Southwestern Edition
Texas Oklahoma Louisiana New Mexico
33
YEARS
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Auto Body Association of Texas (ABAT) Meets in Colleyville for ‘Much Needed Dialogue’ by Barrett Smith
The Auto Body Association of Texas (ABAT) held its third meeting bringing more members of the Texas collision repair industry closer together. Following their prior meeting held this past July in Tyler, Texas (about 100 miles southeast of Dallas), on August 29th the Auto Body Association of Texas (ABAT) held a meeting in Colleyville, Texas, which is in the Dallas-Ft. Worth area. Attendees at both meetings included representatives from several large and well recognized collision repair centers from the Dallas
area as well as others from the north Texas area. Some drove in excess of two hours each way to attend. Burl Richards, ABAT’S acting president, and other founding members joined in discussing with the group the advantages of the collision industry members coming together as colleagues and the many benefits of doing so through the Auto Body Association of Texas. “The turn-outs have been great,” said Richards. “We’re further encouraged at each meeting as more and more shop owners and managers are attendSee ABAT, Page 12
Federal Court in FL to Rule on Overtime Pay Under FLSA for Auto Repair Employees
See Overtime Pay, Page 8
P.O. BOX 1516, CARLSBAD, CA 92018
A federal court case involving overtime payment for employees under the rules of the Fair Labor Standards Act (FLSA) was filed in State Court February, 2014, and removed to the Federal Florida Southern District Court in July. The court’s ruling in Smoluk v. Action Auto Body, LLC, has the potential to clarify confusing and contradictory positions from the Department of Labor and rulings by courts with regard to exempt status for employees in automotive repair. The plaintiffs, Jospeh Smoluk and Michelle Smoluk, are suing their
former employer, Franck Tatto and Action Auto Body, LLC., for damages exceeding $15,000, excluding attorneys’ fees or costs for breach of agreement and unpaid wages under the FLSA. Franck Tatto and Action Auto Body, LLC., located in Broward County, FL, deny the allegations. In court documents, the defendants say the “… Plaintiffs have been paid all wages due in full and in a timely manner.” According to the lawsuit, Jospeh Smoluk worked for Action Auto Body as a non-exempt service writer from
Change Service Requested
by Stacey Phillips, Assistant Editor
VOL. 32 ISSUE 10 OCTOBER 2014
Boyd Group Acquires Seven Champs Collision Centers in Southeast Louisiana The Boyd Group Inc. has signed a definitive agreement and concurrently closed the acquisition of Champ’s Holding Company, LLC (“Champ’s”) the company announced in a news release on Sept. 12. Champ’s is a premier full-service auto collision repair service provider in southeast Louisiana, owning and operating seven collision repair centers. Champs locations are in New Orleans, 4047 South Carrollton Ave.; Elmwood, 200 Edwards Ave, Harahan, LA; Kenner, 1601 22nd Street; Westbank, 3621 Lapalco Blvd., Harvey, LA; Northshore, 2501 Florida Street, Mandeville, LA; Hammond, 500 South Morrison Blvd.; and Baton Rouge, 6137 Siegen Lane. Champ’s has grown significantly since its inception in 1978 and gener-
ated sales of approximately $37 million for the trailing twelve months ended June 2014. This acquisition increases the number of Boyd collision repair locations to 313 across 16 states and five provinces. “We are very pleased to enter the Louisiana market which will expand our reach to new customers, increase our geographical footprint for our insurance industry partners and also provide us with another new market from which to execute our single location growth strategy,” said Brock Bulbuck, President and Chief Executive Officer of the Boyd Group. “With this acquisition we strengthen our position as the largest multi-shop operator in North America in terms of number of locations, and demonstrate our ability
by Ron Perretta
In the center, on an elevated bench were the two Honorable Judges (Presnell and Smith) who sat facing the court room, and then to my left were five attorneys sitting at the plaintiff’s table who were there representing hundreds of collision repairers from various states. To the far left, in spectator’s area were 15 or more shop owners who were plaintiffs in the lawsuits to witness this first step in what will prove to be, no doubt, a pivotal and historical event for the entire collision repair industry. When provided the opportunity to speak and ask quotations, few came from the defending attorneys. John Eaves Jr. mentioned to the courts that since the litigation, some repairers have experienced various levels of abuse from some insurers as and asked of the court to consider rendering a ruling to prohibit steering and retaliatory efforts against those repairers who are named as plaintiffs in the litigation
See Boyd Acquisition, Page 27
A First-Person Account of the Consolidated MDL Hearing in Orlando, September 11 As an observer of the initial court proceedings for the repairers Multi-District Litigation against dozens of insurers in the Orlando Federal Courthouse [on Sept. 11], I can’t tell you the feeling that I had and that other repairers present expressed while watching the proceedings. I’m not sure any words can capture the feeling but it was a feeling that I believe was long overdue for repairers... and insurer’s alike. While phones and cameras were not allowed in the courthouse, the picture of the hearing was one I wish every repairer could have seen. I was sitting at the back of the courtroom, close to center and from my view point I saw 50 plus attorneys who were there representing the 40 plus defendant insurers, all in dark suits, sitting side by side, row after row along the entire right side of the court room.
See MDL Opens, Page 13
Presorted Standard US Postage PAID San Bernardino, CA Permit #2244
2 OCTOBER 2014 AUTOBODY NEWS | www.autobodynews.com
ASA Announces Plans to Relocate
Headquarters. . . . . . . . . . . . . . . . . . . . 41
Auto Body Association of Texas (ABAT) Meets in Colleyville for ‘Much Needed Dialogue’ . . 1 Boyd Group Acquires Seven Champs Collision
ASA Confirms Detroit as Location and
Dates for Next NACE-CARS Expo . . . . . 14
Auto/Steel Partnership to Present During OEM Collision Repair Technology
Summit at SEMA Show . . . . . . . . . . . . 42
CA Has 100K+ Plug-In Cars and Counting . 46
Centers in Southeast Louisiana . . . . . . . 1
CarMax Recruiting for More than
Vehicles. . . . . . . . . . . . . . . . . . . . . . . . 10
Celette Has Fixtures for M-B B Class
in Houston Area. . . . . . . . . . . . . . . . . . 10
Federal Court in FL to Rule on Overtime
Caliber Collision Gifts 10 Recycled
Caliber Collision Opens 14th Location
Herkules to Host NASCAR Driver Brendan
Gaughan During SEMA Show. . . . . . . . 28
1,000 Jobs . . . . . . . . . . . . . . . . . . . . . 26 Electric Drive . . . . . . . . . . . . . . . . . . . . 21 Pay Under FLSA for Auto Repair
Employees. . . . . . . . . . . . . . . . . . . . . . . 1
Mandatory Earthquake Hour for OK
FL is the Third Most Expensive State
NM Ranks 11th for Most Expensive
Ford and Chrysler Up, GM down in
NWLCRA Monthly Meeting. . . . . . . . . . . . . 6
GM Posts Best July Sales Since 2007,
Jeff Silver Award . . . . . . . . . . . . . . . . . 14
K & M Collision Sends Second Version
Insurance Agents. . . . . . . . . . . . . . . . . 12
State to Own Car . . . . . . . . . . . . . . . . . 10
Service King Team Member Wins
Texas Debating Giving Driver’s Licenses
to Illegals. . . . . . . . . . . . . . . . . . . . . . . 27
Tulsa Police Arrest Man for Vandalizing
Cars . . . . . . . . . . . . . . . . . . . . . . . . . . 32
COLUMNISTS
Antonelli - Autobody News Launched Our
New Website on September 13 . . . . . . . 4
Attanasio - Is Angie’s List Impartial or
in Which to Own a Car . . . . . . . . . . . . . 44 August Car Sales . . . . . . . . . . . . . . . . . 45 Toyota Also Up . . . . . . . . . . . . . . . . . . 14 of ‘Open Letter’ Video to NC Attorney
General . . . . . . . . . . . . . . . . . . . . . . . . 28
MS is the 4th Most Expensive State
for Car Ownership Overall . . . . . . . . . . 44
NABC 20th Anniversary Golf Fundraiser,
January 14, 2015 . . . . . . . . . . . . . . . . 38
Napa Body Shops Jolted After 6.0 Quake. . 20 NJ is 5th Most Expensive State for
Auto Ownership . . . . . . . . . . . . . . . . . . 45
Is She Playing Favorites? . . . . . . . . . . . 36
NY Shop Owner’s Forgotten Lottery Ticket
Funds and Get Results! . . . . . . . . . . . . 32
Roseville, MN, Police Fire Local Auto Body
Franklin - End Useless Marketing—Redirect Luehr - Better Blueprinting, Part 2: How to
Set Up a Blueprinting Area . . . . . . . . . . 16
is a Nearly-Lost $2.9 Million Winner. . . 39
Shop After Employees Take Squad
Cars on Joyride . . . . . . . . . . . . . . . . . . 38
Sisk - Parts Authorization, Indemnification
SCRS Posts Tribute to March Taylor for
Yoswick - CIC Committees Look at
Season 34 of MotorWeek 2014 Features
and More—Documentation Part 3 . . . . 34
Autonomous Vehicle Issues, Impact
of “Length of Rental” Formulas . . . . . . 40
Yoswick - October Retrospective—ADP,
Non-OEM Parts, AAIA Study . . . . . . . . 30
NATIONAL
Supporting and Inspiring the DEG. . . . . 44
Collision Mitigation, Traffic Alerts . . . . . 45
Six Holmes Body Shop Locations Acquired by Cooks Collision Centers, All but
Original Shop in Pasadena . . . . . . . . . . 26
Texas Bugatti Owner Pleads Guilty to
Insurance Fraud . . . . . . . . . . . . . . . . . . 10
A First-Person Account of the Consolidated
Theft and Serious Injury at PA Auto Body
AASP-PA Offers Two New Membership
Volvo Reappears on World Market
ABRA Auto Body Acquires USA Collision
WI is the 5th Cheapest State in Which
Aluminum Association to Present During
WY is the Most Expensive State in the
MDL Hearing in Orlando, September 11. . 1
Levels . . . . . . . . . . . . . . . . . . . . . . . . . 14
Centers . . . . . . . . . . . . . . . . . . . . . . . . 12
SCRS’ OEM Collision Repair Technology
Summit . . . . . . . . . . . . . . . . . . . . . . . . 43
Victoria Antonelli is Our New Online Content Editor
Contact Stacey at:
Contact Victoria at:
Stacey Phillips
is our new Assistant Editor. She has written and edited for numerous online and print publications over a 15-year period. Stacey graduated from the University of Southern California with a double major in journalism and political science. Born and raised in Los Angeles, CA, she also lived in Calgary, Alberta where she edited several magazines before joining Suncor Energy. There she helped create an online company newsletter that received the Apex Award of Excellence two years in a row. Stacey also co-authored a commemorative history book for the Province’s Institute of Chartered Accountants. After moving back to San Diego in 2007, Stacey has spent the majority of her time writing about local issues. When she isn’t writing, Stacey enjoys playing tennis, reading and spending time with her family.
