Quote:
Originally Posted by laconic1
Just curious, what has your dealership done with customer pay labor rates? I work on the claims side of the extended warranty business and we have noticed a HUGE increase in labor rates in the last few months. We have dealers that sell our contracts that were at $82/hr in 2004 and $100/hr 6 months ago are demanding $130-135/hr now. I guess they are trying to make up the loss in sales by getting it all back on the service side. Plus we pay MSRP on parts and most shops charge 10-25% over MSRP. It used to be the dealers that sold the service contract didn't go after the customer for the difference, but now a lot of them are. Plus we are getting hammered on upsells. Then shops get pissed when we send adjusters out to the shops to verify everything. Our average claim cost has gone up almost 35% in the last year, which I worry will hurt the viability of my company in the next year or so.
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I can't speak for all the dealers, but our labour rates have not changed in the 4 months that I have been here. we are at $98 hr for all customer pay work. Many dealerships have converted over to the grid system which I not only hate, but thing is very unfair, especially in the way it is applied, but then that could start an entire thread on it's own...
Parts prices are usually set by GM, and we will cut prices to try and make a sale rather than lose the entire job. I have at times cut my labour time to also help make a sale. I would rather get 1.5 hours say for a job, that try and get the normal 2.0 hours and lose out on the entire job.
I don't mind so much about having an adjuster come out. I know what is wrong with the car, and could care less what an adjuster might think. Many times I have told an adjuster that if he didn't agree with my diagnosis, he was more than welcome to bring his own tool box out and diagnose the vehicle himself! I DO get tired of the adjusters who USED to be technicians, and think they know more than me about the car I am working on. What really gets to me is the adjuster asking me to show him step-by-step hwo I did my diagnosis. I simply tell him that I did my job, was not going to do it again, but if he was willing to pay me additinal time I would be more than happy to diagnose the EXACT same problem again! lol. That usually shuts them up.