Your Source for Up-To-Date News and Research on the Collision Repair Industry 

 

click here to subscribe to the FREE INSIGHT Editor's Desk News Alert Email

SUBSCRIBERS-ONLY
Today's News
INSIGHT This Month
INSIGHT Archives
Survey Center
Letter to the Editor

Business Tools
Subscription Information
CSI Reporting
Financial Analysis
IRS Audit Guide

Management/
Technical Info
Market Watch Rates
INSIGHT Inside this month's issue...

Feedback
Letter to the Editor

Safety First?

A look at how state-mandated vehicle safety inspection programs impact the Collision Repair Industry

The statistics are compelling.

According to a study by the Government Accounting Office (GAO), the investigative arm of Congress, U.S. states that require annual safety inspections of vehicles have accident rates that are 20 percent lower than those without such inspections.

"An average of 26 people per 100,000 drivers died in vehicle accidents in states without safety inspection programs, compared to 20 people per 100,000 drivers in states with safety inspections," said Jim Keller, a Minnesota collision repair shop owner and past chairman of the Automotive Service Association (ASA). He believes the evidence is persuasive.

Yet despite such numbers - and the GAO's recommendation back in 1990 that the National Highway Traffic Safety Administration (NHTSA) resume its support for vehicle inspection programs - fewer than 20 states require periodic vehicle safety inspections. And that number is declining.

ASA would like to see that trend reversed.

"ASA promotes and supports federal programs to provide assistance to the states in establishing motor vehicle inspections for safety," the association states in a written position statement. "The federal programs should provide inspection criteria and give technical, administrative and financial start-up assistance to the states, so that each state may implement an inspection program tailored to meet its unique requirements. ASA supports legislation that encourages the states to adopt safety inspection programs, combined with vehicle emissions inspection programs where feasible."

So how do such programs work in the states requiring regular vehicle safety inspections? And how do they impact collision repair shops in those states?

Pennsylvania makes it work

Dan Frohlich is an unabashed believer in vehicle safety inspection programs.

"I'm in love with the program in Pennsylvania," said Frohlich, a 32-year veteran of the industry and owner of A.R.S. Automotive, a collision and mechanical shop in Pittsburgh, Pa. "It's good for the consumer, and it's good for the shops."

Frohlich has been licensed to perform the safety inspections since the late 1960s, and has seen the program shift from requiring inspections every six months to once a year. He has watched unhappily as other states have shifted from annual to biennial inspections.

"I think that's the wrong thing to do," he said. "I think it should be an annual inspection."

What has made the Pennsylvania program successful, in Frohlich's view, is that the program "has teeth." If you're pulled over and your vehicle doesn't have a current inspection sticker, for example, the officer must have your vehicle towed to a repair facility to be inspected. And licensed inspectors such as Frohlich have some powerful incentives for doing the inspections adequately.

"My driver's license number is also my inspection license number," Frohlich said. "If I, as a technician, do a faulty inspection, I lose my driver's license. And if, as a shop owner, I have a technician do a faulty inspection, I can lose my shop's inspection permit from the state. So I have an incentive to make sure my techs are properly educated and are properly doing the inspections."

Fines and even jail time also can be levied for failure to comply with the inspection program's guidelines, Frohlich said.

How the Pennsylvania program works

To become a licensed inspector, a technician must register with the state, have a valid driver's license, complete a state-approved training program, and pass a written and hands-on inspection test.

Inspectors must renew their license every two years. There is no renewal fee, no testing, and no on-going training requirements other than optional (but strongly recommended) attendance at meetings for inspectors held once or twice a year.

Shops employing licensed inspectors and conducting safety inspections must also be licensed, proving the shop has garagekeepers' liability insurance and that those conducting the inspections have valid driver's licenses and inspector licenses.

Vehicle owners must have their vehicles inspected within the three months leading up to the expiration of their current safety inspection sticker. They must show a valid vehicle registration and proof of insurance on the vehicle.

Frohlich said his shop conducts more than 800 safety inspections per year, averaging between 45 minutes and an hour per inspection. The inspection checks brakes, horn, lights and signals, all seat belts, odometer reading, mirrors, tire tread depth, steering, suspension, shock absorbers and more.

"It's pretty intensive," Froh-lich said.

The cost to the consumer?

"It's industry driven," Frohlich said. "There's no set fee from the state. The state sells us the inspection stickers for $2 per sticker. That's the only cost that is set."

Frohlich said the typical fee he sees shops charging for the inspection is $20, so it's definitely not a profit center in and of itself. But he estimates that three out of four vehicles require something - wiper blades, replacement bulbs, headlamp alignment or even much more significant items or services - in order to pass the inspection.

Frohlich said he gives his customers the option of having his shop do any needed service, having it done elsewhere, or doing it themselves. But he has the option of charging for a second inspection if his shop does not do the work (a charge he usually waives if he has an on-going relationship with the customer).