sphillips@autobodynews.com with your story ideas and news items. Publisher & Editor: Jeremy Hayhurst General Manager: Barbara Davies Assistant Editor: Stacey Phillips Online Editor: Victoria Antonelli Contributing Writers: Tom Franklin, John Yoswick, Janet Chaney, Toby Chess, David Brown, Rich Evans, Ed Attanasio, Chasidy Sisk, David Luehr Advertising Sales: Joe Momber, Sean Hartman, Bill Doyle, David Petro (800) 699-8251 Sales Assistant: Louise Tedesco Art Director: Rodolfo Garcia
Shop . . . . . . . . . . . . . . . . . . . . . . . . . . 39
with XC90 . . . . . . . . . . . . . . . . . . . . . . 43
to Own a Car . . . . . . . . . . . . . . . . . . . . 44
US for Car Ownership . . . . . . . . . . . . . 44
Absolute Mitsubishi-Hyundai . . . . . 30 BMW Wholesale Parts Dealers . . . . 39 Car-Part.com . . . . . . . . . . . . . . . . . . . 4 Celette . . . . . . . . . . . . . . . . . . . . . . . . 9 Certified Automotive Parts Association (CAPA). . . . . . . . . . . 15 Chevyland . . . . . . . . . . . . . . . . . . . . . 6 Chief Automotive. . . . . . . . . . . . 20, 21 Classic BMW . . . . . . . . . . . . . . . . . . 26 Classifieds. . . . . . . . . . . . . . . . . . . . 46 Dallas Dodge . . . . . . . . . . . . . . . . . 48 Dent Magic Tools . . . . . . . . . . . . . . 10 Dent Tools Direct USA . . . . . . . . . . 22 Dominion Sure Seal, Ltd. . . . . . . . . 22 Don Carlton Auto Group . . . . . . . . . 28 Equalizer Industries, Inc . . . . . . . . . . 8 Finnegan Chrysler-Jeep-Dodge . . . . 2 Ford Wholesale Parts Dealers TX, OK, LA, NM. . . . . . . . . . . . . . 33 Fowler Honda . . . . . . . . . . . . . . . . . 36 Freedom Dodge-Chrysler-Jeep-Ram. 19 Gillman Acura . . . . . . . . . . . . . . . . . 13 GlasWeld Systems, Inc . . . . . . . . . . 16 GM Wholesale Parts Dealers . . . . . 45 Honda-Acura Wholesale Parts Dealers. . . . . . . . . . . . . . . . . . 24-25 Huffines Chrysler-Jeep-Dodge Lewisville . . . . . . . . . . . . . . . . . . . 12 Huffines Hyundai Plano . . . . . . . . . 38 Hyundai Wholesale Parts Dealers . 40 Innovative Tools & Technology, Inc.. 14
Victoria Antonelli
is the newly appointed online content editor at Autobody News. Victoria will be managing our new website and social media pages. She is originally from South Kingstown, RI, and has lived in San Diego, CA, since August 2013. Victoria graduated from the University of Rhode Island in May 2013 with a BA in journalism. Previously, she attended High Point University in High Point, NC, for two years, and studied abroad for a semester at Oxford Brookes University in Oxford, England. Victoria completed two internships while in college, one with the University of Rhode Island Marketing and Communications Department and another at Rhode Island Monthly Magazine. Victoria’s favorite color is turquoise and her hobbies include hiking, reading, writing, and photography.
vantonelli@autobodynews.com with your story ideas and news items. Serving Texas, Oklahoma, Louisiana, New Mexico and adjacent metro areas. Autobody News is a monthly publication for the autobody industry. Permission to reproduce in any form the material published in Autobody News must be obtained in writing from the publisher. ©2014 Adamantine Media LLC.
Autobody News
Southwest
REGIONAL
Stacey Phillips is Our New Assistant Editor for Print
Indexof Advertisers
Contents
New Talent Joins the Autobody News Editorial Staff
Box 1516, Carlsbad, CA 92018; (800) 699-8251 (760) 603-3229 Fax www.autobodynews.com Email: news@autobodynews.com
Kia Motors Wholesale Parts Dealers. 37 LKQ . . . . . . . . . . . . . . . . . . . . . . . . . 47 Mac Haik Ford. . . . . . . . . . . . . . . . . 31 Malco. . . . . . . . . . . . . . . . . . . . . . . . 11 Martech Services Company . . . . . . 18 Mazda Wholesale Parts Dealers . . . 45 Mike Calvert Toyota. . . . . . . . . . . . . 41 Mitsubishi Wholesale Parts Dealers . 43 MOPAR Wholesale Parts Dealers . . 29 Motor Guard Corp. . . . . . . . . . . . . . . 6 North Freeway Hyundai . . . . . . . . . 34 PreFab Ads . . . . . . . . . . . . . . . . . . . 10 Prima srl, Inc. . . . . . . . . . . . . . . . . . 13 Rare Parts, Inc. . . . . . . . . . . . . . . . . 20 Ray Huffines Chevrolet . . . . . . . . . . 35 Reliable Chevrolet. . . . . . . . . . . . . . 40 Replica Plastics. . . . . . . . . . . . . . . . 41 SATA Spray Equipment . . . . . . . . . 23 Scoggin-Dickey Buick . . . . . . . . . . 27 Sherwin-Williams Automotive Finishes . . . . . . . . . . . . . . . . . 16, 17 South Pointe Chrysler-Jeep-Dodge. . 7 TG Products, Inc. - The Rail Saver . 18 Toyota of Fort Worth . . . . . . . . . . . . 38 Toyota of Laredo . . . . . . . . . . . . . . . 34 Toyota Wholesale Parts Dealers . . . 42 Valspar Automotive . . . . . . . . . . . . . . 5 Volkswagen Wholesale Parts Dealers . . . . . . . . . . . . . . . . . . . . 42 Volvo Wholesale Parts Dealers . . . . 44 Young Chevrolet . . . . . . . . . . . . . . . 32
www.autobodynews.com | OCTOBER 2014 AUTOBODY NEWS 3
Web Window
Autobody News Launched Our New Website on September 13 with Victoria Antonelli
On Sept. 13, 2014, Autobody News launched a new and vastly improved website, under the same domain name— www.autobodynews.com. Enhanced video handling, strengthened social media connectivity, optimal organization, and an eye-catching color scheme are just a few of the many up-
Home The home page (see p. 8)displays the most recent articles in the following categories—Regional Content, Product News, National Events, Recent Association Articles and the Video Gallery. The Video Gallery will feature recent videos that has impacted the industry.
