Auto Body Shops NAICS 811121

Oct 20, 2025 - Parts and Metal Shortages Hampering Auto Body Repair

• US auto repair and body shops are feeling the ripple effects of major auto supply chain disruptions in late 2025. Shortages of aluminum, semiconductors, and other key parts (exacerbated by a US worldwide trade war) are slowing vehicle production, leaving many repair shops struggling to source replacement parts. With longer lead times, repair costs are rising and shops face delays in servicing customer vehicles. Some estimates suggest parts availability has dropped sharply compared with pre-pandemic levels, causing wait times for repairs to stretch by several weeks or more. The situation mirrors the early-2020s chip shortage but is broader, affecting multiple vehicle systems and brands. For repair shops, this means increased operational challenges, higher costs, and potential lost revenue as customers wait for parts. Experts warn that unless supply chains stabilize and tariffs ease, auto repair businesses may continue to face pressure from both constrained inventories and rising expenses.
• Auto body repair costs in the US are rising at an unprecedented pace, driven by labor shortages, higher parts prices, and supply chain pressures, per the Consumer Price Index. Vehicle repair and maintenance expenses increased nearly 8.5% year-over-year in August 2025, with some regions reporting spikes of 15% or more. Labor costs are a major factor: technicians’ wages have risen 10-20% in some markets due to a persistent shortage of qualified staff. Parts costs have also surged, with OEM parts up 8-12%, and used or aftermarket parts climbing 5-7%. Collision shops report that insurers often resist adjusting reimbursement rates in line with these increases, squeezing profit margins. The industry trouble means that the average cost of a typical collision repair now exceeds $4,500, up from around $4,000 just a year ago. Many shops warn that without adjustments, maintaining service quality and profitability remains a challenge.

• In the first half of 2025, the auto body repair industry experienced significant consolidation, largely driven by private equity investment. While traditional large consolidators (such as Caliber and Crash Champions) slowed their expansion by about 60% per Focus Advisors, new private equity-backed firms entered the market and increased competition. The trend reflects a broader shift toward larger, more centralized repair companies that can operate at a larger scale, streamline operations, and negotiate more effectively with insurers. For independent auto body shops, the trend creates both challenges and opportunities: smaller operators may face increased pressure to compete on price and service, while those willing to partner with consolidators can benefit from better operational support and access to new resources. Overall, private equity-driven consolidation is accelerating the professionalization and centralization of collision repair in the US.
• Increased passenger vehicle weights and the further integration of automated safety control systems is having an impact on how the auto body repair industry operates, according to industry experts at a recent seminar hosted by the Collision Industry Electronic Commerce Association. Weights are increasing in cars, trucks, and SUVs and added heft generates more force in crashes and causes more damage. The seminar noted a 1995 Ford Ranger weighed 3,200 pounds, while a 2025 model of the same truck weighs 4,000 pounds. Most of the weight gains are attributed mainly to luxury features such as all-wheel drivetrains, turbocharged autos with higher speed, and EVs, which are significantly heavier than gas-powered vehicles. Technology features like automatic emergency braking systems are not reducing the number of collisions, but it is making them less dangerous yet more costly to repair.