Report Confirms Auto-Repair Gouging, Ranks Best And Worst Cities

February 25, 2010
With auto repair chains ever expanding and dealership service becoming more consistent and predictable, you might think that repair costs are becoming much more standardized than they used to be for car repairs done at independent shops, with very little variation, once you average a few shops, across town or from city to city.

But that's not the case. The repair resource AutoMD studied more than 600 repair shops—including dealers, independent shops, and franchises like Pep Boys—in the market areas surrounding the top 50 most populated cities in the U.S., and found a lot of variation.

For consistency, it chose a job that's quite common and due to easy parts availability should be relatively consistent in price: replacing the front brake pads on a Ford Focus.

But initial estimates for the job were wildly inconsistent, ranging $60 to $545 on a national level and with some shops in the same local area costing three or four times that of others. Even more shocking is how few shops stuck to their original price quote. More than half of the shops polled wouldn't stick to the original number.

You're going to need to be especially careful in Chicago. There, bait-and-switch on repairs is more common than windy days, it seems: 100 percent of the shops checked changed the price by more than five percent.

2008 Ford Focus SES

2008 Ford Focus SES

And even when you average out results over many shops, having that brake job done in Chicago typically costs more than a hundred dollars more in Chicago than in Jacksonville ($226 versus $130).

AutoMD ranked cities not just on the average price quoted and the range from lowest to highest, but on so-called shopping integrity—the likelihood of switching quotes once a shop started doing a repair job.

For instance, Miami had the lowest price quotes, with an average of just $127, but a whopping 92 percent of shops switched quotes, dragging the city down to sixth place overall. Omaha averages $149, with only 33 percent switching quotes, bringing it to a second-place overall rating.

The five best cities for auto repair, according to AutoMD, are Memphis, Jacksonville, Omaha, San Antonio, and Austin, while the worst are Chicago, Honolulu, Albuquerque, Washington D.C., and Raleigh. They've posted the entire list, with prices and percentages for all 50 cities.

VW offers 3 years free service on 2009 models in U.S.

VW offers 3 years free service on 2009 models in U.S.

How do you explain the differences? Even AutoMD is at a loss; in trying to find out why, the company looked at whether the variation in pricing was due to density of repair shops versus population or the number vehicles—so-called shop penetration—and that didn't seem to have any relationship with prices.

Shane Evangelist, the president of AutoMD, suggests that the vulnerable position of the customer is part of the issue. "If you look at the body repair industry, insurance companies really regulate the business," said Evangelist, and new cars are covered very specifically under warranty through dealerships. But when people bring their vehicle to an independent shop, a franchise shop, or even a dealership for non-warranty repair work, he explains, "you get a situation with the seller knowing much more than the buyer."

Some of the variance you'll see from the time of the initial estimate through to the end of the repair is typically based on parts availability, Evangelist concedes, but he said that isn't a good excuse. "It's very easy to come up with a job cost," he said, which is why they chose such a common repair as a benchmark to show that this is happening."We've all kind of known it went on but we didn't have the data to support it until now," Evangelist said, pointing out that AutoMD had recently found that 88 percent of vehicle owners felt overcharged at the repair shop.

Evangelist suggested that some shops give labor discounts some days (mid-week, for instance) and surcharges on others (before holiday weekends) that you're not likely to be able to see on your receipt. Ultimately with more up-to-the-minute repair info, what services like AutoMD hope to achieve in the long run is a live comparison-shopping or bidding process for auto repair—if at least for routine tasks like a brake job.

[AutoMD]

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