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Letter to the Editor

Standard vs. Standard

CAPA and MQVP both claim to better assure non-OEM parts quality

...and you thought it was ugly when shops and insurance companies were battling over CAPA and non-OEM parts.

In recent months, shops and insurers have been basically relegated to the sidelines as the battle over non-OEM parts quality has taken a new twist: dueling certification programs.

In one corner: The 15-year-old Certified Automotive Parts Association (CAPA), somewhat battered and bruised from its history of revamping its certification process every few years, but seemingly reinvigorated by the addition in the last 18 months of a mandatory vehicle test fit in order for a part to be certified.

In the other corner: Upstart challenger Manufacturer's Qualification and Validation Program (MQVP), launched little more than a year ago by Global Validators as the new solution to the quest for non-OEM parts quality assurance.

The two have launched a flurry of press releases in recent months, taking pot-shots at each other's programs and each vying to look like the certification entity that has the support of the insurance community and the non-OEM parts manufacturers. For the outside observer - including most shops - it's easy to get lost in the barrage of charges and counter-charges. While the battle is likely to continue for some time, INSIGHT this month offers some perspectives on the acronyms and acrimony.

The MQVP program

Rather than certifying specific parts as CAPA does, MQVP focuses on certifying that a parts manufacturer has quality processes in place that meet internationally established standards (ISO/QS-9000). MQVP requirements include all aspects of manufacture and distribution including initial design, material specifications, manufacturing and quality inspection, packaging, shipping, handling, delivery and ultimately, customer satisfaction.

MQVP-approved parts are traceable from 'cradle to grave' through an online system. When a part is manufactured and checked against specifications, quality aspects and characteristics are entered into this system under a unique lot number. Upon shipment to the distributor, a shipping certification is created, moving the part and all quality information applicable to that production lot. The distributor receives the shipment and creates additional shipping certifications as parts are delivered to the final customer.

This system, MQVP backers say, gives the final customer the complete quality certification, warranty and traceability for the product ordered.

In the event of poor quality, any individual (from vehicle owner to manufacturer) may register a complaint in the system. Complaints automatically trigger a complete "Root Cause Analysis and Corrective Action Plan" as outlined in the ISO/QS-9000 quality management systems.

There are also procedures and systems to immediately prevent either manufacturers or distributors from making future shipments, and to announce and implement containment or recall of defective part inventories. CAPA, in a report issued earlier this year (and available at its website), outlined what it saw as differences between the two programs, stating that:

• CAPA certifies (after specific and considerable testing) the actual quality of the parts themselves, whereas MQVP is a systems based program.
• Many parts approved by MQVP do not meet CAPA standards or have not been certified by CAPA.
• CAPA parts and packaging are clearly identified in the marketplace.
• CAPA part information is publicly available and widely distributed to the industry at no charge.
• As an independent certifying entity, CAPA plays no role in the marketing, distribution or pricing of parts.

MQVP fired back, saying its program "requires manufacturers to follow the 'science of quality' required of all OEM suppliers," while CAPA "requires manufacturers to meet a customized standard written by CAPA."

"The only quality standard defensible in today's marketplace is that embraced by the OEMs," an MQVP press statement said. "Any other standard (such as CAPA's) is, by definition, a 'customized' standard... Insurance companies, distributors and manufacturers will struggle to defend CAPA parts as having the same quality as OEM when challenged in the next class action lawsuit... No organization can write a single standard to address the engineering issues of the twelve major car companies... This is precisely why MQVP does not write quality standards and endorses only the OEM's standard of quality."

MQVP also said the CAPA report is inaccurate in that MQVP is not involved in the pricing, marketing or distribution of the parts, and in saying that MQVP-approved parts include fenders and hoods that have been decertified by CAPA.

"These part categories are not today, and have never been, approved by MQVP," the organization states.

Taking sides

So given the public bickering between the two organizations, who is voicing support for which program?

Karen Fierst, a consultant who represents the Taiwanese Auto Body Parts Association, said non-OEM parts makers feel very much as shops did when different insurers wanted them to have different estimating systems.

"Manufacturers would like to be able to make parts that they can sell in this market," Fierst said. "There are insurance companies that have [said] that their direct repair shops can use only parts certified using the MQVP program. So the major manufacturers in Taiwan are one by one joining MQVP."

These manufacturers aren't halting participation in CAPA, however, she points out. They're just doing what it takes to meet both programs' requirements.

Butch Viccellio, the president of USAA's Property and Casualty Insurance Group who also recently completed two years as chairman of CAPA's board of directors, has voiced whole-hearted support for CAPA.

"We've looked objectively at the alternatives and frankly, CAPA's certification process is the only process out there that meets our standards for quality, non-OEM replacement parts," Viccellio said. "The standards of some of the other organizations we've looked at just don't measure up to the quality USAA members expect.

"Admittedly, I know quite a bit about CAPA's stringent process," Viccellio said. "But make no mistake, USAA wouldn't use CAPA parts if the necessary steps weren't being taken to ensure that quality replacement parts are available. CAPA is still the only organization that puts both the manufacturing process and vehicle parts through a rigorous certification process taking steps to ensure the parts actually fit on vehicles.

"MQVP is trying hard to enter this marketplace and is focused on the right outcome," he said. "But it seems clear to me that process certification, parts testing standards and pricing structures are areas where they need some additional work. For now, our USAA membership is better served by continuing our exclusive use of OEM and CAPA-certified aftermarket parts."

Nationwide is the primary backer and advocate on the insurance side for MQVP, although Allied Insurance (a subsidiary of Nationwide) and Grange Insurance have also endorsed the program.

"We are convinced that the MQVP requirements of design responsibility, QS-9000 production quality management practices and full part traceability are essential to the consistent delivery of quality parts," said Mark Russell, vice president of claims for Grange, which is licensed in 10 Midwest and Southern states. "Our goal is to specify only the best alternative parts available so the repair technicians are not burdened with returns and rework that increase cycle times. MQVP addresses each of these requirements through both process and product standards that are the same as those used by the OEMs."

While most other insurers haven't issued official statements on the MQVP vs. CAPA issue, most for now seem to be staying in CAPA's corner.

Bob Hurns of the National Association of Independent Insurers (NAII), said his organization does not support MQVP. "We'll continue to support CAPA through thick and thin," Hurns said.

Keith Manich of Allstate said he sees CAPA's program as going beyond that of just quality process standards, which, as he puts it, could certify that a concrete life jacket was made using quality processes.

"It'll be a really good concrete life jacket, but it still won't float," Manich said. "All the processes can be met, but it doesn't mean the part itself will serve the function that it was made to function for... We don't cast aspersions [on either program]. All we would say is that if you look at a model production that goes right to the part, then CAPA's process is the one that fits the bill."

The parts distributors, meanwhile, are trying to stay out of the fray.

"We don't want to get in the middle between those guys," Keystone's Charlie Hogarty told INSIGHT in an interview elsewhere in this issue. "We're for any program that improves quality. It's two different approaches. Both are valid, and we support both programs."

Hogarty said the "intramural fighting" between CAPA and MQVP isn't surprising - and that while having two such programs isn't ideal, it may result in better parts quality overall.

"Both of them are thinking, 'Is there enough revenue in this thing to support two programs?'" Hogarty said. "If a couple large insurers decide they like MQVP and withdraw support of CAPA, that would put CAPA in a difficult situation. That's not likely to happen, but I think that's the reason Jack Gillis thinks he needs to knock down the other guy. But in the end, certainly having both programs isn't a negative for the end consumer."   o

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