Directions: Continuing Our Look into the Health of the Automotive Repair Market – UnderhoodService
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Directions: Continuing Our Look into the Health of the Automotive Repair Market

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Last month, we opened the discussion on the nation’s economic conditions and how it relates to the automotive service and repair industry. The following are more comments from shop owners on their take on the state of the repair industry.

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Don Seyfer, owner of Seyfer Automotive, Inc., in Wheat Ridge, CO, is one who seems to be progressive in getting the word out on vehicle upkeep and service during tough economic times. Seyfer markets to his customers and the public on the benefits of keeping their vehicles longer by hosting three hours of car talk radio every Saturday. He finds the radio a useful tool to promote vehicle maintenance.

“We also direct mail market to our existing customers with specials and other service information,” Seyfer said.

Seyfer has a positive outlook for the remainder of the year. “I believe there will be a slight growth in our business for ’09,” he said. “We can make a significant improvement in net profit with tighter controls of expenses (a never-ending struggle with health care costs, etc.). Our gross dollars will improve as we hold to our business plans, but we need to improve net dollars,” he said.

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Seyfer, like the some of the other shop owners mentioned last month, said he sees the current economic conditions as a good opportunity for growth.

“It is very important to realize your customers’ economic status,” he said. “In other words, are they hesitant in spending dollars for the car because of limited funds or cutbacks in their wages, or, are they being frugal and conservative? It has become very critical to recognize these conditions and to be sensitive to their needs. We will help as much as possible any person who is challenged with hardships and needs for their transportation.”

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Steve Louden, president of Louden Motorcar Services in Dallas, said his shop experienced a roller coaster year in 2008. Louden, who serves as an advisory board member to ImportCar, a sister publication to Underhood Service, said while business was great one month and down the next, the North Texas economy is better than in other parts of the Southwest. “Home prices and foreclosures are about even with last year and people are still moving into the Dallas/Fort Worth market,” Louden said.

However, Louden said his upscale customer base is reeling from a decrease in what was called the “wealth effect.”

“They may still have their jobs, but their stock portfolios and 401K values are down 30-50%, which gives them reasons for concern. They still have money, but are more selective in how they spend it. Last year, a typical customer may have repaired all eight items on our estimate. Today, it’s maybe six out of eight.” Louden surmised that a large factor in the success of a shop today is the age of the business and its customer base. “A new business has yet to build that all-important customer base, which will carry it through tough economic times.”

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If you would like to comment on some of the conditions affecting your shop or report on business practices you have implemented with the recent economic crisis, e-mail us at [email protected].

Edward Sunkin has been the editor of Underhood Service since April of 1999. He has been a member of the Babcox family of automotive aftermarket publications beginning in December 1994, when he joined the jobber/parts specialist magazine Counterman as an associate editor. Sunkin also spent three years as managing editor Engine Builder, learning about the engine and small parts rebuilding and remanufacturing industry.
Besides Underhood Service, Sunkin also serves as the editor of Tomorrow’s Technician, an automotive-related trade magazine delivered to more than 50,000 students enrolled in NATEF-affiliated schools.

 

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