About a month ago we covered a new service called Repair Jungle which was just launched in the DC area to provide a service where car owners can post repair requests online and receive competitive bids for the car repair work from participating auto repair shops. Well, it looks like there is now some competition in town in the form of a new website called AutoMD which has the same exact business model.
The fact that two startups have been launched with this model in the past year means that there may be something to it. Although, in reality, there really won’t be any direct competition between these two companies because they are locally-based and operate on opposite coasts (AutoMD is out of Bakersfield, California). It seems that there really isn’t much that the internet won’t touch these days, and although it seems that the auto center would be one of the last places to go online, those days are now here.
AutoMD suffers from some of the same problems that Repair Jungle did as well. Namely, both of these services require users to be able to accurately diagnose what is wrong with their cars (or to get the problem diagnosed by an auto technician ahead of time). AutoMD attempts to solve this problem by using an elaborate questionnaire to help a lay person diagnose the issue with their car, but there’s no doubt that this is a poor substitute for having an expert eye take a look under the hood.
There is no denying that there is a certain appeal of these types of services for consumers, if they can be fine-tuned. However, the competitive marketplace that they could facilitate would likely drive down costs to the consumer, at the same time that it would threaten profit margins that are already razor thin in the car repair industry.
It remains to be seen how these services will benefit the auto technician or the auto center owner, although the ways in which they would benefit the consumer are much clearer as of right now. The prospect of bringing in new business may be part of the allure to car repair shops, although if the price of that new business is reducing your rates further in order to win the business in a competitive bidding situation.