Sponsored By: Mercury Protect
Hello AMAC Members,
As a fellow vehicle owner and the General Manager of Mercury Mechanical Protection, a company with over 50 years of experience in the vehicle service contract industry, I’m here to address a concern that’s likely already on your mind: the escalating cost of car repairs. In my 41st year in this business, I can confidently say that the current situation is unprecedented.
The last six years have been the most challenging our industry has ever faced! Repair costs are out of control! In 2019, the average claim for Mercury Mechanical Protection was just under $1,000. Today, that number has nearly DOUBLED! We now see claims averaging almost $2,000.
Costs Are Driven up Due to the Amount of Tech in the New Cars.
The issue is no longer just about major repairs or supply chain disruptions. A significant driver of these escalating costs is the increasing complexity of modern vehicles. While these vehicles are safer than ever, they are essentially rolling computers packed with an array of sensors, cameras, and software. This high-tech nature makes even minor repairs a significant expense.
The failure of a radar sensor will disable the vehicle’s cruise control system, and a failed front-facing camera can disable the lane keep assist, traffic recognition, and auto–high beam control. In some cases, these replacement components require special calibration, which adds to the repair cost.
The Modern Vehicle: Electronics? Can be up to 40% of the Vehicle Price
This new reality requires mechanics to have specialized training and access to expensive diagnostic tools, all of which contribute to higher labor costs. In an industry already facing a critical shortage of qualified technicians, the need for these advanced skills is driving up costs across the board. These additional costs are why a Vehicle Service Contract is no longer just a good idea; it’s an absolute necessity!
It’s the single best way to protect yourself from these massive, unexpected expenses. To make this protection accessible for everyone, we’ve created Mercury Protect. This monthly payment plan is designed to fit your budget without draining your savings. You deserve peace of mind while driving! Please take a moment to consider how a Vehicle Service Contract can protect you and your family. We are committed to finding solutions that work for you, our valued AMAC members. You are not alone! Read: Our Claims Experience
By Jim Donaldson, General Manager of Mercury Mechanical Protection
Interesting article. I wonder how this will relate to older, less technical vehicles holding or raising in value. I drive an 86’ Jeep Comanche, fitted with a Cummins engine. It’s extremely reliable and very efficient at 30 mpg consistently. I won’t part with it ever. I recently bought a new Ram 1500 Laramie, beautiful truck and extremely comfortable. But an electronic nightmare. I dread the day when it has to go to the dealer for any repairs. I did purchase an extended warranty, however when that runs out, so will the ownership of the Ram. The Jeep I’ll still own,
I can attest to the information in the article. My wife and I purchased a new to us vehicle three years ago. It’s a 2020 Jeep Grand Cherokee. All of our other vehicles ( a 2006 Lexus, two 20 year old motorcycles) are not filled with high-tech stuff. We purchased an extended warranty for the first time in our lives. A few months ago I took it to the service department for transmission issues. It needed a NEW transmission at 57K miles! The service invoice after approval from Mopar was over $17,000! Cost me $100.
Today’s cars are formal complicated than need be. Some of the stuff they do is downright stupid. These so called safety features abdicate the drivers responsibility leading to careless and unskilled drivers.
Praise for your work Jim – I do believe that what you are doing is in the interest of ethical standards as well as mechanical necessity . In the 1930 ‘s my Dad learned about automobile repair from his Dad who owned a small automobile repair shop in Philadelphia. In 1960,at age ten I would help my Dad with repairs and basic maintenance to the family car ,a 1954 Mercury and after that a 1956 Oldsmobile. So between 10 and 12 was basically a tool passer. By age 13 I can say that I was very knowledgeable of engines and could even diagnose some engine troubles by the sounds made that were different than usual. Started being a Toolmaker in the 1970’s and continue that now at 75 although most of what is done these days involves mechanical drawing and making prototypes . Don’t have a shop nor the equipment needed to do much more but that is okay. In the 1970’s as a civilian , I did mechanical work on ships for two years. Learned a great deal from that experience. The situation you described in this article — the extremely high costs due to the advanced technology involved – sure is a bit difficult to grasp in one sense .I reckon that some of this equipment is not absolutely necessary and that adds to the intricate puzzle of how this came to be , am referring to the exorbitant costs . I do hope your article is read by many as it will be good to fix what needs to be fixed with this situation. It could be said that the Space Age technology has led to prices that are On the Moon — but that doesn’t make it right. Fairness is something of importance and is a good character quality . Your efforts to make improvements are appreciated. Well Done !
Sounds like a wonderful opportunity for a new business model. An auto manufacturer that designs, builds, sells old fashion vehicles that are reliable without all the fluff, without all the electronics, without the requirement for specialized equipment or specialized diagnostic equipment and tools. I’d buy one of these that I could maintain on my own. Who else is interested? Lets build the peoples car 2.0 (reference to the original VW Bug’s)….
The days of working on the family jalopy are over unless you have a special diagnostic scanner and that you can understand what it’s telling you. Here in California, the state is determined to eliminate older vehicles so much as to prevent companies like Amazon to prevent common replacement parts to be delivered. New car repairs aren’t straight forward nor easily fixed, most people do not have necessary skills or tools to even attempt even simple repairs. With labor rates being astronomical, who can afford repairs, let alone a new vehicle? It will only get worse.