284 million vehicles operate on US roadways in 2022 alone. It has been forecasted that general auto repair revenue will reach $58.7 billion by 2024 in the United States.
With these figures, you would think tapping into the auto repair industry is a no-brainer. But expensive repair equipment and finding qualified help makes it very challenging.
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Some auto repair shops can only offer a few services at a time before offering the full spectrum. Even then, they need to have healthy margins to sustain and then grow their business.
If you are an auto repair business just starting out, here are nine of the most profitable auto repair services you can focus on to grow efficiently.
But first: a few things to keep in mind
Most of these services can be done by every level of technician in the shop.
They are highly repeatable processes, meaning the tasks are easy to complete in shorter amounts of time. Considering that, each service can have decent margins.
To maximize profits, ensure that not a lot can go wrong during these jobs. Working on more complex issues, like a timing belt for example, will take up more time. More time means using more resources, which means lowering profitability.
You want to offer easy services for both you and your customer. Those that prevent long term damage and repair, leading to a happy customer and future business for your shop.
With this consideration in mind, here are some of the general auto repair services you can offer that will generate good revenue.
One profitable auto repair service is diagnostic scanning before and after a collision repair.
With time, automobiles have become more technology driven. Diagnosing problems can be difficult. Vehicle owners will usually come with problems like a lurch in the car when they drive, or some unknown noise.
Diagnostic scanning is used increasingly due to the effectiveness of this procedure.
Quickly figuring out and tackling the issue will give you an edge. It is a sure way to bring loyal and new customers to your shop. Advanced diagnostics tools help you do just that. All you have to do is plug into various vehicles and generate a report. The test algorithm will help measure anything from fluid levels to other problems the vehicle may be experiencing.
With this service, you are only charging for your time. It does not require a big investment in terms of equipment. It is a service that will always be required and allows you to continue building your business.
It will not guarantee instant profit, but will definitely help you become more profitable over time. Overall, it’s the most sought after auto repair service.
In 2020, 50% of repaired cars underwent diagnostic trouble code scanning.
Pro tip: Keep in mind that some auto repair shops provide free diagnostic testing. However, this is likely for cars that are aged over a few years. This means some errors are bound to show up after a test, solidifying repair and maintenance opportunities for your business.
2) Air conditioning and heating
Having a reliable heating and cooling system in your car is essential. Depending where you are located in America, you will need a good cooling system for southern states and a good heating system further north. Those more centrally located need a bit of both!
Thus, there will always be a demand for this service. Your shop should offer these from the very beginning. It is a common issue that people run into and definitely needs to be fixed.
An effective air conditioning machine will help you achieve this efficiently. Manually checking the system will waste both your and your customer’s valuable time.
Car suspensions take a beating on a daily basis depending on the condition of the roads they use. Potential road challenges include potholes, railroad tracks, speed bumps, snow, gravel and the like. When these factors cause issues, repairs aren’t easy and definitely require an expert mechanic.
Parts are fairly standard and calculations are easy. You just need to make sure you have reliable (and affordable) access. With reasonable labor costs, you can definitely maintain a good profit margin.
4) Oil change
An essential part of car maintenance, oil changes are definitely one of the most profitable auto repair services. Even if a car is brand new, it will require regular oil changes to perform at a high level.
As you become known for reliable oil change service, you will attract more customers. These visitors may initially stop in for an oil change but end up seeking out additional repairs. When this happens, you essentially become a one-stop shop.
With many oil change businesses raking in nearly $250,000 a year, you could potentially have a net profit of $75,000 to $80,000 a year on this service alone.
A good investment to make is auto repair equipment that will streamline this process. This could include specialty lifts, oil change bays with proper disposal and other equipment. Though these upfront costs could be significant, they will reap rewards later.
5) Brake repair
Brake repair problems are a common occurrence. They can range from:
- Too much noise
- Too much vibration
- Brake pad worn out
Investing in a brake lathe is a good option. This machine fixes noise and vibration problems often experienced with heavy brake usage. It also corrects the thickness of the rotor. The rotor is usually damaged by too much or uneven contact of brake pads on the rotor’s surface. It could also be rust on the rotor’s surface.
Usually auto repair businesses will send brake jobs to another shop for repair. Why do that when you can do it in-house? Your services will become even more efficient and cost effective.
With year-round demand, brake service is a sure shot profitable auto repair service. You can even include this as part of a regular maintenance schedule. This way, you retain customers and generate profits. Similar to suspension services, most parts for brake repair or replacement are standard off-the-shelf items.
6) Tire repair, rotation and replacement
The U.S. market size for tire replacement was about $40 billion in 2020. Passenger tires recorded $26 billion, holding the largest share of the market. This forecast is only expected to increase as more cars join the road.
For this reason, tire repair and maintenance is a definite service to tap into. Depending on the type of car, you can charge up to $200 per tire to replace. However, some shops do this for free provided the owner purchases the tires from their shop.
7) Fluid services
Another common service includes fluid flushes.
This service is part of routine maintenance checks. Cars do not present a warning light or reminder for flushing brake or transmission fluids.
Fluid maintenance helps cars stand the test of time, and a service customers will need consistently.
The different types of fluid maintenance include:
- Transmission flush – For every car that has driven at least 30,000 to 50,000 miles, a transmission flush is recommended to increase longevity.
- Brake fluid flush – Should be changed every 24,000 to 36,000 miles. This recommendation may vary depending on the age of the vehicle.
- Fuel injection flush – Clogged fuel systems lead to poor gas mileage. Making a fuel system flush for every 30,000 – 35,000 miles imperative.
- Power steering flush – Poor power steering fluid can cause terrible damage to hoses, pumps, etc. This can cause the power steering system to fail, which is why mechanics recommend a power steering flush every 50,000 – 70,000 miles.
- Engine coolant (anti-freeze) flush – Modern vehicles use 5 to 10 year coolant. This means it doesn’t require frequent change. However, for any car older than 2011, make sure to perform this service for every 50,000 to 75,000 miles.
- Rear differential flush – This service keeps all the parts in the differential to move smoothly. These should be checked every 30,000 miles and changed every 75,000 miles.
8) Shock absorber replacement
Considering how much impact a car absorbs on the road, the shock absorbers help protect the suspension and springs of the vehicle. Symptoms that indicate shock absorber replacement include:
- Steering wheel vibrations
- Uneven tire wear
- Leaky fluid
- Poor brake performance
Parts are easy to acquire, and the job itself should only take 2 – 3 hours to replace. This service is straightforward and one you can profit from.
9) Steering repair
Another common issue that turns up is power steering repair. The vehicle could make a whining noise when turned, become stiff, or form a puddle underneath the car. Regardless, this is another general auto repair service that you can offer that is bound to be in demand.
Here are some of the common steering issues that you should be sure to expect and ready to tackle:
- Power steering fluid leaks or low power steering fluid – If you are already including fluid maintenance as a service, these should be easy to tend to.
- Damaged or worn out power steering belt – The belt will likely need to be tightened or replaced completely for better steering functionality.
- Failing steering rack mount – A blushings replacement or repairing the rack mount might be needed.
- Bad strut bearings or tie rods – If you are already providing a suspension and tire wear maintenance and repair, this should be easy to do.
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You can make money by charging a flat fee or hourly rate for your service. You can also set routine maintenance fees, charging a set price for simple maintenance such as oil change. Another way you can do it is based on parts and labor costs.
With a little strategic planning, you can truly prepare your business to be profitable. All you really need to do is assess the market for the services that have higher demand. Our list should have helped you find those.