Hot Rods What is an honest shop rate?

I'm retired , after working in other garages and dealerships for 40 years and then another 22 years in my own garage and state inspection station, I was worn out ! The insurance and state inspection requirements drove me out of business at that time I was charging $50 an hour . Also the constant studying for the emissions systems on newer car models was driving me up the wall ! Now I relax and work on my own vehicles which include a car , truck , hot rod , and a vintage stock car and enjoy my wife , kids , gran kids and great gran kids !

 

go back to school and learn to job cost. what does the shop cost you, rent or Morgage cost you, the heat, lights, sewer and water, business insurance, workman's comp, employee wadges taxes and insurance cost including writing a check for you. add for tools and equipment, add reasonable profit. Add it all together an divide it by the number of employees. That will give your prime rate, And you charge mark up on parts and shipping, If the customer wants to discuss new ideas, you're on the clock, if you're in the office working on billing statements you're on the clock, if your researching parts you're on the clock. If you have to pick up or deliver, you're on the clock, you also track mileage and fuel, as well as food and lodging if it is an OverNite trip, It adds up real fast. Oh yeah there is a lot of crying and accusations that you are ripping them off because their buddy told that a show quality paint job would cost less than two grand, I dealt with it for almost 40 years,

 

T&M.

My shop: $200/hr. base rate.
If it involves a computer, or CNC machine, $275/hr.

Less won't cover overhead.

 

"TIME IS MONEY"
IT'S JUST THAT SIMPLE.
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As a sole proprietor , YOU are keeping your books , YOU know which customers might do that , You include the transactions . The first tax guy I spoke with said your own records , then there's no one to dispute them , plus , a small business that makes less than $250k a year , the Fed doesn't have the resources or inclination to care about . You should be more worried by. Dead beats not paying up .

 

I worked for several shops years ago. I just can't get my head around the shop rates of today. On my best day working on a project I really enjoyed I can't believe my skills were worth the amount being billed. Must be a stress filled life today. Bob

 

Most of the time the labor rate is X old part for X amount of work

 

The shops monthly rent divided by 30 plus a Grand for the Shop owner. I prefer to get a price for the whole job and pay half up front and half when the job's completed.
Off the top of my head $60 to $80 bucks an hour. Better to do your own work and save the money.

 

Some shops are not as busy as they were 3 or 4 years ago, maybe they are padding their rates to make the monthly nut? I have seen a few "good" shops close up with covid.

I find that with things around the house that I call in help to tackle. nobody wants to come out for anything less than $500. That $1600 fence replacement 5 years ago is now double that.

 

Reputable shops that I know of in NJ are ranging between $90-$175 and hour, depending on the area of work needed. Late model diagnostics and repair work on the low end, high-end metal shaping and fabrication on the higher end, with general restoration and paint work in the middle somewhere.

I'm more alarmed by rates that go too low than rates that go too high.

 

If you sit down and figure out what the real expenses inflation has added to the cost of things, the longer you put things off, the more its going to cost.

For any business to survive, its going to have to add those extra expenses to the final bill if they want to stay in business. The only way they can do that it to raise the hourly rate. That price they give you today is probably going to be higher in 6 months. If the project they might be doing for you is 6 months from now, they have to guess what that extra cost may be, or they have to have the option to adjust the price upwards. Neither option sits well with most customers, all they think is that you are planning on ripping them off.

Those car shows on TV that show everyone sitting around BSing does not help the image most people hold of most repair shops. Not very many people standing around not working at most repair shops, when there is work that needs to be done. I couldn't afford to have someone's vehicle sitting in my shop if I wasn't getting something done on it. I couldn't live with myself if I was billing someone the hourly shop rate without giving them the hour's worth of work.

 

there are 2 big factors in shop rate, rent. and labor rent of 5k to 10k month is normal = $30 to $62
labor. a residential apartment rent of $1600 to 2400 is normal so your lowest paid labor needs to pay this rent so they should have a take home of twice the rent so $40 for the top end rent. $40 x 1.25 ( worker cop/ unemployed the gov.add ons). $40 x 1.25 = 50 + $5 to $10 health ins. =$57 avg. so were at $85 to $117 hourly now add electric, heat /ac , insurance for biz , water, sewer = $7000/mo = 6 guy shop = $29hr. so $115 to $155 hr is very reasonable.

 

Look at a bill from an attorney and don’t bill like that, Ego can be applied to your labor rate but it shouldn’t pad the bill. If you’re going rate is $100 per hour charge it for your time. I charged for looking up and ordering parts, material and time for collecting funds from the customer. I think telling the customers up front what the hell they’re getting themselves into, I did a 55 Chevy about 14 years ago that was candy Brandy Wine or Peril White everywhere over new panels inside and out. I didn’t do mechanical work I just got the car painted, all the chrome on and gl*** installed. 1800 hours, how would you like to pay that bill.

 

When my ex SIL opened her dental practice, no one told her about her employees health and pension contribution. D’oh! Then you may have sick days and vacation. The overhead these days must just be phenomenal.

 

I've retired from working for others, I just do my own projects now. When I was doing it, some things was a flat rate, setting up rear ends, rebuilding transmissions, etc.. doing Builds were done time and materials. I can recall numerous time when I found poorly done previous repairs that were not immediately evident that had to be corrected before I could proceed. I billed weekly, no pay, no work. I had to protect myself. I have been burned in the past. When I quit doing customer work my rate was $65 an hour, and parts were marked up 100 %.

Gene Winfield just retired. One of the best. He didn't retire a rich man.

 

What bank is only offering 0.15% in this market on CD's? I'm in tri-state area and NE NJ. Every bank in my area offers over 5% on a CD. Not that it has anything to do with the original question.

