Autobody News January 2011 Southeast Edition by Autobody News

Southeast Edition Florida Georgia Alabama Mississippi

YEARS

VOL. 2 ISSUE 11 JANUARY 2012

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Industry News You Might Have Missed in 2011 by John Yoswick

So much happens in the collision repair industry that it can be hard to keep up on everything. A few big stories get plenty of attention, but sometimes it’s the lesser-known stories that can have as big an impact on your business. As a new year kicks off, here’s a wrap up of some of the news stories from this past year that might have flown under your radar amid the dayto-day challenges of running your shop, but that could prove helpful for you to know about. ► 1 The Federal Trade Commission

last year issued a consumer bulletin related to the Magnuson-Moss Warranty Act. It states that use of non-OEM parts in itself cannot void a vehicle warranty. “Still, if it turns out that the aftermarket part was itself defective or wasn’t installed correctly, and it causes damage to another part that is covered under the warranty, the manufacturer or dealer has the right to deny coverage for that part and charge you for any repairs,” the bulletin states. For a copy of the bulletin, visit: http://tinyurl.com/3zvas3w

► 2 The Society of Collision Repair See Might Have Missed, Page 18

Southeastern Collision Industry’s 2011 Redux

See Industry Wrap-Up, Page 10

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The collision industry has certainly seen its fair share of challenges this year. As everyone in this industry considers the promises and hope a new year can bring, we asked some of you in Autobody News’ Southeast region to take a hard look at some of the issues they saw in 2011, and especially those they’d like to see less of in 2012. Barrett Smith, Owner Auto Damage Experts in Dover, FL, and active Florida Auto Collision Alliance member, gave his opinion on the collision industry during the last year. “Concerns with Direct Repair

Programs (DRP) continue to plague the industry,” said Smith. Among the insurer-body shop relations Smith cited were the continual efforts of the Collision Repair Industry to meet the ever-changing goals (KPIs, mandates, restrictions, levels, etc.) that insurers place upon both DRP participants and non-participants; the compelling constraints of such KPIs as “Prevailing Competitive Pricing/Practice (PCP) upon repairers and consumers; and the lack of accountability of repairers and insurers for less than adequate repair allowances and resulting repair quality. “It is my opinion that the insur-

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by Erica Schroeder, Assistant Editor

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NACE / SEMA / CARS / AAPEX

2011 RECAP

Delray Beach, FL, Shop Owner Opposes GEICO’s 10% Charge on Domestic OEM Parts Eddie Quintela wants to know why GEICO is charging his customers a 10% deductible on their domestic OEM parts, regardless of fault, and in addition to regular deductible and/or applicable betterments. Quintela asks why GEICO is apparently assessing this fee in Palm Beach county but not in nearby Polk county; and why is it that an insured driving a foreign made vehicle is not deducted 10% for OEM parts, but one driving a vehicle made in the United States is made to pay 10% extra for their parts? Quintela sent his first email to GEICO’s Dan Maloney, his local claims supervisor, on Dec. 7: Dan, I called you twice and left two voice messages and haven’t heard back from you yet. I am writing in regards to the 10% parts discount that you have taken from the estimate on

Eddie Quintela has sent multiple email letters to GEICO’s local claims supervisor seeking refunds (or at least an explanation) for his customers who are being charged an additional 10% on all domestic OEM parts appearing on estimates. So far he’s had perfuctory response from the insurer, and no substantiation of the “customary” charge. Quintela has offered to help GEICO do its survey of the market since none of the shops he contacted have seen a GEICO sponsored survey. He asks GEICO why they are compromising “relationships between your company and the hundreds of collision repair facilities here in South Florida?” See Domestic Parts Deduction, Page 16

Where We Stand—The U.S. Automotive Sector by Scott Corwin, Evan Hirth, Jan Miecznikowski, Brian Collie, Patrick Mulcahy, and Mike Beck, at Booz & Company

For U.S. automakers and suppliers, the past year can best be described as 12 months of mixed results, leaving unanswered questions about the future direction of the industry and what is required for manufacturers and suppliers to thrive. In 2011, U.S. light car and truck sales will exceed 12.5 million, a nice bump from 11.6 million in 2010 and 10.4 million in 2009. And though the most optimistic analysts forecast that U.S. vehicle sales will rise to more than 14 million in 2012, that’s a far cry from 17.3 million at the turn of the

millennium. Last year’s U.S. sales figures might have been higher if not for the tsunami and earthquake in Japan and flooding in Thailand, which forced Toyota, Honda, and, to a lesser extent, Nissan to curtail production in virtually all of their assembly plants around the world. Auto sales growth is far more rapid in emerging nations such as China and India, with average annual sales gains since 2001 of 23 percent and 15 percent respectively. All of this should be good news for U.S. automakers, which have restructured their operations to be profitable at lower volumes in the U.S. General Motors, Ford, and Chrysler gained market share at the expense of the Japanese manufacturers, and the See Where we stand, Page 14

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Contents After Deadly Orlando-Area Crash, NHTSA

to Inspect Jeep Grand Cherokee . . . . . . . 8

Auto Angels Approaches Finish Line for

by OEMs? . . . . . . . . . . . . . . . . . . . . . . 12

Sisk - Richie’s Collision in Hattiesburg, MS: Beating the Odds, Over and

Over Again. . . . . . . . . . . . . . . . . . . . . . 30

Florida Car Giveaway . . . . . . . . . . . . . . 10

Weaver - A Picture Worth a Thousand

CA, TX, GA with Expanded Business

Williams - Stockton Honda in Sandy, Utah,

Development Team . . . . . . . . . . . . . . . . 4

Delray Beach, FL, Shop Owner Opposes GEICO’s 10% Charge on Domestic

OEM Parts . . . . . . . . . . . . . . . . . . . . . . . 1

Fire at Venice, FL, Auto Shop Under

Words Most of Which We Can’t Print . . 23

Cultivates Long Term Relationships . . . 23

NATIONAL

2010-2011 Toyota Corolla, 2011 Toyota

Sienna Recalled . . . . . . . . . . . . . . . . . . 11

Investigation . . . . . . . . . . . . . . . . . . . . . 6

ASRW Responds to Insider’s Comments

Investigator . . . . . . . . . . . . . . . . . . . . . . 6

Traveling Regional Trade Show?’ and

FL Gets New Head of Insurance Fraud FL Trailing Nation on Texting While

Driving Ban . . . . . . . . . . . . . . . . . . . . . . 6

in his Columns: ‘Can NACE Survive as a

‘Industry Undecided Which Organization

Will Prevail’ . . . . . . . . . . . . . . . . . . . . . 13

Guardian Auto Glass Expansion Continues

Auto Groups Fight Recall Fees Hike in

Houston City Council Set to Vote on Auto

AutoNation CEO Says No Double-dip

into Athens, GA . . . . . . . . . . . . . . . . . . . 4

Repair Ordinance, Draft Not Favorable

to Shops . . . . . . . . . . . . . . . . . . . . . . . 19

Keystone Expands Cullman, AL, Warehouse. 29

Mercedes Adding Third Shift to Vance,

AL, Plant . . . . . . . . . . . . . . . . . . . . . . . 11

Mercedes-Benz Vance, AL, Plant Reaches

front of Congress. . . . . . . . . . . . . . . . . 22

Recession Coming . . . . . . . . . . . . . . . . 11

BMW Working on Lazer Beam Headlights,

Energy Efficient . . . . . . . . . . . . . . . . . . 22

China to Levy New Tariffs on U.S. Vehicles . 13 Daimler to Drop Mayback Brand, Focus on

New S-Class Mercedes . . . . . . . . . . . . . 4

Milestone: 1.5M Vehicles . . . . . . . . . . . . 4

Fiat 500 Gets Only 3-star Safety Rating

Successful Conference in Naples, FL . . 33

GM Partners with Japanese Carbon Fiber

Sherwin-Williams A-Plus™ Network Holds

Southeastern Collision Industry’s ‘11 Redux . 1 Volkswagen Chattanooga Plant Earns LEED

Platinum Certification. . . . . . . . . . . . . . . 8

COLUMNISTS

from NHTSA . . . . . . . . . . . . . . . . . . . . 11

Supplier to Improve Composites . . . . . 22

Honda Recalling 300,000 Vehicles for

Airbag Flaws . . . . . . . . . . . . . . . . . . . . 22

Industry News You Might Have Missed

in 2011 . . . . . . . . . . . . . . . . . . . . . . . . . 1

Attanasio - Yelping Back, an Interview with

NHTSA Proposes Panic-Stop Ignition

Chess - Life Changes or Industry Changes

Nissan’s LEAF to be Sold in More U.S.

Evans - Solution Finish’s Brings Black Back™

NTSB Calls For Full Ban of Cell Use

Franklin - An Effective Marketing Focus . . 26

Saab, Now Bankrupt, Suspends Warranty

Yelp’s Business Outreach Manager. . . . 28 Don’t Happen Without Major Effort . . . 36

is a Breakthrough Product . . . . . . . . . . 34

I-CAR - Nitrogen Hot Air Welding: Repairing

Plastic Parts . . . . . . . . . . . . . . . . . . . . 37

Insurance Insider - Sure, OEMs Set the

Standard, But Who Fills the Gaps Left

Standard for Cars. . . . . . . . . . . . . . . . . 35

Markets . . . . . . . . . . . . . . . . . . . . . . . . 22

Behind the Wheel. . . . . . . . . . . . . . . . . 31

on North American Cars . . . . . . . . . . . . 4

Where We Stand—The U.S. Automotive

Publisher & Editor: Jeremy Hayhurst General Manager: Barbara Davies Assistant Editor: Erica Schroeder Contributing Writers: Tom Franklin, Stefan Gesterkamp, John Yoswick, Lee Amaradio, Toby Chess, Mike Causey, Dan Espersen, Tom McGee, Jeff Webster, Rich Evans, Ed Attanasio, Chasidy Sisk Advertising Sales: Joe Momber, Sean Hartman (800) 699-8251 Sales Assistant: Kristy Navarro Art Director: Rodolfo Garcia

Indexof Advertisers

CARSTAR Sets Stage for Expansion in

Sector . . . . . . . . . . . . . . . . . . . . . . . . . . 1

Southeast

REGIONAL

Serving Florida, Georgia, Alabama, Mississippi and adjacent metro areas, Autobody News is a monthly publication for the auto body industry. Permission to reproduce in any form the material published in Autobody News must be obtained in writing from the publisher. ©2011 Adamantine Media LLC.

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Arrigo Dodge-Jeep-Chrysler. . . . . . 14 Autoland Scientech. . . . . . . . . . . . . 23 BMW Wholesale Parts Dealers . . . . 31 Classifieds. . . . . . . . . . . . . . . . . . . . 39 Crown Hyundai . . . . . . . . . . . . . . . . . 2 CSS USA, Inc.. . . . . . . . . . . . . . . . . 11 Delray Honda . . . . . . . . . . . . . . . . . 15 Don Reid Ford. . . . . . . . . . . . . . . . . 28 Equalizer Industries . . . . . . . . . . . . 27 FiltersForBooths.com . . . . . . . . . . . . 6 Ford Wholesale Parts Dealers FL, GA, AL, MS . . . . . . . . . . . . . . 40 Galloway Mazda . . . . . . . . . . . . . . . 27 Garmat USA . . . . . . . . . . . . . . . . . . . 4 Gus Machado Ford . . . . . . . . . . . . . 33 Honda-Acura Wholesale Parts Dealers. . . . . . . . . . . . . . . . . . 20-21 Hyundai Wholesale Parts Dealers . 32 Kia Motors Wholesale Parts Dealers. 25 Mazda Wholesale Parts . . . . . . . . . 36 Mercedes-Benz Wholesale Parts

Dealers . . . . . . . . . . . . . . . . . . . . 33 Mitsubishi Wholesale Parts Dealers. 17 MOPAR Wholesale Parts Dealers . . 18 Nalley BMW. . . . . . . . . . . . . . . . . . . 26 Nissan Genuine Parts . . . . . . . . . . . . 7 Nissan Wholesale Parts Dealers. . . 37 Palmers Toyota . . . . . . . . . . . . . . . . 16 Porsche Wholesale Parts Dealers . 38 Safety Regulation Strategies . . . . . 31 Serra Mazda . . . . . . . . . . . . . . . . . . 15 Serra Automotive Group . . . . . . . . . . 5 Solution Finish . . . . . . . . . . . . . . . . 34 South Motors . . . . . . . . . . . . . . . . . . 9 Southtowne Hyundai . . . . . . . . . . . 12 Star-A-Liner . . . . . . . . . . . . . . . . . . . 13 Subaru of Gwinnett . . . . . . . . . . . . . 17 Subaru Wholesale Parts Dealers . . 29 Tameron Hyundai . . . . . . . . . . . . . . 29 Toyota Wholesale Parts Dealers . . . 19 Volkswagen Wholesale Parts Dealers . . . . . . . . . . . . . . . . . . . . 38

www.autobodynews.com | JANUARY 2012 AUTOBODY NEWS 3

CARSTAR Sets Stage for Expansion in CA, TX, GA with Expanded Business Development Team CARSTAR Auto Body Repair Experts announced it has expanded the company’s business development team to manage a national growth initiative in the U.S. The MSO has also more than doubled its sales force as it prepares to expand into California and big metro areas in Texas and Georgia. The newly expanded business development team is charged with generating new franchise locations. The business development team, which includes three new leaders in the automotive franchise industry, will serve as business consultants to the country’s independent shop owners. The team will help owners evaluate their businesses and determine how the CARSTAR business model can benefit their operations. CEO David Byers said the larger team will allow North America’s largest group of branded collision repair facilities to finally move into the largest U.S. market. “It was just a matter of not having enough business development staff,” said Byers. The three new individuals appointed to CARSTAR’s business development team include: ● Ryan Keller, assistant vice president of franchise development for CARSTAR. Keller will be responsible for managing CARSTAR’s growth initiatives, enhancing the franchise sales process and overseeing independent store transitions into the

CARSTAR network. ● Mark Behrens, director of network development—California for CARSTAR. Behrens will focus on expansion of the CARSTAR brand into California and adding new franchise partners to existing CARSTAR markets. ● Keith McCrone, director of network development—Northeast for CARSTAR. McCrone will focus on strengthening the CARSTAR network in current and new markets. Dave Blackwell, director of network development—South, Southeast and Midwest for CARSTAR, and Lloyd Taylor, director of network development—Northwest and Central for CARSTAR, are also on the business development team. “We are excited to bring the resources of this expanded business development team to the independent auto body shop owners around the country,” said David Byers, CEO of CARSTAR. “The knowledge they have of the collision industry, their experience as franchisees and business entrepreneurs, and their expertise in guiding independent shop owners through the process of joining the nation’s largest auto body repair MSO all will be incredibly powerful in building the CARSTAR brand across North America.” For more information about franchise opportunities with CARSTAR, visit carstarinvestment.com.

Guardian Auto Glass Expansion Continues into Athens, GA

Guardian Auto Glass, LLC announced December 5 it is expanding its operations into the Athens, GA area and has hired Morlee Sillesky as account manager to lead that growth. Athens will be the eighth location Guardian Auto Glass has opened this year. In January, the company announced service in Alpharetta, GA. Guardian Auto Glass provides glass repair and replacement services for automobiles, buses, trucks and recreational vehicles and has more than 50 servicing locations throughout the United States. Athens will be the eighth location Guardian Auto Glass has opened this year. In January, the company announced service in Alpharetta, GA. “We are excited to welcome Morlee to our Atlanta area team and to begin service to the Athens and

north Georgia communities,” said Marc Talbert, vice president and managing partner of Guardian Auto Glass. “Morlee brings more than 20 years of retail auto glass experience in this area and has a large and dedicated customer base.” Guardian Auto Glass LLC was formed in 2010 between Guardian Glass Company, a wholly owned subsidiary of Guardian Industries Corp., and LRST LLC to manage and grow the retail auto glass business of Guardian. Guardian Auto Glass is seeking qualified sales and operations professionals interested in ownership and/or employment opportunities in their markets, and business owners seeking acquisition partnerships throughout the U.S. Please contact us at LRST@guardian.com for further details.

Daimler AG will shut down the superluxury Maybach brand to end almost a decade of losses from an auto that sells for more than $350,000 when a

revamped version of the flagship Mercedes-Benz S-Class comes to market in 2013. Daimler hasn’t made a profit on the Maybach since 2002.

Daimler to Drop Mayback Brand, Focus on New S-Class Mercedes

4 JANUARY 2012 AUTOBODY NEWS | www.autobodynews.com

Mercedes-Benz Vance, AL, Plant Reaches Milestone: 1.5M Vehicles Mercedes-Benz said December 2 that its Alabama plant has produced its 1.5 millionth vehicle, according to the Birmingham News.

The automaker said the milestone vehicle produced at the Vance factory was a silver ML 350 SUV destined for a customer from Encino, Calif., who pre-paid for the vehicle.

“We are extremely proud of this significant milestone,” Markus Schaefer, CEO of the Alabama plant, said in a statement. “This year has been both challenging and rewarding for our team members, who live and work here in Alabama to help us achieve our goal of delivering superior products to our global customers.” The 2012 M-Class represents the third generation of a SUV that Mercedes-Benz says began the industry trend toward SUVs with a car-like ride. The first M-Class rolled off the assembly line in Vance on Feb. 14, 1997. The plant employs 2,800 people, a figure that will rise to 4,200 as Mercedes invests another $2 billion in the operation and begins production of new models.

