How much should you charge for a 15 minute diagnosis by an A tech who gets it right immediately? What about the same diagnosis that takes your best B tech four hours? Questions like these reveal one of the most common struggles in auto repair: setting rates that reflect the value a shop provides.
In episode 74 of Maximum Octane, Brian Hunnicutt, an ATI executive coach and Certified Profit First Professional, joins Kim Hickey to discuss why shops undercharge, especially for diagnostics, why owners feel guilty charging fairly, how to tell which customers want their car fixed, and three questions that keep the counter and the bays aligned.
What You Will Learn
- A Tech’s, the prima donna of every auto repair shop
- Why do some clients get the wrong idea of how much auto repair professionals’ time is worth?
- It’s 2023, and the automotive industry still struggles to charge diagnostic time properly
- Three questions to align the front counter and technicians in your auto repair shop
A Techs, the Prima Donnas of the Shop
Brian opens by calling A techs the “prima donnas” of every repair shop. Their speed, accuracy, and diagnostic skill make them extremely valuable, and they know it. A great A tech can diagnose in minutes what might take someone else hours. The question is whether the shop’s pricing reflects that value or gives it away.
A techs earn their reputation through years of training and experience. They can diagnose complex problems quickly, often saving customers money by avoiding unnecessary parts replacement. That skill is valuable, and shops should both pay A techs well and price their work to reflect that value. Retaining A techs also requires respect, good equipment, and opportunities for growth, since they are highly sought after by competitors.
There is a practical side to pricing that skill. When a shop bills diagnostic time strictly by the clock, the fastest technician generates the smallest charge, which effectively penalizes the shop for employing its best people. Many shops address this by pricing diagnostics as a defined service with a set starting fee for a given type of concern, then requesting approval for additional time if the problem turns out to be intermittent or complex. That structure rewards accuracy, keeps the customer informed before costs grow, and gives advisors a clear, confident way to explain what the customer is buying.
Why Customers Undervalue Technician Time
Around the 9 minute mark, Brian discusses why some customers get the wrong idea about what a professional’s time is worth. Many people do not understand the training, tools, and experience behind a quick, accurate diagnosis. When a repair takes 15 minutes to diagnose, they may assume it should cost very little. Shops need to explain value clearly, without apologizing for it.
ATI’s It’s Not About the Price, It’s About the Money and Make Price Irrelevant help advisors talk about value.
Customers often compare repair costs with what they see on the internet, where a part may be inexpensive. They may not understand the cost of diagnostic equipment, software subscriptions, training, and the expertise required to identify the right repair. Explaining that the shop charges for an accurate answer, not just time, helps customers see the value. Comparing it to other professional services, such as a doctor’s diagnosis, can make the concept relatable.
The Industry Still Struggles to Charge for Diagnostics
Brian points out that, even now, the automotive industry struggles to charge diagnostic time properly. Many shops discount or give away diagnostics to win the job, then try to make up the difference on the repair. That approach undervalues the most skilled part of the work and leaves money on the table.
ATI addresses this directly in How Much Should Your Check Engine Diagnostic Sell For? and the two-part series Win the Diagnostic Game.
Diagnostic work has become more complex as vehicles have become more computerized. Technicians may need to use scan tools, wiring diagrams, oscilloscopes, and manufacturer information to find a problem. Charging appropriately for that work ensures shops can invest in the tools and training needed to keep up. Free or heavily discounted diagnostics often lead to rushed work or losses that must be recovered elsewhere.
The Guilt of Charging Fairly
Brian discusses why many owners feel like they are ripping customers off when they charge what they should. This feeling often comes from years of underpricing, comparing themselves to the cheapest competitor, or not seeing the full cost of running a professional shop. The result is a business that works hard and struggles to profit. ATI’s Don’t Cut Your Labor Rate for This Reason and Here’s What’s Wrong With Your Labor Rate address the issue.
A later episode, Why Charging Fairly Isn’t Greed, tells the story of a shop owner who nearly gave it all away.
Overcoming pricing guilt often starts with understanding costs. When owners calculate the full cost of running a professional shop, including payroll, benefits, equipment, rent, insurance, and training, they often realize their prices are too low to sustain the business. Fair pricing is not greed. It is what allows the shop to pay employees well, serve customers properly, and stay in business.
Customers Who Want It Fixed vs. Customers Who Want It Cheap
Brian explains how to identify customers who want their car fixed properly and those who are mainly looking to spend as little as possible. Understanding the difference helps advisors communicate appropriately and decide how much time to invest in each situation.