Regional Content Regional Content is grouped, like our print editions, into five major sections of the country—Midwestern News, Southwestern News, Western News, Northeastern News, and Southeastern News. National News, which is replacing the former Industry News category, covers stories that affect all corners of the US. The regions are color-coded at the top of the page to match the headings of each section. Each region now has its own domain. For example, western.autobodynews.com will take you to Western Regional Content, including News, Associations, and Events. You can also located and save RSS feeds from each of these regional categories.
SPS SPS stands for Shop & Product Showcase. This unique publication gives shop owners and managers a detailed, peer to peer perspective on the prod-
grades this advanced template has to offer. The template is fully responsive, meaning you can view it optimally on any device you carry. The main functionality is to group our regional coverage into Regional Content pages, one for each of the print issues of Autobody News.
News Here you will find National News, Company News, Product News, Insurance News, and Automakers and Dealers. Find current and timely news stories about automobile companies, new product releases, insurance dealings, and news provided by dealerships.
4 OCTOBER 2014 AUTOBODY NEWS | www.autobodynews.com
ucts and services being used. Downloadable PDFs of each issue are located in this section, with the most recent being October 2014. The next drop down item, Advertising in SPS, gives detailed information about advertising policies, and how you can get your products noticed by the owners and managers of over 40,000 collision repair shops nationwide. Columns This tab features articles by industry enthusiasts. With the help of over 15 contributors, AutoBody News is able to produce thought-provoking, informative features.
Events This drop down menu not only lists meetings, classic automobile shows, and other activities for all five regions, but also national events, including the latest on SEMA and NACE. See Our New Website, Page 6
www.autobodynews.com | OCTOBER 2014 AUTOBODY NEWS 5
Tips for Smooth Operation If you’re a frequent flyer on our site your browser may store links to our old site in its cache. If you’re not getting active links, go to your history and delete the cache file, then relaunch autobodynews.com.
Continued from Page 4
Our New Website
Associations The association stories come from all five regions, as well as national association news. Examples include news about the Iowa Collision Repair Association (ICRA), Automotive Service Association (ASA), and the Louisiana Collision Industry Association (LaCIA).
Some Ugly Regional Placeholders? You’ll notice some placeholder banner ads on the regional content sections of the website. If you’re a dealership doing wholesale parts trade in your area, consider replacing these ‘eye catching’ spots with a banner of your own. We’ll design it for you at no charge. Email advertising@autobodynews.com for more information.
Digital Editions Download a PDF version of past and present regional issues.
Contact Us Click here to find numbers and emails for all staff members at AutoBody News. Information on how to sign up for the eNewsletter or a print subscription can also be found here.
Login Click this link in the top right corner to create and sign into your account. You will need to create an account and log in in order to post a comment on an article or column for example.
Social Media On the top left corner, you will find
links to our Twitter, YouTube, Facebook, and LinkedIn pages. On the left side of each article, you will also see a Facebook tab, which allows you to “like” our page.
6 OCTOBER 2014 AUTOBODY NEWS | www.autobodynews.com
Take Advantage of Regional Coverage As a shop owner or association member we want to know what’s going on with your shop or your association in your state. Send us an email with the date of your meeting in advance, we’ll post it in our regional secction. Let us know what happened with pictures or video. Likewise if there’s something special going on with your shop, we can get the word out. Email your details to: editor@autobodynews.com. Thanks. We hope you enjoy using our new site.
NWLCRA Monthly Meeting
The monthly NWLCRA meeting was held on Sept. 9, 2014. The meeting focused on where the industry is heading with Aluminum and the tools required to properly repair Aluminum vehicles. This month, shop owners and technicians were invited to experience hands-on straightening and repairing on Aluminum panels. The first session was on Sept. 4, from 3:30 to 8:00 pm with the equipment being provided by PRO SPOT. The second session was at the NWLCRA meeting on Sept 9th from 6:30 to 8:30 pm, with the equipment being provided by CARO-LINER. Both sessions were held at Louisiana Technical College on North Market in the Collision Repair Area. For PRO SPOT session information, call Roger Daugherty at (318) 222-8417. For questions regarding the CAR-O-LINER session, contact Bill Burnside at (318) 208-3895. The NWLCRA meeting also had gumbo available for a nominal fee.
www.autobodynews.com CHECK IT OUT!
www.autobodynews.com | OCTOBER 2014 AUTOBODY NEWS 7
Continued from Cover
Overtime Pay
October 1, 1997 to January 25, 2012. Michelle Smoluk claims she performed work as a non-exempt secretary from approximately May 2004 to January 25, 2012. The plaintiffs say they worked an average of 50 hours per week and were not paid the proper overtime rate for the hours they worked over 40 per week, as prescribed by Federal and Florida law. They also say that Action Auto Body received gross revenue in excess of $500,000 per year, which satisfies the FLSA’s coverage requirements of working in interstate commerce. According to Section 7 of the FLSA guidelines, unless employees are specifically exempted from this rule, “...employers must pay covered workers at least one-and-a-half times their regular hourly wage for hours worked over 40 hours a week at a given job. Employers may choose to pay more than time-and-a-half for overtime or to pay overtime to employees who are exempt from overtime under the FLSA.” The Smoluks are seeking dam-
Excerpt from FLSA Regulation §779.372
Nonmanufacturing establishments with certain exempt employees under section 13(b)(10). (c) Salesman, partsman, or mechanic. (1) As used in section 13(b)(10)(A), a salesman is an employee who is employed for the purpose of and is primarily engaged in making sales or obtaining orders or contracts for sale of the automobiles, trucks, or farm implements that the establishment is primarily engaged in selling. As used in section 13(b)(10)(B), a salesman is an employee who is employed for the purpose of and is primarily engaged in making sales or obtaining orders or contracts for sale of trailers, boats, or aircraft that the establishment is primarily engaged in selling. Work performed incidental to and in conjunction with the employee's own sales or solicitations, including incidental deliveries and collections, is regarded as within the exemption. (2) As used in section 13(b)(10)(A), a partsman is any employee employed for the purpose of and primarily engaged in requisitioning, stocking, and dispensing parts.
8 OCTOBER 2014 AUTOBODY NEWS | www.autobodynews.com
(3) As used in section 13(b)(10)(A), a mechanic is any employee primarily engaged in doing mechanical work (such as get ready mechanics, automotive, truck, or farm implement mechanics, used car reconditioning mechanics, and wrecker mechanics) in the servicing of an automobile, truck or farm implement for its use and operation as such. This includes mechanical work required for safe operation, as an automobile, truck, or farm implement. The term does not include employees primarily performing such nonmechanical work as washing, cleaning, painting, polishing, tire changing, installing seat covers, dispatching, lubricating, or other nonmechanical work. Wrecker mechanic means a service department mechanic who goes out on a tow or wrecking truck to perform mechanical servicing or repairing of a customer's vehicle away from the shop, or to bring the vehicle back to the shop for repair service. A tow or wrecker truck driver or helper who primarily performs nonmechanical repair work is not exempt.
