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
Industry Stocks
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
This article originally appeared in the May 2010 Issue of INSIGHT
©2010 Collision Repair Industry INSIGHT All Rights Reserved
SCRS Documents Position on SRS Replacement Parts
Mitchell International Forms Technology Partnership with UpdatePromise.com
Sherwin-Williams A-Plus Network Names Top Vision Group Collision Repair Facilities
ASA Members Meet with Capitol Hill Leaders to Discuss Replacement Crash Parts
Record Number of Students Apply for Craftsman Tool Grant through I-CAR Education Foundation
CCAR Recognizes Dutch Valley Auto Works as a GreenLink Shop
Valspar Reports Big Sales Increase in Q2
Threat of Lawsuit Leads to Postponement of Latest CIC Parts Presentation
American Honda Position Statement Concerning Vehicle Safety Recalls
INDUSTRY UPDATE
In response to recent attempts in various states to legislate the use of salvaged airbags in the repair process, the Society of Collision Repair Specialists (SCRS) has published a formal position for industry use. The SCRS position is as follows:
SCRS recommends that collision repair professionals use exceptional caution when performing repairs to consumers' vehicles, and to only use parts that they know will perform with the same level of quality and safety as the original part, both upon installation and for the life of the vehicle.
There are many variables introduced by utilizing alternative Supplemental Restraint System (SRS) replacement parts that have the potential to affect SRS operability, and could impair the integral safety function that these parts are intended to provide. Due to the additional liability assumed by the repairer utilizing the replacement part, SCRS encourages repairers to follow the Vehicle Manufacturers' recommended repair procedures when replacing SRS components, and does not recommend the use of salvaged, remanufactured, or aftermarket alternatives for this repair.
"Through our Legislative Committee, the models developed by NCOIL that instigated the introduction of these bills in various states have certainly been a center of discussion for our group," explained SCRS Legislative Committee Chairman Andy Dingman. "In preparation that this issue may be faced in their state at some point, many of our affiliates have specifically asked for a documented position from SCRS, which has been actively involved in addressing and researching the topic."
The SCRS position is much like those of several other industry groups, which have also documented firm positions or cautions on this issue, creating a clear and direct message to members, consumers, and lawmakers about the concern that the industry holds regarding this practice.
"We believe that laws and regulations should be formed based on the recognition of consensus through broad industry representation," added SCRS Chairman Barry Dorn. "This is where a national association such as SCRS can leverage the expansive size of its network, to use the feedback we receive and develop resources such as this position to empower our state affiliates as they address these issues on a local basis."
Through its direct members and 39 affiliate associations, SCRS is comprised of 6,000 collision repair businesses and 58,500 specialized professionals who work with consumers and insurance companies to repair collision-damaged vehicles.
o
Mitchell International, Inc. has completed a technology partnership agreement with UpdatePromise.com, a web-based service provider that delivers automated repair status updates to collision shop customers via text message and e-mail.
The agreement allows UpdatePromise.com to exchange data with Mitchell management systems in order to fully automate the UpdatePromise.com system and eliminate the need for data entry by shop personnel. This technology breakthrough will enable Mitchell management system users to update their customers automatically throughout the repair process.
"Our commitment to providing the most advanced technology for collision repair shops and insurers has led us to this agreement with Mitchell International," said David Caulfield, President of UpdatePromise.com. "We are very proud of this new partnership and we look forward to serving the needs of the thousands of Mitchell users across the country. This is a significant step forward for the collision industry."
Jason Bertellotti, Vice President of Repair Solutions for Mitchell International, added, "We're pleased to welcome UpdatePromise.com as a Mitchell technology partner and are excited to offer this added benefit to our management system users. This agreement demonstrates our combined commitment to innovation and technology leadership, and is an excellent example of Mitchell's dedication to working with best-in-class third party solutions to deliver enhanced value to our collision repair customers. We are committed to helping shops improve the repair experience for their customers to build loyalty and grow their business."
UpdatePromise.com is a communication and information technology provider to insurers, collision repair facilities, and auto-service related operations throughout North America.
Mitchell International provides information and workflow solutions to the Property & Casualty claims and Automotive Collision Repair industries. Mitchell enables millions of electronic transactions between more than 30,000 business partners each month to enhance partner productivity, profitability, and customer satisfaction.
