According to a recent Federal Reserve survey of conditions across the U.S., automotive repair shops were among the few businesses benefiting from the winter weather in the first quarter of 2014.
Many publicly traded stocks in the automotive parts and distribution segments are at all-time highs. Analysts have discovered that winter weather is a bad thing for new car dealers, but a great thing for our industry. Some are even predicting that 2014 will be one of the best years for the auto care industry, if not the best ever.
From Atlanta to Detroit, cold temperatures this year have killed marginal batteries, tested fuel systems and thickened oil to the point where lifters collapsed. Some shops are even reporting a scarcity of certain battery sizes, chassis components and radiators. The forecast is looking even better going into pothole season.
Fuel prices are predicted to stay stable this spring, with no major problems at refineries this year, as we change over to the summer blends. This could mean more miles driven. Also, with the consolidation of airlines, the price of plane tickets is convincing some travelers to drive rather than fly.
There is also a nice “bubble” of cars on the roads. From 2005-‘07, U.S. vehicle sales topped 16 million cars and light-trucks sold, and during the Great Recession, these vehicles did not receive the best care and maintenance. Now these vehicles, on average, have almost 100,000 miles on the odometer and are in need of major repairs.
Add up all of these factors, and there is a perfect storm building for shops this year. Take advantage of this time by investing in your shop and your technicians.