ages for unpaid minimum wage and unpaid overtime compensation for hours they worked in excess of 40 per week with interest; an equal amount in double damages/liquidated damages; the cost of the action and reasonable attorneys’ fees and additional relief decided by the court. If the plaintiffs prevail, there is likely a statute of limitations for any entitlement going back two or three years, at the discretion of the court, from the date on which the case was filed. Since the case was filed in State Court in February 2014, that would be the effective date for damages. The defendants assert that Jospeh Smoluk was exempt from the FLSA under the executive and/or professional exemptions and Michelle Smoluk was exempt under the administrative exemption. Over the years there has been considerable confusion about the status of service writers and whether or not they are exempt from the overtime pay provisions of the FLSA. The answer appears to lie in whether or not the employer is a dealership or a collision center. The distinction is important, since the exemption for service writers only ap-
plies to service writers who work in an auto dealership, that is an ‘establishment . . . primarily engaged in the business of selling automobiles, trucks, or farm implements to the ultimate purchaser.’ 29 CFR 372(b)(ii). If the service writer works in a collision center, service shop, or some other business which does not actually sell cars, then the exemption does not apply, according to attorneys. If Action Auto Body, LLC is a dealership, then the service writer exemption pretty clearly applies. There is a case called Brennan v. Deel Motors, 475 F.2d 1095 (5th Cir. 1973) which is directly on point, and is actually binding on the court where the Smoluk case is pending. “A body shop would have all of the general exemptions available under the FLSA at their disposal,” said an attorney with a nationwide firm that represents employers in labor and employment matters. “For example, executive, administrative, professional, computer professional, outside sales. They just would not have the three commonly used dealership overtime exemptions: salesperson, partsmen, and mechanic,” said the attorney, who is not affiliated with this case,
adding the service writer exemption is considered part of the salesperson exemption. In 1966, Congress amended the FLSA and created an exemption for any salesman, partsman or mechanic employed at a retail dealership. A year later the U.S. Department of Labor (DOL) confirmed service writers were exempt from overtime pay; however, they retracted their statement a month later and issued an opinion letter saying service writers would not be included in the exemption. Since then numerous federal cases have ruled that service employees are exempt from FLSA overtime. On April 5, 2011, the Wage and Hour Division of the DOL clarified its position. According to their website, “Salesmen, partsmen and mechanics employed by automobile dealerships are exempt from the overtime pay provisions of the FLSA.” Richard Longo, Director of Enforcement for DOL’s Wage and Hour Division in the Western Region said, “The April 2011 cleanup rule did stipulate our current position on this matter and that we don’t take an automatic position that service writers are exempt just because of their job title.
That would be consistent with how we apply any of our exemptions. We look at the facts of the case. “With that being said, even though we’ve made these changes when appropriation came in for the spending bills they basically didn’t fund some of the changes,” said Longo. “We’re taking a non-enforcement position on the matter currently but it does not prohibit individuals from seeking court decisions to determine exempt or non-exempt status.” Longo said that if courts are looking for interpretive guidance, the most recent guidance would be the April 2011 update. “If the company is able to establish that service writers satisfy one of the white collar FLSA exemptions, it would eliminate any need to record service writers’ hours worked or pay overtime for hours worked over 40 in a work week,” said the attorney consulted. “While service writers typically work long hours, they are usually paid quite well. If service writers are found to be exempt under one of the FLSA white collar exemptions, this would be a great victory for body shops and collision centers.” The defendant’s attorney has a
policy of not commenting on pending litigation. The plaintiff’s attorney was unavailable for comment at press time. Autobody News will continue to follow this story and update readers on the status of Smoluk v. Action Auto Body, LLC. Details about the applicable FLSA regulations are available on the following website: www.ecfr.gov under section 779.372. As always, consult a qualified attorney before acting or reacting to any business news discussion such as this.
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www.autobodynews.com | OCTOBER 2014 AUTOBODY NEWS 9
Texas Bugatti Owner Pleads Guilty to Insurance Fraud
A Lufkin, Texas, man has pleaded guilty to federal violations in the Eastern District of Texas, according to an announcement by U.S. Attorney John M. Bales. According to information presented in court, in October 2009, Andy Lee House purchased a 2006 Bugatti Veyron for $1 million and had it insured for $2.2 million. On Nov. 11, 2009, House drove the vehicle into the Gulf Bay near La Marque, Texas, and upon exiting the Bugatti, left the motor running, resulting in the engine taking on large amounts of salt water which destroyed the vehicle. House reported to first responders he was reaching for his cell phone when he swerved and accidentally drove into the bay. On Nov. 12, 2009, House called the insurance company and filed a $2.2 million claim on the Bugatti. However, House did not know that another motorist had videoed the accident, including the moment House drove the vehicle into the water, and then posted the video to YouTube. House faces up to 20 years in federal prison at sentencing. A sentencing date has not been set.
Caliber Collision Gifts 10 Recycled Vehicles
Caliber Collision donated 10 vehicles this summer as part of the NABC’s Recycled Rides™ program. Caliber teamed up with insurers, parts suppliers and others to provide transportation for active duty servicemen, military veterans and financially challenged families including: ● Four vehicles provided by Farmers Insurance were donated to veterans in Dallas and Austin as part of the Carry the Load Memorial Day March. ● A Honda Odyssey from Nationwide Insurance will help a veteran in Sacramento working to rebuild his life after homelessness. ● Three vehicles from GEICO were gifted to struggling families in Tucson and Phoenix. ● A Toyota Corolla from Esurance will help a young military family in Rancho Cucamonga, CA with transportation for an infant daughter on daily kidney dialysis. ● A Honda Odyssey van from Allstate will help transport low-income high school students in Tucson who are participating in a work-study program to help pay for their education. The company plans on gifting more than 20 vehicles over 2014 to military and first responders.
10 OCTOBER 2014 AUTOBODY NEWS | www.autobodynews.com
Caliber Collision Opens 14th Location in Houston Area
Caliber Collision Centers, the largest collision repair company in the U.S., opened a new location in the northern Houston area on September 3 as part of its continued expansion in TX. Caliber Collision’s new Kingwood location, with 13,000 square feet of space, opened for business at 5455 FM 1960 East in Humble, TX. The facility employs the latest innovations in collision repairs with 25 service bays, three heated paint booths and 80 parking spaces. “We are proud to now operate 64 locations in Texas with 14 locations across Caliber’s Houston region. Today’s Kingwood opening allows us to restore more customers to the rhythm of their lives, as we deliver on our commitment to expand customer choice while providing industry-leading metrics in every market we serve.” said Steve Grimshaw, Caliber Collision Centers’ CEO. “As we continue to grow in the nine states we serve, we are pleased that our new Kingwood center brings Caliber Collision’s total number of locations to 188 across the Caliber network,” stated Mark Sanders, Caliber Collision Centers’ President and CEO.
NM Ranks 11th for Most Expensive State to Own Car
New Mexico is middle of the road when it comes to gas prices and the price of car insurance. But a new study shows the state is one of the most expensive for drivers. From the road, to the shop, to the pump, New Mexico drivers are finding themselves paying quite a bit to get behind the wheel, according to Cole Miller, writing at krqe.com. According to a new study by Bankrate.com, the Land of Enchantment is the 11th most expensive state to own a car, with drivers forking over a lot of for gas. The study says the average cost to fill the tank for a year is a little more than $1,100. That means New Mexicans were spending the eighth most for fuel. It’s not because of gas prices, though. It’s because New Mexico is a big state with some big commutes, meaning more trips to the gas station. That has some drivers mapping out their motoring. According to the study, when it comes to yearly maintenance and insurance, New Mexicans are paying about average. The average driver in New Mexico spent $315 a year on repairs. Insurance costs came to an average of $895.
www.autobodynews.com | OCTOBER 2014 AUTOBODY NEWS 11
ABRA Auto Body Acquires USA Collision Centers
ABRA Auto Body & Glass, a leading national damaged vehicle repair company, announced it had acquired USA Collision Centers in Harrison, West Chester, and Cincinnati, Ohio. The news follows ABRA’s initial entry into the state in June 2014. Terms of the transaction were not disclosed. The recent growth in Ohio is part of the company’s strategy to increase its national footprint. ABRA is one of the collision industry’s largest multi shop repair operators in the country. ABRA’s portfolio now stands at 243 repair centers in 19 states. “The acquisition of USA Collision Centers represents a fantastic opportunity to expand our presence in Ohio and continue building on the extraordinary success we’ve achieved in the region,” said Duane Rouse, ABRA’s president and chief executive officer. “ Joseph Sanfillipo, Jr., founder and co-owner of USA Collision Centers, said, “I have complete confidence ABRA will continue the legacy my family and I have built over the years. There is no doubt our employees will flourish and our customers will receive the highest quality repairs and superior service they’ve come to expect.”
Mandatory Earthquake Hour for OK Insurance Agents
With the increasing prevalence of earthquakes in OK that some attribute to more aggressive fracking opeartions, Gov. Mary Fallin approved an emergency rule adopted by OK Insurance Commissioner John D. Doak to require all licensed producers and adjusters with the property line of authority to complete one hour of continuing education on the topic of earthquake insurance every two years. “This emergency rule will ensure insurance agents in our state stay up-to-date on earthquake information,” said Fallin. “It’s important as the market for earthquake insurance expands in OK that residents get reliable and accurate information from insurance agents to help them consider whether they need this additional coverage.” “Working with Governor Fallin to approve this rule is an important step for consumers who are seeking clarification on the benefits of earthquake coverage,” said Doak. “The Oklahoma Insurance Department works hard to ensure that consumers across the state receive clear and accurate information from their agents regarding all types of insurance.” The earthquake insurance continuing education requirement goes into effect Jan. 1, 2015.
