Vehicle mechanics depend on insurance companies for the vast majority of their repair work, and insurance companis well know it.
Using the volume of their trade, insurance companies tie vehicle workshops down to a very low price for their work, which is why vehicle mechanics in the Province of Granada have had enough.
They have publicly accused insurance companies for imposing repair prices below the market level, pushing them to the point of their businesses reaching a survival crisis.
“The pressure that the insurance lobby exercises on vehicle repair shops is nothing new; they’ve been applying it for years,” complained the manager of the Asociación Provincial de Talleres de Reparación de Granada (ASEMTAGRA), María José Medialdea.
The problem is that the cost of materials and the running costs of a car workshop have increased enormously but the insurance companies have not adjusted their prices, making vehicle-repair businesses economically unviable.
A total of 263 vehicle-repair workshops in the province, specialised in bodywork repairs, have financed a detailed study on the situation, which has concluded that insurance companies are paying 30% below market prices for their repair jobs.
It’s the cost of manhours that is most telling: the study puts the cost of a manhour at 37.86 euros where as the insurance companies are only paying out at 26.44 euros. This means that to survive workshops have to exist off the profit margin for spare parts and painting material to compensate for the drain on the cost of manhours.
Furthermore, Sr. Medialdea points out that insurance companie have not adjusted their prices in the last ten years.
He stated that customers have not been affected by this to date, but they will shortly find out. He said that vehicle repair shops will make it known when they disagree with the insurance company’s assessment of repair costs and if they want an alternative assessment, we will do it ourselves..
He pointed out that customers can choose the repair shop they want and are not obligated to use one particular one when it is in the interest of the insurance company to use it.
(News: Granada, Andalucia)