Saab has suspended warranty coverage on all of its vehicles in North America. Additionally, new vehicles must be sold “as is,” the bankrupt Swedish automaker told its dealers. However, General Motors, Saab’s former owner, said it would honor warranties on all models sold when it owned the Swedish automaker. The suspension took place on the same day a Swedish

court approved the automaker’s bankruptcy petition to liquidate and begin paying creditors. Two receivers were appointed to oversee Saab’s assets. Effective Dec. 19, “warranty coverage is suspended indefinitely for all new Saab vehicles sold. During this period, the warranty booklet must be removed from the owner information packet,” Saab Cars North America said.

Mercedes-Benz Vance, AL, plant paint shop employees pose with the milestone vehicle

Saab, Now Bankrupt, Suspends Warranty on North American Cars

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FL Has New Head of Fraud Investigations

Daniel Anderson was named as Florida’s lead insurance fraud investigator earlier this month by Florida Chief Financial Officer Jeff Atwater, according to Claims Journal. Anderson will take over as the director of the state’s Division of Insurance Fraud, where he will oversee 155 sworn law enforcement officers, managers and administrators. He will also supervise 48 non-sworn civilian support staff. The division made over 1,000 fraud-related arrests in the last year. Anderson comes to the division after a 25-year career with the federal Drug Enforcement Administration where he most recently served as an associated special agent in charge of the DEA’s New York Field Division overseeing more than 800 employees. He also served as an instructor at the DEA Academy, group supervisor at the DEA’s Norfolk, Virginia office, and unit chief of operations management at the DEA headquarters.

FL Trailing Nation on Texting While Driving Ban

Florida is one of only 15 states without a law against texting and driving During their next legislative session in January, there is a chance state lawmakers could enact a ban on texting while driving. State Senator Nancy Detert, a Republican from Venice, has sponsored a proposal to make texting while driving a secondary offense, meaning law enforcement officers could not stop drivers for that offense alone. Officers would issue tickets only if another infraction occured first. Under the bill, drivers can text at red lights, use GPS, talk on the phone or dial a number while driving. However, drivers could not compose emails or instant messages. The first violation is a $30 fine. A second violation within five years will result in a $60 fine and three points on the driver’s license. Six points are added if the use of a device ends in a crash. More than 30 states have introduced measures banning texting and driving. Recent polls show more than 90 percent of drivers agree that sending messages while on the road is unacceptable.

Fire at Venice, FL, Auto Shop Under Investigation

Sarasota County fire officials are investigating what caused a fire at an auto body repair shop in Venice, FL, on December 7 that caused extensive damage to the building, sent smoke through adjacent neighborhoods and disrupted traffic during the morning commute. No one was injured in the fire. The fire was in an industrial park on James Street, east of the U.S. 41 Bypass. Twenty firefighting units from Venice, Sarasota County and Nokomis responded. Firefighters arrived at 7:03 a.m. to see smoke coming from the building. First responders were on the scene within seven minutes. At least 45 firefighters started a defensive attack from the outside of the auto body and cabinet shops. Within minutes the building was fully involved, according to county fire officials. Battalion chief Glenn Snyder said the fire was out within 90 minutes. Fire officials said there was a woodworking shop in the rear, and an auto body shop in front. Many of the vehicles in the repair shop's parking area, some with for sale signs on them, suffered damage in the fire.

Traffic was re-routed around the area for the majority of the morning. The assistant chief says they did not have to worry about search and rescue because of the time of day. “The main concern of the incident commander was to first confine the fire to make sure it did not spread to the adjacent buildings and to actually locate the seed of the fire, and then begin the extinguishment,” the assistant chief said. No one was injured. There is no estimation of the damages to the two buildings at this time, but they appear to be destroyed. The State Fire Marshal will continue with the investigation.

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After Deadly Orlando-Area Crash, NHTSA to Inspect Jeep Grand Cherokee As part of an effort to determine whether millions of Jeep Grand Cherokees from the 1993-2004 model years should be recalled because their gas tanks may be susceptible to rupturing in rear impacts, the National Highway Traffic Safety Administration is investigating a recent crash in which a Florida man died, according to the New York Times. “As part of our open defect investigation, N.H.T.S.A. plans to inspect the Jeep Grand Cherokee that was involved in a recent Orlando area crash,” Karen Aldana, an agency spokeswoman, wrote in an e-mail. The accident occurred on Nov. 16 on Interstate 4 in Lake Mary, FL, ac-

cording to a report from the state’s highway patrol. The report said that a 1997 Grand Cherokee was struck from behind by a 2002 Mercury Mountaineer after the driver did not notice that traffic ahead had stopped. The Jeep caught fire after the impact, and a 24-year-old passenger was trapped in the vehicle and died. The police estimated that the Mountaineer was traveling at 65 miles per hour, the posted speed limit. The vehicle’s speed when it struck the Jeep, however, was not clear, as the driver might have begun to slow the vehicle by braking. In October 2009, the Center for Auto Safety, a nonprofit safety advo-

cacy group founded in 1970 by Ralph Nader, filed a defect petition with NHTSA asking it to investigate the 1993-2004 Grand Cherokees. The center says the Grand Cherokees have design flaws that make the fuel tank far more likely to rupture or spill gas when hit from behind than competing vehicles built at the same time, like the Ford Explorer. In August 2010 the safety agency said it would grant the request and it began a preliminary evaluation. Experian Automotive estimates that about 2.2 million Grand Cherokees built over the period in question are still on the road. Chrysler has insisted that the Grand Cherokee did not have a safety

defect, and it has provided the agency thousands of pages of documentation intended to support its contention. The Center for Auto Safety, meanwhile, has filed documents that it said supported its case, including the results of three crash tests it commissioned. Jeep redesigned the S.U.V. for the 2005 model year and moved the gas tank from behind the rear axle and next to the bumper to ahead of the rear axle. Chrysler officials have said that any concern about fire danger did not prompt the move. Rather, they said, the change was made because the spare tire was moved from the cargo compartment to a mounting point beneath the vehicle.

Volkswagen’s Chattanooga manufacturing plant has received a platinum certification from the U.S. Green Building Council’s (USGBC) Leadership in Energy and Environmental Design (LEED®) green building certification program. The facility is the first and only automotive manufacturing plant in the world to receive the Platinum certification. The $1 billion plant was also rated as the cleanest and most energy-efficient car-manufacturing site in the world by the U.S. Green Building Council on December 1. Platinum certification recognizes the highest level of performance. “Because Volkswagen has a longstanding, worldwide commitment to sustainable mobility and environmentally responsible manufacturing, we are proud to have achieved the LEED Platinum certification at our Chattanooga manufacturing facility,” said Hubert Waltl, member of the board of management of Volkswagen Passenger Cars Brand for production and logistics. “Volkswagen Chattanooga’s LEED Platinum certification is the fulfillment of a promise that Volkswagen has made around the world and in this community that we will work in harmony with the environment,” said Frank Fischer, CEO and chairman of Volkswagen Chattanooga. Our commitment to building a LEED certified factory began in the planning and design stages,” Fischer said, “I believe that this not only helped insure that we would achieve

Platinum status, but was actually a very cost effective way to implement environmentally responsible building methods,” he said. The ultra-clean paint shop alone will save 50 million gallons of water in ten years. “Volkswagen is clearly committed to the US market;” said Jonathan Browning, president and CEO, Volkswagen Group of America, Inc. “During the worst recession in the past century we never wavered with our investment of a billion dollars to create this world class facility. This certification underscores Volkswagen’s commitment to engineering excellence.” LEED certification is an internationally-recognized green building certification system developed by the USGBC in March of 2000. LEED provides building owners and operators with a framework for identifying and implementing practical and measurable green building design, construction, operations and maintenance solutions. LEED promotes sustainable building and development practices through a suite of rating systems that recognize projects that implement strategies for better environmental and health performance. Aspects of the plant that earned LEED recognition include: ● Superior insulation provided by six inches of mineral rock wool, resulting in 720,000 Kilowatts per year savings. Green power from the local hydroelectric dam

● Use of LED lighting on the exterior results in 68% less energy used, up to 262,500 kWh per year and a reduction in light pollution. ● Rainwater collected and reused to flush toilets and cool the welding machines ● White roof membrane is highly reflective, minimizing heat island effect by up to 50 degrees Fahrenheit. ● Natural flowing creeks to capture heavy rains and restore a natural habitat ● Low-flow water fixtures and notouch sensors throughout the plant reduce water usage by 30%. ● Plant was built on a brownfield property with no destruction of untouched nature. Protected 100 ft. wide creeks and wetlands were established to create natural habitats with low impact on natural habitats. The Volkswagen Academy was also certified by USGBA as a Platinum LEED facility. The primary purpose of the Volkswagen Academy is to prepare new employees for work at the Volkswagen plant. In conjunction with Chattanooga State and Tennessee Tech, the Academy also offers an Industrial Technology degree and an apprenticeship program. “We are very pleased that the Volkswagen Academy has been Platinum LEED certified, because this reflects the level of excellence that we expect and produce in the academy,” said Hans-Herbert Jagla, EVP of Human Resources. “Building operations are nearly 40% of the solution to the global cli-

mate change challenge,” said Rick Fedrizzi, President, CEO & Founding Chair, U.S. Green Building Council. “While climate change is a global problem, innovative companies like Volkswagen Chattanooga are addressing it through local solutions.” Volkswagen Chattanooga produces the all-new 2012 Passat, which has recently been named Motor Trend magazine’s 2012 Car of the Year, as well as having earned the Insurance Institute for Highway Safety’s (IIHS) Top Safety Pick rating, the highest possible from the non-profit safety research organization. The Passat TDI—the only clean diesel option in the midsize segment—is rated at 43 mpg highway, with a range of nearly 800 miles. The U.S. Green Building Council is the nation’s foremost coalition of leaders from across the building industry working to promote buildings that are environmentally responsible, profitable and healthy places to live and work. More information on USGBC can be found at www.usgbc.org. Volkswagen will invest $1 billion in the local economy for the Chattanooga plant and create more than 2,000 direct jobs in the region. According to independent studies, the new Volkswagen plant is expected to generate $12 billion in income growth and an additional 9,500 jobs related to the project. The Chattanooga manufacturing facility builds the all-new 2012 Passat sedan, among other models.

Volkswagen Chattanooga Plant Earns LEED Platinum Certification

8 JANUARY 2012 AUTOBODY NEWS | www.autobodynews.com

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Continued from Front Page

Industry Wrap-Up

ance industry has more or less hijacked the collision repair industry and has successfully redirected the collision industry’s focus from serving the consumer—in proper and thorough repairs—to becoming subservient to the insurers in the insurer’s ongoing efforts to contain and mitigate claims related costs. This includes not only the reduction in costs directly associated with repairs but also the increase in administrative labors and costs which many repairers are undertaking and absorbing on behalf of insurers,” said Smith. Smith pointed out some positives that have come out of issues and strife in the collision industry this year as well. “I would like to think that one of the most positive and significant occurrences is the collision repair industry associations recently coming together to reach an accord regarding ‘Industry Standards’ and the acknowledgement that Original Equipment Manufacturers (OEM) recommended repair processes, procedures, parts and materials are indeed the Collision Repair Industry’s ‘Standards’ by which all repairs should be performed and judged,” said Smith.

According to Smith, this issue was long overdue and presents a perfect opportunity for state and national associations to work together on issues beneficial to the collision repair industry at large and the consumers it serves. Auto Damages Experts also provides post-repair inspections on vehicles repaired at other shops in various situations. Technicians at ADE have even been called as expert witnesses in court cases pertaining to vehicles. Smith said that through some of these post-repair inspects, the overall reduction in repair quality in this industry became evident to him and his staff. Howard Batchelor, Executive Director of the Georgia Collision Industry Association, also talked with Autobody News about his view of the collision industry over the last year. “One of the industry’s biggest issues is the influence insurers have over body shops right now,” said Batchelor, “You pretty much have to be on a DRP program to survive in the industry right now.” Batchelor said he sees insurers getting more involved in the repair process recently—not just the claims process. Batchlor said he sees insurers wanting an OEM parts discount and asking for large discounts on entire jobs from their DRPs, forcing shops

to sacrifice profit and allowing the insurers to manipulate the repair process. “They say steering doesn’t go on, but we all know it does,” said Batchelor. On a local level, Batchelor mentioned how price manipulating by insurers, by setting paint caps and charging some materials items as sublet items or mechanical repairs at body repairs, they are manipulating the amount of tax they pay the state. Batchelor and the GCIA have worked with their state insurance commissioner to address this issue. “We {the GCIA} are here to inform, educate and help shops be more profitable.” Batchelor also sees many independent shops relying on DRP work in an industry where MSOs are the only growing portion of the industry. “Independent shops and even dealership body shops are shrinking and struggling, and really have to have DRP relationships to stay in business right now,” said Batchelor, “Relying on DRPs for business is like putting all your eggs in one basket— you’re giving up a portion of your profits for increased volume.”

Crown Vic to Nikki Broomer Meisner Paint and Body --------1990 Mazda 626 to Paige Pelland Douglas Collision -----------------1997 Explorer to Quiana Hyatt Stewart Auto Repair --------------2001 Escort to Taliah Williams Gunder’s Auto Center ------------2001 Mitsubishi Galant to Debra Powers Auto Body Resurrection --------2001Windstar to Lori Becker Jenkins Collision Center --------1991 Nissan Pathfinder to Dawn McClellan Gunder’s Auto Center -----------1998 Escort to Patricia McKiney The Auto Angels would like to thank the following, in addition to their presenting repairers. Without their support the Auto Angel program would not be possible: Ace Towing, NAPA Auto Parts, Winter Haven Honda, Central Towing, All Pro Auto Parts, Regal Auto Group, Maurice’s Towing, LKQ Auto Parts, Stingray

Chevrolet, Jenkins Towing, 1-800 Radiator, Terry’s Auto Paint, Wemer Towing, Lakeland Auto Mall, Cooper Tires, ARC Towing, B & L Tires, Enterprise Rental Car, Ben’s Paint Supply, ET Limousine Service, Pastor Blackburn with Victory Church, Affordable Auto Glass (Bob Williams), Auto Xpressions, Special Gifts, Larry Walker with State Farm, Rick Marshall with State Farm, Lindsey Yates with State Farm, Centerstate Bank, Dan Mann with State Farm, Community Southern Bank, Cheryl Beckert with State Farm, the Polk Sheriff’s 2Charities, Billy Farris with State Farm, Bartow Ford, Lloyd Herbert, Madison Forrest Products, and Santa Clause. This year’s Auto Angels’ Chairman, David Stewart, stated: “On behalf of FACA and The Auto Angels program and the recipients, I would like to thank each and every one who contributed their time and resources to

Florida PIP Fraud Continues to Gum Up the Works The automotive claims industry in Florida has seen thousands of in-

stances of fraud over the last year, continuing to drive up insurance costs for consumers and put shops in a price pinch. Efforts by the state of Florida and several consumer groups hope to curtail the fraud’s affect on consumers and the collision industry for 2012. “The bottom line is that if PIP is not transformed this year, Florida will continue to lead the country in questionable automobile claims, inviting even more criminal activity and putting Florida’s consumers and businesses at risk,” said Paul Blume, Property Casualty Insurers Association of America’s senior vice president in charge of state government relations.

Georgia Continues to Challenge Insurer-Set Labor Rates With Association-Gathered Surveys Georgia continues to challenge the insurer’s set labor rates with their own, association collected, labor rates surveys. The surveys, collected for their fifth year in a row this year by the Georgia Collision Industry Association (GCIA), help Georgia body shops negotiate better labor rates with insurers. “Shops need to realize that this survey is intended to help establish a fair market rate in the marketplace,” said Batchelor.

Auto Angels Approaches Finish Line for Florida Car Giveaway Auto Angels, in association with The Mid Florida Chapter of Florida Auto Body Collision Alliance (FACA) announced that 11 vehicles will be bestowed upon local recipients this 2011 Christmas season. This year there were over 300 applicants vying for the Angel Autos prepared by Auto-Angels. The selection committee worked very hard to assure that the vehicles will be going to homes with the most opportunity for helping the family or individual to make a new start, get back on their feet and/or cope with tragic illness or disability.

Presenters and Vehicles: Maurice’s Body Shop ------------1990 Buick to Nathalie Rivera Pastor Blackburn------------------2002 Dodge Caravan to Stephanie Smith Bernie’s Body Shop --------------1999 Neon to Mary Gaffney All Pro Auto Parts -----------------1989

10 JANUARY 2012 AUTOBODY NEWS | www.autobodynews.com

help make this year’s Auto Angel Program a resounding success. You truly are Auto Angels!” The presentation of the Angel Autos will be held on Tuesday, December 20th, 2011 at 11:00 a.m. at the Victory Church at 1401 Griffin Road, in Lakeland, Florida, 33810. For more information or on how you may participate in next year’s program, contact David Stewart at david@stewartautorepair.com or call (863) 965-2030.

