The labor rate for auto repair shops in the United States varies greatly. Factors that affect the labor rate include the location, type of repair shop, and whether the repair shop is independent or part of a dealership.
Sometimes the labor rate per hour might seem too high, while at other times a deal might seem too good to be true.
In this guide, you will learn everything you need to know about the labor rate and whether or not you are getting ripped off.
Let’s get started right away!
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Factors That Determine The Labor Rate
The hourly rate varies across the country, to such an extent that the difference could be over $50 per hour. In general, the higher the average wage, the higher the labor cost at the auto repair shop.
Of course, the average state wage is not the only factor that determines the labor rate for a car repair.
Other factors that influence the labor rate include:
- Repair shop location (urban vs. rural)
- Type of shop (independent vs. dealership)
- Make and model of the vehicle
These are the main factors in how a labor rate is determined, but even with the same car, location, and type of shop, the rate may still differ greatly due to a shop valuing their expertise more or possessing special certification.
Repair Shop Location
The labor cost is influenced greatly by the location of the repair shop. This applies both to the state where the repair shop is located, and in what area locally (downtown or in the outskirts).
In general, a repair shop that is on the outskirts of a city will have a lower average labor rate than a repair shop located downtown in the same city.
This is because the repair shop must cover their overheads, which include the rent or mortgage of the shop itself. On the other hand, if the repair shop owns its building outright, the labor cost may be lower.
Independent Or Dealership
Another major factor that influences the labor cost is if the repair shop is an authorized one. These tend to be more expensive, but they also have a few advantages.
If you have your car serviced at an authorized dealership, the price will usually be very similar, regardless of where the shop is located. Unfortunately, these shops also tend to be more expensive.
Many people will be deterred from servicing their car at an authorized dealer due to the price, but there are reasons you should consider it.
The most significant advantage is that your car will be taken care of by people who know it inside and out. They are experts regarding your vehicle and, if anything unexpected pops up, they will be able to fix it.
This is also why cars with a registered service history from an authorized dealership are usually sold for a larger amount as buyers can trust that the care has been properly taken care of.
Of course, this doesn’t necessarily mean that a car that has been serviced at an independent shop will have received worse care than a car that was serviced at a dealership.
Although an authorized shop likely has the better expertise and all the necessary tools, it is also possible that the premium cost will be too high.
If you are buying a new car or trading one in, you should try to negotiate a deal to have your new car serviced at a discounted rate. Dealerships tend to agree with this as it doesn’t cost them much to service a car, yet they otherwise charge a premium.
There are also independent shops that specialize in a specific car brand or type. These may also be on the expensive side. You should always consider whether or not the repair shop has experience working with your car model and/or make.
Car Make And Model
The car’s make and model will usually dictate the labor cost per hour if the car is serviced at an authorized dealership.
For example, a more premium brand such as Mercedes-Benz will cost more to repair than a Honda, even if the repair is effectively the same. In this case, you are simply paying an extra premium cost.
Your car’s make and model might also affect the labor cost (not necessarily the hourly rate). This is because some car models will have more readily available parts, or it uses parts that are easier to replace.
For example, some cars use wheel bearings that are serviceable, while others do not. If they are serviceable, it means the wheel bearing can be separated from the wheel hub assembly and replaced.
If it is not serviceable, the whole wheel hub assembly must be replaced as the wheel bearing cannot be separated. In this example, the work is less labor-intensive, but the part is more expensive.
How Is The Labor Rate Determined?
Most repair shops in the United States charge their client based on a flat fee estimate. The flat fee is taken from a database with flat-rate tables.
These flat-rate tables are usually specified by the manufacturer or by an aftermarket publisher, such as Chilton or Motors.
In these tables, the estimated time is based on the car model and year. Shops then take the rate provided by this table and multiply it by their own hourly rate.
It’s worth mentioning that the shop might charge you for a project according to the flat rate table, even if the work was completed in less time than the estimate given by the same flat rate table.
This means that more experienced mechanics could complete a project in two hours, then charge for three hours as per the flat rate table. This might seem unfair, but it is legal.
As previously touched upon, the hourly rate does not all go to the mechanic servicing your car.
The shop’s rent, mortgage, tools, location, experience, certifications, and more each play a part in determining the rate per hour.
On average, the labor rate per hour will be somewhere between $75 and $130, whereas the dealerships tend to be at the higher end.
Am I Getting Ripped Off?
You now know how and why the labor rate per hour differs, but you may be wondering where you should take your car for servicing and repairs.
The answer is not straightforward. In most cases, an authorized shop will provide you with the best possible service, but you might find it hard to justify the cost.
Many shops, including retail stores that provide car services such as Walmart, offer cheap specific deals for your car.
Always be wary of cheap deals as they could be more expensive in the long run. For example, shops may offer an oil change at a good price but then try to upsell, stating that you need a new air filter, transmission fluid, brake fluid, and so on.
They might also tell you to return after 3000 miles, which is a distance that is nowhere close to most of the oil change intervals. For them, it simply becomes a new opportunity to sell more parts and services.
If you’re skeptical that something needs to be done to your car, you can always ask for a second opinion.
Take time to read about the parts that apparently need to be replaced and ask questions to your mechanic if you have any. To ensure you’re getting a good deal with any work done on your car, be sure to check out our articles on car repair and costs.
The hourly labor rate will vary depending on multiple factors, including shop type, location, and expertise.
While it may seem that the hourly rate is expensive, the repair shop must consider the many expenses that come with running a business. These include rent, mortgage, wages, tools, and more.
One of the most significant factors that determine the labor cost is whether the shop is independent or part of a dealership.
Dealership rates are higher, but you also get mechanics that work on cars like yours almost every day. This doesn’t mean that independent shops are bad or worse than dealerships, but it can be tougher to find a good independent shop.
The labor costs between dealerships of the same car brand usually fluctuate far less than independent shops, which can vary by more than $50 per hour.
Independent shops tend to charge more if their location is more central, if they possess multiple certifications, or they specialize in a particular niche of car repairs and services.
Many people choose to service their car wherever they can find a great offer, such as at a Walmart Auto Care Center. While this doesn’t necessarily mean it is bad, you should be careful to not get dragged into any unnecessary extra costs they may suggest.
This could include a cheap oil change that turns into a change of air filter, brake fluid, and more, even though they are not needed.
Car shops use a flat rate table to determine the cost for the job and then apply their hourly rate. The flat rate is suggested by the car manufacturers or an aftermarket publisher.
If you believe an estimate for a repair is too high, you can check with other shops in your area, or visit local forums to see if any shops offer a cheaper price.
The price could be an indication of the service you will receive, but that isn’t always the case. Shops that offer lower prices could do the job just as well as the more premium shops.
If it turns out that you need an extensive repair, or that you own an unusual car that some mechanics are unfamiliar with, it is generally better to take your car to an authorized repair shop.
The average labor rate per hour is between $75 and $130. You can expect the dealership rate to be higher than at an independent repair shop.