By: Jim Roal
After working over 15 years in the auto repair industry, I have some insight I would like to share with everyone. The auto repair industry has changed quite a bit over the years as more complex automobiles have driven a new kind of mechanic into existence. Some of this has fostered smarter, better trained mechanics. However, it has developed the parts swapping business into enormous proportions. Part of the reason I changed careers was because I was so frustrated by working in such a crooked environment. Bad mechanics that lacked morals made the most money and honest ones lagged behind significantly.
One key problem with the auto repair industry is the flat rate pay system which nearly all repair shops use. Basically it works like this: Labor time manuals are printed by the manufacturer for warranty repair time standards. These are times for a given job that are preset and are rounded to the nearest 1/10 of an hour. For instance, the replacement of an ignition module on a particular car may pay 1.1 hours in the warranty manual. That means that no matter how long it takes the mechanic to change that module, he still gets paid 1.1 hours. Aftermarket flat rate manuals are used for after warranty repairs. These manuals usually just take the warranty manual and multiply the time by 1.5. In some cases special times will be used instead. A mechanics flat rate time charge is usually referred to as a flag. For instance, the mechanic changing the module above will flag 1.1 hours for it under warranty or 1.7 hours retail.
Most mechanics are paid 100% commission based on what they flag. This is not always true but it is the overwhelming majority that are paid this way. For these mechanics, the motivation is to flag as many hours per day as possible. It is not impossible, or even that uncommon, for a mechanic to flag over 16 hours in an 8 hour day. The mechanic will make a given wage per flat rate hour. If he flags no time in a given day, he makes no money at all. Few shops guarantee a minimum income. There is no real maximum either. It is not unheard of for a fast, crooked mechanic to flag over 80 hours in 5 day a week while working only a little over 8 hours per day. The work load can be seasonal too. It was quite common to have a 50% or more pay fluctuation (flagged hours) from winter to summer.
The shop effectively makes a portion of what the mechanic flags so they too are interested in having the mechanic flag as many hours per day as possible. There is little motivation to be honest and quite a bit of motivation to rip off the customers. Most shops will not pay a mechanic to do a job twice. If a mechanic changed a water pump for instance, and the car came back with a leaking water pump gasket, the mechanic would have to replace the gasket and charge no time. The problem is that it is in the best interest of the shop and mechanic to blame the leak on something else that they can charge the customer for. Electrical and electronic parts typically have about a 30% to 60% no fault found rate on warranty returns. That means that about 30% to 40% were misdiagnosed in the field or the failure was not found during lab analysis.
Dealers/managers love those high speed guys because they make the company a ton of money. They figure what's a few blown out customers compared to a good profit. They're not going away, in fact, they are becoming all too common because that's what it's coming down too. Tech's haven't got a cost of living increase in years. When you ask a manager for a raise he says, "You want a raise, make more hours!" A few managers base their mechanics pay on hours produced. Tech's working over 80 hours a week got a $2 per hour raise over a 40 hour tech. It is the exception to find a company giving a raise to the tech with the highest customer satisfaction.
There is not really a flat rate time for diagnosis in most cases. This means that a good mechanic that can troubleshoot a problem in 0.5 hours may charge significantly less than a clueless mechanic that spends 2 days swapping parts to figure it out. In the first case, an honest mechanic will flag 0.5 hours. Some may claim that since they are so smart, they will flag 0.8. In the second case, the same repair will cost the customer 2 full days plus any additional parts that were swapped as a guess. Again, there is very little incentive for the shop owner to intervene unless the customer complains.
Many mechanics will guess and swap parts until the problems are solved or the customer runs out of money. Only about one quarter of the mechanics out there can really troubleshoot problems accurately. Of those, only a portion can troubleshoot intermittent and more difficult problems. Most electrical and drive ability problems on today's automobiles are intermittent. If you find a good mechanic you can trust, stick with him and tell all your friends.
On the other side of things, mechanics are often blamed for problems they did not cause. It seems all too often that a customer would claim the oil change we did caused their headlamps to flicker intermittently or some other bizarre problem that is in no way connected. Customers also seem to think that today's cars are smart and that there is some mystery machine hidden in the the shop that, when plugged into the car, will tell the mechanic everything that is wrong from low tire pressure to internal engine problems. This is far from accurate. Yes, modern cars do have sophisticated electronics on them and they do give the mechanic information such are fault codes and data values but they don't troubleshoot and they never will. On board software does have the capability of determining an out of range sensor or improper outputs. It can give the mechanic valuable information to help him narrow a problem down. It will never troubleshoot for him! An engine control for instance, which is generally the most sophisticated control on the vehicle, can only read values at the pins that connect it to the wiring harnesses. It can determine if a circuit is open or shorted or out of normal range but that is about it. It is up to the the well trained, smart mechanic to determine where the actual fault is. As I said earlier, most electrical and drive ability problems are intermittent. That means that no matter what tests you run, chances are they will all pass. This is where data loggers and real smarts come into play.