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Mercedes Adding Third Shift to Vance, AL, Plant

Mercedes-Benz plans to add a third shift at its Vance, Alabama auto factory and boost annual capacity there by 30 percent in 2012, The Birmingham News reports. Automotive News Europe says it obtained internal plans that show the German automaker expects to build 185,900 vehicles in Alabama next year, up from about 143,000 this year, amid growing global demand. The third shift would start in August, according to the report. Mercedes has previously said it intends to increase its annual capacity in Alabama to more than 200,000 vehicles, part of a series of recent announcements about additional investment and new model launches for the Tuscaloosa County plant. By 2014, the company expects to raise its investment there to more than $4 billion and to add 1,400 workers to the current 2,800-member work force. The plant currently produces the M-Class SUV, GL-Class full-sized SUV and R-Class crossover. The CClass sedan will join the assembly lines in time for a 2014 launch, and a unnamed fifth model also is on the way.

2010-2011 Toyota Corolla, 2011 Toyota Sienna Recalled

More than 500 2010-11 Toyota Corollas and 2011 Toyota Siennas are being recalled due to the potentially flawed installation of aftermarket navigation, overhead entertainment and Bluetooth systems by Southeast Toyota Distributors, the world’s largest Toyota franchise distributor with 173 dealerships in Florida, Georgia, Alabama, North Carolina and South Carolina, according to the National Highway Traffic Safety Administration. During the installation of aftermarket non-Toyota Bluetooth, overhead entertainment and navigation systems, an installer at the facility was found to not be following instructions. On the 518 affected vehicles, the retention clip for the A-pillar trim may have been damaged, which could allow the trim panel to come loose and potentially injure vehicle occupants in a crash. Southeast Toyota estimates that approximately 25% of the vehicles listed have damaged A-pillar covers. Southeast Toyota dealers will inspect the A-pillar trim panel and replace it if necessary free of charge. Owners can call Southeast Toyota at 800-301-6859 or NHTSA at 888327-4236 for more info.

AutoNation CEO Says No Double-dip Recession Coming The U.S. economy will avoid a double-dip recession as auto sales continue to climb back toward 16 million a year, says AutoNation Inc. CEO Mike Jackson. “There is so much stimulus in this economy” that another downturn will be avoided, Jackson told dealers at a Washington Area New Automobile Dealers Association luncheon. And while the recovery is weak, “if there’s a bright side in this economy, it is the auto industry,” said the chief of the nation’s largest retailer. Jackson is not yet giving a forecast for 2012 but says U.S. auto sales will increase from the 12.6 million or 12.7 million units likely in 2011. Longer term, though, reaching 16 million annual sales may take two or three years, he said. “We’re on a journey back to selling 16 million units a year.” He said the projected rebound has three drivers. 1. Demographics support it. With 14 million vehicles taken off the road annually, the scrappage rate exceeds new vehicle sales. Vehicles are getting older with the average age up to 11 years, he said. And 1 million new households are being formed annually. “You see it in the showroom

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every day: People need to replace their vehicles,” Jackson said. 2. Automakers are producing better vehicles than ever before with innovative new technology. 3. In a reversal of the credit crisis that triggered the industry downturn, great financing options are available. “If there’s one lesson from 2008, it’s that people will make their car payments,” Jackson said. “People will pay for their cars before they’ll pay for their house and before they’ll pay for their credit cards.”

Fiat 500 Gets Only 3-star Safety Rating from NHTSA

The 2012 Fiat 500, one of the first minicars to hit the U.S. market, received a disappointing safety rating from the National Highway Traffic Safety Administration. The Fiat 500 has a combined overall safety rating of three out of five stars. In comparison, the 2012 Ford Fiesta four- and five-door models received a combined overall safety rating of four out of five stars.

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Inside Insurance

The Insider is a corporate-level executive with a Top 10 auto insurer in the U.S.. Got a comment or question you’d like to see him address in a future column? Email him at Auto.Insurance.Insider@gmail.com

Sure, OEMs Set the Standard, But Who Fills the Gaps Left by OEMs? with The Insurance Insider

The debate continues to rage: What is the standard for collision repairs? Who develops the standard? Is it possible to deviate from the standard? If you can deviate, what entity can provide an alternate to the standard? As such, people, committees, associations, not-for-profit organizations and corporations are lining up quicker than adults outside of Toys R Us on Black Friday to offer their two cents on the subject. Sadly, most of their opinions aren’t worth a single copper Lincoln penny. Why not? Because most of those offering an opinion are basing their decision upon something other than being experts on the topic. I’m not professing to be an expert or proficient enough in repair methodology to offer an opinion worthy of your consideration. While that may be the most humble thing you will ever read in one of my articles, I am going to give you my opinion anyway. The way I see it, if you are reading and listening to alleged industry experts weigh in, why not an insurance executive who has never actually repaired a vehicle? Maybe I’m the best person to offer an opinion because I don’t stand to gain anything. Although I’ve never repaired a vehicle, don’t discredit the wisdom I’m about to impart upon you. Sometimes the best ideas come from the most unlikely of places. Do you think Moses knew what was going to happen at the top of the mountain? If you happen to be a good church-going boy or girl, you know that is where Moses received the Ten Commandments. Who could have guessed sectioning procedures were even an issue back then? So let me answer a few of the questions I posed at the outset of the article. In order the answers are: OEM, OEM, yes, to be determined. Even though I may be just an insurer who doesn’t know much, I know that the car manufacturer sets the standard.

They spend millions of dollars engineering these vehicles. I think they should have some say as to how they are or are not repaired.

But note I said: They should have “some say…” That’s right. They aren’t the end-all, be-all. The car manufacturers don’t have all the answers. It’s not God’s word. If it were, the Gospel according to the car manufacturers would be shrouded in monopolistic tendencies. If the car manufacturers were God for the day, aftermarket and salvage parts would be banished to hell. That’s not just or realistic. The fact is that the industry needs to be very careful what it is asking for. I would challenge any of my diehard readers to search for sectioning or replacement procedures on an assortment of foreign and domestic vehicles. You will find that there aren’t procedures to repair every part on the vehicle. There are more gaps than there are in our current health care plan. Neither provides the desired end result. So if we use the car manufacturer as the standard, does it automatically mean that alternative repair procedures can’t be developed? If you say ‘yes,’ there’s no need for you to read

Free Monthly Newsletter at www.autobodynews.com 12 JANUARY 2012 AUTOBODY NEWS | www.autobodynews.com

any further. You should also stop repairing vehicles at your shop because you are repairing them incorrectly. If you don’t believe me, try printing out the car manufacturers’ repair procedures on every vehicle in your shop. I think you will quickly realize that you can’t repair the car because there isn’t a standard for everything. Thus there is a need for alternatives from respected entities in the industry. I’m ill-equipped to suggest the best organization or company to develop an alternative, but I can assure you that safe and cost effective repair procedures can be developed. NHTSA (the National Highway Traffic Safety Administration), Thatcham (in the UK) and I-CAR are names that are often cited as the best candidates. Regardless as to who or how they are developed, alternative repair

procedures should be as important to the industry as defining the car manufacturer as the standard. I would argue that it’s probably more important. If finding potential safe alternate repairs isn’t an option, the industry is beholden only to the car manufacturers and their desire to be a profitable entity responsible to their shareholders. The debate shouldn’t be whether or not the car manufacturer is the standard. It should be about which organizations are best equipped to develop viable safe alternative repair options. Alternatives that ultimately provide you more opportunities to repair a vehicle as opposed to having it towed from your lot, auctioned and shipped overseas. The Insider is a corporate-level executive with a Top 10 auto insurer in the U.S. Got a comment or question you’d like him to address in a future column? Email him at Auto.Insurance.Insider@gmail.com.

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ASRW Responds to Insider’s Comments in his Columns: ‘Can NACE Survive as a Traveling Regional Trade Show?’ and ‘Industry Undecided Which Organization Will Prevail’

In light of the excellent working relationship between ASRW and Autobody News, we wanted to comment on the ongoing ‘Insurance Insider’ column. We understand these are op-ed pieces and are written from the author’s point of view. However, the two articles we’ve seen—Can NACE Survive as a ‘Traveling Regional Trade Show? and Industry Undecided Which Organization Will Prevail in NACE vs. SEMA” each contain several inaccuracies. Our attempts to contact the ‘insider’ regarding these statements received standard automated replies. We wanted to bring the following inaccurate statements to your readers’ attention:

‘Can NACE Survive as a ‘Traveling Regional Trade Show’? October 20, 2011 (online); November 2011 (print) ● Article states: “Aside from the fact there weren’t a lot of people there, which made it easier to navigate the show floor, the smaller event meant my feet were intact after a few days of walking.” – Although the size of NACE has contracted in proportion to the size of the collision industry since the late-1990s, ASRW 2011 had an in-

crease in attendance of 18%. ● Article states: “They assembled a committee of industry experts that were supposed to help guide them to “NACE: The Next Generation.”—Although the ‘NACE: The Next Generation’ committee does not exist, we do solicit feedback from industry experts, attendees, exhibitors and prospective participants when making decisions that affect the future of ASRW. ● The article references a vote at the CIC meeting in early 2010 as the catalyst as to where the fall CIC meeting would take place.—Although votes occurred at this meeting, the relevant vote took place at the CIC Planning Meeting in January of 2011 and the results (holding the meeting in conjunction with NACE or SEMA) were separated by 1 vote.

‘Industry Undecided Which Organization Will Prevail in NACE vs. SEMA’ – November 23, 2011 (online); December 2011 (print) • Article states: “[NACE] staked their claim as the undisputed ‘Collision Industry Trade Show Champion’ after 2011.—While we have never made this particular claim, NACE re-

mains the only event dedicated to the professionals within the collision repair industry. ● Article states “SEMA is an upstart show.”—SEMA is not an upstart show. According to www.semashow.com, it is “the premier automotive specialty products trade event in the world,” and has been in existence since 1966. ● Article states: “NACE lost the sale, and Round 1 of the ‘Battle of the Century’ last year went to SEMA.” According to www.semashow.com, SEMA’s audience consists of approximately 60,000 automotive enthusiasts in the automotive, truck and SUV, powersports and RV markets. Unlike SEMA, NACE’s audience has been and remains the professional collision repairer. We consider Autobody News to be a great partner/supporter, and we appreciate the on-going coverage and support we consistently receive. We welcome the opportunity and are always available to provide the anyone – including the ‘insider’ with factual information regarding ASRW. Thank you, ASRW Show Management Hanley Wood Exhibitions

China to Levy New Tariffs on U.S. Vehicles

In the latest sign of trade tensions between the world’s two largest economies, China has announced it will impose anti-subsidy and antidumping duties on imported cars made in the United States. The duties, to affect the Detroit Three and some U.S. units of foreign automakers, will begin Dec. 15 and last two years, the Chinese Commerce Ministry has announced. Cars that have engine capacity at or above 2.5 liters will be hit with duties ranging from 2 percent to 21.5 percent. GM will face anti-dumping and countervailing duties ranging from 8.9 percent to 12.9 percent. Chrysler’s will range from 6.2 percent to 8.8 percent, while the U.S. units of BMW AG and MercedesBenz will face duties of 2 percent and 2.7 percent, respectively. The United States has filed 12 trade cases against China since it joined the WTO, and a total of five since U.S. President Barack Obama took office.

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www.autobodynews.com | JANUARY 2012 AUTOBODY NEWS 13

Continued from Cover

Where we stand

Detroit Three have now posted several quarters of consistently strong operating performance. Whether these improved earnings are short-lived will depend on a number of unknowns: ● As their output returns to normal, will Japanese companies reclaim their market share? ● Will the Detroit Three maintain their focus on new vehicle development and launches and continue to practice pricing discipline, which favors maximizing profits over volume or marketshare growth? ● How will rapid introductions to the U.S. market of highly competitive new models from automakers around the globe, combined with slow growth, play out? How will automakers differentiate their vehicles and earn the pricing and volume they need? What will they do to ensure that each program delivers an attractive return on invested capital? ● How will automakers serving the U.S. market protect themselves against the risk of disruption (such as the supply chain disruptions we have seen in Japan and Thailand) and will they do it at an affordable cost? Automakers [and repairers] will also face technological challenges. For example, advances in braking, parking assistance, propulsion, sensors, and other critical areas are bringing us closer and closer to the era of self-driving automobiles; indeed, Google has already logged well over 100,000 miles on its unmanned robotic vehicle. In urban areas, in particular, these innovations could improve traffic flow, provide revenues (through “smart tags” and traffic congestion pricing), and reduce accidents through vehicle-to-vehicle communication and coordination. Meanwhile, vehicle-based mobile communications technology continues to produce breakthroughs in voice-activated telephony, GPS, information, and entertainment. For example, GM customers can now use the automaker’s OnStar (driver communication) and RelayRides (vehicle location tracking) systems to rent their personal vehicles to others and charge fees based on usage. Both original equipment manufacturers (OEMs) and suppliers will have to anticipate which new technologies and add-on services will justify the cost of inno-

vation. Clearly, anything that consumers are willing to pay for, that increases safety or functionality, or that reduces cost has the potential to be successful. At the same time, OEMs must be careful to integrate new technology into vehicles effectively and only when it is well perfected, or risk adding features that are annoying or, worse yet, prone to breaking down, which could negatively affect consumer perceptions about the quality of the automaker’s products. A return to competition based on innovation is a refreshing change from the dismal situation the industry faced just two years ago. And while the Detroit Three focus on producing more exciting and attractive vehicles, they can take comfort in having addressed a perennially problematic issue through a new and mutually beneficial four-year labor agreement with the United Auto Workers. By being able to pay newly hired workers at rates comparable to those paid by Asian transplants in the U.S., GM, Ford, and Chrysler have taken another important step in narrowing the gap with their rivals on manufacturing costs. Suppliers are also relatively well positioned after several difficult years. Many suppliers were very profitable in 2011; they have emerged from the recession (and, in many cases, Chapter 11) with restructured balance sheets and lowered breakeven points. Moreover, supplier relationships with GM, Ford, and Chrysler have improved, according to the annual Planning Perspectives OEM-Supplier Working Relations Index. But there is more work to do: Chrysler and GM still score in the “very poor-poor” range. There are some dark clouds for suppliers, though. Raw material prices, already elevated, may continue to rise, and many suppliers are struggling to find the capital to ramp up production to meet increasing demand. Moreover, most suppliers must continue to deal with what has become an endemic issue: a talent shortage, as top-flight engineers willing to work in the auto industry are increasingly hard to find.

A Capabilities Strategy for OEMs Against this backdrop of an industry still in flux, this is the perfect moment for OEMs and suppliers alike to invest in developing the capabilities that allow them to achieve and sustain a leading position around the world. We

14 JANUARY 2012 AUTOBODY NEWS | www.autobodynews.com

define capabilities as the distinctive strengths a company has, or should develop, to set it apart from competitors. Each capability is built on a combination of processes, tools, knowledge, skills, human capital, and organization. Prepare for Black Swans There is a natural tendency following horrific events such as the Japanese tsunami to evaluate a full range of risks and prepare contingency plans. But most black swans are the result of a cascading series of events; it is the cumulative impact that makes them so catastrophic. It is not justifiable to build costly, fully redundant supply chains, when the chances of another complete meltdown disruption are fairly small. Companies would be better off by developing a risk preparation capability: Analyze the impact of potential disruptions and prioritize responses by magnitude and chance of exposure, expense, and ease of implementation. For example, manufacturing key electronic components in one location may yield attractive economies of scale but also significant risk. Options to mitigate the risk include splitting global volume across at

least two facilities in different regions, or maintaining centralized production with backup capacity, possibly with a different supplier that can be brought up quickly. Recent experience has proven that having transparency and visibility several layers deep in the supply chain-that is, controlling and managing activities and risk among a supplier’s suppliers and their suppliers-is very difficult and yet essential. Therefore, automakers must do their best to protect themselves with nimble, agile response mechanisms, systems, and processes. (For an in-depth examination of this topic, see “Are You Ready for a Black Swan?”)

Build an Adaptive Innovation Engine In mature markets such as the U.S. and Europe, success depends on bringing to market ever-evolving new vehicles that consumers enthusiastically want and would be proud to drive. But the best ways to do this are rarely clear. For example, powertrain technologies are evolving rapidly; most manufacturers are thus trying to manage balanced portfolios of internal combustion, hybrid, electric, and fuel cells until there is greater clarity

about the future. The challenge is exacerbated by fluctuating fuel prices and inconsistent government policies that make setting a long-term course and sticking to it extremely difficult and costly. Therefore, manufacturers need to develop distinctive practiceswhich might include open networks, frugal engineering, more intensive partnerships with suppliers, or other refinements-to out-innovate the competition at an affordable cost.

Operate in a Global Marketplace Emerging economies such as the BRIC nations (Brazil, Russia, India, and China) offer the potential for high growth and an opportunities to build strong positions in the biggest consumer markets of the future. By contrast, North America and Europe have high volumes but much more limited growth potential. Given this divide, OEMs need to tailor and customize their product portfolios to meet the disparate requirements of both mature and emerging markets, which have fundamentally different consumer needs and preferences, competitive dynamics, and economic returns. For example, manufacturing strategies for

emerging markets should evolve over time, with long-term investment horizons and factories producing less expensive, less profitable automobiles now but geared for assembling higherpriced, higher-return vehicles in the future.

