A small repair garage in a rented unit can open for roughly £15,000 to £35,000 if you buy sensibly. Add an MOT bay and it's more like £50,000 to £90,000. There's no official figure, because premises and equipment vary so much, so this guide breaks it down line by line. You can cross off what you already have and price what you don't.
The short answer
| Type of garage | Rough cost to open | What drives it |
|---|---|---|
| Mobile mechanic (van) | £8,000 – £20,000 | Van, tools, diagnostic kit, insurance |
| One or two bay repair garage | £15,000 – £35,000 | Lifts, tools, deposit on the unit, working money |
| Repair garage with MOT bay | £50,000 – £90,000 | MOT equipment, bay works, DVSA approval, tester |
| Three-plus bay garage with MOT | £90,000 – £150,000+ | More lifts, more staff, bigger unit, more stock |
Premises: the biggest decision
Most garages rent an industrial unit. Before you sign, check four things:
- Planning use. Vehicle repair usually needs B2 (general industrial) use. Ask the landlord for proof, or check with the council. A unit without it can cost you everything you've spent fitting it out.
- Floor and height. A two-post lift needs a solid concrete floor of the right thickness, and enough ceiling height to lift a van. Get the lift supplier to check before you sign, not after.
- Lease terms. Length, break clauses, rent reviews and who pays for repairs at the end (called dilapidations). Get a solicitor to read it.
- Parking and access. Where will ten customer cars sit? Neighbours and landlords fall out with garages over parking more than anything else.
Up-front costs are usually a rent deposit (often three to six months), legal fees, and any work to the unit: power, lighting, an oil-water interceptor if the drains need one, and an office or waiting area. Business rates may be lower than you think. Many small units get small business rate relief, so check with your council.
Equipment: what you need on day one
| Item | Rough cost | Notes |
|---|---|---|
| Two-post lift, fitted | £2,500 – £6,000 each | Needs a thorough LOLER check every 6 months |
| Diagnostic tool and software | £1,500 – £6,000 | Plus a yearly subscription for updates |
| Hand and power tools | £3,000 – £10,000 | Less if you bring your own |
| Compressor and air lines | £1,000 – £3,000 | |
| Jacks, axle stands, engine crane, gearbox jack | £1,000 – £2,500 | |
| Tyre changer and wheel balancer | £2,500 – £7,000 | Only if you will sell tyres |
| Air-con machine | £2,500 – £5,000 | Needs F-gas qualified staff |
| Waste oil tank, bins, spill kit | £500 – £1,500 | |
| Office: computer, printer, card machine | £800 – £2,000 |
Buy what you'll use every week first. A tyre machine that does two tyres a month is money that should be working somewhere else.
Adding an MOT bay
An MOT bay brings customers back every year, and many of them book their repairs and services with you too. It's also the biggest single cost.
- Equipment. A full class 4 bay (lift, brake tester, emissions, headlamp tester, connected equipment) is roughly £20,000 to £35,000 from the main suppliers. Leasing is common.
- The bay itself. It must meet DVSA's size and layout rules. Groundworks, drawings and calibration add to the bill.
- People. The business must be approved as an Authorised Examiner. Someone has to pass the Authorised Examiner Designated Manager (AEDM) training, and you need at least one qualified MOT tester. Testers are in short supply. Read the MOT tester shortage before you plan around one.
- The fee cap. The most you can charge for a class 4 car MOT is £54.85, and many garages charge less. MOT income is steady, but it isn't a fortune on its own.
Many new garages open as repair-only and add MOT in year two or three, once the customer base is there.
Paperwork, insurance and legal
| What | Rough cost | Notes |
|---|---|---|
| Setting up a limited company | About £100 | Or run as a sole trader, which costs nothing to set up |
| Motor trade insurance | £2,000 – £6,000 a year | Road risks, premises, public and employer's liability |
| Waste carrier registration | Small fee | With the Environment Agency (or SEPA/NRW) |
| Accountant | £1,000 – £3,000 a year | Worth it from day one |
| Garage management software | £50 – £200 a month | Bookings, job sheets, invoices, reminders |
| Website and Google Business Profile | £0 – £1,500 | Google Business Profile is free and matters most |
You'll also need risk assessments, lift inspections and the rest of the safety basics. Our health and safety guide for garages lists what's required.
Working money: the cost people forget
The garages that close in year one rarely close because the work was bad. They run out of cash while the customer list is still small. Plan for three to six months of costs with very little coming in.
How long until it pays?
A small garage that prices properly and fills its diary can cover its running costs within a few months, and pay back the set-up cost within one to three years. Two things decide which end of that range you land in:
- Your labour rate. Work it out from your costs before you open, not from what others charge. Our labour rate calculator does the sum.
- How fast you fill the diary. Get your Google Business Profile live before opening day, ask every early customer for a review, and send MOT and service reminders from day one so every customer comes back.
Thinking of buying a garage that's already trading instead? That can be quicker, but has its own risks. See buying a garage business: what to check.
Autex gives a new garage online booking, job sheets, invoices and automatic MOT reminders from the first day, and we set it up for you. See pricing or book a demo.