Auto Repair Shops
Industry Profile Report
Dive Deep into the industry with a 25+ page industry report (pdf format) including the following chapters
Industry Overview Current Conditions, Industry Structure, How Firms Operate, Industry Trends, Credit Underwriting & Risks, and Industry Forecast.
Call Preparation Call Prep Questions, Industry Terms, and Weblinks.
Financial Insights Working Capital, Capital Financing, Business Valuation, and Financial Benchmarks.
Industry Profile Excerpts
Industry Overview
The 79,000 automobile repair shops in the US fix cars with mechanical problems or restore a vehicle after a collision. The automobile repair industry is highly fragmented. Most out-of-warranty vehicles are repaired at independent shops. A vast majority of independent service shops are family-owned.
Declining Collision Sector
Once a highly-profitable segment, the collision and body repair sector is in what some industry experts have termed “irrevocable decline.
Competition from Dealers
Car dealerships are increasing their efforts to service and repair vehicles of all types.
Industry size & Structure
The average auto repair shop has about 4-5 employees and generates $790,000 in annual revenue.
- The automobile repair industry includes 79,000 firms that operate 83,000 shops, employ 392,400 workers, and generate $62.6 billion in annual sales.
- The auto repair industry is separate from dealerships that provide repair services as well as the aftermarket industry, which manufactures and supplies components for vehicle repair.
- The automobile repair industry is highly fragmented. A vast majority of independent service shops are family-owned.
- The average car is 12.5 years old. A shift toward older vehicles tends to benefit the auto repair industry, as it indicates customers are more likely to take them to a mechanic for service.
- Many independent mechanics are closed on the weekends, hindering competition with car dealerships that operate on Saturdays. Mechanics work an average of 40 hours a week.
- The largest auto repair companies in the US are Meineke/Maaco, Midas, Monro, and Precision Tune Auto Care.
Industry Forecast
Auto Repair Shops Industry Growth
Recent Developments
Jan 31, 2025 - Auto Repairs More Complex, Costlier
- The increasing technical complexity of new automobiles is adding time and costs to auto repairs, according to automotive software maker Mitchell International. Overall auto accident insurance claims were down last year due to a milder winter with less hazardous conditions and the growing use of collision avoidance systems in cars. Volume might be down, but total loss claim volume has risen because cars are becoming harder to repair as they age and this can force consumers back into the market if repairs prove too costly. Today’s cars are a complicated mixture of components such as aluminum, composite materials, small individual parts, and technology systems. According to Mitchell, repair claims that need replacement parts grew in the US by 15% from 2019-2024, and now parts account for 51% of repair costs.
- The Q4 CCC Crash Course Report has found that vehicles seven years or older now account for nearly 45% of all repairable claims, which is a sharp increase from pre-pandemic levels due an aging vehicle fleet. The older vehicle pool has also impacted the total loss frequency, which reached a record high of 22% of all claims through October 2024. Another major shift in 2024 was the higher cost of motor vehicle insurance, which has grown 51% since 2022, causing consumers to be selective about filing claims for minor damage. Per the report, repairable claims of $2,000 or less now make up 26% of the mix, a decrease from 43% in 2019.
- A new report from The Romans Group found the total addressable collision market in the US reached an all-time high of $50 billion in 2023, up from $44.8 billion in 2022, according to Body Shop Business. The report titled “A 2023 Profile of Evolving US and Canadian Collision Repair Marketplace” also showed that the Canadian total addressable collision market grew to $4.5 billion (Can$) in 2023, an increase from $3.9 billion in 2022. In the greater than $20 million segment, the top three independent consolidators Caliber, Boyd/Gerber, and Crash Champions continue to grow steadily. The five-year forecast projects the top three consolidators will increase their 2023 market share from over 24% to 37% in 2028. Average repair costs continue to grow due to a variety of factors including greater repair complexity, higher inflation-based labor expenses, higher parts costs, and new costly materials such as carbon fiber, according to the report.
- Car repair costs grew nearly 30% in the past three years due to inflation and new technology in newer vehicles, according to a recent report in the Wall Street Journal. Specifically, the complexity of sensors and computers in newer vehicles requires additional costs and labor to fix. The average repair cost for an insurance claim in the second quarter of 2024 was $4,721, about $800 higher than three years ago. The report noted that replacing a side-view mirror on a 2020 car can range from $1,200 to $1,500 due to the addition of sensors for lane-change assistance and a heating component, compared to a $200 to $400 cost for a 2013 car. According to experts in the report, a typical car had about 10 to 30 onboard computer modules a decade ago, compared to 75 or more today. Tech-aided safety features such as blind-spot monitoring and automatic emergency braking have reduced minor and major collisions and raised the cost of repairs with the recalibration of the advanced driver assistance system (ADAS) required after some accidents. About 26% of repairs associated with insurance claims have included recalibrating sensors, up 5% in 2024 compared to 20202, per the report.
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