Collision Repair Work on Commercial Vans Offers Lucrative Opportunity
Written by John Yoswick, Autobody News
Published August 11, 2021
Almost two in five auto body shops---38%---say they routinely work on commercial vans such as the Mercedes-Benz Sprinter, Ford Transit and Ram ProMaster, according to a recent industry survey.
And while more than half of shops say those vehicles take a little longer to repair than typical passenger vehicles, the higher average labor rates shops are getting to repair them make an attractive business proposition.
About a quarter of 470 collision repair shops surveyed earlier this year said they charge different labor rates depending on what brand of van they are repairing, but most (74%) say they charge the same rate no matter the brand of van. Those rates are notably higher than the rates reported for regular passenger vehicles.
On average, shops reported billing $66 per hour for body work on commercial vans compared to a national average regular body rate around $55, and although the national average regular frame rate is about $68, shops that work on the commercial vans say they are billing an average of $79 for the work.
Refinish rates are $64 compared to $52 per hour, and even mechanical rates, which are much higher on passenger vehicles---averaging $85 in 2020---are even more so for commercial van work, averaging $101 per hour for mechanical labor.
The data comes from a “Who Pays for What?” survey conducted in April. Shop trainer Mike Anderson of Collision Advice, who conducts the surveys with CRASH Network, said he is always on the lookout for ideas that can bring shops new or more lucrative sources of additional revenue.
“I like to think that our survey topics give our participants additional ideas on how they can expand their business, and this is just another one of those,” Anderson said of commercial van repair. “With Amazon's growth and the introduction of the Rivian van, we expect to see this segment of the industry growing in the future.”
Tim Yocum is among those seeing commercial van repair as a lucrative addition to his shop’s work mix. Yocum, manager of the Tom Masano Collision Center in Reading, PA, said the shop has capacity for as many as 12 Roadmaster small trucks and eight medium box trucks at a time for companies like Amazon and FedEx, charging $95 per labor hour for body and paint. As a dealership, the company can provide maintenance work on the commercial vehicles as well.
“We are loaded up with Amazon vehicles and have more coming,” Yocum said. “We are now sending our own transportation company to pick up these vehicles in a tri-state area.”
The shop has 23 employees and annual sales of about $4.6 million.
“But we had another new record for sales last month, a little over $450,000,” Yocum said in early August. “Gotta love this business. It’s great to see my team striving to hit higher monthly goals.”