Main Dealer £100 per hour

[bigasotonuk]

Hi,
I have been reading a lot of posts lately here regarding how much a main dealer charges for work.
I recently had cause to go to my main MB Dealer and i was shocked to find out that my main dealer charges £100 per hour. which i find totally disgusting as the man on the shop floor probably gets only a £10 of that.
Just wondered how they can justifiy that when i work for the biggest defence contractor in the UK 9th biggest in the USA and we only charge approx. £30 per hour (and the MOD still moan about our prices!!) Yet we have bigger overheads (local and corporate) so how does a main dealer justify such an hourly rate, any ideas on what this £100 an hour is made up of?

 

[television]

Hi,
I have been reading a lot of posts lately here regarding how much a main dealer charges for work.
I recently had cause to go to my main MB Dealer and i was shocked to find out that my main dealer charges £100 per hour. which i find totally disgusting as the man on the shop floor probably gets only a £10 of that.
Just wondered how they can justifiy that when i work for the biggest defence contractor in the UK 9th biggest in the USA and we only charge approx. £30 per hour (and the MOD still moan about our prices!!) Yet we have bigger overheads (local and corporate) so how does a main dealer justify such an hourly rate, any ideas on what this £100 an hour is made up of?

Its £165 per hour in London central

 

[bigasotonuk]

Hi,
Bl***y h*ll how do they justify that, my company has people, experts in their field aeronautical engineers, marine and electronic engineers and still only charge £30 per hour its just crazy.
Makes me wonder what the profit margin of a main dealer is.
No wonder people use independants.

 

[television]

Hi,
Bl***y h*ll how do they justify that, my company has people, experts in their field aeronautical engineers, marine and electronic engineers and still only charge £30 per hour its just crazy.
Makes me wonder what the profit margin of a main dealer is.
No wonder people use independants.

I understand it is to do with the ground rent, I still do service calls at £20 and complete repairs at around £60 if I collect or £40 if brought in

 

[philharve]

Its £165 per hour in London central

Presummably Mercedes-owning city types working in the Capitol are likely to be big earners and parting with money at a rate of GBP165.00 per hour is small change to them. I think the Mercedes-Benz brand has a lot to do with big bills.

Compare that with west Cornwall where salaries of GBP100 - 150 per week are fairly typical. Nonetheless, local MB dealers still charge all comers GBP95.00 per hour. I've heard this may be going up.

Maybe well-heeled Londoners ought to take their holidays in the West Country and have their cars serviced here at the same time. They might save a few bob and have an enjoyable holiday too.

REGARDS

Phil

 

[television]

Presummably Mercedes-owning city types working in the Capitol are likely to be big earners and parting with money at a rate of GBP165.00 per hour is small change to them. I think the Mercedes-Benz brand has a lot to do with big bills.

Compare that with west Cornwall where salaries of GBP100 - 150 per week are fairly typical. Nonetheless, local MB dealers still charge all comers GBP95.00 per hour. I've heard this may be going up.

Maybe well-heeled Londoners ought to take their holidays in the West Country and have their cars serviced here at the same time. They might save a few bob and have an enjoyable holiday too.

REGARDS

Phil

Too true phil,the wages down here are the minimum allowed

 

[carabind]

It is a large hourly rate, and the techie only get a fraction. But the rest goes to pay the service receptionist you see, towards the premises you use, as well as heat, light, insurance , rates , insurance, the STAR system and the tools that are used to look after your car and the management of the dealership .


Then whoever owns the dealership will be looking for a return on their investment from those who use it.

Not defending the high charges at all ........but your £100/hour get split into more slices than you can imagine!

 

[television]

It is a large hourly rate, and the techie only get a fraction. But the rest goes to pay the service receptionist you see, towards the premises you use, as well as heat, light, insurance , rates , insurance, the STAR system and the tools that are used to look after your car and the management of the dealership .


Then whoever owns the dealership will be looking for a return on their investment from those who use it.

Not defending the high charges at all ........but your £100/hour get split into more slices than you can imagine!

