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
Oct 17, 2024 - Prices Up for Vehicle Maintenance
- Prices for motor vehicle maintenance and repair services were nearly 5% higher in September 2024 compared to the previous year and were up 1% compared to the previous month, according to Consumer Price Index data from the Bureau of Labor Statistics (BLS). Total revenue for automotive repair and maintenance companies was $41.6 billion in Q1 2024, a 2.2% decrease compared to a year ago and a 0.5% decline from a year ago, according to the Census Bureau. Consumer spending, a key indicator for the industry, grew 2.6% in June 2024 compared to a year ago and increased 0.2% from the previous month, according to the Bureau of Economic Analysis. Employment by auto repair shops was flat in July 2024 compared to a year ago while average wages at auto repair shops grew 5.3% from a year ago.
- The US auto repair shops industry is projected to grow at a CAGR of 4.6% between 2024 and 2028, according to a forecast from Inforum and the Interindustry Economic Research Fund, Inc. The expected growth rate is comparable to the overall economy‘s anticipated growth. The report noted that consumer confidence is expected to improve in the forecast period, which bodes well for the various service industries. Factors that continue to limit consumer spending are lower consumer sentiment levels, higher interest levels, and elevated price levels. Price growth, however, is diminishing and likely to stabilize soon near intended rates. The report noted that auto supply challenges during and post pandemic have boosted consumer demand for the auto repair industry. “These constraints force many to maintain and repair vehicles and other equipment that otherwise might have been replaced,” per the report.
- Drivers drove 2.7 trillion miles in 2023, which is in line with recent years, with nearly 40% of driving trips made in vehicles older than 10 years, according to the recently released 2023 American Driving Survey from the AAA Foundation for Traffic Safety. The report stated that the share of older cars on the roads is a concern. “These vehicles often lack modern safety features and may be in poorer mechanical condition, potentially contributing to a higher risk of crashes,” it said. The number of driving trips taken per day averaged less than 2.5 per day with a duration of just over an hour and totaled 30 miles. Most driving trips taken in 2023 were to run errands (31%) and for work commutes (27%).
- US light duty aftermarket sales grew by 8.6% in 2023, reaching $392 billion, according to the 2025 Auto Care Factbook released by the Auto Care Association. The sales surpassed the previous year’s projections of 8.1% despite challenges such as persistent inflation. Light vehicle growth is expected to be 5.9% higher in 2024. The industry is expected to continue to improve, with a sales forecast of $617.3 billion in 2027 for total light, medium, and heavy duty automotive aftermarket. Consumers seeking affordable options for service and repair to keep their cars running are driving stable growth in the industry. According to Bill Hanvey, president and CEO, Auto Care Association, “As credit card debt in the U.S. reaches an all-time high of more than $17 trillion in 2024, Americans are feeling the weight of inflation and choosing more cost-saving options when possible, including with the maintenance of their cars.”
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