The Sherwin-Williams Automotive Finishes A-Plus(TM) Network is part of the Sherwin-Williams value added program that combines comprehensive business solutions to help the facilities improve customer service, employee growth, insurance relationships, process refinement, productivity, and profitability.
Recently, the company announced the recipients of its annual A-Plus Network Vision Group Collision Centers of the Year. The honorees are:
- Vision Group 1, Jim Hill of Master Tech Collision in Bear, DE
- Vision Group 2, Barry Burkholder of Barry’s Paint Shop in Ephrata, PA
- Dealership Vision Group, Billy Coleman of Gullo Ford-Mercury in Conroe, TX
- Martin-Senour Vision Group, Al Waller of Fradella’s Collision in Materie, LA.
“We are very proud to announce our four A-Plus Network Vision Group Collision Center of the Year recipients for 2009. It is a great honor to present these three shop owners and one dealership collision center manager with this prestigious award,” said Brandon Devis, Sherwin-Williams A-Plus Network Program Manager. “Their hard work and determination to succeed drove their respective organizations to new heights in the past year. Their financial performance was outstanding, driving improved sales, gross profits, and bottom line net profit. We are delighted with both their accomplishments and to have them involved in our A-Plus Network Vision Groups.”
For more than a decade, The A-Plus Network has provided business solutions and support services that have been designed to help its members succeed in meeting the challenges of a changing industry. Members have benefited from the program’s many business-building opportunities, including business management training through A-Plus University(TM) workshops, building insurance relationships by offering continuing education training to insurance agents, Loyalty Rewards Points, marketing programs, and Vision Group participation. There have also been great benefits from an outstanding list of third- party contributors.
The A-Plus Network began its first Vision Group in 2000 and now currently operates four groups with plans to add more due to increased demand. The groups have been specifically designed for independent shop owners, managers, and dealership managers and are categorized for both single and multiple location repairers.
Sherwin-Williams collaborates with Square One Systems, Inc., an independent 20-Group provider in the collision repair industry, to administer and moderate its Vision Groups.
The Automotive Service Association (ASA) hosted a “Taking the Hill” Fly-In and AMI Leadership Conference in Washington, D.C., May 11-12 for its members. Independent automotive repairers from across the country met with their senators and representatives to discuss how replacement crash parts affect consumers.
ASA leaders met with members of the U.S. House and Senate to hone in on consumer consent to the use of replacement crash parts in vehicle repair, as well as to encourage Congress to work with the National Highway Traffic Safety Administration (NHTSA) to ensure the regulation of replacement crash parts. Collision repairers are increasingly concerned with the lack of regulation of automotive replacement crash parts. Further, ASA’s policy for automotive replacement crash parts has been for many years that consumers should have notice as to the types of crash parts that are used to repair their vehicle and give written consent for the use of these parts.
Independent repairers are concerned with some insurance companies encouraging the use of these unregulated parts based on cost without consideration for quality and safety. The lack of regulation of the replacement crash parts industry opens the vehicle owner and independent repairer to a host of quality and safety concerns.
The Automotive Service Association is the largest not-for-profit trade association of its kind dedicated to and governed by independent automotive service and repair professionals. ASA serves an international membership base that includes numerous affiliate, state and chapter groups from both the mechanical and collision repair segments of the automotive service industry. ASA’s headquarters is in Bedford, Texas.
Nearly 100 students applied for a Craftsman tool grant through the I-CAR Education Foundation that was available this spring. This resulted in a record amount of applicants for a Foundation grant and/or scholarship. Out of the student applicants, seventeen were selected to receive a set of Craftsman tools valued at $575 each.
The donated tool kits included a 268 piece Mechanic Tool Set with Lift-Top Lid Case plus a Microtork Torque Wrench, a Craftsman 20 piece Super-Duty Punch and Chisel Set, and a Craftsman 7-piece Fiberglass Handle Body and Fender Repair Tool Set.
“We are thrilled to partner with I-CAR Education Foun-dation to arm these students with Craftsman tools, and in turn help them on their journey to becoming professionals in their trade,” said Laura Sardegna, Brand Director for Craftsman. “Craftsman is America’s most trusted tool brand and these tools can be used for years to come. No matter what path the students choose, they will have the tools necessary to tackle any project.”
I-CAR Education Foundation Executive Director Scott Kruger commented, “We thank Craftsman for their generous tool donation to the Education Foundation and joining us in helping to equip these future professionals of the industry with the proper tools and equipment. This was the first time the Foundation offered a ‘tool scholarship’ and we were overwhelmed with applications from deserving students from around country. This incredible response helps show students' need for tools for their eventual career within the industry.”
