Study: Auto Repairs Average 34% Higher at Dealers

[Spector]

Does the 34% include the upsells that the dealer wants to do but are not necessary.

My independent is less expensive, no upselling and simple things like a rotation and alignment are signifcnatly less then a dealer. Some other stuff, very close to dealer charges. How does one put a value on trust as well. I trusted one dealer service rep, unfortunately he was gone a year later, No knocks on females but I just am not comfortable having a female handle being the service rep, most service reps no nothing about the cars they take in (basically write up orders) but females, sorry, I have a bias there, they know even less!

 

[bdcardinal]

My view may be swayed because I work in a dealer, but here is my view on it. People come to the dealer to have OEM parts used and have their vehicle diagnosed and worked on by OEM trained technicians. True there are dealers and techs out there that do not know what they are doing, but for the most part they want the car fixed right the first time, and to make the customer happy. Dealers have a higher overhead then most shops. The service is usually the consistent money maker for a dealer, and with new vehicle sales being low, even more so. Where an independent might have 1 office person, my small dealer has 5, plus porters, dispatchers, etc. Dealers also have to stock special tools to work on their models. They have no choice to stock them, and are sent new ones on a regular basis and then billed for them. They also have the latest repair updates for new models, or older models.

From a parts point of view, we have to have a fairly large inventory on hand. We cant stock everything and can get most parts either same day or overnight. I mostly do back counter, meaning i deal with technicians most of the time. The techs at my dealer are some of the best I have seen. They tend to specialize, trans, diesel, drivability, etc. Our trans and diesel techs are some of the fastest and most thorough workers I have seen.

I do wholesale also to outside independent shops. You can tell the shops that are setup with proper diagnosis info (Alldata) and the ones that are just throwing parts at a problem. The ones that do not know what are going on call parts and try to get us to help them diagnose the problem over the phone, or ask for the Ford part number, so they can call Kragen and get the knock off version of it. We also get a fair amount of vehicles towed in from shops because they have replaced a laundry list of parts that cant fix it and we usually throw in a fuse, or reconnect something they left loose and voila its fixed. The shops that actually know what they are doing will use OEM parts where it matters most.

Being a BITOG member, i always make sure the fluids i hand out are the proper ones. I have access to service manuals online and can cross the VIN to make sure i hand out the proper trans fluid, etc, which we also stock a ridiculous amount of in stock to meet all the different requirements for both Ford and Mazda.

 

[AzFireGuy79]

I personally would only take my car to a dealer if I couldn't perform the work myself due to a schedule conflict. The dealer where I purchased my Tacoma here in Phoenix has very talented techs, but when you can perform the work yourself and have the tools it's a moot point unless you get yourself in a bind and don't have the time. I enjoy doing the work on my cars and trucks and usually have plenty of free time with my work schedule.

 

[ctrcbob]

When I need something fixed on a car that is not in warranty, I use a small shop five minutes from me. They never advertise, but they always have a lot of cars in for service and repairs. The owner tells me that his customers advertise for him.

About a year ago, for my Continental, I inquired from my favorate Ford Service department the cost for a Front Brake Job, pricing both with Ford Pads or with Motorcraft Pads (yes, they are different) and turning the original rotors. His quote almost gave me a heart attack. About $430. Then I checked with the local Lincoln/Mercury Dealer, and although his price was lower, it was still way off. Went to my local garage, and told him that I wanted "The best pads you can get". He did the job, turning the rotors as they were still good for around $250. (which I still thought was high, but I paid it).

After all this, I saw an ad from my local Ford Dealer for Brakes for something like $129. (Sure the ad did not mention turning the rotors) so I went there and asked they why they quoted me over $400. for the job just a week before. Never could get an answer.

Yes, you have to shop around, and the pads my local garage used do not leave any brake dust. Wheels always clean.

 

[demarpaint]

Keep in mind the service writer is paid a commission on retail work, the more he charges the more he makes. That's why you never got the answer you were looking for when you asked about the brake job a second time.

