Hourly rate, automotive

John@Outfront

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I thought I had started a post in this if anyone can find it. Anyways I have a friend with a 2017 Pacifica blow a motor in utah. They told her $12 k to replace. I’m like what?  I then call a place I know of that sells used and new engines. He told me $11,500 installed. I asked he labor rate and he said $200 per hour!  That is crazy. I raised my shop rate to $130 last year and plan to go to $140?on the first but $200 ftom an independent in Utah is stupid

 
That might be an "I don't want the job" price but honestly, I'm not surprised by a $10K+ engine swap these days. Was your guy selling an OEM long block for that $11,500 installed? 

 
That might be an "I don't want the job" price but honestly, I'm not surprised by a $10K+ engine swap these days. Was your guy selling an OEM long block for that $11,500 installed? 
It was a remanufactured  motor for $5800 which sounds about right and then I asked what his rate is cause to have 5000 in labor sounded high. It’s not an I don’t want this job price as that is what they do. (Motor swaps)

 
You've got to do the math to figure it out. The biggest thing we consider before rasing labor rates is billable hours per tech.  We found on average, a technician will be onsite 8-8 1/2 hours a day. This tech will turn in an 8 hour time card. We pay said tech for the 8 hours. How many of those 8 hours can we bill for and secure payment for.  On average in my industry, it's 6.75 billable receivable hours. My shop averages 6.5 across all the techs. 

If you can find a way to move that number up to 7+ your doing great and will see a bigger increase in your gross compared to a $10.00 an hour labor increase. 

We don't work flat rate and bill by the 1/2 hour after a standard minimum. 

 
friend of mine is a service advisor at the MBZ in newport bch.

          270.00 hr

 
We are currently at $160.00 hr 2022 

2020/2021 $125.00

We are dealers for Cummins, Volvo Penta, Mercury etc. 

Most dealers in my industry are 160-225 per hr.  

 
Our hourly rate is 250$ with a 250$ minimum regardless of how long it takes (includes consumables and use of scrap/drops) its our consumables cost.

A 250cf bottle of argon was 38$ at the beginning of 2022. By june that bottle was 57$ just got notice jan 1 they are 78$ and now there is a 60$ delivery fee (truck was free for orders over a certain $$ not anymore) 
a box of 25 3” roloc scotch brite disks was 25$ today its 58$ 80 grit cubitronic sanding disks more than doubled too. Everything has more than doubled.

then there is state and local govt

the state now wants us to have  a permit to have a restroom for employees ontop of the permits we already have for, sandblaster, air compressor, watershed certification, recycling certification, rainwater-shed permit, etc.

we just got a new landlord who thankfully is dumping alot of much needed and neglected money into our complex, but im sure that will Come with rate increase when done.

stainless steel tube has in some cases gone up 20x’s in cost in the last year and its once again coming with a 200$ delivery fee we were never charged before as well as order minimum contracts. We have to buy so much of each diameter and thickness per year and sign a contract or they just wont sell it.
 

We tend to price our parts 5-10% below industry average. Me alone im producing (and these are going out the door not sitting on the shelf) at minimum $3k per day. Just me. A good day is around $10k. We have only 2 employees. Me and my brother in law. He probably averages around 4-5k$ week average (he does the “custom” applications i run production products). 

We cannot survive on less than 250$/hr we are still the most affordable in our industry. I dont know how the small shops do it (i know we get hit with 10x’s the regulations because we have “aircraft” in our name) 

the offroad shop across from me is 200$/hr

 
I thought I had started a post in this if anyone can find it. Anyways I have a friend with a 2017 Pacifica blow a motor in utah. They told her $12 k to replace. I’m like what?  I then call a place I know of that sells used and new engines. He told me $11,500 installed. I asked he labor rate and he said $200 per hour!  That is crazy. I raised my shop rate to $130 last year and plan to go to $140?on the first but $200 ftom an independent in Utah is stupid
Who are you to set job rate prices in other areas, but also you adjusting and talking about shop rates i think breaks anitrust and price fixing laws, not a good topic to have on a site that can not be edited over time, 

 
it's a very interesting situation that seems to be mirroring what happened in many SA and some European countries.  (its 3rd world now) I hope somehow we turn out better. 

But you have to cover costs and make a profit  - but its amazing how fast the change has occurred. What @Sausage450r said about consumables hit me earlier this year. Cannot quote anything and stand on price for even 15 days anymore. And it true for welding, electric work, fuel systems, and of course electronics.