It seems for the most part that bigger cities have more crooked shops than smaller ones. I think this is because a poor reputation in a small town will put you out of business whereas in a big city there are plenty of customers to go around. The strategy is usually to get all they can out of you when you do come if assuming you won't be back anyway. Also watch out for "mechanic of the month" award winners. These guys are usually the ones who flag the most hours to get a bonus on top of it. They are generally the most crooked as well.
Examples
I will now give a few real world examples of some of the things that go on in
a shop. A new car dealer had a scam going that involved all the service
personnel. They would bring new cars right in off the convoy truck and
claim every one had alignment problems, drive ability problems, and transmissions
problems. Each of 3 mechanics would flag the maximum allowable time for
work they supposedly did although no work was really performed on most of the
vehicles. While these were all warranty claims, it is still fraud and
the manufacturer was getting ripped off for more than a year. Some of
these mechanics were being paid a 6 figure income by all the phony time they
flagged. The dealership was finally caught and closed down but those same
mechanics got jobs at other dealers. How would you like one of them working
on your car?
A little old lady brought her car into a shop. A mechanic sold her over $2000 worth of parts and labor and the car was still not fixed. After all of that, it turned out there was a bad spark plug wire causing an intermittent misfire. The customer was still charged the full amount and none of the unnecessary parts were removed.
One mechanic was charging for piston ring replacements on certain vehicles under warranty on a routine basis. Few of the engines were ever taken apart. He would work at a dealer for a year or so until others would start to suspect and then go to another dealer to do it again. He rarely worked a full day but typically got paid over 12 hours per day.
During the 1980's, before detergent gasoline and deposit resistant injectors, the injectors would periodically need professional cleaning. The process typically pays about 1 hour but really only takes about 15 minutes of a mechanics time since he can connect the machine, start the process, and do other work while the injectors are being cleaned. Starting in the late 1980's, deposit resistant injectors were introduced and detergents were added to gasoline to prevent clogged injectors. Some mechanics will still try to sell you an injector clean as maintenance. There are cases where injectors may need to be cleaned to correct poor running but it is really not a maintenance item anymore. Another similar situation arises with the throttle body. Throttle bodies will sludge up, especially if you use natural (non-synthetic) oils. It was common in the 1980's to periodically clean the throttle body. In the early 1990's, new measures were taken to eliminate the need to clean the throttle body. In fact, some throttle bodies come pre-sludged with a special coating to allow proper idle speed. If you remove the coating, your idle may be too high. Some mechanics still sell throttle body cleaning as a maintenance item. It generally takes about 5 minutes and they will charge you an hour. In some cases it will actually cause an idle problem where one was not previously present.
Warning signs?
There are a few warning signs you can watch out
for:
I want to make it clear however that there are some very sharp and honest mechanics out there who are underpaid for their ability. Sadly, it is the parts swappers and mechanics that do maintenance that really bring home the most money despite lower pay per flat rate hour in many cases than specialists. Training usually pays actual time at best. Some dealers don't even pay for training. The affect is that mechanics have less motivation to attend classes. Most vehicle manufacturers now require at least some degree of training which is helping to drive the right behavior. Modern mechanics working on high-tech systems require a significantly higher skill set than mechanics of yesterday. Vehicles have become very complex. Most of the problems on these high-tech systems are intermittent making it even harder. Some manufacturers don't seem to understand what it takes to troubleshoot problems on these modern systems and believe that the mechanics out there simply don't have the aptitude to learn what they need to so they don't give the detail of information required to really understand these systems. This adds to the challenges a good mechanic faces. Modern vehicle troubleshooting requires many of the techniques a doctor would use to troubleshoot problems with humans. The real frustration comes when these vehicle doctors take home less money than a mechanic that just swaps parts. I would guess that only about 10% of the mechanics out there fit into the vehicle doctor category. Another 20% have some skills for troubleshooting. Many of the rest just swap parts and their skill is the speed at which they can change these parts. Often it is the doctors who really end up troubleshooting most of the problems for the others but he does not make the money for it. That should be improving as vehicles become more complex.
Modern vehicles are significantly more reliable than older ones. The newer the better. Modern vehicles require very little maintenance and very few repairs compared to those just 10 years earlier. Generally, any of the larger automakers make a better quality product today than the best cars of 10 years ago.
I blame most of the problems with the repair industry on the flat rate pay system. It can drive the wrong behavior throughout the organization. It gives clear incentive to go for speed and not accuracy. How would you like your pay cut in half because business was slow. Go home and tell your family that and see how it makes you feel. Up sell becomes easier to justify. It can be a very stressful living. Now work in those conditions and watch the guy next to you cheat the system and rake in the money with bonuses and praise from management to boot. Mechanics are no more dishonest than anyone else by nature, flat rate pay is to blame.
There are a few organizations working to promote more advanced auto
service. You can find them at:
http://www.iatn.net/
http://www.asecert.org/
http://www.flatratetech.com/