The I-CAR Education Foundation, founded in 1991, is a not-for-profit organization dedicated to securing donations that support philanthropic and collision repair education activities .
The Coordinating Commit-tee For Automotive Repair (CCAR) has announced that Dutch Valley Auto Works of Lancaster, Pennsylvania, has been recognized as a GreenLink Shop.
The GreenLink Shop status, an extension of CCAR’s CCAR-GreenLink Environmental Compliance Assistance Center and S/P2 (Safety and Pollution Prevention) E-learning Pro-gram, is designed to promote consumer confidence in local automotive repair facilities’ environmental/safety awareness and stewardship.
“The environmental awareness I learned in the 1970’s as a child is finally here to stay for all of us," said Geoff McCollom, President of Dutch Valley Auto Works, upon learning that his shop had received the GreenLink Shop recognition.
“We are so pleased to add Dutch Valley Auto Works to the growing family of GreenLink Shops around the nation,” said Rod Enlow, CCAR Vice President of Industry Relations. “Their commitment demonstrates a conviction to put employee health and safety on an even footing with other established business practices, along with a willingness to demonstrate these same values to customers.”
Repair facilities seeking the GreenLink Shop recognition must maintain high standards of excellence in environmental, health, and safety (EHS) practices in four categories: business operations, employee training, safety compliance, and environmental management. The CCAR initiative recognizes both auto mechanical service facilities and collision repair shops, with separate criteria established for each type of business.
o
As the sixth largest independent collision repair provider in the United States, True2Form knows something about running an efficient operation. Accordingly, the company has taken advantage of technologies that can help reduce cost, save time, and enhance its reputation for service with insurance carriers and car owners. Even better, one of the most effective technologies is available free of charge.
For True2Form’s Clark Plucinski, Executive Vice President, and Mike Bernard, a regional president, two effective tools are ARMS(R) Automotive, which updates the status of car repairs, and ARMS(R)Automotive Exchange, which automates labor hours and provides free cycle time reporting. Both are free of charge from Enterprise Rent-A-Car, which developed the technology.
With 38 collision repair centers in Ohio, Maryland, North Carolina, and Pennsylvania, it is important for True2Form to be able to centrally monitor transaction details.
“Now, on my computer screen, I see all my stores, number of current rentals and status,” Bernard said. “I can also drill down to get detailed information on specific tickets, including contemporaneous notes to the file. In addition, I have historical data on closed rentals by location and by insurance carrier that I am able to sort and download to worksheets. This information allows us to more effectively monitor repairs on individual cars which, in turn, enables us to minimize the length of rental, a key benchmark for the industry.”
“Instead of spending valuable time contacting insurance and rental car companies and manually matching and updating rental tickets, our store personnel have more time to focus on actually repairing cars on-time and on-budget, which significantly adds to our customer service capabilities. It also has a direct impact on customer satisfaction, both for our insurance partners and the driving public,” said Plucinski.
He added that having easy access to customized reporting features for True2Form’s business is just one of the many benefits. The historical data includes month-to-date reporting that enables True2Form to measure itself against industry benchmarks on a real time basis and conduct its own competitive analysis to identify specific opportunities to improve processes for an individual store or insurance carrier.
Powered by CynCast Data Pump, the ARMS Automotive applications work with a repair center’s estimating and/or management system to automatically push certain repair information to Enterprise via an EMS (estimate management software) file.
In addition to making the replacement rental process more efficient, the system is designed to protect the security of the repair centers’ data and computer systems. The technology collects only the data contained in the EMS file directory, which is the industry standard designed for sharing estimate files between different computer systems and trading partners.
True2Form Collision Repair Centers was founded in 1998 by collision industry veterans who wanted to bring cutting edge operational and managerial practices to the auto body industry.
Founded in 1957 and headquartered in St. Louis, Enterprise Rent-A-Car is an internationally recognized brand with more than 6,000 neighborhood and airport locations in the United States, Canada, the U.K., Ireland, and Germany. In addition, Enterprise of North America is part of a global strategic alliance with Europcar, creating the world’s largest car rental network.
The Valspar Corporation has reported its results for the second-quarter ended April 30, 2010.
