Pressure continues on raw materials at all levels. This has resulted
in second quarter price increases that were a bit higher than we've
witnessed in recent years, according to Tom Langer, founder of TLG
Research.
“Price increases are constrained by distributor pressure
for both margins and pricing to compete at all levels, Langer says.
“Moreover, with the cost of repair already an issue and economic
pressure on the consumer, the headwinds are strong against larger
increases. That said, it remains our view that we will see price
increases larger than in recent years to deal with rising raw material,
higher fuel, an overall sluggish economy and the need by our industry to
recoup costs while balancing customer needs and demands."
The result of this review, Langer says, suggests that
this fall and into 2012 we will see price increases pretty much across
the board.
"Service
Repair Centers will also be pushing price increases, especially at the
labor level. Their costs are increasing at the same time business is
softening somewhat, while also dealing with rising labor and operating
costs," Langer noted.
Click here to see data from the previous quarter.
Methodology for Pricing Calculations:
The pricing is based on changes in the current quarter relative to the
prior quarter. The data is collected from service repair centers with
additional service repair center level pricing information provided by
Nu-Way Automotive. The "Parts Categories" includes only the parts. The
"Service Categories" include both parts and labor and is based on the
average reported. Pricing is collected in percent change, and is
averaged across the U.S. Where needed, the data is weighted in order to
represent the entire market.
Focused exclusively on all segments of the global automotive industry,
TLG Research (TLGR) offers clients a unique approach to obtaining and
keeping a global competitive advantage. Recognized as the “Parts Problem
Solvers,” TLGR provides information quickly and cost effectively.
Founded in 1992 by Thomas Langer, a 30-year industry veteran,
TLGR, through its proprietary database, provides a unique "menu driven"
approach to offer services such as price comparisons and strategies,
product/market data, channel information, competitive analysis, surveys,
new product strategies and technical writing.