 

Well, they have changed the page and don't quote a current %, so I won't name them. However, there are some in your range and some really low. Make sure to hit the see more ****on.
https://www.bestcashcow.com/cd/rates-arizona-az

Makes taking risk even more foolish if there isn't a reward.

 

Getting rid of the frenched headlights ..This was done professionally , not a money car… regardless…not something id pay 125.00 an hour for someone to do.. Bondo mania...no drain hole...Stock headlight bezels for reference…

 

That's kind of my point. If you use the figure you mentioned $2-3 mil, you are talking $100-$150K a year @ 5% for doing nothing. And that is playing is safe and not putting into the market. S&P 500 is over 7.5% so far this year.

Now, that said, if you have skills and people want or need your skills, then you could blow past that $100-150K very quickly by doing what your skills put you in demand for.

That said, I am 53 years old and have 1.5 years in a job that I will receive a pension & benefits when I retire. Why I mention this is, having p***ive income and benefits is huge to anyone going into business for themselves. Without a "Plan B", one major set back or problem can ruin you financially.

Now on the positive side, I believe someone with in demand skills or skills far superior to others will always have work. The fact that you will always have work is as good as having p***ive income coming in as long as are able to maintain the same level of quality.

I'm currently testing the waters as to what I'm going to do next. I have some ideas, but I'd love to do something like cam grinding or the like that the older, little shops are aging out of. We'll see. I've got time.

 

I know folks ***** about car repairs but I’ll throw in planed maintenance. Yes I’m guessing the dealership is charging $150 hr for our OT vehicles. I get coupons for oil changes every few months but usually get about 3-4K miles in 8-10 months and use one of the $59.99 specials. At 79 I won’t due trans, coolant or brakes fluid change outs any more. Granted they charge 3-4 hrs flag time and probably do any one of them in less time so and the tech isn’t paid anything near the $150 per hr but how often do we get the service …. once every 5 years….give a break. I’ll pay it and not complain.

 

I run a lube shop that is steadily expanding into real mechanic work. Our labor rate is 150/hr for anything we have to get our hands dirty for and that is cheap for this area where most shops are over 210/hr. We used to be at 100/hr and despite being booked up all the time we were just barely breaking even. It's tough to make a buck out here!! Overhead is no joke fellas, it costs a fortune to operate a nice clean shop with a good location in this day and age, plus my guys are salaried (not their fault if there's no work to do, they still have bills to pay and they showed up...)

I don't charge a full hour if something doesn't take a full hour, though... I think that's pretty sheisty.

 

Be lucky to find someone to finish a job. $$ mean nothing for unfinished pile of parts.

Everything discussed harkens back to why car clubs make sense:

1 shop, welders, painters, fabricators, engine and driveline spe******ts. Drivers, tuning, electrical, parts finders.

Every member gets a car, all work on it, then next car etc. etc.. benefit.. all get to share skills.

 

There is a lot of truth in this statement! When I was young My uncle could sell ice to Eskimo's. He always was buying and selling hot rods and would ******** people who did not know any better that he built them. A guy at a local monthly show ask My Dad who built the ch***is under his model A and when my Dad told him that we did it at home he asked what we would charge him to build him a Ch***is like it. I do not remember what the price was that my Dad quoted him but this same guy met My uncle at that same cruise night and Ask my Uncle who built the ch***is under the Model A he was driving. And my Uncle being the guy he was lied his *** off and said that he did it. And I know better because My Dad and I built that ch***is for my Uncle. Anyhow My Uncle hooks this guy with one of his ******** stories and Gets the job of building the guy a ch***is for about twice the price my Dad had told him. Anyhow My Uncle Got the Job and paid My Dad and I to build the ch***is for this guy and my Uncle of course Got all the credit and about half the money and didn't do anything accept Lie his *** off. As a teenage boy this would piss me off But My Dad would always say. Doesn't matter if everyone knows we did the work or not, All that really matters is we know. Point being as said above if you try and give someone a good price they might run away and find someone else. Seems crazy but I have seen it happen more than once.

 

A whole lot of cars, trucks, and bikes that I built were built by their current owners, or other shops.

At least I got paid to do it.

 

Watched an episode from AutotopiaLA a few days ago. Never watched it before and they featured an OT 64 Galaxie by Chris Ashton owner of Ruffian Cars. I had heard of this name, but that was it. Towards the end, the host asked Chris if he would ever sell it. He paused for a moment and said, it was a 7,000 hr build, and even at a low hourly rate of $100/hr, you were looking at $700K, without any parts! Lol! He kinda of implied himself, who would pay that much for it, let alone the cost for all the parts. Having said all that, I have to say, the quality of that build, and the level of thought and detail that went into it was at a whole new level from what I’m used to seeing.

 

CAUTION ! Be careful on your choice of "Pro Builder" My Lifetime of experiences, Tool & Die/Pattern Shop owner, 36 years, Tradesman 44 years, Racer into my 40's, Hot Rodder, Big Time DIY guy in many areas, there's a small percentage of "Pro", "Experts" anything in any area. Example, you go to my local GM dealer @ $168/ you think you get Mr Goodwrench changing your oil, reality just a minimum wage kid starting out. I survived being in my business by not being the cheap shop, we were a quality shop providing a top self product. In our hobby there are some reputable builders, Not cheap with a huge backlog which tends to be true with any good reputable service in any area today. Another thing I've learned in our great car hobby is IF ******** was Br*** we'd have a 100 piece band at any show/ cruise/event we go to, But I love the hobby and like all of it. I advise anybody coming into the hobby, start small, easy projects, recommend purchasing car, make it yours and Enjoy the hobby.