Second-quarter sales totaled $803.6 million, a 20.2 percent increase from the same period last year. Second-quarter adjusted net income per share increased 69 percent to $0.61 in 2010 from $0.36 in 2009. Second-quarter adjusted net income per share for 2009 excludes a $0.05 per share charge related to restructuring actions and a non-cash adjustment of $0.03 per share for Huarun minority interest shares. Net income for the second quarter of 2010 was $61.7 million. Net income for the second quarter of 2009 was $31.1 million and reported earnings per share were $0.28.
“Sales increased significantly in all regions in both our Paints and Coatings segments, with core growth and new business contributing to the improvement,” said William L. Mansfield, Valspar chairman and chief executive officer. “Volume growth in combination with operating discipline and tight control of expenses were the main drivers of our earnings performance. Looking ahead to the remainder of the year, we are increasing our earnings guidance to reflect the benefit of demand recovery tempered by the challenging raw material environment. We now expect to deliver fiscal year 2010 adjusted net income per share in the range of $2.10 to $2.25, excluding restructuring charges.”
Just hours before industry trainer Toby Chess was to make another presentation about non-OEM bumper and structural parts at the Collision Industry Conference (CIC) in Atlanta in April, Chess said he was threatened with a lawsuit if he did so. He declined to reveal who threatened the legal action - multiple sources have indicated it was LKQ Corporation, parent company of Keystone Automotive - but said because he had not had a chance to consult with an attorney, he chose to forego making his presentation at the meeting.
In presentations at the previous two CIC meetings in November and January, Chess showed potential problems with a number of non-OEM bumper parts, including apparent significant differences in the material and structure of the parts. That has led at least four insurers to pull back from the use of such parts; it has also led parts suppliers to develop tracking and recall programs for the parts, and to the launch of several testing and certification programs for such parts.
Chess was clearly frustrated by the threat of legal action against him, saying he never portrayed the demonstrations as scientific research but merely as a way to "bring light" to a potential problem.
"I was asked last month why I did this," Chess said. "I said that I don't work for insurance companies, I don't work for parts companies, I don't work for body shops. I work for the consumer. I'm a trainer. I teach. So I have no vested stake in this. I thought it was necessary to say these things. I think we've demonstrated to the industry that there has to be more than just selling these parts. I hope that after I get some legal counsel on this, I can come back to you and show you more of what I did find. Some (of the non-OEM parts) are very good. And I was prepared to tell you about that."
Without explicitly confirming or denying it was the source of threatened legal action against Chess, LKQ Corporation following the CIC meeting issued a written statement about Chess' presentations, including the one last November in which he used a firefighter's extrication saw to show how much easier it was to cut through the metal used to make a non-OEM bumper bar being sold as a replacement for an OEM part made from ultra-high-strength.
In its statement, LKQ Corporation said it tried to replicate such a test and found "the saw cut through the OE rebar with relative ease, "raising concerns that "there is a lot of misinformation being spread."
The company pointed to crash testing it did that it says showed both an OEM and non-OEM bumper passed federal safety standards for passenger protection.
"LKQ believes that it is important for the consumer and the industry to receive relevant and accurate information, so we have communicated that message to the parties involved," the company wrote.
A number of CIC participants in Atlanta after Chess’s announcement expressed outrage that legal threats would be used to prevent a presentation and open discussion at the meeting. Speaking as a past CIC Chairman, Chuck Sulkala said this was the first such incident he was aware of in CIC's nearly 30-year history. He said Chess was merely raising awareness of issues that had been discussed for decades, and commended parts suppliers for finally taking action in the months since Chess' previous presentations to address traceability of the parts.
"To have something stopped because of a potential lawsuit is shooting the messenger," Sulkala said. "The day of stopping discussions at CIC because of a legal issue has got to come to an end. It should never have come to be in the first place."
Industry consultant John Bosin, who chairs the CIC Parts Committee, also called such a threat of legal action "reprehensible" and told Chess he would help start a legal defense fund if necessary.
"Whoever has initiated this (threat of) legal action passed up the opportunity to use this as the forum it is, to express their views," Bosin said. "We would have been open. We may not have liked what we heard, but they could have come here. They were welcome. Whoever it is, why aren't they here talking about the issue and telling us what their concerns are and explaining their actions."
The following is a joint statement by the Automotive Service Association (ASA) and Automotive Service Councils of California (ASCCA). The organizations are national and statewide membership organizations, respectively, of aftermarket service repair facilities and represent thousands of small business owners.
