Finding fair price information on a car repair: parts & labor

Labor can be one of the major costs in getting your car
repaired. It should be a separate category on the repair order. A
labor dollar value and, preferably, a labor time (in hours and
tenths) should be entered for each job performed.

Labor is usually charged by the hour and tenth of an hour. In many
states the shop is required by law to clearly display its hourly
labor rate. In California, as an example, labor rates run from a low
of $45 per hour in depressed areas to over $100 per hour in more
affluent areas.

Some shops have different rates for different categories of repair.
They might charge $75 per hour for electrical and emissions, $60
for mechanical, and $45 for lube work. There is nothing wrong with
this (particularly if it is clearly posted) . . . sometimes it will
actually save you money.

Flat Rate Time is 'by the book'. Manufacturers, as well as
independent publishers (Alldata, Mitchell, Motors, and Snap-on),
use time studies to establish average repair times for the
majority of repair operations. If, for instance, replacing a
waterpump is listed at 2.5 hours, that is what you will be charged.
A good technician may be able to do the job in 2 hours . . . an
apprentice in 4 hours . . . either way you will be charged 2.5 hours.
From the customer's standpoint this is the fairest and most
equitable way to calculate labor.

Flat rate times published by the manufacturer are also called
'warranty times'. These are the times manufacturers use when
reimbursing new car dealers for warranty work. Perhaps because
manufacturers have direct costs associated with 'warranty
times', 'warranty times' are usually lower than flat rate times
published by the independents. Few new car dealers use warranty
time for retail work (the work you pay for). They either factor it
(for example: they might multiply each warranty time operation
by 1.5, charging you one and a half hours for a job listed at one
hour), or they might use one of the independent manuals.

Factoring can also be used with the independent manuals . . . in
fact many service management programs have factoring
algorithms built in. The shop can set the factor to any value they
feel the customer (you) will put up with.

Straight Time is 'on the clock'. All shops use straight time for
operations not listed in the flat rate manuals . . . for instance
electrical diagnosis.

Parts make up another major cost in getting your car repaired.
Each part you pay for should be separately listed and priced on
the repair order. The listing should include a description of the part
and, preferably, a part number.

There are two general categories of parts . . . 'OEM' (original
equipment manufacturer) and 'aftermarket'. Subcategories
include 'new', 'rebuilt', and 'used'.

Incidental costs might include 'shop supplies', 'hazardous
materials (hazmat)', 'tire disposal', . . . even 'data access'.
Although it is customary in the auto repair business to pass some
of these expenses on to the customer, sometimes it is over done.
You should question anything that doesn't make sense.

OEM parts are sold or authorized by the manufacturer of your
automobile. Although they are usually more expensive than
aftermarket parts they have advantages: their quality and
suitability is backed by the same company that manufactured
your car, this 'certainty' of correctness can add to your car's
resale value. Also using the correct OEM parts will not adversely
effect any remaining vehicle warranty.

OEM parts are sold primarily by new car
dealerships. Dealerships buy them
wholesale from the vehicle manufacturer
(ie Ford, Toyota, Chevy, etc).
Dealerships sell them to their own retail
customers (as part of a repair or 'over
the counter') and to wholesale customers
(other shops). Typically the dealership
will give other shops a 20% discount off
the retail price. 20% is an inadequate
margin to cover expenses for most
independent shops and they therefore
sometimes charge more than the OEM
recommended retail price for OEM parts.

Aftermarket parts are sold by automobile parts suppliers such as
AutoZone and NAPA. They are sold wholesale to new car
dealerships and to independent shops. Although aftermarket
parts run the gamut in quality, most used by shops are OK, and
some actually exceed OEM quality, especially in 'performance'
areas such as shocks and tires. Most aftermarket parts are less
expensive than OEM parts, particularly if purchased through an
independent shop.

An 'over the counter'
sale refers to a direct
sale, usually retail, to
the customer (such as
yourself) at the dealer's
parts counter.

Because the
independent shop
usually must buy OEM
parts from a new car
dealer, the independent
shop usually pays more
for OEM parts than a
new car dealer does.

Shop supplies include shop towels, cleaners, spray lubricants, etc.
Sometimes it is charged as a flat fee ($2 is common), sometimes
it is charged as a percentage of the bill.

Hazzardous materials pays for the handling, storage, and
disposal of hazzardous materials (used oil for example). If you
didn't have any fluids replaced you probably shouldn't be charged
for it. Like shop supplies it is charged as a flat fee ($2 is common)
or as a percentage of the bill.

Tire disposal fees are similar to hazzardous materials fees and
pay for the handling, storage, and disposal of tires. Some states
also impose a 'disposal tax'. If you bring in your own rim and
there is no tire on it, and you have a tire installed on it, there
should be no fee because there was no tire to dispose of. Fees run
$2 to $4 per tire.

Data access is a questionable charge. Essentially it pays for the
manuals (usually on-line or on DVD) a shop uses to help
diagnose and estimate the repairs made on your car. Perhaps
charges for the mechanic's tools will be next? It's usually only a
buck or two . . . but question it every time you see it.

So how can you, the customer, determine if you are being
overcharged for labor? It's difficult. You can ask the shop if they
use a flat rate manual in determining labor times. If they say they
do you can ask to see the labor guide for your particular repair . . .
but if the flat rate manual is computerized, and there is a factoring
algorithm, you will see inflated times. One thing you can do is
purchase a flat rate manual of your own. It will be probably be
bundled with a repair manual . . . the best one is computerized
and available from Alldata. Hit the Links button.