AKRON (July 30, 2007) — As increasing numbers of vehicles equipped with tire pressure monitoring systems (TPMS) pull into tire dealers' service bays, many shops are grappling with the decision of whether, and how much, to charge for recalibrating or fixing TPMS.
Within the past couple of years many dealerships have imposed a flat TPMS service fee or extra labor rates—and those charges vary dramatically within a market. For example, within a 15-mile area around West Bridgewater, Mass., TPMS fees, as posted on the Internet, ranged from $4 to $10 per tire. In Cleveland, TPMS fees run a similar gamut. Sunnyvale, Calif., area tire stores advertise prices ranging up to around $5.
Many of the tire dealerships contacted by Tire Business started implementing TPMS charges within the last year to 18 months as more TPMS-equipped vehicles entered their service bays. These same dealerships also had to make an investment of several thousand dollars for hand-held sensors needed to recalibrate the systems, as well as stocking replacement parts and kits. Also, dealerships often pay for their technicians to undergo training in TPMS servicing since a sensor, inadvertently broken during tire dismounting, can cost a dealership as much as $200.
Direct Tire & Auto Service in Watertown, Mass., which operates four outlets in the affluent Boston area, started charging for TPMS servicing about eight months ago. It created a menu of fees, including $7.95 per tire for new valve installation, $36 for up to a half hour labor for calibrating and $9.95 per tire for repair kits that involve replacement of grommets and gaskets. President Barry Steinberg said if a recalibration takes only a few minutes, the dealership tends to waive the labor fee.
The rates are based on the dealership's investment in technician training, new equipment, materials and the extra labor involved, especially if a recalibration involves two technicians. He said competitors “on top of their game” are also charging TPMS fees. “It's the two- to three-bay guys that are sending (TPMS jobs) away,” he said, noting those are usually the same businesses that don't want to keep up with technology.
In preparation for the increase in TPMS servicing, Direct Tire stocked up on valve kits, bought tools to reinstall the systems and sensor tools to reset the sensors and invested in training for every technician. The dealership also stocks sensors for popular car models, just in case one is broken, “which is a little risky because there are so many types,” Mr. Steinberg admitted.
John Jindra Jr., owner of Quality Tire Service Inc. in Spring Grove, Ill., said he researched and calculated various fee options and costs before deciding to charge a half-hourly labor rate instead of a service fee for TPMS service. The charge shows up on the customer's bill as a “reset TPMS light” job, said Mr. Jindra. “We don't hide it from the customer.”
He isn't sure yet if the labor charge recoups his investment. “You hope it keeps up,” he said. Usually resetting the sensors is simple and quick “but sometimes you get a nasty one” involving sensors that require multiple scans before they recalibrate. “It's a flat labor rate, if it takes 10 times or one time to reset,” he said. “So you make sure what you do the first time is done right.”
Mr. Jindra said he started charging for TPMS service about 18 months ago “as soon as I got smart. It started as a gratis thing.” Then he became inundated with TPMS jobs because he was doing them for free and realized he should charge for the service.
Most of his customers accept the added charge, he said, because he explains the safety aspect of TPMS and the fact that his technicians are trained and qualified. “It goes back to educating the customer. You can't just say, 'You need this,' and shove it down their throats. You've got to educate them,” Mr. Jindra said.
Likewise, Lakeway Tire & Service in Jasper, Texas, raised its TPMS service prices about eight months ago when the three-outlet dealership began seeing an increasing number of TPMS-equipped vehicles, according to company Vice President Wyatt Pugh.
Mr. Pugh, who is president of the Texas Tire Dealers Association, said several of the association's members also are adding charges for TPMS service. Some charge a labor rate, others increased service fees. “We have to increase. We don't do it for our health,” he said, noting that all the local dealerships in his market are charging extra. “It's a service we have to stomach and do.”
He said Lakeway Tire invested about $2,000 to $3,000 in training and equipment to handle TPMS. It probably will spend more as TPMS jobs become more frequent and, he added, the dealership is slowly recouping its costs.
Meanwhile, in the southern tip of Texas, McAllen-based Pueblo Tires & Service charges its normal labor rate of $34 per half hour. If the customer is buying new tires, the dealership charges $25 per tire for mounting, balancing and reinstalling the sensors. The dealership began charging for TPMS service about a year ago because “it's the wave of the future. You can't ignore it,” said Mike Braaten, Pueblo's sales manager.
The dealership originally charged a higher hourly rate for TPMS, he said, but then modified the fee “to be competitive in the marketplace and (be in line with) what the customers would tolerate.” He said customers don't seem to have a problem with the added charge once the reason is explained to them before the service job is started.
He said each of the dealership's nine stores has at least one Tire Industry Association-certified technician trained to handle TPMS, and the shops have started to see more TPMS-equipped vehicles enter their bays. Pueblo Tires even receives TPMS jobs from a couple of car dealerships that apparently don't want to deal with the system, according to Mr. Braaten, with one of its outlets getting about two to three car dealership referrals a week.
While the dealership has had to replace two sensors it broke, Mr. Braaten said Pueblo Tires has had to fix “quite a few” sensors broken by other service shops “because they didn't know what they were doing.”
“We find a lot of retail dealers are unskilled in TPMS,” noted Chip George, a Discount Tire Co. Inc. store manager in Commerce, Mich., adding that all his technicians are certified to service the systems. The tire dealership chain doesn't charge for TPMS service since “we still feel it's an added service to the customers.” But he surmised that as TPMS becomes more prevalent, charges eventually may be applied.
Arlington Tire & Service Center in Jacksonville, Fla., also is holding off charging for TPMS service only because the one-outlet dealership sees just one or two TPMS-equipped vehicles a week.
“It's not big enough yet for us to be wholly concerned,” said owner A.D. Preston III. “We haven't charged yet. We're trying to be customer-friendly right now.”
He admitted his shop eventually will have to charge because of the extra time involved in servicing TPMS. He said he'll watch what happens in his local market, “but there's always going to be some guy who will say he'll do it for free.”