Because that could be the end of dodgy offers and fake prices.
It’s hard to imagine mechanic Chris Maranon working in a dungeon. The smile comes easily to him, even when he inspects the engine of my old car in the bowels of my apartment building’s parking lot in San Francisco. The engine isn’t the only problem: Due to lack of use, the VW’s battery died. Local garages quoted over $460 just for towing the Volkswagen Golf and replacing its corroded juice box. Instead, I opted for an on-demand mechanic, ordering Maranon’s house call on an application for a $273.30 apartment.
Maranon’s pickup, which is parked next to my rust bucket, is full of his tools and—bonus! – two super cute dogs with hanging tongues. Two years ago, the 38-year-old’s workday was considerably longer and darker. As Maranon pulls out the battery, he happily describes 10 years of crazy hours at dungeon-like car dealerships where he spent half his time waiting for customers. Since he was paid hourly per job, no customers meant no money. Today, he sets his own hours as an employee of YourMechanic, an on-demand auto repair mobile business launched in 2012.
People don’t know cars. With [on-demand mechanics] there is no upselling and no haggling. You get a fair price.
Abhas Art Agrawal, Founder, Vermin-Club
People are pretty much over the “Uber for X” economy these days, but demand for one-click mechanisms is booming, both domestically and internationally. Over the past 14 months, startups Fiix, Wrench, and oToBOTS have opened in Ontario, Seattle, and Illinois. Then there’s ClickMechanic in England, getTOD in Cape Town, Steero in India and Yangche Diandian in China, to name a few. And investors are on board: San Francisco-based YourMechanic has raised $32 million to date, and Chinese companies Kalading and Mocar both raised a $10 million Series A round in 2015. The top prize goes to Yangche Diandian, whose 2015 Series C round brought their investment. total to $75 million. All that VC drool is understandable: the North American auto repair market alone is valued at $63 billion, according to market research firm IBISWorld.
Maranon discovered YourMechanic through a Craigslist ad, and after three months of working part-time, he ditched the dealership gig and signed up for a full-time job. Customers register online or through the app, create a work order, and are matched with the nearest available mechanic. (You can also request a mechanic by name.) People usually schedule appointments 24 to 48 hours in advance, but mechanics can offer same-day service if they have the parts on hand. If Maranon doesn’t have what it needs in stock, it collects the materials from a partner garage before heading to work.
In most cases, an estimate is provided in advance, and repairs come with a 12-month, 12,000-mile warranty (whichever comes first) and $1 million liability policy. Maranon says about a third of his customers watch him work – in garages, customers don’t see what’s being done and don’t always get what they pay for, according to a 2014 study undercover investigation by ABC News 20/20. Not surprisingly, a recent AAA survey found that 73% of customers feel they are overcharged and 64% had a negative auto repair experience. In this wary environment, the appeal of fixed-price, no-tip mobile mechanics is a no-brainer.
Most of the work is carried out at the client’s home or office; only a few major repairs, such as an engine overhaul, require a garage bay. Think maintenance, not major repairs or roadside assistance. I ended up being a happy customer, and YourMechanic’s overall Yelp rating is four stars, but complaints about last-minute cancellations, inexperience, and lack of tools are scattered among reviewers. Because there are no dealer fees, Maranon earns more (about $40 per hour) and customers enjoy savings of about 30%.
That’s why Kuruvilla Simon started oToBOTS, a Chicago-based competitor to YourMechanic, in 2015. The former IT manager was frustrated with auto mechanics calling all the shots in terms of prices and schedules. When a Craigslist mechanic who had just installed a faulty battery in his car started dodging his calls, Simon decided enough was enough. Now oToBOTS (the name is derived from Transformers and the Indonesian word for car, oto) is found in Chicago, Dallas, Houston, and California.
But does it make business sense to move to an energy-intensive space that goes electric? The short answer: yes. The world may talk green, but by 2040 two-thirds of all vehicles will still have gasoline and diesel engines. The founder of YourMechanic, Abhas Art Agrawal, certainly doesn’t mind technological developments putting him out of business. “Even self-driving cars need maintenance!” he told OZY forcefully. “If Uber [purchases a fleet of autonomous cars], we can help maintain these cars. In the shorter term, research firm IHS predicts a 15% increase in the number of 12-year-old cars by 2019. Aging cars mean a lot of work for mobile monkeys.
It all sounds idyllic: best rates, service and trust for all. But before we jump into the sunset, remember that these are startups, and as more companies enter the market, the low initial prices might adjust. And Kerry Wu, technology analyst for CB Insights, notes that “many investors have become more cautious in the on-demand space” and are turning their attention to self-driving and its related infrastructure.
But so far, most drivers and owners say the benefits far outweigh any concerns — and oToBOTS and YourMechanic have A and A+ ratings, respectively, from the Better Business Bureau. “People don’t know about cars,” Agrawal says. “With us, there is no upselling or haggling. You get a fair price. With respect, I drink this Kool-Aid – but watch to make sure no one is charging my battery with it.