I went back to a 2019 LS build that was identical to a quote I did last month, its has gone up almost 40% and all the consumables are 20-30% up. How does it happen so fast?

In SA countries -

Runaway costs led to significant drop off in car and truck ownership which lead to many places closing (dealers and repair which led to serious unemployment.. and the spiral 

This country always had more natural resources, high skilled labor, reasonable housing and VERY low food costs. All that is changing rapidly. Unless something reverses that we are headed down a bad path. I am afraid we cannot reverse cost  and like those places it looked like it all was good until one day it was over...

Happy New Year  ... (sarcasm)

 
I paid at Friendly ford $100 per man hour on my 6.7, it worked out to be $400 a hour, not sure how many people really worked on it,  but came with a 2 year warranty and all factory parts, Every time the dealer worked on my 6.7  the issue never came back, the only issue with some shops is the parts quality, 

 
Who are you to set job rate prices in other areas, but also you adjusting and talking about shop rates i think breaks anitrust and price fixing laws, not a good topic to have on a site that can not be edited over time, 
There are no laws against discussing or setting rates ...There are organizations and franchises in every industry that determine costs and set prices.  But they do n ot control "supply"  Since this "group" does not control the distribution of goods or services  - its all good.

The robinson-patman  act regulations control price fixing, but this is not part of that

 
Steve, a member here blew up the motor in his truck in Utah and he had it towed back to CA where he lives and had someone put a motor in it and had a friend drive it back to tow his trailer home. I was surprised how fast he got it done, all by phone calls. DON~~~

 
Steve, a member here blew up the motor in his truck in Utah and he had it towed back to CA where he lives and had someone put a motor in it and had a friend drive it back to tow his trailer home. I was surprised how fast he got it done, all by phone calls. DON~~~
The day they picked it up at the RV park. DON~~~

Marysvale Sept 2010 057.JPG

 
Most of the car dealers are at or getting to 200/hr  now...doesn't matter what the make....the German stuff has been over 200 for a while....Please don't complain when your insurance rates go up... we went from 48/hr not long ago to 60-70 now.... the cost of fixing cars has pretty much doubled in the last 3 years...We are heading into a massive adjustment in the economy. Not going to be good. 

 
Who are you to set job rate prices in other areas, but also you adjusting and talking about shop rates i think breaks anitrust and price fixing laws, not a good topic to have on a site that can not be edited over time, 
i think you must have not read my post. how does anything i said translate into "I set job rates in other areas"?" As a matter of fact i would generally think that California prices are always higher than Utah so I was making a general observation.  anti trust laws?  wow.  If i want to raise my rates because of my unique business based on the fact that a regular independent auto shop charges $200 for general car repair in another state then i will do so.   last time i checked, i calculate my inflation as 30% in business, not 7% of the things i buy.  and to think im raising my labor rate buy only 7.6%   i guess i should be hitting up carl's and Jack in the box for with antitrust and price fixing cause my combo went from $10 to $15 at both places  Hmmmm......

 
I thought I had started a post in this if anyone can find it. Anyways I have a friend with a 2017 Pacifica blow a motor in utah. They told her $12 k to replace. I’m like what?  I then call a place I know of that sells used and new engines. He told me $11,500 installed. I asked he labor rate and he said $200 per hour!  That is crazy. I raised my shop rate to $130 last year and plan to go to $140?on the first but $200 ftom an independent in Utah is stupid
Not sure if applies in your friends case but I had to get a local phone number up here, when I had the Ca area code I was quoted the Ca prices IF they even called back... 

 
Not sure if applies in your friends case but I had to get a local phone number up here, when I had the Ca area code I was quoted the Ca prices IF they even called back... 
that’s interesting

 
It was a remanufactured  motor for $5800 which sounds about right and then I asked what his rate is cause to have 5000 in labor sounded high. It’s not an I don’t want this job price as that is what they do. (Motor swaps)
If they have a large backlog, there is no downside to quoting an "I don't want to do the job" price. Put another way, turning down the job outright is bad for business but offering a higher price could result in a good payday without telling the customer no. I don't know if this is the case obviously. I've had it happen to me with contractors in the past. The consumables price increases other posters have mentioned sound like it has more to do with the cost though. Holy smokes. Gotta eat up all of that inflation and then it sounds like a huge recession will be coming. 

 
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