Automotive Repair Shops

The US auto repair shop industry includes about 170,000 establishments (single-location companies or branches of multi-location companies) with combined annual revenue of $90 billion. Large companies include Midas, Monro Muffler Brake, and Belron US. The industry is highly fragmented: the 50 largest companies generate less than 10 percent of revenue.

The industry includes fast lube/auto oil change services and car washes, which are covered in separate industry profiles.

COMPETITIVE LANDSCAPE

Demand depends on car usage and the number of cars on the road. The profitability of individual companies depends on convenient location and good marketing. Large companies can maximize use of expensive diagnostic equipment and have advantages in purchasing, distribution, and marketing. Small companies can compete effectively by providing superior customer service or offering specialized services. The industry is labor-intensive: average annual revenue per worker is about $100,000.

Competition includes other venues that provide automotive services, including some gas stations, car dealerships, and branches of chain stores, like Sears and Kmart. Auto repair shops perform an estimated 70 percent of repairs for out-of-warranty vehicles, according to the Automotive Service Association (ASA).

PRODUCTS, OPERATIONS & TECHNOLOGY

About 70 percent of industry revenue comes from mechanical repair and 30 percent from collision repair. Mechanical jobs include repairs to "undercar" systems, (mufflers and exhausts, transmissions, brakes, and shock absorbers) or in "underhood" systems (engines, electrical systems, radiators). Body work includes exterior and interior repair and glass replacement. Other services include oil changes ...