12 OCTOBER 2014 AUTOBODY NEWS | www.autobodynews.com
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ABAT Holds Meeting
ing and even traveling long distances. More and more shops are asking for meetings in their area.” “There’s a thirst for the knowledge that’s being shared and perhaps even more important, there’s a hunger for the industry members to assemble and to know they are not “The Only Ones” who face the numerous challenges this industry offers. This association is only a few months old and we’ve seen phenomenal growth and it’s all from word of mouth. Repairers are actually reaching out to others in their market areas saying: “C’mon y’all, let’s get together and make our industry better!” “During these meetings we explained the mission statement of ABAT and why we felt the need to start such an association. We discussed issues such as the “Spot Within Panel” calculator among other procedural and educational information. We are discussing the possibility of having a truly independent survey conducted in regards to the “Prevailing Competitive Practices and Pricing “PCP.” “Each ABAT meeting begins with
the Pledge of Allegiance and a prayer; we learned this from Barrett Smith during his recent presentation to ABAT members. The attendees seem to really enjoy this and it really sets the stage for some open and down to earth conversation. “Of course we make a statement regarding Anti-Trust and what can and can’t be discussed,” said Chad Neal, owner of Paint Works, one of ABAT’s founding members. “Of course there’s a great deal more that can be discussed than the few restrictions on what can’t be. The goal is to overcome long-time misunderstandings and unnecessary fears and to spark a much needed dialogue within the repair community.” ABAT membership is growing as more shops are sending in their applications and dues. Inquiries are coming from across Texas wanting to learn more about the association and how to get a meeting in their area. One well known Texas shop owner remarked: “I believe this association has teeth and we need to get on board.” If you’re a Texas repairer or manufacturer-vendor supporter and would like to learn about ABAT, contact: Burl Richards @ Phone: 903.657.8082 Fax: 903.655.1270 email: brich08@aol.com
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MDL Opens
and to enjoin them from efforts to harm them by making disparaging comments about them and to steer consumers away from them. The judge stated in so many words that he would not render an order at that time as he anticipated the insurers would not make it necessary to do so... but he would consider it if indeed their behavior warranted it. This was pivotal as it placed the concern in the judge’s minds as well as became part of the record. Repairers will be documenting any such instances and share them with their legal counsel. The five attorneys representing the repairers were Mississippi attorneys John Eaves Sr., John Eaves Jr., Allison Fry, Hal Wilkins and Florida’s own Brent Geohagan, who, as most know, has represented Ray Gunder in his ongoing legal quests. Because this was a pretrial hearing, the judges were cordial yet to the point regarding their conveying the court’s expectations for the attorneys. The judges made it clear to all that frivolous filings and unnecessary de-
lays and such would not be tolerated, and due to the sheer volume of the issues and evidence that was to be presented, that the court would be quick to discourage and stop such behavior. Based upon the limited questions posed by the insurer attorneys, the judge’s message had been received clearly and duly noted. Upon conclusion, as the court rose to its feet and the judges left the bench, while it was quiet and subdued, there was a sense of relief along with excited expectations by the repairers who were there. They knew that this was the beginning of long overdue changes in the automotive collision repair and casualty insurance industries normal behavior and practices. It wasn’t a day of reckoning… but I firmly believe it is the first day of its beginning!
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Excerpts from Orlando Sentinel Articles
The following are excerpted from Paul Brinkman’s September 11 article in the Orlando Seninel as referenced by Ron Perretta. •About 55 attorneys representing insurance companies came to the Orlando court hearing September 11 •The judge in charge, Senior U.S. District Judge Gregory Presnell, showed dry humor, saying, “I don’t know what we did to deserve this, but here we are.” •Body shop attorneys said they expect another 20-25 cases to be filed in other states. •The hearing mostly set schedules and conducted introductions between attorneys and court staff. •Michael McCluggage with Eimer Stahl in Chicago said he would be doing “most of the talking in court for State Farm.” •Judge Presnell said he would discourage lengthy extensions on deadlines or filing too many back-and-forth replies to others’ motions, adding “you’ll have to come back from the golf course to get it done [if he allows it.]” Separately, Paul Brinkman has quoted Ray Gunder of Gunder’s Auto Center in Lakeland as saying, “[I have] seen many cars that were repaired improperly at other shops under insurer-imposed expense limits.” “One of those cars was a 2007 Toyota Camry hybrid owned by Joan Dick of Lake Wales, Gunder said. After a collision, Dick said, she had the car repaired first at a shop that is part of State Farm’s repair program. She says the car still shook violently on the road. She eventually took it to Gunder. Gunder’s inspections indicated a cracked block and bent steering column, among other problems, Dick said in an interview. Eventually the car was declared totaled. “I had been through hell for months,” Dick said.” “Gunder’s attorney on the case, Brent Geohagan of Lakeland, said the court may need to rent a hall for all the attorneys involved.”
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ASA Confirms Detroit as Location and Dates for Next NACE-CARS Expo The Automotive Service Association (ASA) announced that NACE | CARS 2015 will again be held in The Motor City, July 23–25 by ‘popular demand.’ The ASA Board and management considered feedback from attendees, exhibitors, and other industry constituents. Dan Risley, ASA Executive Director, stated “The response for Detroit was overwhelmingly positive. Many said this was the best event in recent memory. Attendees were pleased with the education and training, and numerous exhibitors made significant sales on the show floor. There were many requests for the exhibition to continue through Saturday, and we will incorporate that for 2015.” Partnering with industry organizations and associations is key to the success of Industry Week, and that format will continue. I-CAR, CIC, CCIF, MERA, NABC, and CREF have already committed to Detroit next year. I-CAR will again host the center stage in the exhibit hall to provide education and awareness on advancing vehicle technologies and related repair and industry trends, maintain a booth for membership, provide live technical demonstrations in the demo zone,
and offer add-on I-CAR training sessions in classrooms. John VanAlstyne, I-CAR CEO & President, said “We are very pleased with the results of Industry Week this year. Attendance was up significantly on the NACE floor and the I-CAR Conference was a great success. We are committed to NACE and will continue with a similar footprint in 2015. We also plan to continue holding the I-CAR Conference in conjunction with Industry Week moving forward, shifting to a biennial cadence, so make plans to attend our next Conference in 2016.” ● CIC will once again host the summer quarterly meeting during Industry Week following a successful meeting this past July in Detroit. ● CREF will hold its annual golf fundraising event during the week. ● After drawing a larger-than-expected Canadian contingency, and with close proximity to the growing Canadian market, CCIF will be back once again with their education program, sessions, and a keynote speaker. ● MERA will host a series of sessions again in 2015. ● NABC will produce the Recycled Rides program on the exhibit floor.
14 OCTOBER 2014 AUTOBODY NEWS | www.autobodynews.com
Other organizations are currently evaluating co-located meetings and announcements are forthcoming. “On behalf of the ASA members, the board of directors, and our team, we are pleased to be working with ICAR, CIC, CRES, CCIF, MERA, NABC, and others for the benefit of the automotive repair industry,” said Darrell Amberson, ASA Chairman. “With our organizations working together we can provide the most current education and training in the market. We look forward to seeing everyone in Detroit the week of July 20, 2015.”
GM Posts Best July Sales Since 2007, Toyota Also Up
General Motors has posted its best July sales since 2007. GM sold 256,160 cars in July, a 9% uptick from July 2013. Retail sales were only up 4%, though—perhaps a sign that those who buy cars for fleets have more faith in GM than individual customers. This is the ninth straight month of year-overyear sales growth for GM, and an improvement from June when yearly growth was at around 1%. Toyota said it sold 215,802 cars last month, an 11.6% increase over a year ago.
Service King Team Member Wins Jeff Silver Award
The Inter-Industry Conference on Auto Collision Repair (I-CAR) named Service King teammate Dustin Harrier winner of the prestigious Jeff Silver Award for his outstanding commitment to the industry. Harrier, Service King’s Western U.S. Quality Control Manager and an I-CAR instructor, received the award July 30 at the International Autobody Congress and Exposition in Detroit. The Jeff Silver Award is presented annually to an I-CAR Platinum individual who demonstrates passion for training, professional growth and improvement of the industry’s image. “Dustin is a multi-talented ICAR instructor, and Service King is proud to have a teammate that shows so much dedication to his students and the collision repair industry,” said John Halbrook, Service King Project Specialist. “His instruction has led to thousands of high quality collision repairs for Service King’s customers.”
