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Posted

Hello all,

 

As an independent automotive shop we service most makes and models. We recently experienced a situation where a customer brought a vehicle for a no start diag, authorized certain repairs, and did not come to pick up vehicle since additional repairs were needed to complete the job.

 

We soon learned the reason why was because the owed balance isn't worth the cars value. I personally believe it isn't worth the headache, time, or money to deal with a mechanics lien for a car that's worth not much.

 

How do you guys handle diags? Do you collect the fee upfront to secure payment of your actual time covered?

 

And if a customer approves repairs, do you request a deposit? Only if repairs exceeds the cars value? (Older vehicles)

 

 

Thank you all for your thoughts and opinions in advance.

Posted

I have a 1989 Camaro that I have had since May. I am getting a mechanics lien and will sell it for what I can get. To secure a title for a vehicle in Indiana costs me about $150. You just have to weigh it all out. I will have 1-2 vehicles abandone each year. For me it is just part of running the business.

Posted (edited)

If I have any idea there is a chance the customer will not pay, I get at least all of the parts up front. If the repairs are 1/2 the book value of the car or more I have a serious conversation with the customer up front ( yes, I book a lot of vehicles before making repairs). I weigh all the pro's and cons of repairing the vehicle with the customer before they make a decision on the repair. I feel it is my job to be a trusted and unbiased advisor to them on all things vehicle related (and then some). People really seem to appreciate this.

Edited by kars
  • Like 1
Posted

If I have any idea there is a chance the customer will not or can not pay, I get at least all of the parts up front. If the repairs are 1/2 the book value of the car or more I have a serious conversation with the customer up front ( yes, I book a lot of vehicles before making repairs). I weigh all the pro's and cons of repairing the vehicle with the customer before they make a decision on the repair. I feel it is my job to be a trusted and unbiased advisor to them on all things vehicle related (and then some). People really seem to appreciate this.

In other words......no, I have not had this problem.

Posted (edited)

I was once told to use a 70% rule..if the cost of repair excededs 70% of the vehicles value then its a no go. Now with that said I try to counsel my customers as to the vehicles value and the value of the repairs. I get a lot of cars that need a grand in repairs that are marginally worth more that that. On the other hand in my market a decent used car is 3000 and up. Many folks cant afford another car or dont have the credit to get sold. As to the lien..it cost me 350 to lien a car. With salvage here paying a 150 or less I try real hard to not get stuck with an abandoned car. On the other hand had a guy walk away from an 08 H3 that needs an engine. Car books at 14G plus and an engine is 3100.

Edited by Jeff
Posted

I had a car abandoned where I was owed $100. It needed a fuel pump. When it was all said and done I made $2,000 profit on the car.

  • Like 1
Posted

If the bank owns the car, they will be coming for it. They cannot repo the car without paying you. Make sure you are documenting all the storage charges. Also a mechanic's lien shouldn't cost you more that $300 if you go through a lien guy but state laws vary.

Posted (edited)

Unless someone can correct me, Minnesota does not have mechanic's liens for automotive. If they owe you money on the repair, the car is sold at sheriff's auction and the amount owed you is given to you. If the car sells for less than what is owed, you get what was collected at the auction

Edited by PAPShop
Posted

In the case of the H3 the car was registered in Illinois. They dont reciprocate with Florida. I suspect thats what the owner thought. I have had vehicles in the past that had bank notes. When the bank was notified they repairs and storage were more than they wanted to pay. They write it off to loss, tag the owners credit file and I sell the car.

Posted

Bank refused to pick up vehicle, declared it abandoned since it was not worth the value ( it would cost more to pay off and send a wrecker to pick up the vehicle).

Posted

soThe cars I've had abandoned are POS with deadbeat owners. I never get too far into anything without being paid. Some of that is luck and some of that is intuition. I have a junk dealer that will come pick them up for nothing and keeps them for so long and if the owner doesn't respond to his calls he goes through the process of getting the titles and parting it out.

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  • Have you checked out Joe's Latest Blog?

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      It always amazes me when I hear about a technician who quits one repair shop to go work at another shop for less money. I know you have heard of this too, and you’ve probably asked yourself, “Can this be true? And Why?” The answer rests within the culture of the company. More specifically, the boss, manager, or a toxic work environment literally pushed the technician out the door.
      While money and benefits tend to attract people to a company, it won’t keep them there. When a technician begins to look over the fence for greener grass, that is usually a sign that something is wrong within the workplace. It also means that his or her heart is probably already gone. If the issue is not resolved, no amount of money will keep that technician for the long term. The heart is always the first to leave. The last thing that leaves is the technician’s toolbox.
      Shop owners: Focus more on employee retention than acquisition. This is not to say that you should not be constantly recruiting. You should. What it does means is that once you hire someone, your job isn’t over, that’s when it begins. Get to know your technicians. Build strong relationships. Have frequent one-on-ones. Engage in meaningful conversation. Find what truly motivates your technicians. You may be surprised that while money is a motivator, it’s usually not the prime motivator.
      One last thing; the cost of technician turnover can be financially devastating. It also affects shop morale. Do all you can to create a workplace where technicians feel they are respected, recognized, and know that their work contributes to the overall success of the company. This will lead to improved morale and team spirit. Remember, when you see a technician’s toolbox rolling out of the bay on its way to another shop, the heart was most likely gone long before that.
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