Manage Inventory Well In a highly competitive market, it is more critical than ever for automakers to provide a mix of models and trims on dealer lots closely matching customer demand, although given the permutation of vehicles necessary to meet distinct customer needs, 100 percent inventory coverage is neither possible nor practical. Providing the right inventory means at a minimum continually improving distribution and sales forecasting capabilities to make sure inventory in each region is adequate, but not excessive, based on potential sales. More ambitiously, smart inventory strategies may involve transitioning to a more sophisticated mix of build-to-stock for popular combinations and build-toorder, with more rapid and certain delivery than today, for unusual combinations. This could generate

significant cost savings and better align vehicles with customer preferences.

Maintain Pricing Discipline Capacity issues have essentially been addressed in the U.S.; factory utilization rates are quite high for most OEMs in the NAFTA region. High-capacity utilization brings less pressure to offer discounts and incentives, and OEMs have taken excellent advantage of this situation to enjoy higher realized prices and profits. But as competition increases, automakers must maintain this rigorous and dispassionate approach to pricing and incentives, using advanced modeling to understand price-volume trade-offs and to estimate residual value effects of firsttransaction decisions. And they must be willing to prioritize medium- and long-term profitability over immediate market share. Focus on Customer Experience As vehicle and quality differences narrow, automakers are increasingly exploring ways to create differentiated experiences for customers throughout the vehicle life cycle. This is fertile

territory for revenue and earnings growth but requires a well-defined OEM capability. You must define the experience you want to provide, make it consistent with your brand heritage, and make every aspect of your product and service ecosystem more customer-centric-including in-store experience, warranty and ongoing maintenance and repair, and financial services options and execution. Over the past decade, there have been numerous attempts at this, often with high expectations; most have fallen short. We believe that in an era when consumers seek value, OEMs that can master and execute this capability best will gain a major competitive advantage.

Primary Capabilities for Suppliers Drive Innovation One excellent way for suppliers to capture value is to offer OEMs something that others don’t and can’t. Indeed, when suppliers create end-user pull around their intellectual property, they can build market share and earn high profits. For example, one company has held a very large share of the See Where we stand, Page 38

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Domestic Parts Deduction

claim # 0088707650101145-01. As you are aware of, we do not offer any parts discount to Geico or any other insurance company which we do not have a direct repair agreement with. I spoke with our customer, your insured and asked them if there is anything in their policy that states that they are responsible for anything other than their deductible or any applicable betterments. As per Mrs. Wrubel, she is unaware of anything in her policy that states that she will be responsible for anything other than her deductible or applicable betterments. She stated that there [was] nothing stated about being responsible for 10% of the OEM part costs. Can you forward either her or me the part of her policy that states that the insured will have to pay 10% of the OEM part costs? If you cannot provide that, we would appreciate that you complete a supplement removing the 10% deduction. I hope that you will respond promptly to this email so that we can get this matter settled as quick as possible so that we can better serve our mutual customer. The following day Quintela copied the previous email to Maloney’s supervisor prefacing with the following text: Good morning Mr. Nicely, My name is Eddie Quintela. I operate a collision repair facility in Delray Beach, FL. I am writing to you to see if I can obtain some assistance with an issue that we continue to have here in Palm Beach county, FL. I am forwarding you an email that I sent to your local claims supervisor Mr. Dan Maloney. Your company continues to take a deduction of 10% off of any domestic OEM part on all your estimates. This leaves your insured’s to pay an additional out of pocket expense besides their deductible and/or any applicable betterments as described in your policies. I have yet to see where this additional deduction is spelled out or listed in your automobile policy. What is even more troubling is that it is also applied to claimants estimates where a Geico insured is at fault, thus placing an expense on a claimant that had no fault at all. Mr. Maloney did call me this morning to inform me that Geico ‘s position will not change and that they will have their insured pay the additional monies. As I asked Mr. Maloney in my email, can you please show your insured or me where it is written in your policy that they will be

held responsible for this? I believe that Geico wants to treat every customer the same in every aspect, but how can an insured in Palm beach county not be made whole after a loss but an insured in Polk county, FL, can? How can an insured that drives a foreign made vehicle not be deducted 10% for OEM parts, but one that drives a vehicle made in the United States be made to pay 10% of their parts? My customers that own and insure American vehicles are infuriated when I have to explain that they owe additional monies on top of their deductible because they drive a domestic vehicle. Mr. Nicely, I have already taken one of these claims to court and was awarded a judgment for the 10% and attorney fees. Your company has asked for a stay on the judgment and we are scheduled for another hearing on January 9, 2012. The 10% that we are suing for in that claim was a mere fraction of the attorney fees that we incurred and ordered to be paid by your company. I cannot see how that makes a sound business decision by your local management. It not only shows poor customer service on your company’s part towards their own insureds, but it deteriorates relationships between your company and the hundreds of collision repair facilities here in south Florida. If you can look into this matter and advise me if there is anything you can do, both your insured and I would greatly appreciate it. I would like to avoid any costly legal proceedings if at all possible. I would like to thank you for your time and I look forward to hearing from you.

Quintela then received a phone call from Dan Maloney, the local claims supervisor, who told Quintela that the domestic OEM parts discount was customary in the market, a surprise to Quintela, who called several local shops and dealers, then emailed back seeking written confirmation: Good morning [Dan Maloney], Thank you for your call yesterday. As per our conversation; you told me that your position on the 10% domestic OEM parts discount will not change and that it is customary in our market. I must say that I was taken aback by that statement. Besides Geico, there are no other insurance companies (that I am not a DRP for) that take this so called customary 10% discount. Since you told me that most shops and dealers accept this, I decided to make some phone calls to other shops and dealers and ask them if they offer this

16 JANUARY 2012 AUTOBODY NEWS | www.autobodynews.com

10% discount or if Geico just “takes” this discount. As I thought, everyone that I spoke with told me that Geico just takes the 10% discount. I spoke with 2 shops in particular that stated that they must always charge your insured the 10%. Since you made the statement that this is customary in the market, I have begun to wonder, when was the last time that Geico surveyed the “market”? I have yet to ever fill out or participate in a Geico survey. I also asked every shop owner and manager that I know if they ever filled out a Geico survey and I was astounded to find out that no one has ever been surveyed. If you never surveyed a shop in the “market,” how can you make such a statement? If I spoke to over two dozen shop owners and managers and none offer this 10% discount, how is it “customary” in our market? Mr. Maloney, I am willing to team up with Geico and do a survey of the south Florida market. Let the market speak for itself and let’s finally put this issue to rest. If you are confident that your position is correct and customary, let’s conduct a true survey and find out. Let the facts speak for

themselves and we will have the correct data to determine what is fair and reasonable in our market.

Quintela then followed up with a copy of this email to Supervisor Nicely asking for written confirmation of the policy and repeating his offer to help GEICO with its survey of the market: Good morning Mr. Nicely, I emailed you last week regarding an issue that I am having with your company. I have yet to receive a response in writing from either you or your local claim supervisor, Dan Maloney. I do not believe that this is typical of you or your employees, but a response in a timely matter would have been appreciated. Mr. Nicely, I also copied you on an email that I sent to Mr. Dan Maloney regarding Geico ‘s survey practice and idea of the local market area. If you or your company disagree with my findings or have information to illustrate that my findings are not accurate, than please respond in writing as to any inaccuracies or differences of which Geico may have within five, (5) business days. Should I receive no written response within this reasonable time frame than it will be agreed that the aforementioned facts

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are true and accurate as reflected herein. I look forward to hearing from you. I hope that we can work this matter out without any further complications. I thank you for your time.

handed to me by Mr. Ladato & Mr. Dan Maloney yesterday, 12-14-11. I would have preferred if you had contacted me directly, or had someone other than a local manager respond to me since they are the root cause of my concerns. I would like to know if you have read and approved of your company’s response to my concerns? Mr. Nicely, your Auto damage manager, Tony Lodato has incorrectly addressed the appraisal clause as a possible solution to my concerns. The appraisal clause would come into play if we did not agree upon the method of repairs, labor times, or if we had a disagreement over repair or replacement of a part or parts. We have no such disagreements. We are on the same page as far as these items go. What the concern is over, is the fact that Geico takes a 10% discount off of domestic OEM parts that we both agree need to be replaced. I still find it difficult to understand how Geico can take a discount on something that we do not offer. An insurance company, I understand, is to fully and properly indemnify an insured for their entire loss (less their deductible if applicable); but deducting 10% off of parts is not indemnifying your insured fully or properly, but

GEICO responded with a hand delivered letter dated Dec. 13 saying: Dear Mr. Quintela, The e-mails that you sent to Mr. Nicely have been forwarded to our attention. Our experience is that we reach an accepted price on the vast majority of claims in your area. We rely on our experienced staff to let us know when accepted prices cannot be reached and it occurs very infrequently. When we are unable to reach an agreed price, we have been able to resolve those matters through the appraisal clause of the policy. Tony Lodato Auto Damage Manager [Geico] Quintela gave his last response, as of this writing, via email: Mr. Nicely, Thank you for forwarding my emails to your local auto damage manager, Mr. Tony Lodato. Please see the attached written response that was

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is a breach of the policy contract and an act of bad faith. I am still baffled by the logic which your local management conducts itself by. How can an insurance company take a 10% domestic parts discount when it is never mentioned in the policy? What is worse is when you fail to protect your own insured as stated in the policy when they are the tortfeasor [wrongdoer]. How can Geico justify having a claimant pay 10% of their parts when they were a victim of your policy holders’ negligence? That would cause a claimant to pursue legal action against your policy holder, and therefore causing another breach of contract on Geico‘s behalf. I believe that your local management has been breaching the policy contract and acting in bad faith in regards to this issue. I know that I have spoken to well over two dozen collision repair facilities and all seem to agree that this is taking place in on a wide scale throughout the south Florida area. I have offered to work with your company to do a survey of the market and determine what the true fair and reasonable labor rate and charges are. As I have stated in my past

emails, I have yet to find a collision shop that is not a direct repair shop that offers this discount to Geico, they have all stated that Geico just takes it. I am respectfully asking for your intervention in this matter so that we can avoid any further complications. I would like nothing more than to arrange a meeting with you, your local management, and a group of my peers to sit and discuss this issue. I would like to be able to serve our mutual customers in the future without having to expose them to these unnecessary difficulties. We both know how hard it is to keep and retain customers, I can’t imagine a Geico customer would want to renew their policy after having to pay 10% of their parts costs on top of their deductibles; especially when it is not written in their policy contract. That also brings up the fact that I have yet to be shown where in Geico ‘s policy it states that the insured would be responsible for 10% of their parts cost if they drive and insure an American vehicle. I have a copy of your policy and have not been able to find this in it. Please feel free to contact me at anytime to discuss this further. I do hope that we will be speaking in the very near future.

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Continued from Cover

Might Have Missed

Specialists (SCRS) last spring released its findings into whether the paint manufacturers consider tinting and blending as necessary procedures that are commonly performed in conjunction with each other. “Research of the color code and existing variations provided by the refinish manufacturer, and blending of the color coat are both recommended operations to perform an acceptable match,” SCRS said in a summary of its findings. “If the refinish technician determines that the color variance requires adjustment, it is a consistent recommendation to tint to a blendable match. When tinting is necessary for color adjustment, it is always done in conjunction with blending.” SCRS has posted individual responses from each of the five major paint companies in the “Technical Info” section of its website (www.scrs.com).

► 3 J.D. Power and Associates data released last year—based on surveys of more than 11,500 insured drivers who had a claim within the previous 12 months—shows how important to customer satisfaction it is to get repairs done quickly and on time. Satisfaction levels for the 75 percent of customers who felt their vehicle was done on time were nearly 200 points higher (883 vs. 709, on a 1,000point scale) than those who felt their vehicle wasn’t done on time. It doesn’t appear to matter what causes the delay: parts, unexpected additional damage, insurer delays or just plain too much work in the shop. In all these cases, customer satisfaction still never exceeded 728 points. Setting expectations is particularly important on larger, non-drivable jobs, Jeremy Bowler of J.D. Power and Associates said. Fair or not, customers expect a drivable vehicle to be repaired within a week, and non-drivable vehicles—even the worst “train wrecks”—within two weeks. An extra effort needs to be made to adjust these expectations if they can’t be met, Bowler suggests. Speed still offers a shop a chance to set itself apart, according to the data. One-in-four customers with drivable vehicles say they didn’t get them back within a week, and onethird of those with non-drivable vehi-

cles didn’t get them back within two weeks. ► 4 Industry trainer Toby Chess last year was alerting shops to the need to recalibrate the steering angle sensor that is part of the electronic stability control system on an increasing number of new vehicles. Such systems are standard equipment on 85 percent of 2010 new vehicles, and will be Toby Chess required on all new remains concerned vehicles as of about steering model year 2012. recalibration The recalibration is an additional procedure that must be done after the vehicle alignment. “It’s an added step, and there’s also no more 2-wheel alignments with these systems. That won’t work,” Chess said. He said he is concerned because even though no “trouble light” will be lit on the dash and the vehicle may handle properly under normal driving conditions even if the system is not calibrated, the electronic stability control function may not work properly in a subsequent “emergency maneuver.”

► 5 The Automotive Education & Policy Institute, which last year received a grant from the Alliance of Automotive Service Providers to build a web-based repository of legal decisions finding in favor of collision repairers, has been posting court Erica Eversman documents to the describes the “legal cases” secautoepi.org website tion of its website (www.autoepi.org). The Institute was founded by Ohio attorney Erica Eversman, who said that the website will give shops and their attorneys easy “access to court precedent and the facts and admissions leading to... decisions that can be used to persuade other courts, customers and insurers that the repairers’ charges are reasonable and necessary for a safe and proper repair.” ► 6 Both Audatex and CCC Information Services last year began offering an automated labor time system for the additional labor needed when replacement bumpers arrive “raw” or unprimed from the factory.

18 JANUARY 2012 AUTOBODY NEWS | www.autobodynews.com

In the Audatex system, the “prep raw, unprimed bumper cover” labor operation is not automatically added to an estimate but must be selected by the user. A line for the operation will show in the “part edit box” when a bumper Audatex knows to be supplied raw from the manufacturer is selected. Although the labor time is prepopulated at 20 percent of the base refinish time for the part (or .3 minimum), the user can override this value. Jack Rozint of CCC said that that based on labor studies completed by Motor Information Systems, the pre-populated labor time for the operation in his company’s estiJack Rozint mating system is addresses the 25 percent of the unprimed bumper full refinish time labor issue for the part (with a minimum of .1 and a maximum of 1.0). The feature is available through the “additional operations” menu both when the bumper is known to

arrive unprimed and when the condition of the new bumper is uncertain (when it may arrive unprimed); it will not be seen only when the bumper is known by Motor to always arrive primed. If the automaker has informed Motor the bumper may or will arrive unprimed, footnotes in the CCC system will alert the estimator to this, and a headnote (“Add if Required”) will appear to allow the user to add the “prep unprimed bumper” operation if indeed the part is unprimed. Both Audatex and CCC said the stumbling block in extending the labor operation option to other types of parts that also may arrive unprimed is that information about the parts isn’t provided to them from the automakers. ► 7 With all the apparent bad news about the nation’s economy, one story many have missed is the relatively good news coming out of the automotive industry. Some economists in recent months, for example, were saying it may be the auto industry that “bails See Might Have Missed, Page 26

Houston City Council Set to Vote on Auto Repair Ordinance, Draft Not Favorable to Shops The city of Houston is moving to enact an ordinance to regulate the automotive repair and service industry that would regulate every type of business that touches a car, whether it’s a body shop, an independent auto repair shop, a dealership or a big store like Wal-Mart. The mayor has set the vote for Wednesday, Dec. 21, the last City Council meeting of the year, and after this issue goes to press. “While this ordinance has good intentions, it paints the entire industry with one stroke. The proposed ordinance stems from an effort to eliminate a problem that comes from a small percentage of unscrupulous collision-repair shops, which is one segment of the automotive repair trade. This attempt at a solution will wrap an already difficult business in more red tape,” says Kathryn van der Pol, Past President of ASA, Houston Chapter, and co-owner of Adolf Hoepfl & Son Garage, which has been in business since 1946. Writing in the Houston Chronicle, Van der Pol says there are some

good features for the consumer in this ordinance: “The ordinance will require all autorepair facilities to post their license number on their advertising and invoices so that the consumer will know which companies are city-licensed repair facilities. “It will also require auto-repair facilities to carry a minimum amount of liability insurance. Currently, there is no local or state law that requires a repair shop to have insurance. In an uninsured shop, Kathryn van der Pol car owners are liable for anything the garage owner does with their car. Good shops already purchase insurance, but virtually all shops that lack integrity will also lack insurance. “Giving approval over the phone for any collision work will be illegal and limits will be placed on certain fees charged by collision shops. There is a good reason for this. Repairs re-

