Mechanics are rich people!

[t_marat]

Article finding how expensive some service centers charge for their work
http://news.bbc.co.uk/2/hi/business/4723504.stm

[winfred]

the mechanic only gets a small part of the labor rate, the shop is the *******

[Tiger]

Amen!

[shogun]

Well, you have to consider the high cost for investment in special and expensive tools and diagnosis equipment.
One of my friends in Germany just gave up his dealership for a German brand after more than 20 years, as they were so demanding in preconditions to keep it, a new large showroom with specified square meters, newest tools, diagnosis equipment, less discount on parts as his turnover in a small town is not that high and many other very strict regulations.
It is not that easy.

[SharkmanBMW]

my indy is pricey, but within 5 minutes he has diagnosed your problem, and can fix it faster than any dealer ever could!
So, yes he rakes it in, but he has earned the capability, his knowledge, ability and equipment are worth millions to the owner of a broken e34!

[pundit]

Winfred nailed it!
Here in Australia, unless you run your own shop or are self employed, mechanics and panel beaters have the lowest award pay rates of any trades people. Carpenters, plumbers and electricians easily earn twice what a mechanic gets paid. The reason for this is there is no union covering auto mechanics. The building industry however has very active union representation (some would say too much).

I remember being shocked to find that a plumber friend of mine was earning more money in the second year of his four year apprenticeship than I was as a fully qualified mechanic working at a stealership. My nieces husband who is 30 works on Rollers, Bentleys and Jags at a prestige dealership in Melbourne. They charge him out at $128.00 per hour and pay him $22.00 per hour. He has asked for more money and they keep promising but never deliver.
His last increase was two years back and that was $2.00 per hour. He has a mortgage and two young children so he is reluctant to quit.

The auto trade was also at least ten years behind the building industry in dealing with asbestos. I remember being forced to blow out brakes when servicing vehicles while for years any hint of asbestos on a building site would trigger a union ban and get coverage on TV.

I got fed up with the trade in the end as the stealerships treated their mechanics like cattle and there was little opportunity for advancement.
Most service managers had generally not come up throught the trade are were mainly number crunchers more interested in their own bonuses.

I finally left the trade for good about fifteen years back got into telecommunications during the IT boom and spent 4 years earning good money and travelling the world.
Best move I ever made!!

[winfred]

service managers that haven't been mechanics bite ass, our guy thinks he knows how to turn wrenches, it helps that he has sold parts for about the last 15 years, it's annoying when he diagnoses something wrong and has all of the parts ready and it's something totally different


Most service managers had generally not come up throught the trade are were mainly number crunchers more interested in their own bonuses.

[rob101]

Winfred nailed it!
Here in Australia, unless you run your own shop or are self employed, mechanics and panel beaters have the lowest award pay rates of any trades people. Carpenters, plumbers and electricians easily earn twice what a mechanic gets paid. The reason for this is there is no union covering auto mechanics. The building industry however has very active union representation (some would say too much).

The diesel Mechanics I work with earn 1000 per week after tax, not to mention the mechanics onsite, they earn over $100 000 per year....and on the mines forget it, they pay ******** money. We can't get enough diesel mechanics, There is a resource boom in this country not a car servicing boom, anyone who needs good mechanics for trucks etc. can't find them.... there are mechanics who earn ******** amounts of money, but they don't work on passenger cars. They work on trucks and other heavy machinery... I've even heard of a couple of these mechanics who have retired at 34 with close to 1 000 000 in the bank.

