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
Jul 10, 2024 - Sales Decrease as Employment Grows
- Total revenue for auto repair and maintenance services was $41.9 billion in Q1 2024, a 2.5% decrease compared to a year ago and 2.2% lower than the previous quarter, according to the latest data from the Census Bureau. Employment by auto repair shops increased 0.9% in May 2024 year over year, as levels remain higher than pre-pandemic levels, according to data from the Bureau of Labor Statistics (BLS). Meanwhile, average wages per hour for nonsupervisory employees at auto repair shops were 6.6% higher in May 2024 compared to a year ago, reflecting the tight labor market. Average wages per hour reached $28.18 in May 2024.
- Consumer confidence levels fell in June 2024, after an uptick in May, according to data from The Conference Board. The Conference Board’s consumer confidence index was 100.4 in June 2024 from 101.3 in May 2024. Dana Peterson, chief economist at The Conference Board, noted that confidence was the highest among those under age 35 and those in the income category of over $100,000. Plans for large appliance and smart phone purchases rose on a six-month basis, while plans for car purchases stalled.
- 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.”
- Electric vehicle (EV) total loss frequency rates were higher in Q1 2024, up 8% from Q4 2023 and up 30% from Q3 2023 in the US, according to the “Plugged-In: EV Collision Insights” report from Mitchell in Body Shop Business. EV total loss rates were 9.9% and 7.4% in the US and Canada, respectively, in Q4. According to Ryan Mandell, director of claims performance for Mitchell, “Slowing new sales, manufacturer price reductions and changing consumer sentiment are impacting the value of used EVs. As a result, the total loss frequency for collision-damaged EVs is increasing. However, it is also increasing for new gasoline-powered vehicles, which are comparable to EVs in terms of their complexity and cost to repair.” In addition, the report noted that the average number of mechanical labor hours present on estimates for repairable vehicles was nearly twice as high for EVs as for internal combustion engine (ICE) vehicles, and EV claims frequency is steadily rising.
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