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sulting from accidents usually cost thousands of dollars. While we are hesitant to say that the city should set pricing for any private business transaction, we agree every approval for collision repair should be in writing. The ordinance includes pages and pages that regulate how records will be kept, how repair shops may gain approvals from customers and establishes fines for sometimes honest mistakes that must be paid to the city. If this new law takes effect, phone approvals for mechanical work will be allowed only if the customer provides a third signature permitting an estimate either to be given orally, in person, or over the phone. Records of that approval have to be maintained for two years. Automotive professionals are concerned about this for a few reasons. “Our main concern,” continues van der Pol, “is that if your car is towed in to a mechanical shop, the facility can’t even look at the car until the owner comes in or faxes or emails a signature. If you are a business owner with a fleet account, you will have to email, fax or come to the shop to give approval of authorization or to sign a waiver. This will slow down the repair process and be an inconvenience for everyone involved. “Mechanical work is entirely different from collision. It differs in that it’s quick, less costly and customers depend on our efficiency so they can get their autos back. The city’s proposal will slow down this repair process. If it sounds complicated, it will be even worse when customers are confronted with the legalese. If they refuse to sign the waiver authorizing estimates by phone, the customer will have to return to the shop, find a fax machine or send an email. “While the Automotive Service Association (ASA) fully supports efforts to root out bad players in our industry, we believe this ordinance overregulates and will be a burden to our customers who don’t own fax machines, have access to email or have a second car to come back to the shop for a signature. This is going to affect senior citizens, the disabled, those with lower incomes, and those who depend on one vehicle the most. “Another provision is that no authorizations are required for repairs

under $100. As long as your bill is $99.99, the repair shop does not need your permission to make repairs or perform maintenance on your vehicle. Our concern is that if you are dropping off your car for an oil change and the technician calls because he determines your coolant needs to be flushed, the work will exceed $100. Then you will have a delay in repair if you did not sign the waiver - even though we still have the two signatures required by the state. This provision seems unnecessary and could lead to confusion and abuse. “If a shop neglects to put the license plate number, vehicle identification number, or mileage on a work order, or records it inaccurately, it could result in a criminal misdemeanor charge with a $200 to $500 fine. “Why do the mayor and some members of City Council feel this ordinance is needed? “The ASA was told it was necessary because there were some bad body shops taking advantage of insurance companies, resulting in a rise of insurance premiums. “ASA requested information through an open records request about the complaints so that as an industry, we could better understand what problems the city is trying to address. The complaints did indeed support that there are some bad players in the collision repair industry who are charging excessive disassembly fees, administrative fees and are holding cars hostage. We were given 257 complaints filed over a three-year period with the Houston Auto Dealers, a division of the Houston Police Department that enforces automotive repair facility licenses. Of those, 61 complaints concerned excessive fees from collision shops—none from mechanical. It is a problem, but, “it’s like killing flies with a cannon instead of a flyswatter,” as Councilmember Jolanda Jones said. “Last, there is the concern about increased costs of implementation that will be passed on to consumers. All our paperwork will have to change to comply. Not to mention all our fees and permits were increased this year. For example, in 2011 a Houston automotive repair facility license increased 147 percent, from $200 to $495. See Houston Ordinance, Page 32

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BMW Working on Lazer Beam Headlights, Energy Efficient

FLORIDA • GEORGIA • ALABAMA • MISSISSIPPI

Honda Recalling 300,000 Vehicles for Airbag Flaws

BMW engineers say their laser headlights have big advantages over LEDs, or light-emitting diodes, and they are working to commercialize the lights. Laser headlights use less than half the energy of LEDs, and their light intensity is a thousand times greater, BMW says. Moreover, a laser diode is one-hundredth the size of an LED diode, which allows designers to shrink the headlight. “We see a lot of advantages,” says Hanafi Abdul, BMW's optical systems designer. “We can reduce power consumption and weight, and it provides our stylists more freedom to produce beautiful shapes.” In each headlamp, three small diodes generate blue laser beams only 10 microns wide. Those beams are aimed at small mirrors, which reflect them onto a lens. Inside the lens is yellow phosphorus, which emits an intense white light when activated by the lasers. That light is bounced off a reflector onto the road ahead.

Honda Motor Co. is recalling 304,000 vehicles globally for airbags that may inflate with too much pressure in a crash, send metal and plastic pieces flying and cause injuries or deaths. There have been 20 accidents so far related to this problem, including two deaths in the U.S. in 2009. The Japanese automaker said the recall affects the Accord, Civic, Odyssey, Pilot, CR-V and other models, manufactured in 2001 and 2002. The recall spans 273,000 vehicles in the U.S. The latest recall is an expansion of recalls for the same problem in 2008, and again carried out in 2009, as well as last year. The recall now covers about 2 million vehicles worldwide. Honda spokesman Hajime Kaneko said the cause for the latest recall was the use of incorrect material in the chemical used to deploy air bags.The initial cause of the recall was excessive moisture in the inflator propellant, which inflates the air bag.

General Motors is teaming up with a major carbon-fiber supplier to develop new types of the strong, lightweight composite for future GM vehicles, including potentially high-volume models sold globally. GM is partnering with Teijin Ltd. of Japan, which has developed a technology that it says dramatically reduces the time it takes to process carbon-fiber material. The faster cycle time could open the door to the use of carbon fiber in high-volume vehicles, GM says. Carbon fiber is considerably stronger and lighter than steel and aluminum, but it’s more expensive, mostly because of a long, labor-intensive production process. As a result, the composite is only used for select parts in low-volume vehicles, such as the fenders on the Chevrolet Corvette Z06.

“Our relationship with Teijin provides the opportunity to revolutionize the way carbon fiber is used in the automotive industry,” GM Vice Chairman Steve Girsky said in a statement. “This technology holds the potential to be an industry game changer and demonstrates GM’s longstanding commitment to innovation.” GM says Teijin’s technology has the potential to mass produce carbonfiber composites using thermoplastic material that can be molded in less than one minute, vs. mold times of 10 minutes or more for traditional carbon fiber, which is made using a material called thermoset. “It’s easier to handle and quicker to mold,” Jim Hentschel, GM’s executive director for body and exterior, said in an interview. “That’s what allows us to be able to introduce this technology into more mainstream, high-volume vehicles.”

Auto Groups Fight Recall Fees Hike in front of Congress

Automakers, car dealers, rental car companies and the U.S. Chamber of Commerce are opposing an increase in fines for delaying vehicle recalls to as high as $250 million. The Senate Commerce Committee will consider a long-delayed bill to toughen auto safety laws. The bill, aimed at reforming the National Highway Traffic Safety Administration, would hike maximum fines for manufacturers that delay recalls to $250 million from the current $17.35 million. Proponents have pushed for more than a year to strengthen auto safety measures in the wake of sudden acceleration concerns in Toyota Motor Corp. vehicles. The bill by Sens. Mark Pryor, D-Ark., and Jay Rockefeller, D-W.Va. would not take effect until at least one year after passage. A coalition of groups told Congress late it opposes hiking the fines. The alliance includes General Motors Co., Ford Motor Co., Chrysler Group LLC, Toyota and eight others.

January 2012

Nissan’s LEAF to be Sold in More U.S. Markets

On Nissan LEAF’s one-year anniversary, the Japanese automaker announced that it will be expanding the availability of the all-electric car into new U.S. markets. Nissan has re-opened reservations and has begun taking orders from the general public for the 2012 Nissan LEAF in Delaware, Indiana, Louisiana, Nevada, Ohio, Pennsylvania, and Rhode Island. For the 2012 model year the LEAF gets additional standard equipment including quick charging and cold-weather features. “Nissan LEAFs have been on the U.S. roads for one year now, and thousands of drivers have become living proof that a 100-percent electric, zero-emissions vehicle fulfills the daily needs of drivers from all walks of life,” said Brian Carolin, senior vice president, Sales and Marketing, NNA. “We are seeing already-strong interest in the LEAF continue to grow.”

GM Partners with Japanese Carbon Fiber Supplier to Improve Composites

22 JANUARY 2012 AUTOBODY NEWS | www.autobodynews.com

Hentschel said the pact will allow Teijin to advance development of the technology while working with GM on integrating the material into vehicles. He wouldn’t predict when it might be used in GM vehicles. The companies didn’t disclose financial details of the deal but said it does not involve an exchange of equity. Teijin will open a technical center in the northern United States to do its work with GM, the companies said, but they didn’t specify a location. Automakers are seeking to cut vehicle weight as a way to improve fuel economy as they face increasingly stringent emissions and fueleconomy standards. GM is expected to expand the use of carbon fiber in the next-generation Chevrolet Corvette, which is expected to debut for the 2014 model year.

BMW AG has said it plans to begin high-volume production of carbon-fiber parts by 2013, which likely would make it the first automaker to expand use of the material beyond low-volume models. Its i3 electric car, which debuts in 2013, will have a carbon-fiber shell. Partly as a consequence of emissions reduction targets, mass-market automakers need to produce lighter cars. For the next few years, automakers such as Peugeot, Fiat, Volkswagen and Daimler expect weight reductions to come largely from using aluminium. But composites are 30 percent lighter than aluminium and 50 percent lighter than steel. If car makers can get the price down—composites currently cost at least 10 times as much as aluminium and 30 times as much as steel, according to Volkswagen—they hope to be able to use them in the mass-market.

Gonzo’s Toolbox

This is a new story by Scott “Gonzo” Weaver as posted on his website, www.gonzostoolbox.com. Gonzo has been serving the Tulsa area at Superior Auto Electric for over 27 years. See his book “Hey Look! I Found The Loose Nut”, which provides a Good Laugh for Mechanics of Any Age. The book is available at amazon.com. Contact Gonzo at Gonzosae@aol.com.

A Picture Worth a Thousand Words Most of Which We Can’t Print with Gonzo Weaver

Years ago my younger brother came tle details that are harder to teach, because you tend to forget to mention to work for me. He didn’t know a thing about cars, but was willing to them while you’re teaching—mainly because you are trying to get to the learn all that he with could. Teaching Richardnew Arnold solution as efficiently as possible, and technicians is an art that most shop owners have to learn to do, but teachyou neglect to bring it up. Such as: ing your little brother can be a chore “always test your test light connection before testing what you’re testing, or and can test your patience. don’t forget to check for all your tools I muddled through it all and before you pull the car out of the taught him what I could. I was sure at shop.” Things like that. some point in with time the of us Edtwo Attanasio One day we had a truck come in would butt heads like brothers will with dual fuel tanks on it. The gas do, and he would take his new found gauge wasn’t working and needed skills and move up in the rank and files of the automotive technical some attention. This was a perfect opworld, but in the meantime it was his portunity for Junior to learn a few of my short cuts on these old models. It turn to learn from his older brother. with Erica Schroeder was an older Ford, in which the tank When he first started I would gauge ran through the tank switchover walk him through each step of how to diagnose a certain system in a car. A button. It was rather easy to pull it out of the dash and connect to the gauge lot of times he would have questions, and I’d do my best to answer them. from the back of the switch. Luckily it was the typical probHe learned quickly and was really lem I’ve seen a hundred times in the sharp at picking up some of those lit-

Jobber Journal

past. The switch connections would melt and the tank wouldn’t switch from the front tank to the rear, and of course the gauge wouldn’t move either. After locating the correct leads to the gauge and to the tanks I decided to show him how the gauge worked. I hooked up the one of the tanks to the crossover lead that would supply the signal from the tank to the gauge. “Ya see this, that’s the lead to the fuel gauge in the dash, and this is one of the tank wires. I’ll connect these together and we should get a reading on the dash,” I told him. He was watching intently, taking in all the wiring diagram information, the location of the wires, and how I was bypassing the switch. He was fascinated with the flow of the current and the way the gauge would respond. I even went as far as moving the gauge from full to empty by open-

Shop and Product Showcase Shop Showcase Shop Snapshot with Erica Schroeder

ing and closing it to a ground signal. While I had his attention I filled him in on the two types of gauges that were used back then (bimetallic and magnetic) and how low resistance on a bimetal type gauge would read near a full tank, while a magnetic gauge would read close to empty. Change the resistance and the gauge would/should read accordingly. “So, if we put gas in the tank the gauge should move right? That way we could check the sending units in the tanks too,” he asked me. “Great idea, grab a gas can and let’s add a few gallons,” I said, excited that he was so interested in the project. He grabbed a can of gas and poured a few gallons in the tank. I was watching the gas guage carefully, but there was no movement. I knew I was on the right wires, but nothing See Picture It, Page 24

Consumer Callout with Ed Attanasio

Custom Corner with Ed Attanasio

Company Connections with Chasidy Rae Sisk

Shop Strategies for Savings with Walter Danalevich

Inside Insurance with The Insurance Insider

www.autobodynews.com | JANUARY 2012 AUTOBODY NEWS 23

Continued from Page 23

Picture It

was happening. Now what? Are there more problems? “Crawl under there, and check to be sure the wire color is correct,” I yelled from the cab to him. “Yep, it’s the right wire on the tank.” “Well, we might have to pull the tank; it’s not changing the gauge readings up here.” “Before we do that let’s add some more gas, maybe we didn’t add enough,” Junior tells me. I thought I better go back and help hold the funnel, while he poured the gas in the tank. Unknowing to me, all

this time my wife (who was the office manager) was listening in on the whole thing. She likes to keep tabs on me, and make sure I’m not going into one of my usual rants or having a fit because I had to explain something over and over again to little brother. This time she was standing at the corner of the shop just behind the truck with a camera. “CLICK”, I heard the camera shutter go off and she was back there laughing like there was no tomorrow. “What’s so funny?” I asked her. “You two idiots have been putting gas in the wrong tank. You’re on the front tank, and you’re putting gas in the rear tank,” my wife answered, laughing hysterically. About then the camera “clicked” again, this time it was an action shot

24 JANUARY 2012 AUTOBODY NEWS | www.autobodynews.com

taken at precisely the exact moment when these two idiots had that dumb struck look on their faces and realized what they just did. The shot had both of us on our knees, one holding a funnel and the other with the half empty gas can, and both of us staring right into the camera lens. Couldn’t have set it up any better if you tried. The picture clearly showed the side of the truck with both fuel tank doors visible and there was no doubt which tank we were putting in the extra gas. I guess it was one of those things I should have mentioned when we were checking the tank senders, make sure we are both on the same tank. For years that picture hung over her desk, and anytime I thought I was

so smart she would point at the photo. Usually with that typical smirk, usually shaking her finger at me and of course the laugh, she had to laugh, but it wasn’t all that funny until she had me laughing about it too. Ok, Ok, I’m not perfect... and now my little brother knows it too. These days he’s a top notch tech at a dealership, and I have to call him on occasions for some help on how to solve things once in a while. Oh the photo…uhmmm… what photo?? Somehow it’s missing… haven’t seen the darn thing in years. But I guess I really don’t need to see the photo, the wife has a pretty good memory, she reminds me just how smart I think I am every chance she gets.

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On Creative Marketing

An Effective Marketing Focus with Thomas Franklin

I recently noticed a shop that had sev- trum: intense concentration vs. a wide, eral excellent repeat business sources less effective, general approach. lose one of them—a major dealership There may be no “right answer” to —to a competitor. When I inquired the question: “How much or how little about how this could happen, I learned should I concentrate marketing attenthat the shop’s owner and manager tion?” But I believe the shop that lost were busy focusing their full attention the dealership needed to accurately ason saving one of their insurance sess how many balls they could juggle DRPs. During this time, they some- at once. I’ve seen novice shops that Dick Strom worked hard to get a DRP or a dealerwhat neglected with that major dealership source. This gave the competitor an ship relationship and then lose it beopening to jump in and grab that busi- cause they didn’t realize that getting ness. I’m sure that in retrospect, this that relationship was just the beginning. shop owner realized he should have After that, keeping the relationassigned someone—or hired someone ship depends on giving it adequate at—to maintain giving that dealership tention. Attention is one of the most all of the attention they were accus- prized commodities in existence. tomed to receiving. Many students fail classes in school Is it possible to have too many because they can’t keep their attention irons in the fire? Is a shop better off on the teacher or the subject matter. just concentrating on a limited num- Marital relationships often fail bewith Amaradio Jr. one of the spouses is so inber of sources so eachLee can be given cause abundant attention? volved in business or other aspects of Let me illustrate with a metaphor. life, he or she fails to give adequate atOne of the exciting technologies of tention to the spouse or the children. “the space age” is the development of All business—and human—relationlasers (L-ight A-mplified by S-timu- ships call for an enormous amount of lated E-mission of R-adiation). A attention. beam of light is concentrated to such a Many aspects of life fall apart befine point it can cut through metal. cause of inadequate attention. Plants Think about for the intensity of con- die without water or fertilizer. A stock centrated attention needed to hold in a retirement portfolio drops because onto a major referral source. the owner failed to keep track of the On the opposite end of the light value and didn’t sell in time to gain a with Sheila Loftus concentration spectrum is the flash- profit or prevent a loss. A physical light. It casts a broad beam that en- condition that might have been treated compasses a wide area ahead of the and cured early on becomes life light, but the intensity of the light is threatening because no attention was fairly weak. It’s just strong enough for paid to the early warning signs. The the human eye to get a general view list can go on and on. of the area ahead. Marketing concenThe opposite of receiving attentration can fall across a similar spection is being ignored. Everyone likes

Opinions Count

Action Counts

Your Turn

ders for autos and auto parts, a number of recent government reports have shown the auto industry was the strongest segment of the manufacturwith Janet Chaney out” the nation from slipping back ing economy in July. into a recession. Ford, GM and Chrysler have John Yoswick is a freelance added 90,000 manufacturing jobs, a writer based in Portland, Oregon, who 14 percent increase, from the low two has been writing about the automotive years ago. Nissan, Volkswagen and industry since 1988, is also the editor other foreign-based automakers are of the weekly CRASH Network (for a expanding in the U.S., and dealers are free 4-week trial subscription, visit making more per-sale than they have www.CrashNetwork.com). He can be in years. The Commerce Department contacted by email at: has reported significant gains in orjyoswick@SpiritOne.com.