[pundit]

The diesel Mechanics I work with earn 1000 per week after tax, not to mention the mechanics onsite, they earn over $100 000 per year....and on the mines forget it, they pay ******** money. We can't get enough diesel mechanics, There is a resource boom in this country not a car servicing boom, anyone who needs good mechanics for trucks etc. can't find them.... there are mechanics who earn ******** amounts of money, but they don't work on passenger cars. They work on trucks and other heavy machinery... I've even heard of a couple of these mechanics who have retired at 34 with close to 1 000 000 in the bank.
Sure it is possible to earn good money as a diesel mechanic working on mining trucks etc. As long as you are prepared to live miles away in outer **** creek.
That's one of the reasons for the big money. Not just the type of work but where you work and the conditions you work under. The same applies to guys that work on oil rigs. Big money for the isolation factor and conditions. However these are the exceptions rather the the rules. I think the award rate for a qualified mechanic is still well under $20.00 per hour and that is just plainly abismal. There are unskilled jobs that pay more than that.

The biggest culprits here are not usually the small independents, they often look after their staff fairly well as they tend to be more customer orientated and need to keep decent staff in order to maintain a good reputation. They also tend to have a tough time keeping up with the cost of technology. It's mainly the large dealerships who are highly profit driven. That catch is if mechanics were paid the same rates as plumbers the dealers would be charging $200.00 per hour.

As for the twenty guys that I went through my auto mechanic apprenticeship training with, over 3/4's of them all left the trade within five years.
The predominate reason... shite money (http://www.drive.com.au/editorial/PrintArticle.aspx?id=5317)!

"...Dealers may charge customers up to $100 an hour for labour but apprentices are poorly paid. The award wage for a first-year apprentice mechanic is $227.70 a week before tax, with a $4.85 tool allowance; a fourth-year grosses $477.10 and gets a $10.20 tool allowance. Most experienced mechanics can expect a top take-home pay of $500-$600. Simpson believes mechanics should be paid better because of the increased use of technology in modern cars, which requires elaborate training and a better calibre of student..."

I wish I got $227.70 a week in my first year.
Back in my days I got $39.00 per week or 97 cents per hour!

[digitaldragon03]

The only thing that bugs me is that they charge, not by the amount of time it takes them to fix stuff, but by what some book tells them it should take.

[wingman]

Yes exactly. Was it on this site that we were discussing service times? Might have been. For example: 'Change headlight globe=35 minutes'. Actually takes 10 minutes but you're charged for 35.

[rob101]

Sure it is possible to earn good money as a diesel mechanic working on mining trucks etc. As long as you are prepared to live miles away in outer **** creek.
That's one of the reasons for the big money. Not just the type of work but where you work and the conditions you work under. The same applies to guys that work on oil rigs. Big money for the isolation factor and conditions. However these are the exceptions rather the the rules. I think the award rate for a qualified mechanic is still well under $20.00 per hour and that is just plainly abismal. There are unskilled jobs that pay more than that.

Well I think you can earn good money as a diesel mechanic anywhere, for example at my work in brisbane diesel mechanics earning more than I do. I wouldn't exactly call where i work isolated either, there is a subway shop 5 minutes down the road :p As well if you went to townsville, gladstone or mackay you could earn a very good wage, sure they aren't capital cities but they aren't country towns with one pub either. The fact is its hard to find good diesel mechanics here, there just isn't enough. Thus they get paid more.
But if you goto the mines Diesel mechanics don't get paid a good wage, they get paid as much as some people in general manager positions. as in 150 - 200K.

[pundit]

The only thing that bugs me is that they charge, not by the amount of time it takes them to fix stuff, but by what some book tells them it should take.
Ahhhh! Now you begin to get the picture.
Service department budgets are not only based on total sales for the month but bonuses are paid (often to only the service management team, at least in my days in the trade) based upon book billed hours versus actual hours. So the object is to complete each job in less than the specified book time but of course still bill the customer based on the book time. Mechanics who work in stealerships are under pressure to complete each job in less than the specified time.

The other thing that can effect bonuses is the amount of warranty claims. Here the object is to keep warranty claims to a minimum by for instance refusing a claim on an engine failure by suggesting the customer has either not had the vehicle serviced by an authorised dealer, used a non-dealer recommended lubricant (which may even be superior to the dealer supplied lubricant) or may have exceeded the service interval even if only by a marginal amount which may have had no effect on the outcome of the failure.