Recent public relations initiatives by AutoMD, a division of US Auto Parts Network, warrant a strong and clear response from the automotive repair and service industry. The company's recent activities include a press release ranking US cities according to the "honesty" of auto repair facilities in each city, as well as a television segment on the CBS Early Show. In both of these PR efforts the company makes several claims and promotes a set of conclusions that are inaccurate and based on flawed logic and biased methods.
We take particular issue with two of AutoMD's efforts:
- In a press release (Feb. 24, 2010), the company reported that it had "conducted a fairness check of over 600 shops in the top-50 DMAs” (including a range of dealers, independent shops, and franchises like Pep Boys) "to create a "Repair Shop Fairness Report" that ranked the "best and worst cities for auto repair." A company that distributes auto parts knows better than anyone that parts quality and price varies substantially by brand, often 100 percent or more, and no mention of parts brand or quality was included in the survey. It also failed to account for differences in technician training, warranties included with the parts used, quality of equipment used and level of service provided by each type of facility. Furthermore, in each of the 50 cities included in their survey there are thousands of dealers, independent shops and chain stores. Their survey included an average of 12 shops per city, a number not anywhere close to what is needed to get an accurate or representative sample. Using biased methods allows US Auto Parts to reach whatever conclusions it desires.
- In a segment on the CBS Early Show (April 14, 2010), the company brought its specially prepared vehicles to shops and dealerships in several states, asking for quotes on a front brake pad replacement at several shops. The CEO, Shane Evangelist, claimed the job should cost "about $180" and stated emphatically that mechanics were ripping off consumers by charging more than $180. One mechanic that offered to do the job for $169 was widely praised for his honesty. Once again, no mention of parts quality, technician training or the quality of the equipment used in the facility was ever made, especially since quotes were being compared across multiple cities, each with different labor rates. More important, at no time during the broadcast was it revealed that AutoMD is owned by US Auto Parts, and according to its CEO during investor presentations, is using AutoMD as a lead generation platform for selling its parts. Taking the auto repair industry to task for its lack of transparency while failing to disclose its own self-serving motives is misleading.
Overall, US Auto Parts' publicity campaigns are misleading to consumers and undermine our longstanding efforts to educate the motoring public and continually improve the professionalism of the industry. They perpetuate consumer mistrust of automotive professionals, devalue the development of expertise through ongoing training and education, ignore best practices and promote a race to the bottom. US Auto Parts’ attacks put repairers in a bad light and undermine the work of honest and reputable automotive service shops.
The following position statement has been received at INSIGHT from American Honda Motor Co.
In the interest of customer safety and increased customer convenience, American Honda Motor Co, Inc. urges all collision shops, independent repair shops, used car dealers, or any non-Honda or non-Acura auto repair facility to check for any applicable safety recalls each time a Honda, or Acura vehicle is serviced, repaired, or inventoried.
Although American Honda notifies the current registered owner (as identified through state vehicle registration data) each time it conducts a safety recall, not all owners receive such notices (due to change of address or ownership or lack of current registration) and even when notices are received not all owners respond to such notices. If all sales and service facilities were to check for applicable safety recalls for all vehicles that come into their facilities together we can ensure that necessary safety repairs are made to all vehicles owned by our joint customers.
Finding an applicable recall is quick and easy, and your customer will likely view your effort as a value-added service.
To find any applicable recalls for any Honda vehicle:
- Go to www.recalls.honda.com
- Enter the vehicle VIN
- Any recall for that VIN will be noted, including the status of the repair, open or fixed.
To find any applicable recalls for any Acura vehicle:
- Go to www.recalls.acura.com
- Enter the vehicle VIN
- Any recall for that VIN will be noted, including the status of the repair, open or fixed.
In the event that a recall operation is required, do not attempt to service the vehicle but refer the owner to a local authorized Honda or Acura dealer. The service will be performed free of charge.
If your customer has any questions about a particular recall, please have them contact the following:
- Honda Customer Service: 1-800-999-1009, select option 4
- Acura Client Services: 1-800-382-2238, select option 4.
Thank you for your consideration and help in this matter.
Feedback
Have a comment about this article? Send Email to Editor, INSIGHT's Editor
©2010 Collision Repair Industry INSIGHT
All Rights Reserved
FEATURED
LINKS:
INSIGHT Supports the NABC!
Do You?