 

[Gary Allan]

Quote:
I think this study reflects the cost difference between having a repair performed at a dealership and at a Pep Boys type outfit. Good independent shops, especially ones that specialize in your vehicle's make, are not significantly cheaper than the dealership.


If an indy shop is charging any where near as much as a dealership, without some DISTINCTIVE and/or exclusive advantage, they're taking you to the cleaners.

The only reason a dealership is so expensive is that there are so many people in your pocket. You have the owner, the parts manager, the parts counter person, the service manager, the service adviser, the technician, and the clerical staff/cashier/etc. You also have to maintain the leading edge electronics/software and tools.

Indy's eliminate about 60%-90% of those static costs and can only book throughput to the limit of their much smaller (typically) facility. The dealer has to cram X # of tickets a day just to pay the bills. The indy's do outsource the parts aspect of those costs, so you could probably eliminate the parts man/counter thing.

 

[ted s]

i guess 20% more in labor is tiny?
I can't even get a dealer loaner car for warranty work.

Originally Posted By: LT4 Vette
The tiny bit extra in labor rate ($30-$40 hr) is worth taking it in to the dealership.

Plus the dealer will give you a free loaner car for the day, so it sometimes pays just to take it to the dealer.

 

[rjundi]

Recently had my front brakes(pads/rotors) replaced on my WRX on a Subaru WRX for $400. A decent Subaru versed independent quoted me $250 using quality aftermarket parts.

I used dealer only due to the fact I had $300 in credit card kickback points for Subaru service.

My independent charges $60/hr and dealer is $80/hr. The mark up is high on parts at dealer. I can get the parts from a mail order site from same dealer at 2/3 cost of what they charge when they repair your car.

 

[Mr Nice]

Quote:
i guess 20% more in labor is tiny?

I don't mind spending the extra 20%
Why? Cause I am getting OEM parts , not some low quality junk.

Even for a 4 hour job like a new timing belt/water pump, our dealership will give you a free loaner. What so difficult about requesting that a free loaner is part of deal?

Find another dealer if they don't want to give you a free loaner when you have warranty work done.

 

[NHHEMI]

Originally Posted By: LT4 Vette
Quote:
i guess 20% more in labor is tiny?

I don't mind spending the extra 20%
Why? Cause I am getting OEM parts , not some low quality junk.

Even for a 4 hour job like a new timing belt/water pump, our dealership will give you a free loaner. What so difficult about requesting that a free loaner is part of deal?

Find another dealer if they don't want to give you a free loaner when you have warranty work done.


Well, as someone who has sold parts in both the aftermarket and at dealers let me say OEM parts are not always that great. In my personal opinion the only OE parts I feel are superior are body panels for collision repair. Hard parts have never impressed me from a dealer. OE parts from a dealer are generally EXTREMELY over priced. You would be stunned at the mark up on OE parts. I felt like a crook selling stuff when I worked dealer parts and service in the past.

OE parts are generally average quality for most things and some are poor quality. OE shocks usually are JUNK yet very expensive as one prime example. OE brake pads are another excellent example of generally over priced, usually poor quality, OE parts.

I have always been able to find better quality parts in the aftermarket for the same and usually less money than OE parts. Nothing wrong with using OE parts. At times you have no choice on it either as OE is your only option. IMO however if you are using them thinking they are superior to aftermarket you are mistaken as long as you know what brands to buy. Yes, you can get aftermarket cheap junk parts but there are better parts for almost every hard part available aftermarket and again pricing is usually the same or less than OE from a dealer.

JMO.

 

[Spector]

No question that a dealership is a necessity on certain repairs, I use them for electrical, etc, crazy non routine repairs. For all routine maintenance, belts, hoses, plugs etc, dealers are just overpriced and the upsell issue. Yes, they have a huge overhead. Not sure that is the problem of new car sales not making money and using service to subsidize or shopuld it b my problem?

