Technology

As a retro enthusiast, I’ve fixed my share of electronics that only needed an hour and a $2 capacitor. But there was also $7 shipping for the cap, and 30-60min of labor, and my knowhow in troubleshooting and experience. If the company had to send someone out, they’d likely spend well over $200 for time, gas, labor, parts, etc. not including a vehicle for the tech and the facility nearby and all that good stuff.

This is exactly it. I used to work for a manufacturer that made devices they would often need to repair. They would bill non-warranty labor at $100/hour, plus the cost of parts. Their products were primarily used by professionals, so that was fine when it was being done to repair something that cost between $700-$4,000 new, especially for people who were making money using the product. When they launched a product at a $500 MSRP, though, it started to get harder, and even more so when competition forced them to lower the price to $400. When I left they were about to launch a product targeted at amateurs, originally aiming for a $200 price. It was actually being built by a Chinese competitor, with our software guys contributing to the system and putting our logo on it. Spending $100 labor to repair a $200 device was going to be a tough sell, and when I left the plan for warranty “repairs” was to just give the customer a replacement unit and scrap the defective one. And I’m sure the repair labor rate was going up; they had a hard time hiring qualified technicians at the rate they wanted to pay, and most of the department had quit/moved to new roles when I left, so they were surely having to increase pay and the rate they billed.

When something’s being built on an assembly line mostly by machine and/or low-cost Asian labor, it’s harder for a company to justify paying a skilled technician’s labor in a western country when that makes the cost of repair close to the cost of a new unit.