William Oliveri

That's pretty crappy.
"Paul Calman" <spam@trap.com> wrote in message
news:bu1aua$cji10$1@ID-87669.news.uni-berlin.de...
> > I've recently been wondering, I've taken my jeep to a business where
> they
> > charge 75.00 per hour for the mechanic's labor. I'm curious what take
> does
> > the mechanic get from that charge?
>
> Not enough. It used to be 50% of the labor, but that is very rare now. The
> costs of compliance with epa, osha, bar , very high insurance and workers
> comp rates, defective parts, etc., adds up and most techs get less than
they
> used to, but are still expected to have 20-50K tied up in tools and
> specailty tools that become obsolete with every design change.
> A certified Master Auto Tech with 25 years experience still makes less
than
> a San Francisco Garbageman.
> --
> Paul Calman, Hathaway Pines, California
>
>

William Oliveri

That's pretty crappy.
"Paul Calman" <spam@trap.com> wrote in message
news:bu1aua$cji10$1@ID-87669.news.uni-berlin.de...
> > I've recently been wondering, I've taken my jeep to a business where
> they
> > charge 75.00 per hour for the mechanic's labor. I'm curious what take
> does
> > the mechanic get from that charge?
>
> Not enough. It used to be 50% of the labor, but that is very rare now. The
> costs of compliance with epa, osha, bar , very high insurance and workers
> comp rates, defective parts, etc., adds up and most techs get less than
they
> used to, but are still expected to have 20-50K tied up in tools and
> specailty tools that become obsolete with every design change.
> A certified Master Auto Tech with 25 years experience still makes less
than
> a San Francisco Garbageman.
> --
> Paul Calman, Hathaway Pines, California
>
>

William Oliveri

That's pretty crappy.
"Paul Calman" <spam@trap.com> wrote in message
news:bu1aua$cji10$1@ID-87669.news.uni-berlin.de...
> > I've recently been wondering, I've taken my jeep to a business where
> they
> > charge 75.00 per hour for the mechanic's labor. I'm curious what take
> does
> > the mechanic get from that charge?
>
> Not enough. It used to be 50% of the labor, but that is very rare now. The
> costs of compliance with epa, osha, bar , very high insurance and workers
> comp rates, defective parts, etc., adds up and most techs get less than
they
> used to, but are still expected to have 20-50K tied up in tools and
> specailty tools that become obsolete with every design change.
> A certified Master Auto Tech with 25 years experience still makes less
than
> a San Francisco Garbageman.
> --
> Paul Calman, Hathaway Pines, California
>
>

Bill Beyer

"Nathan Collier" <JeepMail@7SlotGrille.com> wrote in message
news:dfWMb.221803$Vu5.16486442@twister.southeast.r r.com...
> a typical dealership mechanic averages around $15-$17 an hour. the
> dealership has to pay for all the shop expenses including insurance and
> match the mechanics ss deductions but its still a rip to charge $75 an
hour.
> they do it because they can.

You have to take into account the "specials" they run which generally
discount the labor and then balance in the fact that lower skilled
technicians perform some jobs but overall in a store that has a $75/hr
posted rate their "effective" labor rate is roughly $65/hr, $70/hr if they
are very well run.

A typical dealership runs 65-70% gross profit on retail labor which is the
"effective" labor rate minus the mechanic's wages.

Now factor in the cost of "non productive" employees such as the service
advisors, cashiers, car jockeys, service manager, dispatcher, warranty
administrator, shop foreman (in some cases) and remember that all of their
wages and benefits come out of what's left of the $65-$70/hr_after_ the
mechanics are paid.

Now factor in the overhead for the facility, rent/lease payment (if any),
insurance, special tools, utilities, hazmat storage & disposal.

Now add in the costs for advertising, "goodwill" adjustments, etc. and most
dealerships are lucky if they hit a 5% net profit in the service department.
The goal of any dealership is to reach 100% service absorption, IOW the net
profit from the service & parts (fixed operations) covers the costs of the
entire dealership including the salaries of the owners & all other overhead.
Very few dealerships hit that mark.

Bill Beyer

"Nathan Collier" <JeepMail@7SlotGrille.com> wrote in message
news:dfWMb.221803$Vu5.16486442@twister.southeast.r r.com...
> a typical dealership mechanic averages around $15-$17 an hour. the
> dealership has to pay for all the shop expenses including insurance and
> match the mechanics ss deductions but its still a rip to charge $75 an
hour.
> they do it because they can.

You have to take into account the "specials" they run which generally
discount the labor and then balance in the fact that lower skilled
technicians perform some jobs but overall in a store that has a $75/hr
posted rate their "effective" labor rate is roughly $65/hr, $70/hr if they
are very well run.

A typical dealership runs 65-70% gross profit on retail labor which is the
"effective" labor rate minus the mechanic's wages.

Now factor in the cost of "non productive" employees such as the service
advisors, cashiers, car jockeys, service manager, dispatcher, warranty
administrator, shop foreman (in some cases) and remember that all of their
wages and benefits come out of what's left of the $65-$70/hr_after_ the
mechanics are paid.

Now factor in the overhead for the facility, rent/lease payment (if any),
insurance, special tools, utilities, hazmat storage & disposal.