Tom Franklin has been a sales and marketing consultant for fifty years. He has written numerous books and provides marketing solutions and services for many businesses. He can be reached at (323) 871-6862 or at tbfranklin@aol.com. See Tom’s columns at www.autobodynews.com under Columnists > Franklin

attention. We seek out the restaurant where the waiters or waitresses know us by name and give us that special attention. We prefer the dry cleaner and the barber and other service people who favor us with their attention. In marketing, attention is the most valuable thing there is. Ignoring a shop’s repeat business source is a guaranteed way to lose it. So how can a shop owner or manager be certain a referral relationship is getting enough attention? It can often come down to: “How many man-hours can be devoted to the source?” I found out that in the early stages of losing that shop’s dealership relationship, an estimator was assigned to be on the dealership’s service drive every morning to write brief estimates on any damage observed on vehicles coming in for service. But when that estimator’s time at the dealership was reduced or eliminated altogether some days, the rela-

tionship began falling apart. Fortunately for the shop owner, the attention he took away from the dealership was turned to hosting manager meetings for a major insurance company, plus promoting a drive-in relationship with another. So he didn’t lose much business. But he also could have saved the dealership by somehow keeping a laser-like attention focus there as well. The biggest, most affluent shops never limit the number of referral sources they can obtain. They have the resources to assign one dedicated person (or more) to each source to be certain that source receives meticulous attention to repair requirements, estimate details, reports and more. But I believe a smaller shop without that kind of resources would be wiser to try for fewer sources and be certain each source they did have receives the ultimate in constant attention.

Nalley BMW

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Continued from Page 18

Shop Showcase Might Have Missed

Industry Overview with Janet Chaney

26 JANUARY 2012 AUTOBODY NEWS | www.autobodynews.com

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Parts Profiles

Larry Williams is an innovative parts manager with national awards and over 30 years of experience in creating and managing profitable departments. He can be reached for consultation at ljoew2@gmail.com. To read all his columns go to http://www.autobodynews.com/columnists/williams-larry.html

Stockton Honda in Sandy, Utah, Cultivates Long Term Relationships This month I want to single out Stock- short sighted opportunists, who al- viding the best service possible to the will miss the daily contact with her ton 12 Honda,Automaker in Sandy, Utah. Owned ways rely on the nextand customer,Announcements will real customer, the car owner. team and her friends. She leaves Marc Actions with Larry Williams

by former basketball star John Stock- almost always fail. The past five years withis Jeremy ton, this dealership located justHayhurst a have shown the truth of this opinion. short drive south of Salt Lake City. Dealers who were out for the “quick Their web site is stockton12honda.com. buck” have vanished from the scene, Since 1998 this dealer has servleaving only the best to continue in iced its customers with pride, and a business. dedication to quality. Quality in all Her secrets of success are simple: with Jeremy Hayhurst ways, which is best demonstrated by Don’t let your customer wait for a its parts department, led by “Peg” Elneeded part; freight is not an issue; corlenberger. rect your mistakes immediately; value Peg started her automotive career your customer’s business; and always in 1985, moving to Stockton 12 put yourself into your customer’s Honda in 2001. She brought a follow- shoes; always maintain a positive attiing of loyal customers with her, custude, and don’t let the “problems” get tomers who knew she cared about you down; create long-term relationthem. This dedication to quality serv- ships; work smoothly together to repair ice has led to continuous growth, and cars as quickly as possible; work as her customers now supply over half of friends, not strangers; and make somethe parts department’s business. one else smile! Peg and I share the same opinion, Her teammates at Stockton 12 dealers who cultivate long term relaHonda share these philosophies, and tionships will always succeed. Those treat their customers as partners, pro-

Autobody Tech

I-CAR Tech

Amaradio Explains CRA with Lee Amaradio Jr.

When you call this dealer, professionals Marc, Randy, Tamara, or JR will always give you the best service possible. Five incoming phone lines assure your call will be promptly answered. Four drivers, Melissa, Ryan, Travis and Victor will deliver parts quickly to your door. Honda of America helps this dealer, as they help all their dealers, with the Collision Link program. Peg credits this program as instrumental in her success. Her ability to come within $5 to $10 of the cost of an aftermarket part allows customers to select quality parts for their repairs. Honda’s support of their dealers over the last five years has ensured quality repairs; with original parts, to all Honda owners. Now for a little sad news, Peg is leaving. Her only regret is that she

to continue her work, confident that he will continue to give her friends the same excellent service they have come to rely on. We can be assured that her life will continue to be filled with friends, wherever she goes. Good fortune always follows those who live as she does. Larry Williams is a former parts manager and consultant with national awards and over 30 years of experience in creating profitable parts departments. He can be reached at ljoew2@gmail.com.

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Social Media for Shops

Ed Attanasio is an automotive journalist based in San Francisco, California. He can be reached at era39@aol.com.

Yelping Back, an Interview with Yelp’s Business Outreach Manager with Ed Attanasio

Back in July I wrote an article about existing customer service policy and DH: Consumers turn to Yelp for We also offer paid upgrades for busiinformation about businesses before nesses looking to expand their visibilYelp—the well-known review web- then respond diplomatically. site where customers can comment they step through the door. In the 3rd ity even further. about businesses and rate their perABN: Why do bad Yelp reviews Quarter of this year, Yelp had a formance. My article was about stay at the top of the list while more ABN: If a body shop suspects monthly average of 61 million unique body shops having a love-hate rela- positive reviews disappear over time? that some of their bad reviews are visitors. On top of that, we had an avDH: To clarify, the order in erage of over 5 million monthly from either former disgruntled emtionship with it. See www.autobowhich reviews appear on a business unique users on Yelp’s mobile appli- ployees or competitors, how can it redynews.com and search ‘yelp’ if you missed it. Like any business, shops profile page is determined by Yelp cation for smart phones. If a potential spond? appreciate postive reviews from Sort, and does not automatically as- customer is looking at a body shop’s DH: The situation you describe customers and bristle at negative sign a negative review as the first re- Yelp listing, it means that they are acis against Yelp’s terms of service. ones, but the issue we were ad- view. We encourage body shops to Business owners can report these sittively searching for that type of busidressing is what shops can do to look at a variety of business profile ness. The information on a Yelp listing uations by alerting our User Support mitigate negative reviews. Since pages to verify this for themselves. team at www.yelp.com/contact or by can help users make a buying decithen there have been some develop- Yelp Sort is the default view, which sion, which is why it’s important for flagging reviews using the “flag” butments. factors in the recency of the reviews, business owners to claim their free ton that appears right under the reDarnell Holloway is Manager and user voting (useful, funny or business owner’s account at: view itself. Our user support team cool), among other factors. More im- www.biz.yelp.com. From there, we evaluates these situations and may refor Local Business Outreach for Yelp, the on-line review site. Holloway reportantly, we give users the ability to help business owners by providing move reviews that violate our guidecently spoke at a Santa Clara Califorsort reviews by date, star rating, them with a free suite of tools which lines. nia Autobody Association meeting friends, Yelp Elite reviews, etc. Do allows them to maximize their pressome reviews disappear over time? ABN: Many of the positive Yelp ence on Yelp. Businesses can respond and Autobody News subsequently interviewed him about what he said in You bet they do. And here are the reviews that some body shops see on to reviewers, add photos, post checkmore depth. three reasons why that might happen: in offers and run their own Yelp Deals. their competitors’ pages suspect that ABN: If a shop receives a bad re1) A Yelper may choose to remove view, what options does it have to rehis/her own review. 2) If a review is spond? reported and found to be in violation DH: Generally speaking, the of our Review Guidelines or our business owners who have the most Terms of Service, our user support success with reputation management team will remove it. Business owners on Yelp are the ones who are dedican contact our user support team cated to providing a great customer reviews for our user supmatters affecting the industry. and/or flagWant to Contribute to this Southwest Edition? experience in the offline world. Beport team for evaluation. 3) The reParts Hours: yond that, we provide a free suite of view may have been caught in our Monday-Friday 7:30 am - 5:30 pm; Saturday 8 am - 4 pm tools via www.biz.yelp.com that alautomated Review Filter which runs lows business owners to respond pri24/7 on the site and publisher@autobodynews.com aims to filter Call Us Today! Fax: autobodynews.com vately as well as publicly to reviews, away biased or suspicious reviews 407.645-4971 upload information about themselves from the business profile page. It’s and add photos, among other things. important to note that because of our Promote your business with Promote your business with Once a business starts receiving remethods of quality control, review Ken Adams views, it’s important for business number fluctuation is common on featuring an exclusive article featuring an exclusive article Parts Director owners to join the conversation. We Yelp. All businesses, whether they adyour products or services. your products or services. information vertise with us or not, are subject to Toofadvertise ly provide a whole host on Yelp for business owners, includ-at: the same rules and standards. It’s also call Joe Momber ry ing how to respond to online critics. important to note that our stance on ! We also recently800-699-8251 released a video feaquality control is why consumers cone-mail: turing business owners as they share tinue to come CALL: to YelpJoe in large num-for details! F-250 Lariat ‘11 FMomber Call for details! jmomber@autobodynews.com 51their thoughts on this subject. The bers. takeaway for business www.autobodynews.com 800-699-8251 800-699-8251 E most important owners is: 1) Remain calm. 2) Think ABN: How can a body shop use n. about the complaint in relation to our Yelp to help promote its business? www.fordparts.com/donreidford

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they were written by themselves or friends, as opposed to genuine customers. Can anything be done about this and how can Yelp detect fake reviews? DH: Yelp has had an automated review filter which is designed to identify patterns of abuse, such as the scenario you are describing. It’s an automated system that has evolved over the years, but its purpose has remained the same—to protect consumers and business owners from fake, shill or malicious reviews. Some companies attempt to manipulate the system by soliciting reviews and reaching out to friends and family to write glowing reviews for them, but after a while the system can detect it. In addition, consumers are very savvy and they can read between the lines. If someone joins Yelp to write one positive review and then doesn’t use Yelp again, it’s red-flagged. So, we tell businesses they should focus on providing good service and let the Yelp reviews build organically. It won’t happen overnight, but it will happen eventually. While our filter system isn’t

perfect, it is effective at catching fake and shill reviews. We also understand that our review filter system sometimes raises questions and frustrations amongst body shop owners, but this is the high cost that we’ve chosen to accept, because we know the infinitely higher cost would be to not have an algorithm in place at all. We obviously need a review filter system to stop people who will spam and cheat the system. We know that there are companies out there who will sell reviews and create fake content for people and we need to work against it in order for us to retain our objectivity. Sure, it’s not a perfect system, but there isn’t anything out there in place that has proven to be better. We hear back from companies all the time that say Yelp has helped us. One important final note: Our system is 100% automated and we never favor advertisers over non-advertisers. And a lot of people don’t know it, but reviews are never deleted from Yelp. If one does get filtered, it goes into a section at the bottom of the company’s Yelp page, where it can still always be read.

Keystone Expands Cullman, AL, Warehouse

After more than 15 years in Cullman, AL, auto parts supplier Keystone Automotive celebrated the grand opening of a new facility December 6 on Golf Course Road. The new, 60,000square-foot location replaces their older, smaller site at Cherokee Avenue, according to the Cullman Times. The expansion included a $3 million investment in equipment and construction, which retained 41 jobs in Cullman County. John Fowler, with Keystone, said the expansion has been in the works for several years, as the company planned for sustained growth in the area. “We’ve been working and trying for two years to move and relocate, so this is a long time coming,” he said. “Without the help of the economic development office and local officials, this might not have been possible.” Cullman County Commission Chairman James Graves praised Keystone’s commitment to the community since opening in 1993. “Keystone has really been a stable, quiet entity in the community,” he said. “After hearing about the expansion I was excited to see it come to-

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gether. We’re so proud to have such a quality company in Cullman County.” “With 40 employees, Keystone makes a significant impact, in areas like sales tax for the community,” he said. “They’ve been a great corporate citizen and we look forward to the next 20 years.” Cullman Mayor Max Townson said Keystone exemplifies the diversity present in the industrial climate of the city and county. “We’ve very proud of Keystone, and its an asset for this community,” he said. “I also want to thank the economic development office and development boards, because they all played a role in attracting and keeping Keystone in Cullman.” Keystone is an after market supplier of auto parts, serving areas across Alabama and the southeast.

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www.autobodynews.com | JANUARY 2012 AUTOBODY NEWS 29

Shop Showcase with Chasidy Rae Sisk

Chasidy Rae Sisk is a freelance technical writer from Wilmington, Delaware, who writes on a variety of fields and subjects, and grew up in a family of NASCAR fans. She can be contacted at crsisk@chasidyraesisk.com.

Richie’s Collision in Hattiesburg, MS: Beating the Odds, Over and Over Again Richie’s Collision Center in Hattiesburg, Mississippi, is extremely proud of their propensity for quality repairs and excellent customer service, but one fact that owner, Richard Lewis, does not boast about is his lack of a

next twelve years, Richie worked in several auto body shops. According to Richie’s wife, Tracy Lewis, Richie “taught himself to read, write and work the estimating system. He grew up on the streets in the roughest of neighborhoods with everyone that he grew up with being in jail, dead, alcoholics or drug addicts. Where he grew up, someone was getting beat, shot or stabbed almost every day, but Richie wanted more for his life, so in his pursuit to prove himself, he William Scott, Jay Stinson, Richard Lewis (Owner), Billy Richardson, wanted no one to noSandra Stephens, Steven Cochran, and Allen Richardson tice that he didn’t formal education. Despite the fact that have an education so he would do Richie only attended school until seceverything he could to work that much ond grade, he has established a busiharder and try that much more to ness that anyone would be proud to achieve the best outcome of the job he own, whatever their level of educawas doing so that people didn’t think tion. he was uneducated.” After dropping out of school durIn 2003 after Richie was laid off ing second grade to begin work paintfrom his job working at a local shop, ing houses in order to help support his Tim Graham encouraged him to go family, Richie spent his spare time into business together, opening a shop. building model cars, and this early auWithout the financial backing for such tomotive interest led to the purchase an endeavor, the only land the two of a 1969 Camaro when he was fourmen could acquire was an old chicken teen years old. He and a friend recompost shed on Tim’s parents’ land, behind two chicken houses. The 2,400 square-foot building had only one bay door for entrance into the shop, and it was neither heated nor air-conditioned. Tim and Richie cleaned out the shed and installed a make-shift paint booth until they were able to purchase a paint booth about a year later. They also acquired a used frame machine. Since Tim worked another fulltime job after the start-up, Richie did A vehicle sits on a lift in the bays of Richie’s the body and paint work on his own. Collision Center in Hattiesburg, MS Tracy tells me, “He gave huge disstored the car, but though Richie had counts just to get what business he discovered his talent for auto body could to show people what quality work, he was unable to use those skills work he could do. He worked tirein an occupational facility due to his lessly to prove himself because he lack of an education. A few years later, knew that being behind two smelly he restored a 1970 Trans Am and was chicken houses and down a dirt road, offered a job in a local auto body shop he would not get a lot of business unafter the shop’s owner was impressed less his work was impeccable.” After with Richie’s remodeling job. For the the devastation of Hurricane Katrina

30 JANUARY 2012 AUTOBODY NEWS | www.autobodynews.com

in 2005, Richie realized he needed a more convenient facility, but though he decided to clear out land behind his own home to deliver a better environment for customers and workers, financing became a deterrent. A local doctor who was impressed by the body work Richie did on his airplane recognized a good investment, so he loaned Richie $20,000, which—along with insurance money from the storm—Richie used to clear a plot of land on his property and to erect a 7,000 square-

A DuPont spray booth is a workhorse at Richie’s Collision Center

foot building over the next thirty-one days with the help of his father-in-law and a forklift. Richie and Tracy built slowly, adding to the shop as they had funds and time to do so until they were eventually able to move into the new facility in May 2007 with Tracy as Office Manager and Richie as Shop Manager. Over the past several years, Richie has been able to purchase another frame machine and hire more employees. He has also bought another 3,000 square-foot building which he plans to put up as a paint department, separated from the body shop. Despite their humble beginnings in a shed behind a chicken house, Richie’s Collision now repairs seventy cars each month on average. Now, in addition to the 3,000 square-foot addition that will soon be erected, Richie’s Collision boasts the original 7,000 square foot building, as well as seven employees: one painter, three body techs, one tech for specialty cars, one helper and one office Administrator. Of course, this excludes Richie Lewis who personally does all of the above, as needed. The shop’s only source of revenue outside of auto

body work is storage that they provide for totaled vehicles. They participate in a direct repair program with Alfa. Richie’s Collision is I-CAR certified, Lesonal Waterborne Certified, and they have received additional certification from DuPont Paint and Tinting. Richie’s Collision receives a combination of older and newer mix cars, but they have not have many paint match problems with their current painter. They use Azko Nobel’s Lesonal and Sikkens paints. The shop now has much more equipment than when they began, including a Goliath four-tower frame machine, a BeeLiner frame machine, cross-draft paint booth, I4 Prospect welder, 60 KW John Deer Generator, hydraulic press, strut compactor, 2 MIG welders, 2 air compressors, a gunwasher, a DuPont Paint Camera and mixing machine, and a Sikkens Paint Camera and mixing machine. Richie and Tracy credit the Goliath frame machine and the I4 Prospect welder for saving them “tremendous amounts of time in the repair process.” Tracy also praises her husband’s emphasis on customer service as a key ingredient in their success. “Richie is very adamant on customer satisfaction. He spends most of his time going to customers and doing estimates where it is convenient for them. He picks up cars and delivers them if it’s needed. He gives unprecedented warranties on his work. The business stays busy even when other shops in the area are slow, and our shop is located on the end of a dead end road in the woods behind our home. We do almost no advertising, but we stay busy by word-of-mouth and through a few of the local dealerships that direct business our way.” Richie is also very involved in his community. He sits on the Board of Directors for a Christian half-way house for women coming off the streets or out of prison. Along with Toyota of Hattiesburg Dealership, he gave support and headed the campaign to purchase a new Toyota Sienna van for the half-way house. Richie also supports America’s military in various ways when opportunity presents itself, and he frequently em-

ploys people whose past makes them ineligible for many employment opportunities because he believes in trying to give them a second chance at life. Richie’s Collision also focuses on the environment by recycling chemical waste as well as any possible met-