They also have no ability to negotiate, have to go by the book, even with empty service bays they will not negotiate parts or labor. parts are really the killer at a dealership though, I can get OEM parts wholesale via the internet for about 50% less. Now, if they stocked the parts fine, but contrary to what the dealership rep said earlier, my experience with dealerships is that their inventory stinks. So why should I pay premium parts prices if they have to overnight it from Atlanta.. They did not incur the cost of carrying that part etc. What gives them the right to mark it up 100% as if they had it sitting in inventory??????????????

 

[MrCritical]

Nationally, I guess the figures could be true. In my area, only one dealer is that far out of line with the independents.

Our dealer averages about $12 hr. flat rate over the local independents. Maintenance items are done on a reduced rate, oil changes, brake services, ect. No, I can't sell you an AC/Delco oil filter for the same price as a Fram, but you're protecting a $5000 engine here. Also by popular demand, I don't use bulk oil.

Most independents can't match my 12/12 parts AND labor warranty on most of my work (some carry lifetime warranty parts and labor). Yes it costs a little more. You decide which is best for you. Little old ladies who've paid labor twice to have department store a/c compressors put on at the local independent and pull up in my service drive in tears don't give me a lot of confidence in their product.

One of the customers pulls an invoice from one of the better local independents to show me how much he saved on a repair. Sure enough, the guys labor rate is less. But there's a problem.

The invoice itemizes an hour diagnostic time for finding out the cause of the repair. Our techs would have raised the hood, looked, listened, and told the service advisor what was needed. Minus the hour diagnostics.

So the customer paid less per hour, paid an additional hour, and got a 90 day warranty on a job they would have gotten a year warranty on (minimum) at our dealership. He really saved.

None of the local independents can program a radio, body control module, powertrain control module, power door lock switch, or reprogram anything on a vehicle. Having that capacity is why my labor rate is $12 hour more than an independent. And when an independent brings your car to me to get it done, they pay the same thing that you would pay if you brought your car to get it done.

 

[NHHEMI]

Originally Posted By: Spector
No question that a dealership is a necessity on certain repairs, I use them for electrical, etc, crazy non routine repairs. For all routine maintenance, belts, hoses, plugs etc, dealers are just overpriced and the upsell issue. Yes, they have a huge overhead. Not sure that is the problem of new car sales not making money and using service to subsidize or shopuld it b my problem?

They also have no ability to negotiate, have to go by the book, even with empty service bays they will not negotiate parts or labor. parts are really the killer at a dealership though, I can get OEM parts wholesale via the internet for about 50% less. Now, if they stocked the parts fine, but contrary to what the dealership rep said earlier, my experience with dealerships is that their inventory stinks. So why should I pay premium parts prices if they have to overnight it from Atlanta.. They did not incur the cost of carrying that part etc. What gives them the right to mark it up 100% as if they had it sitting in inventory??????????????


Actually dealers absolutely CAN charge less than list price. They are not bound by the car mfg to charge full retail price. It is up to them what they charge.

If you ever saw a price list for dealer parts, that shows cost and retail/list( usually they are seperate sheets so the customer doesn't see ), trust me you would see they can give a discount still make plenty of cash. They just choose not to as a general rule. Some even charge MORE than list price.

 

[eljefino]

Originally Posted By: MrCritical

None of the local independents can program a radio, body control module, powertrain control module, power door lock switch, or reprogram anything on a vehicle. Having that capacity is why my labor rate is $12 hour more than an independent. And when an independent brings your car to me to get it done, they pay the same thing that you would pay if you brought your car to get it done.


You can thank the manufacturer for locking that stuff down. AC Delco radios have an 800 number and dealer code for fixing locked-out radios. Same thing with their exclusive access to microchip keys and the BCM reprogramming sometimes needed. Who, honestly, wants to steal an odd shaped factory radio anymore?

