Hey Joe, great post.

I'm sure dealer principals and fixed ops managers choked just a little at your tech pay rate suggestion. It made my eyebrows go up for a moment too, but you're bang on. Techs, especially fully-trained and certified techs, are in short supply. If you can't keep them, you're up the proverbial creek. 

In the dealerships I've been a part of, I can count no less than a dozen techs poached by the railroad alone in less than 10 years. There are employers throwing around huge wads of cash to good people, so if you don't treat them right and pay them well, they're gone. 

Jason, my dealers that have been with us for years understand, and are following our advise. However when dealers who hear this message that don't know us, and go to 20 Groups and share this information, the other dealers laugh them out of the room.

Sometimes 20 Groups are a poison pill.

In the near future, GM dealers will be the biggest believers! I just read an article that the average age of a GM Tech is 50. What do you think happens when Techs turn 62 choose “A”- can start Social Security. Or “B” - oh I enjoy being beat up by warranty times, can't do P.M. because some hot blond reporter of our local station perceived our dealership for selling fluid changes on fluids for life, losing my service advisor because of his DUI who could sell, I love sitting from 8:00 am until 8:45am for my first ticket and car, and can’t tell you how many times I walk into the parts department behind 5 other Techs”

99% of Techs can’t wait for age 62 … if their bodies or health last that long.

This article is very interesting.It suggest a 40% GPM on parts which is directly relayed to the customer and not over keystone pricing standards.It also suggests a GPM on labor of 70% minimum.Shop labor rates are a set fixed rate and do not vary or are they relayed to the customer.An example,a shop rate is $160 and a tech is paid $20 the margin is 700% over cost and 82.5% GPM.How is this not wage fixing and an absolutely absurd cost mark up to the customer?I was taught first day of automotive school about these pricing standards and started at age 19 for 50% of the shop rate.I have a list of skilled trades from 30 cities and none are marked up over 100% of cost and the median is in the 40-60% above cost.A pet groomer will get 50% or more.I don't see the trade as viable any longer and it is certainly not worth the investments for someone new to come in.Warranty times are sometimes 25% of customer pay time and completely at their discretion after the work is performed rather than being stated clearly and agreed to before.It has completely gone into another realm and violates my being!

http://www.autodealermonthly.com/channel/dps-office/article/story/2012/06/service-and-parts-profitability.aspx

They substitute "lower level"or lower pay techs with master tech signage posted everywhere but offer the customer no discount for them.They have doubled shop rates since and this article was written in June of 2008 in the middle of the Great Recession and 10% unemployment speaking of technician shortfalls and cutting their pay in half again.Omg! http://www.autodealermonthly.com/channel/parts-and-service/article/story/2008/06/the-technician-shortfall-proper-recruiting-hiring-and-training-to-attract-and-retain-qualified.aspx

Hardest position to fill in the U.S. and 42 other countries.There has always been shortages of talented techs and going to get much worse although there have never been any shortages of dealer accounting specialist,office personnel or management. http://www.autoserviceworld.com/1003794907-2/#comment-93222

20 groups,dealer associations and Technician Compensation Panels discussing technician pay is absolutely illegal and considered Wage Fixing in every sense of the term.Unbelievable how little regard these people show for the laws and their employees!Especially ignorant to do it so openly. https://www.justice.gov/atr/file/903511/download

"Most consumers would be appalled that you are selling something for double what you paid for it. They would be inclined to ask why you don't carry a gun and wear a mask." https://www.entrepreneur.com/article/193986

This is a list of skilled trades,their average hourly pay and the GPM's on them.Notice that none of their cost are more than doubled or keystones.It has become commonplace to more than quadruple the cost of an auto technicians labor or more.This is not only a disservice to the technician but very unethical cost markups to the customers.Proper pay in this system has always been 50% or more. https://www.rsmeansonline.com/References/LABORRATE/2-Year%202013%20Labor%20Rates/Repair%20Remodeling%20Labor%20Rates.PDF

Did they forget what the customer is paying for or that an experienced journeyman produces three times the amount of work with ten times the range? Dealers need to look at lower skill level technicians. There are several benefits: They’re a lot easier to steal from somebody else and they make you more money because they have a lower cost. You hire an A mechanic at $25 an hour, a C for $15 an hour, and your labor rate is $75 an hour. So you’re paying $25 to get $75 or paying $15 to get $75.”