. Respondents most frequently cited rewards or cashback opportunities (60%) and having additional time to pay (53%) as reasons they would prefer to pay by credit card (even with an up to 3% surcharge).
Another 46% appreciated the ability to track spending more easily, and 43% cited purchase protection benefits.
Taken together, these findings suggest consumers are making intentional tradeoffs. Rather than focusing exclusively on the cost of a surcharge, many are weighing that cost against the benefits they receive through credit card usage. Credit cards remain an important part of that equation, but they are no longer the only way consumers achieve financial flexibility.
Dealer Takeaway: Customers most frequently associated credit card payments with rewards, payment flexibility, and purchase protection, suggesting dealerships should make credit card payments easy and transparent while offering customers clear payment choices.
What Surcharges Actually Influence: Payment Behavior Versus Dealership Loyalty
One of the more surprising findings in the study is that surcharge fees appear to influence payment behavior far more than dealership loyalty.
When asked whether a credit card surcharge would affect which dealership they choose to do business with, 71% of respondents strongly or somewhat agreed that a surcharge would have no impact on their dealership choice.
71% of consumers strongly (30%) or somewhat (41%) agreed that a surcharge would have no impact on their dealership choice.
At the same time, consumers clearly demonstrated a willingness to adjust payment methods to avoid fees.
Approximately half of respondents indicated they would choose cash, debit, or check for various dealership transactions if doing so allowed them to avoid a surcharge.
Routine maintenance (51%) and repairs (49%) ranked highest among the categories where consumers would consider switching payment methods. The implications here for dealers looking to protect the customer experience are important:
1) While consumers may change how they pay when credit card transactions are surcharged, they are less likely to change dealerships because of a surcharge policy.
2) For the 29% of customers who indicated that their choice in dealerships may be impacted by a surcharge, technology that offers those customers freedom of choice with clear options to avoid the surcharge can help to minimize the impact for dealers who surcharge.
This matches what we see from dealers who implement SmartSurcharge® with PayJunction’s customer-facing terminals that show both surcharge and surcharge-free options to the customer at checkout.
“I think it’s helped a lot because it’s right in front of them. They can see when the fee pops up… or if they change their mind and pay a different way, they can see there’s no fee attached.” (Stacy, Statewide Ford Controller)
Transparency and customer choice appear to play an important role. The key is ensuring consumers clearly understand their options and retain control over the decision. For dealers evaluating surcharge programs, the findings suggest that strategic conversations should focus less on customer attrition and more on customer experience.
“[With SmartSurcharge] we’ve had absolutely no kickback, no effect over CSI… absolutely nothing… They’ll come to us like, ‘Oh wow, we’re used to this already.’” (Shaun Strieb, GM Andean Chevrolet)
The real win is when dealerships can protect CSI scores while realizing meaningful savings on the cost of card acceptance. Indeed, Statewide Ford experienced this firsthand after implementing a compliant surcharge payment option as part of their overall dealership payments strategy, resulting in a 50% offset of its card processing fees with no reported customer impact.
Dealer Takeaway: Surcharging, when done the right way, can boost profits with minimal disruption to the customer experience. Dealerships should ensure that all surcharges are transparent to consumers with clear disclosures that highlight the freedom to choose between credit (with a surcharge) and other options that come without the fee.
Insight Recap for Strategic Dealers
These insights reveal an opportunity for dealerships to rethink payments as a strategic part of the customer experience. Rather than relying on a single payment method, dealerships can better meet customer preferences by offering more ways to pay. And when these ways to pay are automated and simplified for staff from front of house to back-office operations, the benefits compound. Service lane interactions are easier for staff and customers to understand. Accounting reconciliation is faster and more accurate.
Moreover, the perceived “pain” of integrating these new payment options into a dealership is minimal, especially when compared to the potential savings. For example, Andean Chevrolet integrated PayJunction’s SmartSurcharge (including staff training) in just two hours and realized approximately $36,000 in monthly credit card processing cost savings the following month.
As consumer expectations continue to evolve, providing greater freedom of payment choices may become an increasingly important driver of customer satisfaction, loyalty, operational efficiency, and dealership growth. And, for dealers looking to implement cost saving strategies like surcharging or increase repair order approvals with BNPL, upgraded payment solutions may be the boost to net profit that helps dealers unlock the next level of profitability for their dealership.