I have seen this happen on several occasions and knew that in some situations it was a manufacturing defect that caused the problem. The dealers were expected by the manufacturer to keep the lid on claims as much as possible. (A chronically faulty transmission computer springs to mind.) Claims were often settled only if the customer got upset enough to really cause the dealer (read car maker) a lot of bad publicity and then usually the car was fixed under warranty. Many however gave up in despair, never to buy
from that manufacturer again.

However, I think things have now improved somewhat with the advent of the internet as 'lemon defects' can no longer be simply hidden from consumers in order to deny them of their rights.

[pundit]

Yes exactly. Was it on this site that we were discussing service times? Might have been. For example: 'Change headlight globe=35 minutes'. Actually takes 10 minutes but you're charged for 35.
A guy I work with had his 2001 Fairlane serviced a while back by a Ford dealer.
He asked how much their hourly rate was and they told him $85.00 dollars per hour plus parts. The service was supposed to take 4.5 hours.

His wife dropped the car off and went shopping. Two hours later she rang to ask when the car would be ready as she was contemplating whether to go and visit a friend later in the afternoon and was told the car was already finished and ready to go.

When her husband saw the bill he rung the dealer and asked again how much the hourly rate was and was again told $85.00 per hour so he said why have you then charged me over $190.00 per hour for two hours worth of work? They came out with standard book times etc. He told them obviously the book times are exaggerated and he was going to go to Consumer Affairs and highlight the practice of inflated dealership recommend job times.

They ended up knocking $200.00 of his bill and suggested he take his car somewhere else in the future.

On the other hand you wouldn't want some really incompentant or slow mechanic spending 10 hours on a 2 hour job and being charged for 10 hours.
I can understand the need for some kind of recommended times, but if the book times are consistantly nearly always being beaten, on everyday standard type service work, then that indicates the book times are either too long, short cuts are being taken or a combination of both.

[athflying79]

Ahhhh! Now you begin to get the picture.
Service department budgets are not only based on total sales for the month but bonuses are paid (often to only the service management team, at least in my days in the trade) based upon billed hours versus actual hours. So the object is to bill out as many book hours as possible above above actual hours it takes to do the job. Mechanics who work in stealerships are often under pressure to complete each job in less than the specified time.

The other thing that can effect bonuses is the amount of warranty claims. Here the object is to keep warranty claims to a minimum by for instance refusing a claim on an engine failure by suggesting the customer has either not had the vehicle serviced by an authorised dealer, used a non-dealer recommended lubricant (which may even be superior to the dealer supplied lubricant) or may have exceeded the service interval even if only by a marginal amount which may have had no effect on the outcome of the failure.

I have seen this happen on several occasions and knew that in some situations it was a manufacturing defect that caused the problem. The dealers were expected by the manufacturer to keep the lid on claims as much as possible. (A chronically faulty transmission computer springs to mind.) Claims were often settled only if the customer got upset enough to really cause the dealer (read car maker) a lot of bad publicity and then usually the car was fixed under warranty. Many however gave up in despair, never to buy
from that manufacturer again.

However, I think things have now improved somewhat with the advent of the internet as 'lemon defects' can no longer be simply hidden from consumers in order to deny them of their rights.

I part-own and run a Powersports Dealership. While it is not exactly cars, it is based on mostly the same principles.

Flat rate does several things, but most importantly it attempts to establish a standard among dealers/shops. It is true that you want to beat flat rate as much as possible...but it seems there are always jobs that come along that takes a mechanic much longer than is billable to fix a problem. It is also how warranty claims are paid.

