Car Repair Prices: Why Your Oil Change Is Never "just An Oil Change"
For a repair shop, there's very little profit in the $29.95 oil change
. When a shop pays its technician, pays for the oil, the filter, and the hazardous waste disposal fees, there is no money left.
This low profit margin is made worse by the very competitive "Quick Lube" business, which forces local repair shops to avoid raising prices, in spite of rising costs.
This all begs the question: If oil change specials, which range between $15.95 to $29.95, obviously produce extremely low profits, then why do so many service facilities advertise oil change specials?
The answer is actually very simple: It gets you in the door. Service centers are aware that as soon as they have your vehicle, they can sell you additional work.
Suggesting extra work is known as upselling, and it is a major profit tactic of every service facility.
Here's a common example. You drop your automobile off for "just an oil change." Upon completion, your service representative smiles and proudly states, "We observed that your air filter was filthy; so we popped in a new one." You may think "Great; what wonderful service!"
What truly occurred is that you were casually upsold an air filter. It probably wasn't required; it definitely wasn't replaced in accordance with any factory recommendation, and you were certainly overcharged for what was most likely a poorly-fitting, aftermarket, inferior air filter.
Here is a real-life example that happened recently. This specific vehicle had 54,000 miles on it, and was dropped off at a local shop for "just an oil change". Upon paying the bill, the customer was handed an estimate for $199 to replace his air filter and top radiator hose.
Surprised at the price, he called me.
Following review, I discovered that the air filter suggestion was premature. It didn't require replacement until the manufacturer's recommended 60,000-mile service interval. The top hose was also premature. Actually, it did not require replacement in any way, in spite of a really minor problem easily addressed during the factory maintenance schedule-at no additional cost.
Take a look at the aftermarket part prices quoted below (such as the unnecessary radiator hose). Do a comparison of these to the manufacturer's suggested retail price (MSRP) for the factory OEM parts (Original Equipment Manufacturer).
Local Shop Aftermarket Air Filter: $32 Manufacturer OEM Filter, MSRP: $17
Local Shop Aftermarket Top Hose: $36 Manufacturer OEM Top Hose, MSRP: $19
Notice that this local shop was doubling the price of the OEM parts with its inferior aftermarket parts.
Now, let's take a look at the labor time quoted.
Local Shop Labor Time: 2.0 @ $60 per hour = $120 Manufacturer Labor Time: 0.9 @ $60 per hour = $81
Notice that the shop labor time estimate for the repairs was 2 hours. This is more than "twice" the manufacturer's recommendations (despite calculating manufacturer times against the industry standard multiplier).
Had the local shop abided by the vehicle's particular maintenance intervals instead of trying to make a quick buck, it should have recommended a 60,000-mile service at the next visit. This would have better served the customer, saved him $199, and maintained the automobile correctly.
Instead, the service center lost a customer, permanently!
What has to be made really clear is that this kind of price-gouging happens every day in each type of service facility in one form or another across the automotive service industry.
This type of price-gouging is considered normal!
Wheeling Auto Repairby: Elena Finch
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