I give your shop credit for this bit of competence; my saturn dealer couldn't unlock my y2k radio, it uses a different button sequence than the 91-99s and all other GMs. They told me it was fubar'd and I could have another one for $630!

 

[ffracer]

I've had mixed results in this rural area:

I usually do most stuff myself on my '95 Ranger 4cyl 2wd 5-speed. Easy to work on. When something needs replacing I can't do I go to the Ford dealer. The charge $85/hr, but they figure it out, get it done fast, and thus the total bill is reasonable. I've been too many local mechanics that can't seem do even the most mundane repairs without a couple callbacks and one uses the cheapest parts from Autozone, despite me being willing to pay more. Their rates are $48-60/hr, but they take far more time, so it actually costs more than the dealer. Amazing considering the Ranger is one of the most common vehicles out there.

The BMW dealer is definite no-go. Really expensive, and they aren't very compenent. Luckily there's a German car repair guy that is much cheaper, much better, and doesn't use OEM parts on a lot of things, since OEM is source of the failure. He knows what works and what doesn't.

My Honda (long gone) could go to either a certain indy guy who is good or to the dealer 50 mi away, who is not cheap, but very good. Only needed the dealer a handful of times in 300k mi.

 

[Spector]

Sorry, every dealership I have used in the past 3 years (Ford, GM, Mitsubishi ) insists on a diagnostic charge and WILL NOT deduct that from the price once the issue is known and repaired!!! Even if I tell them what sensor is gone they charge me the diagnostic!

 

[Mr Nice]

Thats cause any 'diagnostic charge' are a CA$H cow for the dealer.

 

[newpassatt]

Not trying to defend auto dealer service departments, but if they are that much over priced, GO ELSEWHERE! A top line Mercedes-Benz will easily cost 34% more than a lot of cars on the market & still get you from pont A to B. Doesn't mean you have to buy a Benz when a VW is available for less just down the street.

 

[rjundi]

I am likely done with my dealer since my powertrain warranty is done on both vehicles now. Good things about them is inexpensive diagnostic fee($40) I think. Incredible waiting room if you get stuck waiting with free wifi, three laptops, and plasma TV. They also give me a loaner if I prearrange it.

The downsides are they recommend work I typically turn down and other independents don't even think count. For example they state my rear bushings are cracked at 4yrs/60k and want $540 to replace them. They always "find" work I kindly turn down.

A good independent in the long run will save you money. However the hardest thing is finding them.

 

[rat]

Originally Posted By: NHHEMI
Originally Posted By: Spector
No question that a dealership is a necessity on certain repairs, I use them for electrical, etc, crazy non routine repairs. For all routine maintenance, belts, hoses, plugs etc, dealers are just overpriced and the upsell issue. Yes, they have a huge overhead. Not sure that is the problem of new car sales not making money and using service to subsidize or shopuld it b my problem?

They also have no ability to negotiate, have to go by the book, even with empty service bays they will not negotiate parts or labor. parts are really the killer at a dealership though, I can get OEM parts wholesale via the internet for about 50% less. Now, if they stocked the parts fine, but contrary to what the dealership rep said earlier, my experience with dealerships is that their inventory stinks. So why should I pay premium parts prices if they have to overnight it from Atlanta.. They did not incur the cost of carrying that part etc. What gives them the right to mark it up 100% as if they had it sitting in inventory??????????????


Actually dealers absolutely CAN charge less than list price. They are not bound by the car mfg to charge full retail price. It is up to them what they charge.

If you ever saw a price list for dealer parts, that shows cost and retail/list( usually they are seperate sheets so the customer doesn't see ), trust me you would see they can give a discount still make plenty of cash. They just choose not to as a general rule. Some even charge MORE than list price.




Dealership parts employees are also paid by commission on what they sell, in the case of my employer, we were paid on gross profit percentage. Many dealerships now have their own pricing matrix to increase profit by charging more than list price whenever possible. Its not right or honest in my opinion, but they have made it so thats the only way the employees can make any money.