Very true,you forgot the free coffee

 

[stevesey]

Hi,
Bl***y h*ll how do they justify that, my company has people, experts in their field aeronautical engineers, marine and electronic engineers and still only charge £30 per hour its just crazy.
Makes me wonder what the profit margin of a main dealer is.
No wonder people use independants.

I thought most of your development work was fixed price?

I work for a software consultancy (long time since we've worked directly for you I think), but we have done work for your nearest competitior more recently. Our rates will be comparable with MB labour rates, in my case this will get significant number of years technical and management experince - or in a MB dealer it gets you an Oil Change.

P.S. We also get free coffee

 

[kingsize]

Happy to pay it if it keeps MB Belfast staffed with smokin hot female assistants.

 

[Gavel]

Hi,
I have been reading a lot of posts lately here regarding how much a main dealer charges for work.
I recently had cause to go to my main MB Dealer and i was shocked to find out that my main dealer charges £100 per hour. which i find totally disgusting as the man on the shop floor probably gets only a £10 of that.
Just wondered how they can justifiy that when i work for the biggest defence contractor in the UK 9th biggest in the USA and we only charge approx. £30 per hour (and the MOD still moan about our prices!!) Yet we have bigger overheads (local and corporate) so how does a main dealer justify such an hourly rate, any ideas on what this £100 an hour is made up of?

The hourly rate for servicing is a ritual thing. It has nothing to do with how much the work really costs because an hour of work on one vehicle may require special tools and equipment whereas an hour of work on another may not.

Take the £10 to the mechanic. Add in a % to cover less than 100% utilisation, sickies, training and 12% to HMRC for employers' NI.

Now divide the annual costs of the dealership by the actual billable mechanic hours: people (additional non-billable staff such as amanagement, HR, accounts, reception), marketing, rent, rates, maternity pay, jury duty, cleaning, specialised equipment, insurance, capital depreciation, tax, loan repayments.

The add a profit.

Add VAT if not included.

Lo and behold .... a huge chunk of money.

 

[stevesey]

Happy to pay it if it keeps MB Belfast staffed with smokin hot female assistants.

What sort of service are you after.

 

[television]

The hourly rate for servicing is a ritual thing. It has nothing to do with how much the work really costs because an hour of work on one vehicle may require special tools and equipment whereas an hour of work on another may not.

Take the £10 to the mechanic. Add in a % to cover less than 100% utilisation, sickies, training and 12% to HMRC for employers' NI.

Now divide the annual costs of the dealership by the actual billable mechanic hours: people (additional non-billable staff such as amanagement, HR, accounts, reception), marketing, rent, rates, maternity pay, jury duty, cleaning, specialised equipment, insurance, capital depreciation, tax, loan repayments.

The add a profit.

Add VAT if not included.

Lo and behold .... a huge chunk of money.

Welcome to the forum gavel, I will go to sleep tonight working out what you have missed on the list

 

[Mr Teddy Bear]

Your Making Me Smile

Hey Gavel, you and Bigasotonuk you working for the same company?
I think I've heard this before.................

 

[kingsize]

What sort of service are you after.

Honestly, it's like walking into the pages of FHM....

 

[philharve]

The hourly rate for servicing is a ritual thing. It has nothing to do with how much the work really costs because an hour of work on one vehicle may require special tools and equipment whereas an hour of work on another may not.

Take the £10 to the mechanic. Add in a % to cover less than 100% utilisation, sickies, training and 12% to HMRC for employers' NI.

Now divide the annual costs of the dealership by the actual billable mechanic hours: people (additional non-billable staff such as amanagement, HR, accounts, reception), marketing, rent, rates, maternity pay, jury duty, cleaning, specialised equipment, insurance, capital depreciation, tax, loan repayments.

The add a profit.

Add VAT if not included.

Lo and behold .... a huge chunk of money.

Hi All

This submission got me thinking about MB labour charges which I will take up with my indie the next time I see him. He used to work for the company.

Specifically, is there a supplementary charge for using special tools and equipment during a given job?