Now add in the costs for advertising, "goodwill" adjustments, etc. and most
dealerships are lucky if they hit a 5% net profit in the service department.
The goal of any dealership is to reach 100% service absorption, IOW the net
profit from the service & parts (fixed operations) covers the costs of the
entire dealership including the salaries of the owners & all other overhead.
Very few dealerships hit that mark.

Bill Beyer

"Nathan Collier" <JeepMail@7SlotGrille.com> wrote in message
news:dfWMb.221803$Vu5.16486442@twister.southeast.r r.com...
> a typical dealership mechanic averages around $15-$17 an hour. the
> dealership has to pay for all the shop expenses including insurance and
> match the mechanics ss deductions but its still a rip to charge $75 an
hour.
> they do it because they can.

You have to take into account the "specials" they run which generally
discount the labor and then balance in the fact that lower skilled
technicians perform some jobs but overall in a store that has a $75/hr
posted rate their "effective" labor rate is roughly $65/hr, $70/hr if they
are very well run.

A typical dealership runs 65-70% gross profit on retail labor which is the
"effective" labor rate minus the mechanic's wages.

Now factor in the cost of "non productive" employees such as the service
advisors, cashiers, car jockeys, service manager, dispatcher, warranty
administrator, shop foreman (in some cases) and remember that all of their
wages and benefits come out of what's left of the $65-$70/hr_after_ the
mechanics are paid.

Now factor in the overhead for the facility, rent/lease payment (if any),
insurance, special tools, utilities, hazmat storage & disposal.

Now add in the costs for advertising, "goodwill" adjustments, etc. and most
dealerships are lucky if they hit a 5% net profit in the service department.
The goal of any dealership is to reach 100% service absorption, IOW the net
profit from the service & parts (fixed operations) covers the costs of the
entire dealership including the salaries of the owners & all other overhead.
Very few dealerships hit that mark.

Dave Milne

Possibly, but the fact remains that every day they turn away business to
cheaper mechanics who do a better job..

Dave Milne, Scotland

"Bill Beyer" <bill_beyer@excite.cXoYmZ> wrote in message
news:APXMb.46747$xy6.116598@attbi_s02...
> Now factor in the cost of "non productive" employees such as the service
> advisors, cashiers, car jockeys, service manager, dispatcher, warranty
> administrator, shop foreman (in some cases) and remember that all of their
> wages and benefits come out of what's left of the $65-$70/hr_after_ the
> mechanics are paid.
>
> Now factor in the overhead for the facility, rent/lease payment (if any),
> insurance, special tools, utilities, hazmat storage & disposal.
>
> Now add in the costs for advertising, "goodwill" adjustments, etc. and
most
> dealerships are lucky if they hit a 5% net profit in the service
department.
> The goal of any dealership is to reach 100% service absorption, IOW the
net
> profit from the service & parts (fixed operations) covers the costs of the
> entire dealership including the salaries of the owners & all other
overhead.
> Very few dealerships hit that mark.

Dave Milne

Possibly, but the fact remains that every day they turn away business to
cheaper mechanics who do a better job..

Dave Milne, Scotland

"Bill Beyer" <bill_beyer@excite.cXoYmZ> wrote in message
news:APXMb.46747$xy6.116598@attbi_s02...
> Now factor in the cost of "non productive" employees such as the service
> advisors, cashiers, car jockeys, service manager, dispatcher, warranty
> administrator, shop foreman (in some cases) and remember that all of their
> wages and benefits come out of what's left of the $65-$70/hr_after_ the
> mechanics are paid.
>
> Now factor in the overhead for the facility, rent/lease payment (if any),
> insurance, special tools, utilities, hazmat storage & disposal.
>
> Now add in the costs for advertising, "goodwill" adjustments, etc. and
most
> dealerships are lucky if they hit a 5% net profit in the service
department.
> The goal of any dealership is to reach 100% service absorption, IOW the
net
> profit from the service & parts (fixed operations) covers the costs of the
> entire dealership including the salaries of the owners & all other
overhead.
> Very few dealerships hit that mark.

Dave Milne

Possibly, but the fact remains that every day they turn away business to
cheaper mechanics who do a better job..

Dave Milne, Scotland

"Bill Beyer" <bill_beyer@excite.cXoYmZ> wrote in message
news:APXMb.46747$xy6.116598@attbi_s02...
> Now factor in the cost of "non productive" employees such as the service
> advisors, cashiers, car jockeys, service manager, dispatcher, warranty
> administrator, shop foreman (in some cases) and remember that all of their
> wages and benefits come out of what's left of the $65-$70/hr_after_ the
> mechanics are paid.
>
> Now factor in the overhead for the facility, rent/lease payment (if any),
> insurance, special tools, utilities, hazmat storage & disposal.
>
> Now add in the costs for advertising, "goodwill" adjustments, etc. and
most
> dealerships are lucky if they hit a 5% net profit in the service
department.
> The goal of any dealership is to reach 100% service absorption, IOW the
net
> profit from the service & parts (fixed operations) covers the costs of the
> entire dealership including the salaries of the owners & all other
overhead.
> Very few dealerships hit that mark.

Jeepster

This is why you see lots of small shops run by father and son
mechanics.

On Tue, 13 Jan 2004 17:52:09 GMT, "Nathan Collier"
<JeepMail@7SlotGrille.com> wrote:

>a typical dealership mechanic averages around $15-$17 an hour. the
>dealership has to pay for all the shop expenses including insurance and
>match the mechanics ss deductions but its still a rip to charge $75 an hour.
>they do it because they can.