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Car Repair Costs Could Put Drivers on the Road

Thursday, 13 Jun 2013 | 2:17 PM ET
Car damaged by Hurricane Sandy
Brigitte Dusseau | AFP | Getty Images
Car damaged by Hurricane Sandy

Here's a summer vacation idea for New Jersey residents who are driving around with their check-engine light on. Head up to Vermont, if you're old rig will make it there, and have the repairs done while you relax.

Sure, the Green Mountain state has beautiful vistas and crystal clear lakes. Better yet, the trip will take you from the most costly state to repair your car to the state with the lowest cost, according to the annual CarMD Vehicle Health Index.

The average cost to fix a check-engine related problem was $367.84 nationwide last year, but nowhere did drivers pay more than in New Jersey, where the average cost for a repair was $392.99. From 2011 to 2012, New Jerseyans saw a 20.7 percent increase in labor rates and an 8.2 percent increase in parts costs.

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CarMD, which sells a tool for diagnosing car problems, bases its index on reports from a national network of car repair technicians. This year's list is based on the company's analysis of 161,350 repairs made on model year 1996 to 2012 cars.

Several factors contribute to high repair costs, but the most powerful appears to be the weather, which can affect some of the most expensive parts of the car to replace, or simply create a climate (so to speak) in which car owners turn up most regularly at repair shops. In the 16 years that CarMD has been conducting its study, the tough winters and hot, dusty summers that stress a car's systems have usually put Western states at the top of the cost index. In 2011, six of the top seven states were in the Mountain time zone.

In New Jersey's case, CarMD's experts say, the precipitating factor was Hurricane Sandy. "The storm affected how often people brought their car into the shop," said CarMD's Kristin Brocoff. Whether or not ensuing repairs were directly related to Sandy, said Brocoff, the problems were likely diagnosed after the vehicle's owner brought it in.

Ten percent of drivers are tooling around with their check-engine light illuminated; half ignore the warning for at least three months.

Though Louisiana and Indiana experienced the highest percentage hikes in repair costs, the storm-battered Northeast as a region experienced the largest percentage increase in the nation, with a hike of 11.56 percent last year. The West, by comparison, saw only a 6.53 percent increase.

The recession is another likely suspect in the 10 percent overall increase in the national average. As drivers hang onto their cars longer—the average age of a car on the American roads is now over 11 years old—the more likely they are to need new oxygen sensors and catalytic converters, the most common repairs in CarMD's survey, and two of the most expensive maintenance repairs: In New Jersey, replacing a catalytic converter, which scrubs the engine's exhaust of pollutants, cost $1,112 on average.

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The recession may also have shifted higher costs eastward. The economic downturn that began in 2008 put many repair shops out of business, and many of those that survived did so only by dropping their labor rates. "We are seeing labor costs go up in New Jersey and Connecticut," said Brocoff. "It's a slight market correction, in which rates are going back to where they should be."

There are anomalies, too, which can bump up state up into the top of CarMD's list. For unexplained reasons, it is relatively expensive to have hybrid cars fixed in Arizona.

Despite the Northeast's price hike, New England is still a relative bargain when it comes to repairs, because of its mechanics' cheap labor rates. Vermont's repairmen charge the lowest rates in the country, at $115 an hour, followed by New Hampshire ($121), Massachusetts ($124) and Rhode Island ($127).

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Two years ago, Washington, D.C.'s labor costs were a quarter less expensive than the national average. Today only three states have higher labor costs that the nation's capital. The difference moved the district from No. 51 in the nation that year to No. 2 today.

The good news in the shift of higher rates is that drivers on the East Coast are often within a day's drive of cheaper ones. D.C. drivers can sneak into Virginia and get a $5 drop in labor costs and a $4 drop in the average cost of parts. If they dare to drive into West Virginia, they can take advantage of labor rates that average just $130 an hour and parts costs averaging $180, saving an average of $81 on repair costs.

For some drivers these days, that's almost an entire tank of gas.

—By CNBC's Paul O'Donnell.

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