An example may illustrate the point I'm trying to make. If similar repairs are undertaken to two vehicles but one requires the use of 'special equipment', if the jobs are completed in the same time, will the labour charges be identical? Forget about parts ... lets assume they each need the same items replaced.

I could develop this line of thinking a stage further. Let's suppose the two jobs are undertaken by differently qualified mechanics, one: the dealership's 'No. 1' ACE mechanic and two: the newest, youngest, most recently-qualified mechanic. Will the labour charges be the same if identical tools and processes are followed and the jobs are completed within the same time?

I retired from a company 10 weeks ago that, amongst a great many other things, provided cost estimates to clients for services to be rendered. These estimates included manhours (labour charges) which varied according to the mix of skills required. Junior technicians would cost in at around GBP30 per hour whereas senior technicians would cost in at possible twice that, say GBP60 per hour. It might be expected that senior technicians could do the job in half the time of the juniors but, in practice, it never worked quite like that. Do MB employ a similar method for costing labour charges?

REGARDS

Phil

 

[jberks]

I retired from a company 10 weeks ago that, amongst a great many other things, provided cost estimates to clients for services to be rendered. These estimates included manhours (labour charges) which varied according to the mix of skills required. Junior technicians would cost in at around GBP30 per hour whereas senior technicians would cost in at possible twice that, say GBP60 per hour. It might be expected that senior technicians could do the job in half the time of the juniors but, in practice, it never worked quite like that. Do MB employ a similar method for costing labour charges?

REGARDS

Phil

No, and in reality I doubt they could or you'd be paying different amounts each time you had a service, just depending on who was available.
My industry works in the same way. and, yes, I charge a lot more for my experience. Not necessarily that I will complete a specific task any quicker, but that I can anticipate the problems that will come up later and pre-empt them. There are diagnostic issues when I will get there quicker as I'm more likely to know where to look but thats all part of the experience argument. That said, they need 2-3 cheap rookies, plus one of me.
This argument is harder to justify on physical maintenance. We expect the dealer to have one or two experienced guys who can deal with the odd stuff and the rest, barely more than fitters who do oil and filter changes. But as has been said before, in the case of a dealership, the cost of the person is a very small part of the overall charge. Most is for overheads or to put it another way, not there to cover the cost of the work, but rather the surrroundings. Hence an indie may not be so salubrious but he charges less than half.

 

[nick-E55]

the only partial (very partial) excuse i can think of is the capital outlay for diagnostic equipment etc. Not that i know what diagnostic equipmt is... but i assume that these days the equipement required is a lot more sophisticated than in the past. Take the vets for example (bear with me here...), my wife is often taking one of our numurous pets/animal to the vets, and the bills are huge... ( i've probably paid for their fleet of S classes but a friend of ours (Gerry) has a very large canine hospital... and he's got lots of machinery/equipment etc, one of which, some kind of heart machine cost over a 1/4m quid... so i guess they have to cover the cost (ex depn) somehow.

Note to self... if suffer heart problem, forget the NHS... go straight to Gerry's

 

[ant500sl]

Note to self... if suffer heart problem, forget the NHS... go straight to Gerry's

Funny one that, we got one of our cats in to see the heart specialist for a scan at our vets on a same day basis for £30.00.

Took my 70 year old father 8 weeks to get the same thing at an alleged cost to NHS of thousands. Dad came out with MRSA, cat came out in perfect condition.

Back to the original post!

I have bills for my 500SL from 1990 which make interesting reading:

Cost of car approx £70,000 cost of new 2007 SL500 approx £70,000

Cost of spark plug for 119 engine £1.83 in 1990, cost a few months ago when I bought a set of 8 from the dealer £1.83.

Labour charge at main dealer £25.00 per hour!!!!

Certainly implies to me that the money isn't being made on the cars and the spares but on the labour.

 

[nick-E55]

Certainly implies to me that the money isn't being made on the cars and the spares but on the labour.[/QUOTE]


another note to self... re-train for new profession as MB mechanic