Paar Melis Releases 2025 Auto Repair Industry Benchmark Report
Paar Melis & Associates has released its 2025 Auto Repair Industry Benchmark Report, providing data on the current state of the independent auto repair sector and consumer preferences.
While the report showed a slight dip in the average monthly sales across the industry, gross profit margins also improved, as well as Paar Melis’ core metric—owner pay + profit—continued to rise.
Self-assessments revealed customer service and experience as the most reported strength, with efficiency and productivity once again being the most cited weakness for the second year in a row.
The report examined top performing shops, and compared them with lower-performing shops. Top performers have been implementing smarter pay structures, and using incentives like commissions and retirement plans to attract and retain skilled team members. They’re more productive, with tight management of operations, resulting in stronger margins and higher average repair orders. This is combined with intentional investments being made in their people through coaching and training, which benefits both productivity and culture.
On the other hand, the lowest performing shops struggled with high overheads, inconsistent staff performance, and poor cost control.
On the economic front, volatility pervades, and the strongest auto shops are planning for uncertainty through building financial buffers, tightening operations, and communicating clearly with customers when costs change. This is especially important as repair and maintenance costs saw a near 7% increase from the same time last year.
High interest rates are also hurting shops that are trying to finance new equipment, renovations, or carry extra parts stock—though it has also meant fewer consumers purchasing new vehicles. Vehicles between six and 14 years old on the road are expected to grow by 12% from 2020 to 2028.
EV and hybrids still take up a small share of vehicles in operation, but are gradually taking up a larger share with each year. Nearly half of shop owners are planning to expand into EV service within the next five years, and many are already making early investments in training and equipment.
Parts supply has improved since the worst of 2021, but delays continue to be a problem, especially with specialized electronic components and European parts. Some repairers are adjusting by building buffer stock or splitting orders across multiple suppliers, but new tariffs on imported vehicles and auto parts has the potential to impact parts pricing and availability.
Dealership service departments are the biggest competition for independent repair shops. The perception is that they’re more equipped to handle complex jobs, particularly for newer European makes. However, dealer appointments are slow to secure, with waits often extending out to five days. Additionally, the average visit costs for dealer service departments have surged in recent years.
This has created a real opportunity for independents to lean into what they do best: faster turnaround, competitive pricing, and a more personal service experience. Over a third of mass-market vehicle owners cited faster service as the reason for skipping the dealer.
Price matters too, with another third pointing to lower cost. In addition, satisfaction scores for independent shops have improved sharply, especially in areas like advisor courtesy and turnaround time.