On the Up and Up: Auto Glass Shops Struggle with Rising Costs

As the costs of auto glass materials rise steadily each month, how are auto glass shops making up for the difference in their reduced profit levels?

The Bureau of Labor Statistics’ latest Producer Price Index data for January 2022 revealed prices for motor vehicle parts increased by 5.2% from a year ago. Adhesives and sealants increased in price by 14.2% from a year ago. Prices for materials related to motor vehicle repair and maintenance increased 2.9% from January 2021.

“Last year alone — urethane went up six different times. That’s unprecedented,” says Jaymie Percival, who owns Superior Auto Glass in Dallas, Texas. Percival has been in the industry for 30 years. She says she was paying $43 for a box of tubes, and says the price would go up a few bucks once every year or two. “But, six times in one year? That’s ridiculous.” Now she’s paying $56 for a box.

A year ago, she paid $130 for a box of 16 tubes for another brand, but now she pays $171. “It didn’t go up a little bit.”

Percival says NAGS pricing has yet to catch up to what auto glass shops have to pay for materials. Percival does not do any job, not even a chip repair on a windshield, for the NAGS list price. She does refuse insurance work when the job does not pay enough. A windshield that cost $45 a year ago, now costs $60-65. “And the insurance companies are not taking that into consideration.”

“[Auto glass material suppliers] have used this as an opportunity to raise our prices,” she says. A year ago, she replaced the windshield in a 2020 Ford Explorer for $300. The customer just called back and asked if he could get her to replace the windshield again for the same price. “No way,” Percival told her customer. The windshield now costs her $370.

“And now you’ve got the war [with Ukraine and] Russia,” Percival says, which means material costs will continue to go up while the supply chain continues to experience shortages. Percival says she has no choice but to pass the added costs to her customers. “Absolutely. I can’t afford to eat that.” Percival has increased her labor rate sometimes up to 25% since before the last hike in material prices.

“For the longest time in auto glass, insurance work is where the money was. That was their bread and butter,” Percival says.

One southwestern auto glass shop owner, who prefers not to be identified publicly for fear of reprisal from the insurance industry, has been in the industry since opening his auto glass shop in 2009. Customers can have their windshields repaired, replaced and Advanced Driver Assistance System (ADAS) cameras calibrated. “It is frustrating that our costs are going up and our reimbursements from the networks are going down,” he says. Networks also ask to take discounts off NAGS listing of windshields. “For me, it gets difficult to maintain margins,” he says.

“We’re seeing less and less money. Meanwhile, our input costs are going way up,” he says, not to mention, labor costs are up, as well as costs to maintain a physical auto glass shop location.

“Every single …cost of goods [item] has gone up incredibly,” he says. “It’s so difficult to bill insurance companies directly. In most instances, it goes to a network.”

“The amount we’re getting paid is significantly less than we’ve been getting paid before,” says the southwestern auto glass shop owner.

In California, Don’s Mobile Glass almost triple ordered windshields and adhesives before the pandemic in an effort to stock up. “We lucked out because we were able to order and bulk up before the pandemic took effect,” says Jacques Navant, technical director. However, Navant says that price increases are common across the industry.

A member of leadership for a large Midwestern auto glass chain, who preferred to remain anonymous to avoid disrupting business relations with insurance companies, says his company buys urethane in bulk so the price increase has been less intrusive.

“We’ve become accustomed to [price increases] now,” he says. “Knowing that we can get our hands on things is a big plus.” In some areas, he says, cost of goods has doubled, and, while he sees supply chain challenges becoming less intrusive in the future, challenges will continue.

“We’re being affected. It’s huge,” says Peter Brown, president of Tiny & Sons in Boston. Buying aftermarket parts, such as windshields and door glass, is expensive now. Brown says an increase in prices was noticed more than a month ago. “The insurance companies won’t pay for it,” he says.

Brown says his business has not been financially impacted yet. “But it’s starting to pinch us,” he says. His company has to watch where products are purchased, plan routes for jobs more effectively and purchase more materials at a time now to ensure materials are available when needed for customers. “All we know on our end — we can’t charge for [the increase in costs].”