We are a dealership and we charge $76/hour for labor. We have two flat rate mechanics that make $25/billable hour and one full time hourly mechanic that makes $14/ hour. The flat rate guys stick to repairs only, were as the hourly guy does everything from re-paint the service department to prep a unit for sale. He also does repairs and helps out the flat rate guys...all the while learning more about his trade. I would say we are the exception. (We are a small dealer at the moment)..but most dealers you go to will have maybe 2 or 3 flat rate guys that have a pretty good idea of what is going on and then you have 20 seventeen year olds working on stuff. You as a customer don't see the service department usually and don't realize you've had a bunch of idiots work on your unit until you have to bring it in 4 times for the same problem. Most dealership owners know this and love it. They pay nearly nothing for labor and there is a large enough customer pool that the suckers keep coming in. So they are making major cash.

As far as warranty goes...the powersports industry might be different, but we gladly do and are encouraged by the manufacturer to do warranty. We get paid for the parts we used plus 110% of our normal labor rate...so we actually make more money doing warranty work. The only reason it is a pain in the ass, you have to stay on top of it constantly. If a claim is rejected, making sure it's filed in time, making sure it gets paid, etc....warranty in itself is a full time job.

[pundit]

I part-own and run a Powersports Dealership. While it is not exactly cars, it is based on mostly the same principles.

Flat rate does several things, but most importantly it attempts to establish a standard among dealers/shops. It is true that you want to beat flat rate as much as possible...but it seems there are always jobs that come along that takes a mechanic much longer than is billable to fix a problem. It is also how warranty claims are paid.

We are a dealership and we charge $76/hour for labor. We have two flat rate mechanics that make $25/billable hour and one full time hourly mechanic that makes $14/ hour. The flat rate guys stick to repairs only, were as the hourly guy does everything from re-paint the service department to prep a unit for sale. He also does repairs and helps out the flat rate guys...all the while learning more about his trade. I would say we are the exception. (We are a small dealer at the moment)..but most dealers you go to will have maybe 2 or 3 flat rate guys that have a pretty good idea of what is going on and then you have 20 seventeen year olds working on stuff. You as a customer don't see the service department usually and don't realize you've had a bunch of idiots work on your unit until you have to bring it in 4 times for the same problem. Most dealership owners know this and love it. They pay nearly nothing for labor and there is a large enough customer pool that the suckers keep coming in. So they are making major cash.

As far as warranty goes...the powersports industry might be different, but we gladly do and are encouraged by the manufacturer to do warranty. We get paid for the parts we used plus 110% of our normal labor rate...so we actually make more money doing warranty work. The only reason it is a pain in the ass, you have to stay on top of it constantly. If a claim is rejected, making sure it's filed in time, making sure it gets paid, etc....warranty in itself is a full time job.
Flate rates theoretically should make for a level playing field and this may be generally true across the dealer networks. Flat book rates are designed in such a way so they standardise the rates across a given dealer network and present a 'official' time which is used to bill the customer, ("See Sir, the book says 3.75 hours!") while at the same time ensure that an efficiently run dealership will nearly always be able to beat the times to maximise profits.

It's a way of telling the customer the labor rate is $85.00 per hour while in fact they are really being charged $150.00 per hour. So really it's just figure fudging. But hey, most stealers do it! Of course for the times when things go wrong and jobs take longer than they should the overall dealer bias of the flat rates ensure that any losses are well and truly offset.

In my days 1st year apprentices of spent nearly their entire first year down in the lube pits. This was an effective way to maximise the return for the dealer as they were cheap labor (also subsidised by the Government) and couldn't cause too much damage (short of leaving a sump plug or oil filter loose!)

Granted it takes about two years before an apprentice can generally be left to do most general service work without too much supervision. In the larger dealerships many apprentices don't get much real in depth hands on mechanical work until towards the end of their apprenticeships.

In my days warranty work was paid at about 75% of normal rates so this also encouraged the dealership to try and avoid warranty versus non-warranty work. I think this was a deliberate ploy by the manufacturer to discourage what it saw as frivolous warranty claims and put the onus on the dealer to avoid claims as often as it could due to the lower hourly rate. I'm talking quite a long time ago and as I said, I think the public is a lot more informed these days and car manufacturers & dealers are more sensitive to bad publicity.