I consult with dealers all over the country and here are some examples of what their techs get paid. An entry level tech could expect $12-$15 per hour. At the top of the heap would be a fully certified and factory trained tech would be $22-$25 and a certified diesel tech commands a few dollars more (all per hour). Most of these techs are also paid on a flat rate basis which I suspect your guy is paid on clock hour.
I would suggest looking at Independent shops. Here you would find people who are used to searching for parts, are comfortable with a clock hour pay program and are familiar with electronic diagnostic techniques (most are). I think you could expect to pay somewhere in the $20 range but this shouldn't be a problem for the right person.
If you have other questions, let me know.
Dugan knows his stuff. Any mechanic should be paid on Flag hours (flat rate) and not clock hours, in my opinion, but you have to work within your market. I would give him a small bonus on parts profit to encourage saving on parts.
We have around 50 cars and sell around 15 cars per month, but do quite a bit of fix up on site.
It is extremely difficult to find a skilled mechanic that is also good with people (and paperwork). If they can do both they are typically running their own shop somewhere. I have one of my salespeople (that has a fair amount of mechanical knowledge) work directly with the customers.
I am in Oregon, which has around 12% unemployment, so may be cheaper than Dallas.
I am very aware I underpay my mechanics, but give them a large amount of flexibility and the ability to bring in their own side work. It sometimes results in a higher turnover rate, so I have begun giving 30-90 day raises once they prove themseIves. I typically run 1-2 mechanics on site between $10-$12. My guy at $10 is comparable to your last guy. One at $12 is more experienced but not a certified tech. He likes that I work around his school and sidework schedule. Both of these are per clock hour, but they can bid a job at around $15 per flag hour for bigger projects. Agreed that someone willing to save on parts is worth more per hour.
I also have a tech off site. He was laid off from a shop when they slowed down, but is still allowed to use the facility which is better than ours. He works for $22 a book hour, and has access to a lift and SnapOn Modis scanner, which we don't on site.
I hope that is of some help to see what another little guy is doing. I am very open to advice and input from more seasoned dealers and service managers.
Thank you guys for all your answers. sure gave me a lot to think about. I've started interviewing applicants and just from talking to a few it looks like a basic mechanic is a shop like Midas makes about $10/hr.
I'll update once I've learned more.
I would love to hear you share anything you have learned in your research.