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www.autobodynews.com | OCTOBER 2014 AUTOBODY NEWS 15
Lean Operations
David Luehr is the owner of Elite Body Shop Solutions, LLC, a collision business consulting firm based in Nashville, Tennessee. He is a 30 year veteran of the collision repair industry. David is an expert in Body Shop Operations and specializes in Lean, and Theory of Constraints methods. Email him at dluehr@msn.com
Better Blueprinting, Part 2: How to Set Up a Blueprinting Area with David Luehr
In last month’s Better Blueprinting Part One, we discussed reasons that shops have failed at Blueprinting. This month we will focus on performing Blueprinting, and how it can greatly benefit your collision repair shop.
Blueprint Admin Staffing Over the years I tried numerous variations and combinations of people to staff a Blueprinting program. All of them worked better than no Blueprinting program, but some combinations definitely worked better than others. Much of what influences your Blueprint staff is simply the size and volume of your shop. Many clients run smaller shops where people wear many hats. In a small shop it is not uncommon for the manager to also be the estimator, the parts guys and the Blueprint guy. It is pretty easy to determine how to staff a really small shop, but what about a shop that is a little bigger? I recently worked with a
client that had two estimators, one of them liked being in the shop and the second one was better at dealing with customers. So we moved one of them into the shop to be the Blueprint Analyst, and the other efficiently handled the entire volume of customers as the Customer Service Manager. You may need to experiment with different staffing combinations to make it work for your unique needs.
Blueprint Technician Staffing The best Blueprint team I put together had an older and very knowledgeable technician working alongside an apprentice disassembly technician. This was a high volume shop and the team worked in a dedicated Blueprint workspace with a Blueprint analyst who never left his station. Many advanced shops have taken advantage of the benefits that creating a team system brings. It is still possible to use a dedicated Blueprint area with individual flat rate
techs who are not paid as a team, but there is a lot of movement of tools and people. Some shops using rolling computer carts are finding some success performing the Blueprinting in the technician’s stalls. It works, but I still prefer a dedicated area. Again, there are many ways to create a Blueprint staff and each shop is going to be a little different than the next based on skill level, shop size, personalities, etc.
Space Don’t fall in the trap of believing that your shop may be too small to be successful with Blueprinting. I have analyzed damage in space from 2,000 sq. ft. to over 60,000 sq. ft. and the practical application is still the same.
1. Disassemble and analyze the damage. 2. Move the car until enough parts arrive to continuously work on it. (Notice I said continuously.)
3. Move the car in and fix it. The key here is to only allow vehicles on the shop’s repair floor once they are ready to be worked on continuously. If you follow this discipline, you will find shop space you knew you never had! Some setups used by successful shops: ● One or two dedicated Blueprint stalls inside the shop
● Laptop or dedicated computer in the Blueprint area ● If possible, keep the area accessible for tow trucks ● Keep fasteners and fluids in the Blueprint area
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6. Small mirror 7. Flash light/drop light 8. Mobile Estimating system 9. Creeper 10. Collision estimating system 11. Access to OEM parts schematics 12. Colored markers 13. Heavy Gloves 14. Safety Glasses
Recommended Tools In addition to the usual hand tools, the following items are needed to complete the inspection procedure: 1. Parts cart 2. Clipboard 3. Tape measure 4. Tram gauge 5. Tread depth gauge
Better Blueprinting Techniques Step 1. Vehicle Check-in Even though the process of performing a “check-in” with the customer during vehicle drop-off may not be considered a part of the Blueprint process, the information obtained is absolutely vital to the Blueprint. With the customer present, this process involves walking around the vehicle and
communicating and documenting the following. It is a great way of communicating the customer’s concerns indirectly to the Blueprint Analyst to ensure things don’t get missed! ● What damage is a result of the accident? ● Unrelated prior damage? ● Upsell opportunities? ● MILs such as check engine warning lamps on dash – prior or related? ● Anything unusual about the vehicle’s performance mechanically? ● Touch-up paint and other “freebie” promises
Step 2. Identify Mechanical Issues Identifying mechanical issues prior to disassembling and disabling a damaged vehicle is always preferable. (But not always possible.) Everyone can relate to the delays that are caused when these problems are discovered on the day the car was supposedly going to be ready! In a collision, mechanical issues could involve many things; however the most common are suspension, air conditioning /cooling system, wiring and supplemental restraint systems. I recommend that first you address these items by: ● Review the customer concerns on the check-in sheet ● Test driving ● Performing suspension alignment prior to disassembly (if possible) ● Using a scan tool to help diagnose trouble codes (check engine lights, etc.) ● Always ask the customer how many passengers were in the car, especially if restraint systems were deployed. Check those seatbelts! ● Check interior electronics, heat/air, etc. ● Check fluid levels Step 3. Communication between Estimator and Technician How many times have you seen a techSee Better Blueprinting, Page 18
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Better Blueprinting
nician take the front bumper off a car that was in the shop to get the rear bumper fixed? This is not a complicated step, but one that is often skipped with costly results. Shops need to include this step as a standard procedure and hold people accountable because the technician must be properly informed prior to touching a single wrench to the vehicle! Make it part of your program to have the estimator or Blueprint Analyst go over the checkin sheet with the technician and also review the estimate if one had been previously prepared. Use the next step (visual mapping) to help with this communication as it will clearly indicate what parts need to be removed in order to properly analyze the damage.
Step 4. Visual Mapping A great form of communication between the Blueprint Analyst and the disassembly tech is the use of a colored water marker to write on the vehicle or “visual mapping.” It can sometimes be difficult to pull the technician aside for an extended period of time to discuss
the details of a particular vehicle’s disassembly requirements. This technique can help by writing the instructions on the car in advance. This technique can also be used by the customer service rep who is identifying damage during vehicle check-in and is particularly handy when there are multiple dents or scratches on a single panel, some which are supposed to be repaired, and some that are not. When doing visual mapping, you can use any color you wish; however, I prefer to use traffic light colors: red, yellow and green.
● Red = Don’t fix ● Yellow = Caution, Don’t know if fixing yet? ● Green = Fix it! You can come up with your own system of words, abbreviations, or symbols to mark the vehicle, but here are a couple of the most common ones.
