software and long-time industry expert . In 2020 , the average cost of an auto mechanic ’ s labor hour was $ 131 dollars , according to data from Statista . ( The median annual wage for automotive service technicians and mechanics was $ 51,940 in May 2023 , according to the U . S . Bureau of Labor Statistics . And for OPE mechanics and technicians , it was $ 45,180 ).
To find the average posted shop labor rate at OPE dealers in the U . S ., we spoke with a parts distributor that recently polled a large group of dealers and asked , “ What is your posted shop labor rate today ?” Just 17 percent said they posted a rate of $ 101 or more . Meanwhile , one third of dealers use a posted rate of $ 80 or less .
Greg Paul said he listens to the advice of Bob Clements and Sara Hey . “ Bob Clements says that if people are not complaining about your labor rates , your rates are not high enough .”
“ Fix this issue and everything changes ,” said Sara Hey . Most OPE dealers , according to Hey , figure their shop rate using a simple “ time and material ” process . This , she said , is good for customers but not for dealers . Hey advises a strategic mix of pricing , including flat-rate pricing , menu pricing , and the time-and-material structure .
People , prices , tech & communication
“ A lot is changing right now , from parts to labor rates to battery equipment . It ’ s evolving fast . I ’ ve never seen it like this ,” said Greg Paul , owner of
By Glenn
Paul ’ s Lawn & Garden in Massillon , Ohio . And he ’ s seen a lot . Paul ’ s
Hansen parents started the business decades ago .
In these pages , we look at changes taking place in and around the service shop at OPE dealers . We talked to service providers , distributors , consultants and dealers to learn what ’ s happening and what ’ s to come .
17 % $ 101 and higher
POSTED SHOP LABOR RATE
12 % $ 70 or less
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Shop labor rates
“ This should be a flashing red light for dealers ,” said Sara Hey of Bob Clements International . The question of shop labor rate , she said , has been a problem for some time , “ but it ’ s bigger now because of the problem in finding good technicians , due to both retirements and an overall shortage of labor .”
“ Pricing jobs is astronomically important . And when you get this right , you can do a lot of things better and solve a lot of problems , especially the personnel issue ,” she said .
“ Labor rates are inching up , but the rates in OPE dealerships still lag behind other industries ,” said Tim Berman , a product manager for C-Systems
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26 % $ 91- $ 100 |
22 % $ 81- $ 90 |
23 % $ 71- $ 80
Source : A Parts Distributor
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18 OPE + May 2024 |
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www . OPE-Plus . com |