Richie and Tracy Lewis

als. They donate bumpers to Keystone for refurbishing, and any profit resulting from such efforts are used to treat workers to dinner or a cookout. When discussing current trends in the market, Richie and Tracy see a lot of shops converting to waterborne paint systems, and they believe that all shops will be forced to convert soon. I asked Tracy about problems they

have experienced recently, and she NTSB Calls For Full Ban of told me “we see uninformed people The government’s transportation safety come in that have no idea where or experts recommended December 13 to how to pay a deductible, or we have ban all American drivers from using people who automatically think that portable electronic devices—including auto repair shops pad estimates to cellphones, even if drivers use a handsmake up the difference of their defree device, according to MSNBC. ductible so they will not have to pay The recommendation, which isn’t it. We see people who just come right binding but which is likely to influence out and ask for their deductible to be the decisions of Congress and state legsaved. We do not pad estimates, and islatures in writing new safety laws, if we have to save people on the estimakes only two exceptions: drivers mates, we just have to take a cut dicould still use GPS navigation devices, rectly out of our pocket. People do not and drivers could use cellphones beunderstand that by doing that it’s like hind the wheel in an emergency. someone asking for their pay checks “No call, no text, no update, is at the end of the week. We’ve also had worth a human life,” Deborah Hersseveral cars come in for re-repair that man, chairwoman of the National have had previous damage repaired Transportation Safety Board, said at a from prior wrecks.” news conference in Washington. Richie and Tracy Lewis have Besides calling for government BMW Parts BMW been Original unable to attend any recent North County action, the NTSB also urged consumer NACE, SEMA or other expositions electronics manufacturers to figure out due to their responsibilities in the a way to “disable the functions of bmwusa.com (800) 564-8222 shop. portable electronic devices within reach of the driver when a vehicle is in Original BMW Parts North County BMW Richie’s Collision Center motion” while at the same time being 29 Huckleberry Drive able to turn themselves back on in an Hattiesburg, MS 39402 emergency. 601-544-0610 bmwusa.com (800) 564-8222 Jason Oxman, a senior vice preswww.richiescollisioncenter.com ident of the Consumer Electronics Aswww.ncountybmw.com

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sociation, said that as far as he knew, “nothing that would meet all of those parameters would exist today.” In general, Oxman told msnbc.com, the focus should be on drivers’ choices, not on “specific devices.” He endorsed the NTSB’s recommendations to the extent that they would regulate activities that take the driver’s eyes off the road—”manual texting while driving, for example, you shouldn’t be allowed to do it,” he said. But he criticized the safety board’s suggestion to disallow hands-free devices like Bluetooth earpieces. “It may be that NTSB, in searching for a solution, is not aware of all of the technologies that exist today, and that is one reason we look forward to the opportunity to work with them,” he said. Safety advocates have long called for such a ban like the one the NTSB proposed December 13 to reduce the phenomenon of distracted driving, which the National Highway Traffic Safety Administration says killed 3,092 people in 2010. The NHTSA has reported that See NTSB, Page 38

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Continued from Page 19

Houston City Ordinance

“What do we recommend? Ideally, the city should create two separate automotive licenses, one issued to regulate the collision industry and another, simpler one, for the mechanical industry. Many at City Hall acknowledge that this would be a real fix, but there is a rush right now to pass the ordinance before the end of the year. What’s the rush? ASA has known about this proposal for less than a year, and we have been working diligently with the city to help. The Automotive Service Association wants City Hall to slow down, listen to both industry and consumers and do it right the first time. *** Houston City council approved changes to the city’s ordinance on Nov. 30 covering towing companies and auto shops geared toward “trying to make sure that an unhealthy relationship between the tow truck drivers and collision repair shops is monitored more closely,” Mayor Annise Parker said. “There are lots of reports that after accidents, tow trucks may be being paid bounties to take cars to particular collision repair shops.” The Houston city council voted to delay voting on those provisions for two weeks (until Dec. 21). The majority of the council feels that more time should be granted to have input from additional small business owners. The delay will allow more time for further deliberation and communication with members of the Houston city council over potential changes in the proposed ordinance language. Other key industry representatives, including the Houston Auto Body Association (HABA), applaud some of the proposed mandates but are quick to say others may end up bogging down reputable businesses, slowing their ability to serve customers. James Brown, President of the Houston Auto Body Association (HABA), testified before the Mayor and City Council on behalf of HABA on November 29, voicing the HABA’s concerns with the current language in the ordinance. Brown was pulled into a private meeting with the Mayor’s Assistant, the City Attorney, and members of HPD Auto Deal-

ers Division (Capt Baimbridge & Sgt Provost) following his testimony. The meeting lasted around an hour and a half and the group informed Brown that none of the latest revisions HABA requested would be honored for one reason or another. “We do think there’s a lot of good things in there, said Brown to KHOU 11 News Houston. “But there are a lot of things that still need some work. There are a lot of things in there that give the insurance companies the same authority as the consumer—the owner of the vehicle—which we would like to see taken out.” “HABA has been working with HPD Auto Dealers Division for over a year and that has resulted in a lot of positive changes,” said Brown, “HABA has also worked closely with ASA on the revisions and we have made a lot of progress but still have a ways to go.” Councilwoman Sue Lovell, who spent a year meeting with auto repair industry representatives to craft the changes, said that once a car arrives, some unscrupulous collision repair shops charge more than $1,000 just to generate an estimate. She brandished a binder full of complaints to back her assertion that while most merchants are honest, there have been enough cases of abuse to warrant the city’s intervention. “It’s really about consumer protection,” she said. Jeanette Rash, owner of Fast Tow and leader of a consortium of wrecker companies that clears freeway breakdowns for the city, supported the revisions in part because it will allow storage yards to increase daily rates for the first time in a decade, from $15 to $20. Council members delayed action on other revisions that would have specifically regulated estimates and repairs to prevent the scenario Lovell outlined. Those changes would require mechanics and body shops to get written authorization for all work or a signed waiver allowing for a verbal approval from the customer. The changes would require shop owners to keep such records for two years.

‘Overregulation’ Councilman Oliver Pennington had two problems with the revisions. “I think it’s a classic case of overregulation,” he said. The recordkeeping requirements are too onerous

32 JANUARY 2012 AUTOBODY NEWS | www.autobodynews.com

for the shops, he said. He also complained that the rule changes fail to make a distinction between collision repair shops, which have generated most of the complaints of alleged swindles, and mechanics, which have not been the subject of widespread complaints. Pennington said mechanics should be able to get a verbal OK from customers for prices that exceed the estimate instead of having to do more paperwork that creates an inconvenience and cost. Council members Jolanda Jones and C.O. Bradford said the Parker administration got the changes to them too late for proper consideration. The final version of the changes did not arrive at council offices until November 28, meaning many council members did not see them until moments before November 30th’s meeting. Targeting ‘bad guys’ The late changes also caused automotive repair industry representatives to hesitantly endorse a final version they acknowledged they were not yet familiar with based on how it had been described to them.

“We want to get rid of the bad guys in the body shop business,” adds van der Pol. “On the other hand,” she said, “We don’t want something that burdens small business with overregulation,” and she worries that the proposed revisions will criminalize an honest mistake, such as not collecting a signature authorization. The Houston City Council says the new auto repair industry regulations for the city came about because of complaints that some body shops are deceiving consumers. The changes are aimed at increasing transparency within the industry, said Lt. Wendy Bainbridge with the Houston Police Department, according to KHOU 11 News Houston. The ordinance comes after one Houston City Council member said she received complaints about body work done without customers’ consent. “They’d charge (customers) for the estimate. Sometimes up to $1,000. And if you wanted to get your car out, you had to pay the $1,000. We thought that wasn’t fair,” Council Member Sue Lovell said to KHOU 11 News Houston.

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Sherwin-Williams A-Plus™ Network Holds Successful Conference in Naples, FL Sherwin-Williams Automotive Finishes A-Plus™ Network recently held its annual Vision Group Conference at the Naples Grand Beach Resort in Naples, FL. The conference provided the more than 80 leading collision shop owners and managers with world-class training, top industry speakers and group breakout sessions, all with a focus on succeeding—and growing— in a difficult economic climate. The A-Plus Network is made up of an exclusive group of collision repair specialists who reflect the industry’s highest standards. They are part of the Sherwin-Williams leading valueadded program that combines comprehensive business solutions to help them improve customer service, employee growth, insurance relationships, process refinement, productivity and profitability. The conference agenda featured many outstanding industry leaders and speakers from the collision repair and business arena, including: ● Bob Lane, Managing Partner of Robert Lane and Associates, a leading business advisory headquartered in

Toronto, delivered the keynote on ‘How to compete and win in today’s business world’. Bob educated the group about undergoing a journey of change, business intellect, competitive advantage, and understanding of what is going on in the world around you. Bob shared his wealth of experiences and knowledge with all attendees to help them know what they need to have in business today to not only succeed, but to win. ● Darren Fristoe, President, The Fristoe Group, and Dan Bailey, former President, CarStar Collision Centers, discussed the hot topic of ‘Succession Planning,’ an in-depth look into the long term reality of each attendee’s company—and how to prepare their business for future generations and/or how to make it more attractive to potential purchasers ● Steve Feltovich, Manager of Business Consulting Services, SherwinWilliams Automotive Finishes, presented ‘Beyond Lean;’ a deep dive into shop analytics, succession planning and the next key steps for collision industry facilities to adopt as they go

further along their lean journey ● Matt Ohrnstein, Principal at Matt Ohrnstein Advisors, a top automotive industry consultant, took the group through the state of the industry— today and tomorrow—and what to expect when collision repair center owners open their third, fourth or even tenth location After keynote and featured speakers, a number of breakout sessions were held in tandem with peer-to-peer discussion groups throughout the threeday event. The discussion groups gave attendees the chance to review financial performance, discuss lean implementation, build marketing plans and define their goals. “Our annual conference continues to support and educate our Vision Group members, giving them the competitive edge to succeed in this challenging environment,” said Troy Neuerburg, Manager of Marketing Business Services at Sherwin-Williams Automotive Finishes. “The conference is just one of several meetings our Vision Group Members attend and all are designed to keep their businesses at the

industry forefront.” Sherwin-Williams Automotive Finishes began the A-Plus Network Vision Group Program in 2000 and now has two independent owners groups, one manager’s group, two dealership collision center groups and one Canadian collision facility leadership group. These groups consist of both single and multiple shop owners and managers. Square One Systems, Inc., one of the premier independent “20-Group” providers in the industry, administers and moderates the A-Plus Network Vision Groups. A-Plus Network members not only benefit through their Vision Group participation, but are also assisted by the program’s many business-building opportunities. These include specialized marketing and management programs, industry leading business training through A-Plus Network University, insurance relations programs, loyalty benefits and specialized programs and services from outstanding contributors. For more information visit www.a-plusnetwork.com.

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Custom Corner with Rich Evans

Rich Evans is the owner of Huntington Beach Bodyworks and an award winning painter and fabricator. He offers workshops in repair and customization at his facility to share his unique talents. For contacts and design samples visit www.huntingtonbeachbodyworks.com

Solution Finish’s Brings Black Back™ is a Breakthrough Product

I’ve missed you guys the last couple of months because I’ve been really slammed with great projects and getting ready for SEMA, but I’m back with a lot of great news and some great projects.

while you’ve noticed that the black plastic or the black finish on your windshield wipers fade over time. This problem is due to the carbon in the plastic and carbon is what makes the color whether it’s black, brown, grey. There’s never really been a product that could really fix these probwith Thomas Franklin lems. A lot of us just came to accept that there is nothing that can repair the problem. Eventually the sun and the wear and tear, the carbon is eventually going to fade. Now I know that there are silicones that you can wipe on to make the surface shiny and slimy, but it wipes off on your towel or rubs off on your clothes. It attracts dirt, and after one or two washes it comes off anyway. You can also slip if you get it on your running boards; it’s just a real Chris West with Rich Evans at SEMA with Dick Strom temporary fix. I’ve been fascinated with a prodI ran across a guy named Chris uct from a company that I came across West who invented Brings Black about six months ago called Solution Back. You wipe it on, you wipe it off, Finish. They have a product called and it restores the carbon and brings Brings Black BackTM that is in a class the black back. How cool is that? I’ve by itself. Just like I do with every- been testing it for the last 6 months on everything from stoves, to door handles, to wiper arms, to hitch covers, to inside bedliners. I’m trying to find a black finish that it doesn’t work on. It’s just amazing how far beyond the automotive world this product can exwith Lee Amaradio Jr. tend to. I’ve found that the best results come from washing the surface down with rubbing alcohol—it’s all about the prep. The product works with almost no prep, but to get the longest Half finished wiper restoration black back results, I’ve found dabbing thing, I put it to the 6 month test. I’m just a little bit of product on with a so excited about this product that I’m sponge goes a long ways. A dime sized drop of this product will do almost a half a cowl panel. Wipe it on, buff it a little, and rub off the extra with Sheila Loftus residue that didn’t bite into the plastic, and it really gives that deep black back. That’s the color that is out now but Solution Finish is just startDoing the rest of the job ing to get into other colors. putting my name to it (see ad). I’m not The product dries within two just endorsing this product, I’m part minutes. It doesn’t stick to paint or to owner of the company and I’m glad to windows so you don’t have to mask it. be a part of Solution Finish. This is It’s almost like spraying without a going to go viral and be used to fix paint gun. Nine out of ten cars you millions of cars from here on out. walk by need the product, whether it’s If you’ve worked on cars for a just wiper arms, belt moldings, front

bumpers, grille panels, whatever. It’s amazing to find a product that can ac-

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34 JANUARY 2012 AUTOBODY NEWS | www.autobodynews.com

Partial job on the bumper assembly

jobs. I’ve been really working with body shops, to help them do upsells, and paintless dent removal guys. You can see a couple of Youtube videos at: www.youtube.com/watch?v=KYfiPfD02DU. Note how easy it is to apply the product and wipe off with a microfiber sponge. The developer of this product Chris West says “Solution Finish was developed over the last six years using techniques unlike anybody has been using in the autocare industry. We didn’t follow any of the typical steps in developing a product. We reversed the process, we looked at how the surface, how the material is made and we tried to formulate a product that would not only enhance the general appearance, but something that would actually chemically place the color back into the plastic and how we

did that was we developed a series of modified and penetrating oils with a very high grade of colored carbon and we milled that carbon 7 times which makes the actual colorant smaller than a virus. So if you can imagine the penetrating oils will pull the black carbon, the colorant, deep back into the plastic, then the modified oils lock it in and it chemically changes the chemistry of the surface itself. So over a 6 year period this has been developed and perfected, I brought in Rich Evans at the final stages of formulation because there’s little tricks that only a professional body and fender paint guy would know and that was the missing key to finalizing the product.” Anybody that cares about their car will want or will need this product whether they apply it themselves or whether a body shop offers it as a service, or paintless dent remover guys offer it as a service, or any of the other guys out there doing interior repairs. It’s simple, easy, affordable, comes in 3 different sizes, a 1oz bottle is $29.95, a 12oz bottle is $125 and a 32oz bottle is $250. The one ounce bottle can repair up to 3 vehicles based on doing a Chevy Avalanche, which is 70% plastic finish. If you’ve seen one you know how much plastic avalanches have. Twelve oz bottle Every avalanche goes for $125 I see is faded. Bring Black Back lasts as long as a new part. I took one Avalanche and priced out what it would cost to replace all the parts—over $10,000 with labor—never mind putting all those new parts back on. Those replacement parts are only going to last as long as the original new parts did so in a year and a half you’re going to be doing it

Solution Finish Avalanche’ or ‘4nJDkORNges.’ Now a customer can buy, say, a 12oz bottle (you can do up to 36 complete vehicles with the 12oz bottle for $125) so if you’re the do-ityourself guy or if you’re the shop out there that wants to offer this service, this is a new product you really need to check out. A 32oz bottle will do up to 96 complete vehicles—who’s ever heard of coverage like that? I’m a body shop owner and I’ve been buying paint and product for a long time, to be able to do up to 96 cars for $250 worth of product. There’s no telling how many panels and parts you can do and how much money you can make—I guarantee a body shop on its slowest based profit would be 10 percent of what their income is. So if you can make a minumum of 10 percent in your sales increase and up to 30 to 40 percent, you have a customer. You’re going to

look like a rockstar because you’re going to be able to fix something that this customer has not been able to fix and they’d just accepted that they can’t fix it. So what’s that going to do? That’s going to get the word of mouth going. People are going to talk about it, people are going to say ‘hey this body shop fixed this and I’ve never been able to fix this problem.’ I spent $30,000 for my car, I want my car to look as good as it can look for a long time. Solution Finish has brought that to you. We want to make people like you happy and proud to have your car back in the shape that it was when you purchased it, without spending thousands of dollars. Let’s review the 10 basic steps of this: 1) quick and easy application. 2) long lasting results, lasts as long as a new part, second application may be required. So there’s no mill build or any of that, this is wipe-on wipe-off almost like shoe polish. Dries instantly. 3) no greasy residue. How cool is that? 4) No black streaks on towels after application. 5) long product shelf life. That’s cool, we’re hitting all the points. 6) wipes off protected paint, wipes off glass, or most application no masking required 7) doesn’t leave streaks on applied surfaces. 8) only a small amount is needed for each application, which is great for profitability.

