As the collision repair industry heads into 2026, one thing is clear: there are fewer vehicles coming into shops, but each one is more complex—and more expensive—to fix. The past year’s data shows these trends aren’t slowing down. They’re stacking on top of each other.
Fewer Claims, Fewer Repairs
Repairable claims dropped more than 10% in 2025, while total loss frequency climbed to nearly 23%. At the same time, small repairs are disappearing. Jobs under $2,000 now make up just a quarter of appraisals, down sharply from pre-pandemic levels.
Higher deductibles are a big reason why. More than one in four drivers now carry deductibles of $1,000 or more, and some are choosing to skip filing claims altogether. The result? A growing share of customer-pay work and a shrinking pool of insured repair jobs.
Why it matters: When claims fall, total losses rise, and customers pay out of pocket, shop volume can tighten faster than expected.
Calibration Is No Longer Optional
Advanced driver assistance systems are now part of everyday collision repair. Calibrations appear on more than a third of DRP estimates, and nearly 90% of estimates include a scan. But research shows over 60% of vehicles actually need calibration—meaning many are still being missed.
That gap creates real risk. ADAS-related lawsuits have surged in recent years, and federal regulators are starting to pay closer attention. New legislation introduced in late 2025 could eventually bring standardized calibration requirements.
Why it matters: Missed calibrations aren’t just a supplement issue—they’re a liability issue.
Parts Costs and Availability Remain Unstable
Parts prices rose more than 6% in mid-2025 as tariffs and overseas sourcing costs flowed through the supply chain. Nearly half of OEM collision parts sold in the U.S. are manufactured abroad, and automakers have signaled they may pass more of those costs downstream.
At the same time, ongoing semiconductor constraints continue to affect ADAS and electronic components, creating uncertainty around pricing and lead times.
Why it matters: Parts volatility isn’t over, and electronics are likely to be the pressure point.
EV Sales Slow, Hybrids Take Over
After the federal EV tax credit expired in late 2025, EV sales dropped sharply. Hybrids, meanwhile, surged to record levels as automakers adjusted course.
While EV repairs still tend to cost more, hybrids are showing up in shops more often. Hybrid claim volume grew more than 20% year over year in 2025, making them a growing share of collision work.
Why it matters: Vehicle mix—not just repair severity—will shape shop workloads.
Workforce Help Is Coming (Slowly)
The industry will need hundreds of thousands of new technicians by the end of the decade. Two new programs aim to help: federal Workforce Pell Grants launching in mid-2026 and ASE Connects, a new platform linking shops with training programs.
These won’t fix staffing shortages overnight, but shops that engage early may gain a pipeline advantage.
Why it matters: Retaining and developing talent may matter more than hiring in the near term.
Looking Ahead
The challenges facing collision repair in 2026 aren’t new—but they are converging. Fewer claims, more total losses, rising repair complexity, higher parts costs, and ongoing workforce pressure are all hitting at once.
Shops that track these trends closely and adapt early will be best positioned to navigate a tighter, more competitive market.
Source: AutoBody News Staff, “2025 Data Points to Fewer Claims, More Collision Repair Complexity in 2026.”