Oil Change Economics

By
Real Estate Broker/Owner with Broad & Bailey Realty LLC
 
Broad and Bailey [logo]


Peter Nikic
Oil Change Economics


When was the last time you changed your own oil in your car? For me, it's been over 20 years.

Did you know that we have over 200 million cars in this country? That means there are at least 400 million oil changes every year. So who's changing your oil?

SATURN OF COLUMBIA EZ Lube, JiffyLube, etc. . . .

If an oil change takes 20 minutes, than an employee can do 24 oil changes per day. At 260 work days per year, that's 6,240 oil changes per employee per year. You can see that there must be a lot of oil change mechanics in America.

Yes, it would take over 64,000 mechanics to do 400 million oil changes per year.

But how many people actually change their own oil? Let's say that 25% of all Americans change their own oil. That means that 48,000 people are actually employed annually just to change oil.

So what is "Oil Change Economics"?

When taxes are increased for America's highest income bracket, they respond by spending less. No, they're still not going to change their own oil, but they will spend less on everything else. When they spend less, more companies make less, so they limit overtime, cut salaries or lay people off. As these employees begin to feel the pressure of making less money, more of them will be doing their own oil changes.

As the percentage of people who change their own oil goes from 25% to say 50%, we just lost 16,000 oil change mechanics jobs.

Process:

  • Rich get taxed
  • Middle class suffers
  • 16,000 oil change mechanics lose their jobs


  • That's "Oil Change Economics", any questions?





    Peter Z. Nikic
    Licensed Real Estate Broker
    & Investor (NY)
    Contact: Peter@Nikic.com
    Tel:(914) 804-0037

     
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    Rainer
    35,176
    Brian Luce
    HomeStarr Realty Inc. - New Hope, PA
    Associate Broker

    As a car nut and car collector, I change my own oil  (even in my daily drivers).  -  And more than 2x per year that's for sure... - :-)

    Great Post 

    Apr 16, 2008 03:07 AM #1
    Rainer
    9,215
    Kathryn Tharp
    Realtor - Rancho Cucamonga, CA
    Rancho Cucamonga, Real Estate Specialist
    I have my oil changed every 3,000 or close to it.  It is cheaper than a new car or repair bill.  So if we don't change our oil, how many mechanics will be employed?  LOL
    Apr 16, 2008 03:11 AM #2
    Rainer
    56,996
    Peter Nikic
    Broad & Bailey Realty LLC - Valhalla, NY

    Brian - I'm sure these numbers are extremely conservative especially for car buffs.

    Kathryn - That will be covered under the "Maintenance-free, High Cost Economics" :-)

    Apr 16, 2008 03:24 AM #3
    Rainmaker
    1,057,614
    Steve Loynd
    Alpine Lakes Real Estate Inc., - Lincoln, NH
    800-926-5653, White Mountains NH
    This is the theory of trickle down economics, that Ronald Regan was using to turn around the economy  twenty plus years ago, Agreed with it then and still do now. Spending at the top reaches the bottom and everyone along the way re-spends the same dollars to boost the GNP. I like the post thanks
    Apr 16, 2008 03:32 AM #4
    Rainer
    56,996
    Peter Nikic
    Broad & Bailey Realty LLC - Valhalla, NY
    Steve - you are exactly right. Same economics theory, different perspective. Ronald Reagan was the best!
    Apr 16, 2008 03:38 AM #5
    Ambassador
    891,430
    Lane Bailey
    Century 21 Results Realty - Suwanee, GA
    Realtor & Car Guy
    As a car guy... I never change my own oil.  It isn't worth my time.  I hire it out...  But, what you have just done is stated "Trickle-down Economics."  Pretty good job defining, too. 
    Apr 16, 2008 03:38 AM #6
    Rainer
    56,996
    Peter Nikic
    Broad & Bailey Realty LLC - Valhalla, NY
    BTW, it was this theory that prompted me not to change my own oil:-)
    Apr 16, 2008 03:40 AM #7
    Rainer
    56,996
    Peter Nikic
    Broad & Bailey Realty LLC - Valhalla, NY
    Lane - thanks. I know that people like you and Steve would recognize it, but others who had never heard of it or understood it, would see it from a different perspective.
    Apr 16, 2008 03:43 AM #8
    Rainer
    45,581
    Joe Virnig
    RE/MAX Gold Coast REALTORS, Ventura County, California - Ventura, CA
    No Ordinary Joe
    As the number of people changing there own oil increases, the amount of oil found in our streams, lakes, and oceans will go up since most folks do not dispose of their oil correctly.
    Apr 16, 2008 03:46 AM #9
    Rainer
    56,996
    Peter Nikic
    Broad & Bailey Realty LLC - Valhalla, NY
    Joe - that will be covered under the EPA's "Green Economics" :-)
    Apr 16, 2008 03:55 AM #10
    Ambassador
    891,430
    Lane Bailey
    Century 21 Results Realty - Suwanee, GA
    Realtor & Car Guy