The shop's inspection records are audited annually and the shop is responsible for maintaining control and precise records for the inspection stickers it purchases. He said fraud - generally involving sale of inspection stickers - has been only a tiny problem.

"I think Pennsylvania has a model inspection program that could be duplicated in other states," Frohlich said. "It definitely does work."

Programs vary widely

But a report compiled by the ASA is a stark reminder that not all states use a Pennsylvania-style vehicle safety inspection program. The report offers a summary of 19 programs around the country

In Maine, for example, shops conducting the annual inspections may charge customers a $6.50 fee - of which the shop keeps a whopping $5. The fee is $10 in Utah, where vehicles under five years old are only inspected every other year. Rhode Island requires inspections biennially and charges a $47 fee, which includes safety and emissions testing at the same time.

A few states and the District of Columbia have "centralized programs," in which inspections are done at testing facilities rather than by repair shops.

Fred Loney, administrator of the District of Columbia's program, said the district's sole inspection station completes an emissions and safety inspection every 11.5 minutes during the 13-hour day the eight-lane station operates. (A second 5-lane inspection station is now being built.) Vehicles must be tested every two years, and the $25 fee includes up to two re-inspections. About 15 percent of vehicles fail the safety inspection, he said.

Given time constraints, the safety inspection is not as in-depth as the Pennsylvania inspection. Checks of headlight aiming, for example, were discontinued several years ago.

Still, Loney points to the program's 70-point safety inspection checklist, and says the program has even added checking child safety seats, finding about 60 percent of them installed incorrectly. In addition, any vehicle involved in a fatality must immediately go through the inspection process.

Proponents of centralized inspection programs generally argue that fraud is less of a problem when inspections are done at a few contracted facilities rather than offered at hundreds of independent shops in a jurisdiction.

But the District's program has not been fraud-free, Loney admits. In 1998, 28 people - including some program inspectors - were arrested for inspection fraud; 27 were convicted and eight served jail time.

But Loney contends the biggest problem facing safety inspections is the inconsistency in the programs from state to state. He thinks the programs would be most effective if more states adopted the "model guidelines" created by the American Association of Motor Vehicle Administrators (AAMVA).

ASA teams with AAMVA

The AAMVA, which consists primarily of representatives of state motor vehicle departments nationwide, is working with ASA to champion the cause of vehicle safety inspection programs.

"We believe in it. We endorse it. But not everyone does it," says AAMVA's Lori Cohen. "In recent years, the trend has been to go from one year inspections to two year inspections. In the recent case of Oklahoma, they lost their safety program altogether."

In addition to hard data, such as the GAO study, backing up the value of such inspections, Cohen said there's plenty of anecdotal evidence as well. In Missouri, for example, after the inspection program became biennial rather than annual, the state saw an increase in the number of abandoned vehicles on the road.

But the insurance industry, which would likely benefit from regular vehicle safety inspections, is oddly silent on the issue.

"I've tried talking with the Insurance Institute for Highway Safety and they're not interested," Cohen said. "I've asked someone in AAMVA who's on the insurance side, and there's just no interest. They may be looking for more data because it can be really hard to tie periodic motor vehicle safety inspections to reduced crashes and fatalities. But we'd all like to see insurance companies interest, and I've just never had a clear answer why there doesn't seem to be the interest."

Meanwhile, the programs come under attack in states for a number of reasons, Cohen said. In Utah, for example, the program is criticized because so few vehicles fail. Such a charge is difficult to defend, Cohen said, because the low failure rate actually could be a sign the program is working; vehicle owners are either maintaining their vehicles or removing them from the road because they know that otherwise they won't pass the inspection.

(Frohlich said failure rates may also be low because inspectors do not record a vehicle as failing if the customer has the shop immediately correct the problem.)

In some states, some political candidates have campaigned on promises to eliminate the inspection program because they aren't always popular with vehicle-owners if the inspections are viewed as a hassle or too cursory to be worthwhile.

And still other jurisdictions have adopted less periodic inspection programs, looking at vehicles, for example, only when they are sold or cited in an accident.

Still, the AAMVA says there is public support for safety inspection programs when they are seen as effective, and the association offers a handbook to assist those working to establish or improve an inspection program.

"AAMVA and ASA have formed a good working relationship on the inspection issue," said Florida shop owner Charlie Elder. "We're trying to form partnerships with other associations to bring industry and government to work together for solutions instead of just banging heads."

Vehicle safety inspections may be moving upward on the list of ASA's priorities. A panel discussion devoted to the topic took place at the association's recent annual meeting. ASA and AAMVA also are planning a third annual joint forum later this year. And Pennsylvania shop owner Frohlich is likely to bring his steadfast belief in the programs to his new position this year as ASA's national chairman.   o

Feedback

Have a comment about this article? Send Email to Charles Baker, INSIGHT's Publisher

©2002 Collision Repair Industry INSIGHT
All Rights Reserved

FEATURED
LINKS:

INSIGHT Supports the NABC!
Do You?