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
Aug 9, 2024 - Increase in Prices, Vehicle Miles Traveled
- Total vehicle miles traveled on all roads and streets grew 1.3% in May 2024 compared to a year ago, reaching an estimated 293.4 billion vehicle miles, per the US Department of Transportation. An increase in miles driven can drive demand for auto repair and maintenance, as vehicle servicing is required at certain mileage markers. Prices for motor vehicle maintenance and repair grew 6% in June 2024 compared to a year ago and increased 0.2% from the previous month, according to Consumer Price Index data from the Bureau of Labor Statistics. In addition, consumer spending levels grew during the first five months of 2024, according to personal consumption expenditures data from the Bureau of Economic Analysis.
- The Institute for Supply Management reported its services-sector PMI expanded to 51.4% in July 2024 from 48.8% the previous month. The PMI indicated expansion for the 47th time in 50 months, though two of the contractions came in April and June of this year. The report tracked the performance of 18 service sectors, out of which 10 showed an increase in July. Industries reporting growth were Arts, Entertainment & Recreation; Accommodation & Food Services; Mining; Construction; Management of Companies & Support Services; Transportation & Warehousing; Public Administration; Finance & Insurance; Health Care & Social Assistance; and Utilities. Eight sectors showed declines in July: Agriculture, Forestry, Fishing & Hunting; Real Estate, Rental & Leasing; Wholesale Trade; Retail Trade; Professional, Scientific & Technical Services; Information; Educational Services; and Other Services. The Services PMI report is based on data from purchasing and supply executives nationwide compiled by the ISM.
- Consumer confidence levels rose in July 2024, after a decrease in June, according to data from The Conference Board. The Conference Board’s consumer confidence index was 100.3 in July 2024 from 97.8 in June 2024. Dana Peterson, chief economist at The Conference Board, noted that confidence was the highest among those under age 35 and those 55 and older in July. Those in the income category of over $100,000 were the most confident on a six-month moving average basis. Plans for large appliance and smart phone purchases increased on a six-month basis, while plans for home purchases fell to a 12-year low.
- 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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