Understanding customer priorities helps advisors communicate effectively. Some customers prioritize safety and reliability. Others are focused on budget. Advisors can serve both by clearly explaining options, priorities, and consequences, allowing customers to make informed decisions. Respecting customer choices while being honest about risks builds trust.
At the counter, the difference often shows up in the first few minutes. A customer who wants the car fixed tends to ask about cause, reliability, and how long the repair will last. A customer focused mainly on price tends to lead with “how much” before the problem is even understood. Neither customer is wrong, but each needs a different conversation. Advisors who ask a few open questions about how long the customer plans to keep the vehicle and what matters most to them can tailor the estimate, rather than guessing and either overwhelming one customer or underserving the other.
Three Questions to Align the Front Counter and Technicians
Around the 18 minute mark, Brian shares three questions he developed to keep the front counter and technicians aligned. Misalignment between advisors and techs leads to inaccurate estimates, missed work, and frustrated customers. Listen to the episode for Brian’s specific questions.
ATI’s 3 Quick Ways to Improve the Distance Between Techs and Service Advisors offers more ideas.
Alignment between advisors and technicians reduces mistakes and improves customer experience. Regular communication about diagnoses, estimates, and customer concerns ensures that everyone understands the job. Clear processes for documenting findings and approvals also help prevent misunderstandings.
How Proper Pricing Benefits Everyone
Fair pricing benefits more than the shop owner. It allows shops to pay technicians and advisors competitively, which attracts and retains talent. It funds investment in equipment and training, which improves quality. It enables better customer experiences, such as comfortable waiting areas and thorough inspections. And it builds financial stability, which protects jobs during slow periods.
Customers also benefit from shops that price fairly, because those shops are more likely to be around when they need them and to stand behind their work. Brian’s message is that pricing reflects value, and shops that deliver value should be confident in charging for it.
Common Pricing Mistakes to Avoid
Shops that struggle with undercharging often repeat the same handful of habits. Recognizing them is the first step toward changing them:
- Waiving the diagnostic fee whenever the customer approves the repair, which teaches customers that the diagnosis has no value.
- Setting the labor rate by checking what nearby shops charge instead of calculating what the business actually needs.
- Letting advisors discount on their own judgment, with no written guidelines or follow-up.
- Quoting a diagnostic price over the phone before anyone understands the concern.
- Never revisiting prices, even as equipment, software, and payroll costs rise.
Fixing even one of these, consistently, can make a noticeable difference in how the shop feels financially by the end of a quarter.
Pricing Questions to Review
- What is your posted labor rate compared with your effective labor rate?
- Do you charge for every diagnostic, and is the price based on time and skill?
- How often do advisors discount without a clear reason?
- Do your advisors and technicians communicate clearly on every repair order?
This episode returned as a Maximum Octane throwback. Brian also appears in Putting In What We Need to Get Out.
Frequently Asked Questions
Should an auto repair shop charge for diagnostics?
Yes. Diagnosis is skilled professional work that relies on trained technicians, expensive scan tools, software subscriptions, and repair information. Charging for it pays for those resources and sets accurate expectations with customers. Shops that give diagnostics away usually try to recover the cost by inflating the repair, which is less transparent. A clear diagnostic fee, explained up front as the price of finding the right answer, tends to build trust rather than lose jobs.
How do I explain a diagnostic fee to a customer who thinks it should be free?
Focus on what the customer receives: a confirmed answer rather than a guess. Explain that the fee covers a trained technician’s time, specialized equipment, and access to manufacturer information, and that an accurate diagnosis prevents paying for parts that do not solve the problem. Comparing it to a doctor’s visit often helps. Keep the tone calm and confident, and avoid apologizing, since hesitation signals that the fee is negotiable.
Why do shop owners feel guilty about raising prices?
Guilt usually comes from years of competing on price, from personal memories of struggling to afford repairs, or from not knowing the true cost of running the business. Once an owner adds up payroll, benefits, rent, insurance, equipment, training, and a reasonable profit, the need for higher prices becomes a matter of math rather than greed. Fair prices are what allow a shop to pay people well and stay open to serve customers.
How can service advisors and technicians stay on the same page?
Alignment starts with clear documentation. Technicians should record findings, causes, and recommended repairs in plain terms, and advisors should confirm they understand before calling the customer. Short daily huddles, a standard way of noting approvals, and a quick conversation whenever a job changes all reduce miscommunication. When advisors and techs respect each other’s roles and talk openly, estimates become more accurate and customers get fewer surprises.
Resources and Links From This Episode
Connect With the Guests
- Brian: LinkedIn
