They are losing a lot more than that! A lot of shops offer cheap oil changes or transmission service as a way to get the vehicle in the door so they can sell more work. And there is nothing wrong with that, as long as the work is actually needed. And given the lack of routine maintenance that the typical car receives, they should have no trouble finding legitimate discrepancies.

Quite a few ears ago, I took advantage of a $8.99 automatic transmission service offer. I watched the mechanic remove the transmission pan, then take it into a back room. When he emerged, he showed me that the magnet in the pan was covered with metal filings, stating that my transmission needed an immediate overhaul. I felt the filings. They were bone dry. (In other words, he sprinkled the filings on the magnet when he took the pan into the back room.) When I declined the overhaul, the manager was summoned. He explained how lucky I was that they caught the problem just in time; said I probably would not make it home if I did not get the overhaul. Apparently he was wrong. I sold the car 60k miles later and never had the first problem with the transmission.

It was quite obvious that their motive was to turn every $8.99 service job into an overhaul. (Upselling, as it is now called.) And the real tragedy is that folks probably did not even get an overhaul when they paid for one.