    Peter... Joe just hit one of the reasons I don't change my own oil...  My trucks hold 4 gallons (yes, I said gallons).  I've had 10 gallons that I needed to take to be recycled.  And, by the time I buy the oil and other supplies, I'm saving about $10 for an hours worth of work (prep time, going to buy the stuff, and cleaning up afterwards...).  It just isn't worth it.  

    And I can help to keep someone else in a job.   

    Apr 19, 2008 03:11 AM #11
    Rainer
    56,996
    Peter Nikic
    Broad & Bailey Realty LLC - Valhalla, NY

    Lane - wow! 4gals? you're probably employing 4 people with that truck:-)

    as long as you're making enough money to keep paying others, then the economy is doing well. if you ever begin to change your own oil, let me know, it'll be time to move to south America:-)

    Apr 19, 2008 05:39 AM #12
    Rainer
    21,703
    James Monastero
    Texana Bank - Fuquay Varina, NC
    The Matchmaker

    Peter- I came, I saw... I disagree. We have a situation in this country where 3% of the population controls 90% of the wealth- or something obscene like that. Trickle down economics has not worked. I thought you were going to say that we should only change our oil every 4500 miles or so to help with the gas prices or something. You tricked me. :)

     

    Jen 

    Apr 24, 2008 02:33 PM #13
    Rainer
    61,224
    Lisa Lambert
    The Law Offices of Elisabeth A. Lambert - Fresno, CA
    Esq. 1031 Exchange Expert

    Peter:

    What a great illustration of how one small segment of our life that depends on service providers will be affected when we begin to cut back and perform some of these services for ourselves. Excellent post.

    Lisa

    Apr 24, 2008 05:29 PM #14
    Rainer
    56,996
    Peter Nikic
    Broad & Bailey Realty LLC - Valhalla, NY

    Jennifer - there's nothing wrong with that. this is part of the driving force of this country. remember how communism tried to make it fair for everyone. it sounds great, but it doesn't work. those percentages are probably the same in every country. the benefit in US is that any one of the bottom 97% can get to the top 3%.

    Lisa - thanks. this country is so big and complex, sometimes it's good to focus on just one tiny aspect and how it affects everyone.

    Apr 25, 2008 01:44 AM #15
    Rainer
    56,996
    Peter Nikic
    Broad & Bailey Realty LLC - Valhalla, NY

    Are you seeing more people changing their own oil?

    Oct 21, 2009 06:32 AM #16
    Rainer
    56,996
    Peter Nikic
    Broad & Bailey Realty LLC - Valhalla, NY

    It has been almost 2 years since I wrote this. I'm having some work done to my truck and one of the items was an oil change. The mechanic said the oil change will be $110. With the state of the economy and my own financial struggles, this is the 1st time in a very long time that I've actually contemplated changing my own oil.

    I wont (yet), but it did make me think about this blog.

    Mar 06, 2010 12:22 AM #17
    Anonymous
    Waco Johnnie

    Except the money people save by changing their own oil doesn't just disappear. They spend it on other things, which creates jobs in other sectors of the economy.

    And of course, the rich spend less a proportion of their income than the middle class and poor, which is actually one of the arguments people make in favor of taxation: it redistributes to people who spend it.

     

    I don't entirely buy into that, but this "oil change economics" article is rather silly.

    May 16, 2012 07:57 AM #18
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