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terms “meticulous disassembly” or “100% Teardown.” This refers to the practice of taking off EVERY damaged component that is bolted or otherwise fastened to the vehicle. This practice should not only include damaged parts but also parts being re-
Step 5. Meticulous Disassembly in Sequence (if Possible) In this step, it is time to start disassembling the damaged vehicle. If you have a dedicated Blueprint Analyst who will be keying-in the estimate as the technician removes the parts, it will be much easier to remove the parts in approximately the same group sequence as your estimating system parts groups i.e. bumper, grille, lamps, etc. This method is not always possible, but you will find that removing damaged parts and entering damage into the estimating system with both people following the same group sequence (Step 10) will make your life easier. You have probably heard the
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Napa Body Shops Jolted After 6.0 Quake by Ed Attanasio
In most parts of the country, snow, tornadoes, floods and other severe weather can lead to an unexpected windfall for body shops. But most of California isn’t usually affected by dramatic seasonal weather. However, when an earthquake hits, like the one that shook Napa, CA, on August 24 at 3:20 a.m. and measuring at a 6.0 on the Richter scale, everyone, including body shops, are impacted. The quake’s epicenter was located approximately 3.7 miles northwest of American Canyon near the West Napa Fault beneath the Napa Valley Marina, just west of the Napa County Airport. The earthquake was the largest to hit the San Francisco Bay Area since the 1989 Loma Prieta earthquake 25 years earlier. Significant damage and several fires were reported in the southern Napa Valley area, and there was also damage in the nearby city of Vallejo, in Solano County. Napa, of course, is best known for its wine industry, and certainly wineries were damaged. So were distributors and retailers whose inven-
Most cars damaged by the Napa Earthquake needed just cosmetic work, but obviously some vehicle required much more. (Photo courtesy of Michael Smith)
tory was subject to breakage. Bistro Don Giovanni in Napa lost about a third of its wine and liquor inventory, worth $20,000 to $30,000, said Curtis Bradford, the restaurant’s manager. The quake could lead to economic losses of as much as $4 billion from wrecked wine stock and shuttered businesses that rely on
20 OCTOBER 2014 AUTOBODY NEWS | www.autobodynews.com
tourists, according to an estimate from Kinetic Analysis Corp. Brent Blackwood, the owner of Blackhawk Body Shop in Napa was obviously concerned about his shop when the earthquake hit, but once he realized that the damage was minimal, his focused shifted to repairing cars. “There was a little sheet rock damage and quite a bit of broken glass here at the shop. A few tool carts and a jack fell over, but other than that we were fine. It was just enough to make a big mess, that’s all.” Since the earthquake, Blackhawk Body Shop has been inundated with customers and business is up at least 40%, Blackwood explained. “On a normal day, we do 4–6 estimates, but since the earthquake, we’re doing 15 or more every day. It’s mostly PDR (Paintless Dent Removal) work, but in some cases if the paint was affected, we need to do more than just PDR. We knew that we would get a spike in business, so we came in the day after the shaker and made sure we’d be prepared. We have a PDR guy that we work with regularly and he’s normally here once a week, but now he’s been
down here almost every day.” A second-generation body shop owner, Blackwood and his father have seen a few earthquakes over the years, including the 1989 Loma Prieta quake, but this one hit closer to home. “[Loma Prieta] impacted us, of course, and some people here in Napa lost their homes,” Blackwood said. “We’ve been here since 1957 when my dad opened this shop, so we have second and thirdgeneration customers. We’ve developed relationships with them over the years, so seeing their cars coming in and asking them about their homes was different. In this industry, we make money when people get into accidents, but when things like earthquakes happen, everyone is affected and anyone’s property can be damaged.” Mike’s Auto Body in Napa experienced some toppled shelves and flipped chairs, but overall the shop came through without damage, according to the shop’s Manager Brad Woodland. “We were extremely lucky,” he said. “The city green-tagged our building, which means we’re clear for business as usual. I live here in Napa and we know people whose
earthquake has been good for us from a business standpoint, but in the end we’re more focusing on helping people in need after a disaster like this.” Randy Lichau, a Napa native and the owner of Lito Auto Body near downtown was shocked by the magnitude of the quake. “Our refrigerator danced across the room and it’s a very large unit, so I was impressed by that,” Lichau said. “We lost a lot of good buildings and several parts of the town took it hard, but we never shut down and we have been working hard to fix all the cars that have been coming Some older buildings in Downtown Napa didn’t fare well here.” during the 6.0 temblor. (Photo courtesy of Michael Smith) Lichau has been fast homes have been red-tagged or yellow- tracking his production to meet the intagged and some that came down comcreased need and getting his cuspletely.” tomers back on the road as quickly as Business was already brisk even he and his crew possibly can. “We’re before the quake hit, so now Wood- coming in early and working on Satland’s workload is over the top, he urdays, because we were actually busy explained. “The repairs are all earth- even before the quake,” he said. quake-related, involving dented “We’re doing all of the glass-related roofs, hoods, fenders and trunks. The repairs first, replacing windshields,
headlights, side mirrors and things that make the cars unsafe to drive. We’ve definitely seen a spike in business, but as someone who was born here and grew up here, a tragedy like this is never a good thing. We’re happy to be helping people by fixing their cars and allowing them to return to their normal lives.” Insurers will probably cover about $2.1 billion in damage, according to research firm Kinetic Analysis. Costs borne by the insurance industry may be limited because many homeowners don’t have earthquake coverage, according to the Insurance Information Institute. The costliest earthquakes in the U.S. have occurred in the state. But just 10% to 11% of California homes with homeowners insurance have earthquake coverage, which must be obtained on top of the standard homeowners policy, according to the California Earthquake Authority, a state-managed earthquake insurer. California residents seeking a CEA policy can contact an insurance agent for a premium quote, or go to CaliforniaRocks.com for an estimate. “I’m sure more people are going to buy earthquake insurance now,”
Amy Bach, executive director of San Francisco-based consumer advocacy group United Policyholders. Ms. Bach’s main buying tip is: “Don’t forgo buying it because you think the high deductible is a rip-off. No earthquake insurance means you’re carrying a 100% deductible!”
Celette Has Fixtures for M-B B Class Electric Drive
Mercedes-Benz launched its first electric vehicle in 1906. Over a century later, the company has returned with a vehicle that is 100 percent electrically powered. The new vehicles are built on the same assembly lines as models equipped with gas and diesel engines, and retain the same structural characteristics. The electric engine, developed by Tesla, is integrated in the engine block. The batteries are housed underneath the passenger cabin. For the underframe check, Celette says to use the existing MZ+ fixtures 7246.510 B Class W246 and the complementary set 7156.509 GLA X156. For side repair, use the existing overhead gantry 7246.810 B Class W246. For more information, please visit celette.com.
www.autobodynews.com | OCTOBER 2014 AUTOBODY NEWS 21
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Better Blueprinting
should also have all the grilles, lamps, moldings, fasteners, etc. removed. There are three main reasons that 100% Teardown is recommended.
1. To reveal all hidden damage 2. Ensure fasteners will be reused 3. Facilitate ease in mirror matching the replacement parts
Step 6. Divide Parts by Good and Bad (R&R and R&I) As the technician is disassembling the vehicle, the parts being removed should be separated and placed in two visually separate spaces. One space for damaged parts (Bad) and another for parts just being removed and later re-installed (Good). I prefer to use a table to lay parts out, but you could also use the floor.
and billed out on the initial Blueprint, they become a profit center! I have seen several ways to capture and record these, but my favorite technique is to use a clip sheet. By the tech taping a sample of the damaged clip to a clip sheet and writing out the quantity needed, the person entering the information into the estimating system will have the information. There are two additional benefits to using this system. 1. You can take a photo of the clip sheet to send to the parts vendor. 2. The clips are where you can mirror match them until the new clips arrive. If your company stocks the needed clips, you should put the new replacement clips in a marked bag along with
Step 7. Using a Clip Sheet Clips and fasteners tend to be an often overlooked part of the damage analysis process and with costly consequences. Some shops consider clips and fasteners an expense. When damaged or missing fasteners are captured
22 OCTOBER 2014 AUTOBODY NEWS | www.autobodynews.com
● Is ready to go back on during assembly (part of the “kit”)
the old re-usable clips so when it comes time to reassemble the vehicle, everything the tech needs will be there. It’s a term called “kitting” because you are actually building a kit with everything needed to assemble the car on a parts cart.
Step 8. Re-backing Moldings and Trim As mentioned, we are trying to build a “kit” for the technician during reassembly so cleaning the adhesive and applying new adhesive backing on moldings and emblems should be done immediately after removing them. There are advantages to re-backing the trim now. ● If molding is painted, lessens chance of damaging paint later on ● If they are going to break, it is better to know now so it can be added to repair plan
Step 9. Sequenced Analysis of Damage Using Arrow-Down Method There are several schools of thought about what sequence to put damage entries onto the estimate. Most of us were taught to start with the point of impact and then work outwards. I don’t agree with this because it opens up too much room for error. Nearly 10 years ago, a good friend suggested that I should use the information in the estimating system and take it to the damaged car, instead of the other way around. By keying down through every part in each group, you will now catch parts that may have been completely destroyed or torn off during the accident. I also highly recommend using actual OEM diagrams.
Step 10. Photo Documentation In addition to your company’s photo standards, I suggest getting photos of the parts as they are being laid out on the table or floor. Your local insurance adjuster will most likely appreciate it. Step 11. Blueprint Verification Process, Loading Parts Cart See Better Blueprinting, Page 27
www.autobodynews.com | OCTOBER 2014 AUTOBODY NEWS 23
24 OCTOBER 2014 AUTOBODY NEWS | www.autobodynews.com
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Six Holmes Body Shop Locations Acquired by Cooks Collision Centers, All but Original Shop in Pasadena Cooks Collision Centers, based in Rosedale, CA, has acquired six collision repair locations from Holmes Body Shop. Holmes will continue to own and operate the original Holmes Body Shop location in Pasadena, CA. The transaction is Cooks Collision’s
The original Holmes Body Shop location in Pasadena, CA, from which it grew into an MSO with seven collision repair centers throughout the Los Angeles area. This location will continue to be owned and operated by Tom Holmes
first MSO acquisition in the Southern California market. Terms of the agreement were not disclosed. The Holmes Body Shop locations solidifies Cooks’ position as the largest independently owned and operated collision repair organization in California, with 25 locations through-
out the state. The Holmes collision re- sion Centers. “Cooks Collision is compair centers are located in Alhambra, mitted to providing our new Southern Canoga Park, Duarte, El Segundo, California customers the same high Riverside and Westlake Village, CA. quality collision repair, customer serv“We are very excited about Cooks ice and value that our Northern CaliCollision assuming ownership of our fornia customers have come to expect six locations,” said Tom Holmes, for the past 33 years.” owner and CEO of Holmes Body Shop. Chris Rose, vice president of “Since 1972, our team has focused on Southern California operations for delivering outstanding customer servCooks Collision, said the company ice and quality collision repairs to our plans to add several more collision recustomers. We made our final decision to join the Cooks team based on the honesty and integrity of the entire Wood family and Cooks employees that we met and dealt with. Our team is excited to join the Cooks Collision organization.” Cooks Collision said The seven locations of Holmes Body Shop are dispersed Holmes will continue to own over a wide area of greater Los Angeles and operate the Holmes Body Shop pair locations throughout the Southlocation in Pasadena, CA. ern California market in the future. “The acquisition of the six Symphony Advisors consulted Holmes locations is a key step in exewith both Cooks Collision Centers cuting our strategic plan by expanding and Holmes Body Shop throughout to the Los Angeles basin and serving the acquisition process and separately Southern California consumers,” said Veritas Advisors, Inc. assisted Cooks Rick Wood, co-CEO of Cooks ColliCollision Centers.