transmission’s being ‘locked in park,’ or with the engine still running, increasing the chances of vehicle rollaway or carbon monoxide poisoning in an enclosed area,” the regulator said in the proposal. Toyota, in 2009 and 2010, recalled more than 10 million Toyota and Lexus vehicles for defects that may cause unintended acceleration. Some of the cars had push-button starts, meaning panicking drivers would have to hold down the button to stop the car rather than turning a key. The rule would standardize the length

of time drivers must push a button to stop a moving car to a half-second. The Society of Automotive Engineers, which writes industry standards for automakers to follow voluntarily, in January recommended a range of a half-second to two seconds. In a 2009 Lexus ES-350 crash that killed four people and helped lead to Toyota’s recalls, the car had a keyless electronic starting system with a push-button control that required the driver to hold the button for as long as three seconds to stop the engine, NHTSA said in the proposed rule.

again. Take a look at my video demo at: youtube.com, search ‘Rich Evans

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NHTSA Proposes Panic-Stop Ignition Standard for Cars

Auto-safety regulators have proposed standardizing keyless ignitions to allow drivers to turn off cars faster and more easily in incidents of unintended acceleration following Toyota Motor Corp.’s record recalls. The proposed rule will cost less than $500,000 a year, the U.S. National Highway Traffic Safety Administration said in a proposed rule published Dec. 12 in the Federal Register. “At issue [is] drivers’ inability to stop a moving vehicle in a panic situation, and drivers who unintentionally leave the vehicle without the vehicle

9) lasts through heavy rain and normal washes. 10) the one I like the best—no silicone. How long does it last? Longer than a new part. If you own a vehicle, you need Solution Finish. So here’s another great product. I’m sharing my processes, my steps and procedures in building cars, all the way to finding and discovering products out there that’re going to help us fix cars. I’ve fixed thousands of cars and with this product I’m going to be fixing many more cars, but even more important is to be creating thousands of jobs for people out there. There’s detailers, there’s paintless dent removal guys, and others who can get in business for themselves. If you’re in the business you want to offer this service. It’s $29 to get into business! You’ve got to check this out: solutionfinish.com. Go and check out my Youtube, there’s testimonies that are going up as well. We’re putting this product into the major WD’s PBE warehouses, so if you’re a jobber and you’re wanting to buy go to PBE warehouse and order up some Solution Finish. Give it a shot yourself and offer it to your customers. If you just comp it, it’s going to get people talking. It’s going to get word back and raise money one way or the other, whether they bring cars back or referrals or talk about you. It’s all about the marketing part about it. At the end of the day, you can be confident that the product works great. Buy yourself a bottle, go out and fix three vehicles. I have a suggested price guide to help you to learn how to charge for it. It’s an easy way to create more income and it’s an easy way to look like a rockstar to people by fixing problems that have been out there for so long that people have forgotten it’s a problem. I’m really stoked about it and I’m really happy that I ran into Chris. I’m glad to be back on track, lots of cool projects coming up. Thanks again! Ignition sales The rule probably won’t help sales of push-button ignitions or components because it will probably require a calibration change, rather than different parts, said Rich Hilgert, a Morningstar Inc. analyst who follows auto suppliers. Automakers have also worked on standardizing keyless ignitions and are reviewing the proposed rule, said Gloria Bergquist, a spokeswoman for the Alliance of Automotive Manufacturers.

www.autobodynews.com | JANUARY 2012 AUTOBODY NEWS 35

Hey Toby!

Toby Chess is an I-CAR program instructor, Training specialist, and former salvage yard operator. Toby is universally known in the collision industry for his work with first responders and advocacy for body shops and consumers. He can be reached at tcspeedster@yahoo.com

Life Changes or Industry Changes Don’t Happen Without Major Effort with Toby Chess

I want to start this month’s column increases with age, with 8% of people with a personal reflection on some life over 80 having AF. changing events that happened to me In AF, the normal electrical imlast year. pulses that are generated by the The last Saturday of September I ‘sinoatrial node are suddenly or gradwoke up about 1:00 a.m. with a pain in my chest. It felt like a 500 lb gorilla was standing on with my chest and theMcClune pain David was excruciating. Not being the brightest person in the world, I got into my truck and drove myself to the hospital. When I told the nurse in emergency that I was experiencing chest pain, she rushed into a room and hooked up an EKG monitor and blood pressure gauge. My blood pressure was 170 over 90. Not real good (I am on blood pressure medication). The ER doctor camewith in andJohn told meYoswick that I did not have a heart attack or a stroke, but there was something not working right with my heart and set up an appointment with a cardiologist the following week. Five hours later, I came home, hooked up my welding trailer Hayley Torres, the first grandchild for Toby and and conducted an I-CAR structural Sheila Chess, was the catalyst for some seristeel test (Again, not the best move, ous changes sometimes my brain works in reverse). Monday, I made an appoint- ually overwhelmed by disorganized ment with a cardiologist for the electrical impulses that often origiwith Richard Steffen following Friday. nate in the roots of the pulmonary On that Wednesday, my daughter veins, leading to irregular conduction gave birth to an 8 lb baby girl named of impulses to the ventricles which Hayley, and for my wife and me, our generate the heartbeat. AF may occur first grandchild. in episodes lasting from minutes to I will tell you that being a grandweeks, or be permanent in nature. parent is a tremendous experience. The natural tendency of AF over time The best experience of all is that I is to become a chronic condition. haven’t had diaper duty yet. Chronic AF leads to a small increase On Friday, I had my appointment in the risk of death. with the cardiologist. I had another He said that I had a choice. I with John EKG and he determined that IYoswick had a could go on meds that would change mild case of Atrial Fibrillation. my life style or I could lose weight (he Atrial fibrillation (AF or A-fib) is suggested 75 lbs). It was my choice. the most common cardiac arrhythmia At that moment, I realized that I (abnormal heart rhythm). It is a com- wanted to be part of Hayley’s life and mon cause of irregular heart beat, I decided to lose the weight. The docidentified clinically by taking a pulse. tor recommended that I use ‘Weight Chaotic electrical activity in the two Watchers Online’ due to my crazy upper chambers (atria) of the heart re- schedule. So I went home, Googled sult in the muscle fibrillating (i.e., Weight Watchers and signed up. It quivering), instead of achieving coorworks on a point system. You are alwith Karyn Hendricks dinated contraction. lowed so many points per day and you The presence of AF can be conenter the food that you ate and the firmed with an electrocardiogram points are automatically calculated. (ECG or EKG) by the absence of P All the things I ate in the past like waves and an irregular ventricular steaks, bread, sweet rolls, Italian rate. Presence of AF in a population sausages and nearly everything else I

put into my mouth were high in points. I started off the program with 54 points. One hot dog is 12 points. It doesn’t take much to add up to the allotted daily points. The web site offered a lot of advice on what I should be eating. On October the ninth, I weighed 307 lbs. and by December 15, 2011, I weighed 281 lbs. I used to get tired after walking one block. My knees and hips would hurt. I started riding my bike and I am up to two miles a day and, guess what? My knees and hips have stopped hurting. It is very difficult to change one’s eating habits after 66 years of abuse, but the consequences of not changing them, were much too high. The reason for opening up my personal life is that it runs parallel to recent events in the collision repair industry. Last month, I requested from repairers that they send me pictures of parts that do not fit. To make the re-

California Autobody Association

Year in Quotes

placement parts better, we need data to back up our claims that there are parts being sold that don’t fit, have poor workmanship and they are not the same as the original. On a daily basis, I am told by people in the body shops about these substandard parts, yet when I requested pictures and data, only five shops have so far responded. It would have been a lot easier for me to take a pill for the A-Fib, but what was better for me was to make a sacrifice to eliminate of some of the foods that I normally ate. You can go the easy way and do nothing or you can get off the pot and send me that data. It’s your choice. If you choose not to do anything, then stop the complaining. I cannot help you if you can’t help yourself. I hope that you will make the same decision that I made—Make a change to improve our industry. With that I want to wish all of you a happy and prosperous 2012.

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I-CAR Tech

This article first appeared in the I-CAR Advantage Online, which is published and distributed free of charge. I-CAR, the Inter-Industry Conference on Auto Collision Repair, is a not-for-profit international training organization that researches and develops quality technical education programs related to collision repair. To learn more about I-CAR, and to subscribe to the free publication, visit http://www.i-car.com.

Nitrogen Hot Air Welding: Repairing Plastic Parts Hot air welders have been around for a number of years and used mostly in bumper remanufacturing facilities. A hot air welder works by passing compressed air over a heating element and heating the air to

the rod is laid into the V-groove, and the two are melted together. Whenever using this type of welder, it is important to have airflow over the element at all times no matter if it is preheating, welding, or cooling. A nitrogen hot air welder uses compressed nitrogen gas to eliminate oxygen from the weld area. The nitrogen acts as a shielding gas and allows with Lee Amaradio forJr. a contaminant-free weld with less smoke, which creates a stronger weld (see Figure 1). This type of welder can also switch to compressed air so that when preheating, or cooling down the heating element, it does not waste the nitrogen. Figure 1 - A nitrogen controller and tank are A fusion weld is made when the required to make nitrogen hot air welds welding rod and plastic melt and mix around 345ºC (650ºF) to melt the together. This type of weld can only be base plastic and filler rod/ribbon to- done on thermoplastics. Thermoplasgether. This type of welder does not tics, such as polypropylene/thermo use a flat shoe or feeder tube-type plastic polyolefin (PP/TPO), which is used to make most bumper covers tip. A V-groove is cut into the part,

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Making a Repair Before any sanding or grinding starts, the part must first be cleaned with soap and water, followed by cleaning with the recommended cleaner. It is also recommended to wipe in one direction to help reduce static. If this step is skipped, the repair may fail due to contamination in the repair area. Once the plastic has been abraded, no solvent cleaners should be used because if any of the solvents become trapped under the repairs it could bubble the repair area in the bake cycle or when it is exposed to the sun. Identification When making a nitrogen hot air plastic weld, the need for plastic identification is essential to a successful repair. The plastic identification is primarily used to determine which rod will match the plastic part. It is also helpful to know how the plastic will melt because different plastics will

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Figure 2 - Whenever possible, match the ISO code on the part to the filler material

melt at different temperatures. One way to identify the type of plastic is to look at the ISO code that should be located on the backside of the part (see Figure 2). If the ISO code cannot be found, the vehicle maker may have a listing of the types of plastic their parts are made of and may even have a recommended repair procedure. Once the base material is identified, the technician can select the filler rod to use. Plastic welding rods are usually made of a pure plastic like polypropylene (PP), acrylonitrile butadiene styrene (ABS) or thermoplastic olefin (TPO). Therefore, they may not match a specific blend of plastic

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Repair After the part has been cleaned and the base material and filler rod have been identified, the part being repaired can be realigned and held in place using aluminum tape. Once the front side is realigned, the backside of the part can be sanded with about P80 grit. Following sanding, the area should be blown clean with clean, oilfree compressed air.

Figure 3 - Protective gloves are recommended in order to prevent burns from the high heat of the nitrogen hot air welder

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base material. They are available in different diameters and shapes. Some are round rods and others are a flat ribbon. There are also different widths of flat ribbon with the wide ribbons used on the backside as a reinforcement and the more narrow ribbon used as a filler on the front side.

After the nitrogen hot air plastic welder is preheated, the nitrogen gas is turned on and the base material and the welding ribbon are preheated. As the base material and ribbon start to melt, the ribbon is pushed into the base material (see Figure 3). The ribbon will start to fuse to the base material and begin to squeeze out the sides of the ribbon. If a tear goes to an edge of a part, a second smaller ribbon can be laid down across the tear to form a “T” pattern at the edge of the part to add extra strength. Watch the video for a short demonstration of this process (see video at www.i-car.com). Once the backside repairs are complete, the aluminum tape can be removed and the tear on the front side can be v-grooved. A v-groove is made on the front side to allow the repair ribbon to be laid down level or slightly lower than the surrounding plastic. Again, make sure that no paint See Repairing Plastic Parts, Page 39

www.autobodynews.com | JANUARY 2012 AUTOBODY NEWS 37

Continued from Page 15

Where we stand

global market for auto-dimming mirrors for years, with exceptionally high profits for a Tier 1 supplier as a result. In other cases, process and supply chain innovation can drive durable cost advantages, even for products that are commodities or close to it. Successful suppliers must understand the opportunities for innovation of both types to create and capture value, and invest accordingly. Refine the Factory Footprint The economics of manufacturing in low-cost countries are shifting. With Chinese wages on the rise and an artificially strong renminbi, the tide of production shifting to Asia has slowed. In fact, for some products that Continued from Page 31

NTSB

about 20 percent of all drivers and 50 percent of drivers 21 to 24 years old admit to having texted while driving. Overall, more than three-quarters of

do not ship well or have relatively low labor content, regional production footprints-factories in Asia, North America, Europe, and South America, for example-are increasingly preferable. The question to ask is what factory network will allow you to meet forecasted demand for your products most cost-effectively-and more cheaply than the competition.

Ruthlessly Manage the Portfolio All too often, suppliers try to be everything to everyone-and, in doing so, design products that fail to meet the needs of anyone. To avoid this trap, suppliers must develop the market insight necessary to understand fully the varied requirements and purchase decisions of different OEMs and different market segments. With this knowledge, suppliers can determine which segments are most attrac-

drivers say they are willing to answer calls on all, most or some trips. “People continue to make bad decisions about driving distracted—but what’s clear from all of the information we have is that driver distraction continues to be a major problem,” said

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tive based on their core skills, strategic outlook, and business and operating models. This prioritization allows suppliers to target resources to business units with the potential to create sustainable and strong market positions and stop subsidizing weak businesses with little or no strategic value. Suppliers with this sophisticated knowledge of their businesses also know when to walk away from bids and programs when the economics are not right-pursuing programs with poor economics to fill factory capacity in hopes of someday increasing prices and margins is chasing after fool’s gold. Leverage M&A Potential Large M&A deals have been rare among auto suppliers during the postrecession restructuring period, but the pace of consolidation will pick up NHTSA Administrator David Strickland. Cell Phone Use and Crash Risk: Evidence for Positive Bias The recommendation comes following the NTSB’s investigation of an

during 2012 as private equity and strategic buyers return to the market. In fact, a Booz & Company survey of automotive executives earlier this year (see “Is the U.S. Auto Industry Ready for Economic Recovery?”) found that 60 percent of automotive suppliers are actively pursuing acquisitions. Suppliers must assess their positions in this context-are you a buyer or a seller?-and in turn work to build the necessary supporting capabilities. For example, if you are a buyer, how do you assess which targets are the most attractive to your organization, and how do you overcome the operational, customer, financial, and change management challenges to ensure that you are able to capture the full value of an acquisition? And if you are a seller, how can you secure the most attractive valuation for your company? August 2010 accident in Gray Summit, Mo., involving a pickup truck, two school buses and several other vehicles. The accident was blamed on the 19-year-old driver of the pickup, who sent or received 11 texts in the 11 minutes before the pileup.

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sure, which should be firm and constant. The “S” stands for speed, which should allow for 100–150 mm (4”–6”) of material to be welded per minute.

Continued from Page 37

Repairing Plastic Parts

is in the weld area. A smaller ribbon is placed into the v-groove using the same technique as on the backside. Once the weld area has cooled, it should be sanded down and, if necessary, a plastic repair filler should be applied to fill any imperfections. The acronym TAPS will help the technician remember all the different things to watch while making a nitrogen hot air plastic weld (see Figure 4). The “T” stands for temperature, which must be at the correct setting to melt the part and the rod. The “A” stands

Figure 4 - The technique used to make a nitrogen hot air weld is similar to that of a TIG weld

for angle, which should be about 45º to the part. The “P” stands for pres-

Precautions Some welding repair precautions are to never leave any shiny or melted plastic on the part. This will cause poor adhesion of any filler or refinish material. It is also important to featheredge the repair area to make it an invisible repair. With all plastics, never use a solvent on bare plastic. If the vehicle is equipped with an adaptive cruise control or parallel park assist systems, no repair should be done in front of a sensor if it impedes the abil-

ity of the sensor to function.

Conclusion Nitrogen hot air plastic welders are another option to repair plastic parts that otherwise might be discarded. As with any repair technology, it is a business decision to choose to use a repair technology that works best for you. For more information on nitrogen hot air welding and training on the various other plastic repair techniques and precautions, attend I-CAR’s Plastic And Composite Repair (PLA03) course. For comments or suggestions on the Advantage Online, please contact I-CAR at advantage@i-car.com.

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