Automotive Repair Shops, NEC

SIC 7539

Companies in this industry

Industry report:

This category covers businesses that primarily do specialized automotive repair, not elsewhere classified, such as fuel service (carburetor repair), brake relining, front-end and wheel alignment, and radiator repair. Businesses that primarily do automotive welding are in SIC 7692: Welding Repair.

Miscellaneous services done by automotive repair shops included automotive tune-ups, automotive electrical repair, battery and ignition repair, fuel system conversion, generator and starter repair, and brake work. This industry classification does not include such automotive service providers as emissions testing centers, inspection services, do-it-yourself garages, diagnostic centers, lubricating and oil change shops, emergency road services, rust proofers, window tinting shops, and towing services, all of which are covered under SIC 7549: Automotive Services, Except Repair and Carwashes.
According to the U.S. Census Bureau, 4,874 establishments operated in this industry in 2010. Together these firms employed 19,776 people who earned a total annual payroll of $600 million. Annual revenues in the industry were nearly $2.3 billion. Dun & Bradstreet reported that the vast majority of businesses were small shops, with 94 percent of establishments employing fewer than 10 people. These small establishments accounted for 62 percent of industry revenues. Of the numerous subsectors in this industry, automotive repair shops, not otherwise classified, was the largest sector, with 53 percent of the firms and over 45 percent of industry revenues. Other significant sectors included automotive electrical services, automotive machine shops, brake services and brake repair, and radiator repair.

At the end of the first decade of the 2000s, auto repair shops benefited from fewer new cars on the road and the overall increase in the average age of U.S. vehicles (9.4 years in 2009). During the economic recession at the end of the decade, many U.S. consumers decided to repair existing vehicles rather than invest in a new car. Because most warranty work must be done by a franchise dealer service department, the increasing age of cars was a benefit for independent repair shops that took business from franchise dealers' shops.

The National Automobile Dealers Association (NADA) reported that total auto dealership sales were up 17.2 percent in 2010 compared to 2009 as the nation started to recover from the economic recession. Sales per dealership were estimated at $31.2 million. Overall sales of services and parts increased 5.2 percent from 2009 to 2010, reaching $4.3 million in 2010. NADA also reported that franchised dealers had 309,750 service bays in 2010, down from 357,779 in 2008 and 366,157 in 2007. However, the increase in average service charge per hour from $88 in 2008 to $93 in 2010 helped sustain the franchise service section.

Although the auto repair and maintenance industry was recovering on from the economic recession by 2012, it nevertheless faced several challenges. One of these was a trend toward legislation that would reduce the requirements necessary for a vehicle to be operated legally. Examples of these laws were those that reduced or removed the need to obtain a motor vehicle inspection as a prerequisite to registering a vehicle, and the move toward eliminating or reducing emissions requirements. Because the auto repair and maintenance industry depended in part on getting business from consumers seeking to meet such government requirements, most in the industry opposed the changes in state laws, including those that were being considered by Missouri, Pennsylvania, and Florida, among others.

The employment situation in the industry was positive in the early twenty-first century. As cars became a staple of U.S. life during the middle of the twentieth century, demand for specialized repair services rose. By the beginning of the twenty-first century, more than 100 community colleges offered two-year degrees sponsored by the major automobile makers. In addition, the National Automotive Technicians Education Foundation (NATEF) certified quality training programs offered by high schools and technical schools. Computerized components used in cars transformed mechanical repair to a job requiring specialized technical knowledge and training. Employment of automotive repair and maintenance technicians was projected by the U.S. Department of Labor to increase at an annual rate of around 2.6 percent through 2020, when slightly more than 1 million people were expected to be working in the industry.

Numerous firms in this industry had multiple locations in the early 2010s. Small but significant companies included AAMCO Transmissions, Inc., of Horsham, Pennsylvania, which had more than 900 independently owned and operated sites offering complete car care services. Annual revenues for AAMCO were around $9.6 million in 2011. Its sister company, Cottman Transmission Systems, also based in Horsham, had 120 transmission repair shops around the country and brought in about $5.2 million in 2011. In 2012 parent company American Driveline Systems planned to combine the two businesses, which would continue to operate under the AAMCO name.

Grease Monkey International of Greenwood Village, Colorado, had more than 200 centers operating nationwide and in Mexico in 2011. Annual sales exceeded $2.5 million. Meineke Car Care Centers, Inc., of Charlotte, North Carolina, had more than 900 locations across the United States as well as in Mexico, Saudi Arabia, South Korea, and China. Sales in 2011 reached $6.6 million.

Other industry leaders were Midas, Inc., of Itasca, Illinois, with 1,500 locations across the United States and Canada as well as 750 in 12 other countries. Midas recorded sales of $183.6 million in 2011. Monro Muffler Brake, Inc., of Rochester, New York, had 800 locations and sales of $636.6 million in 2011. Tuffy Associates Corporation of Toledo, Ohio, brought in $30 million a year from its 235 locations in 20 states and also owned Car-X Auto Service, which operated as a separate brand. Car-X had over 170 franchises and company-owned locations throughout the Midwest.

One of the largest firms in the industry, the diversified Goodyear Tire & Rubber Company, headquartered in Akron, Ohio, offered a variety of auto repair services. With more than 1,600 locations nationwide, the firm had overall revenues in 2011 of $22.7 billion.

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