Vehicle repair comparisons
The recent release by the Automotive Aftermarket Industry Association (AAIA) of the Vehicle Repair Cost Analysis compares the average cost of specific repairs between new-car dealership service departments and independent service businesses.   The AAIA analysis stated that vehicle repairs for parts and labor averaged 34.3 percent more at new-car dealerships and that foreign and domestic nameplates showed an average cost difference of 36.8 percent and 31.5 percent, respectively.

The analysis revealed differences in the costs of parts and labor of 10 vehicle repair jobs in six U.S. cities: Boston, Newark, Atlanta, St. Louis, Los Angeles, and Seattle.  The comparison difference in LA was 46.8 percent, 38.8 percent in St. Louis, but only 19.9 percent in Seattle.  The report showed that cost varied by job and by city.  Two examples: The average cost of a foreign nameplate radiator repair is $325.99 higher at a dealer compared to an independent shop, and front brake pads repair on a foreign nameplate is $138.92 higher.

The commissioning of this comprehensive study to Lang Marketing resulted from an initial intention by AAIA and Motor Vehicles Owners’ Right to Repair Act proponents to respond to congressional leaders’ requests for the cost comparisons.

Lean-time advantage 
Price is certainly a competitive advantage, especially during lean times.  Independents are rightfully proud of providing a quality repair service for a third less cost than the dealerships.  Independent business models, fixed-asset requirements, and owner management continue to yield results.  It also, arguably, demonstrates the result of traditional distribution channel efficiencies and value-added support.

However, generalizing about the independent side of the industry is difficult, by shop or by city.  The variance between independent shops, top to bottom, city to city, may be almost as great as between dealerships and independents.

Without doubt, dealership service departments will rightfully try to justify results with their menu of value-added services and unique expenses.  And mixed in somewhere is customer preference, determined by differing circumstances.

Regardless, the independent vehicle service shop will continue to offer, an often preferable and always alternative, choice for vehicle maintenance and repair. 

Long-term advantage
Among the independent training community (technical, management, selling), a consensus exists, however, that the price gap probably also indicates the strain under which the independents operate.  The investment funds from profits for equipment, information, training, and recruitment are often lacking.  Increasing requirements for independents to upgrade their technology, not just diagnostic but business-general technology, weigh heavy on the industry. 

 
After two years of vehicle sales cut in half, followed by a quantum leap to technologies for the next “green” generation of vehicles, the training and equipment costs in the next half-decade are bound to increase in order for the independent to meet the challenge.  While influential interests try to rid the roads of “pre-green” vehicles and service departments get a cut of the bail-out money to upgrade technology and associated training, the independent will need to respond.

It is important for independents to understand the new dynamics and secure the new flow of green business, stimulus capital for training, equipment, and recruitment needs while also securing affordable information access.  Without that, many shops may need to justify price increases of up to a third or perish.