CarMax Recruiting for More than 1,000 Jobs
CarMax Inc. said it is recruiting for more than 1,000 positions to fill across the country. The used-car retailer in Richmond, VA, said in a statement that it is offering full- and part-time permanent positions. Most of the openings are in sales and service operations, which include detailers and technicians, CarMax said in a statement. The retailer also has openings in purchasing and in its business office. “While many retailers are hiring for the holiday rush, we are looking for individuals who are looking for a long-term career,” CarMax spokeswoman Michelle Topping Ellwood said. CarMax plans to open 10 to 15 stores during the next year, Ellwood said. CarMax has 139 superstores in 70 markets, but cities with the most job openings are Sacramento, CA; Bakersfield, CA; Cincinnati; Atlanta; Lancaster, PA; and Huntsville, AL. Job seekers can apply at carmax.com/careers. Most positions, with the exception of technicians, require no prior automotive experience.
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Continued from Page 22
Continued from Cover
This is the most important step! Print the estimate out. Check off each damage entry on your estimate as the corresponding part is loaded onto the cart. If you have everything checked off your estimate and there are still damaged parts on the table or floor, you
to add attractive multi-shop operations in line with our growth strategy.” “Our team is proud of the business we have built over the last 36 years,” added Champ’s President Danny Kingston. “Champ’s decades of growth and success in the collision business are a direct result of the efforts of our knowledgeable, friendly, and professional team. We are excited to build on our accomplishments as part of the Boyd team.” The total purchase price consideration of approximately $35.0 million, will be funded through a combination of seller financing and use of Boyd’s revolving credit facility. This purchase price reflects a valuation multiple that is within the range of other recent multi-location acquisitions completed by Boyd.
Better Blueprinting
may have missed something. It’s a simple but very powerful technique. Finally, be sure to place the parts in the same manner as discussed in Step 6. When you orderly divide the good and the bad parts on the cart, it makes checking the replacement parts for correctness (mirror matching) easier to do. For more information or to schedule a Blueprint Clinic at your shop, please contact David Luehr at: dluehr@msn.com.
Boyd Group Acquires
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Texas Debating Giving Driver’s Licenses to Illegals
The State of Texas is again debating whether to grant driver’s licenses to illegal immigrants. The Texas Legislature has repeatedly debated, and ultimately rejected, the idea of granting driver’s licenses to people in the state illegally. But State Rep. Byron Cook (RCorsicana) says it would make Texas roads safer, because motorists with licenses also have to get car insurance. “The State of Utah passed a similar statute in 2005,” Cook said. “The program has worked extremely well, their uninsured motorist rate is currently at 5% while the Texas rate is more than 14%.” Steve McCraw, who heads the Texas DPS, agreed with Cook’s conclusions. “The more people who have drivers licenses, the more people who have insurance, the better,” he said. Texas has long wrestled with the problem of uninsured motorists. There are currently several measures
Free
in the works to make sure that people have licenses, including the new Texas Sure program, which allows officers to check the insurance coverage on a vehicle using the license plate. But the main way drivers are checked for insurance is through the requirement that proof of insurance be provided whenever any vehicle related services are completed, including applying for and renewing a driver’s license. State Rep. John Smithee (RAmarillo), indicated that opposition to Cook’s measure will be broad based. “It sends the wrong message to people who have worked hard and come here legally and done it the right way,” he said. The fact that rates of uninsured motorists increase closer to the Rio Grande is an indication that many of the uninsured are illegal immigrants who are driving without insurance because they are not required to get driver’s licenses.
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K & M Collision Sends Second Version of ‘Open Letter’ Video to NC Attorney General K & M Collision, a NC shop that is known for strong advocacy (see previous story this page and search autobodynews.com), posted a consumer-
ferral program or preferred list, we won’t warranty or guarantee the repair’. “This statement isn’t just misleading, It’s completely false. The insurance company does not, has not and will not warranty the repair even if your car is repaired at their direct repair facility. “Let’s say you do follow their recommendation, and take your car to one of their shops. If there are problems with that repair, the shop itMeredith Bradshaw narrates the second version of the self is liable, in exactly the open letter video. Previous videos are viewable online same way that K&M is liable oriented video on YouTube that it pro- for any of the repairs that we perform. duced in support of Louisiana Attor“The shop you choose, whether it ney General Buddy Caldwell’s action be an insurance preferred shop or an against State Farm. independent shop, is solely responsible “These kinds of unfair trade pracfor the warranty on the repairs to your tices aren’t just a problem in Louisiana,” vehicle. owner Meredith Bradshaw states in “So why do insurance companies the video. “They pose a threat to conmake this misleading statement to their sumers here in North Carolina and policyholders? It’s just another scare throughout the United States.” tactic. The text of a related video states “In reality, the insurance com“After an accident, one of the most pany itself doesn’t provide any guarcommon things you’ll hear from an antee. In fact, with the pressure they insurance company is ‘if you take place on their shops to turn out high your car to a shop that’s not on our re- volume, they create an environment
Herkules to Host NASCAR Driver Brendan Gaughan During SEMA Show Herkules Equipment Corporation will be hosting NASCAR Driver Brendan Gaughan at the 2014 SEMA Show, being held in Las Vegas, Nevada November 4-7. Gaughan will be
NASCAR Driver Brendan Gaughan will be signing autographs on Nov. 4 & 5 at the Herkules booth during the SEMA Show in Las Vegas, NV
signing autographs and chatting with fans on Tuesday and Wednesday, November 4 and 5, from 1 to 3 pm, in
the Herkules booth #11139. Brendan Gaughan has been a NASCAR Driver since 1997 with his debut in the Camping World Truck Series and winning this race in 2000. A Georgetown University graduate and family man, he holds 17 career wins and 83 top-five finishes throughout all of the NASCAR Series races. His latest win was in June 2014 at the NASCAR Nationwide Series Gardner Denver 200 race. His website is: www.brendangaughan.com. Herkules Equipment Corporation, established in 1984, is a leading manufacturer for the Automotive Paint & Body Repair industry, having designed, manufactured and patented the first Paint Gun Washer. They have been manufacturing quality vehicle lifts and scissor lift tables for close to 30 years, providing many industries with ergonomic solutions for countless applications. Herkules also supplies Sparkle Clean, Air Jacks, Carts & Stands, and Crushing Equipment. For more product information, please contact Herkules at 800-4444351, or at info@herkules.us or visit their website at: www.herkules.us.
28 OCTOBER 2014 AUTOBODY NEWS | www.autobodynews.com
that’s more likely to result in bad repairs. “But they don’t have to worry about that. Because ultimately, the shop is responsible. “At K&M Collision we don’t participate in referral networks. Our only priority is to serve our customers by fixing their car the right way. You can rest assured that any repair that comes through our doors is guaranteed for life.” A previous version of the video was suspended from YouTube because of a copyright complaint from the Insurance Institute for Highway Safety (IIHS) due to its use of one of the organization’s crash test clips. K & M Vice President of Operations Michael Bradshaw alleges State Farm persuaded IIHS to file the complaint. “The basis of their complaint was that we used a few-second clip of a crash test to give our viewers a sense of the way a ‘crash management system’ works,” says Bradshaw. “We found this clip on YouTube, created by what we thought was an independent, nonprofit organization dedicated to consumer safety. We’re also certain that our brief, educational use of this clip constitutes ‘Fair Use.’ However,
Don Carlton ACURA OF TULSA
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we didn’t notice that this ‘independent, nonprofit organization’ was founded by State Farm.” Bradshaw says K & M has countered the copyright claim through YouTube and is awaiting word on the outcome. He says the video has gotten the attention of the North Carolina Attorney General’s office, and they have even taken an interest in the IIHS’s effort to remove K & M’s video from YouTube. “We will be documenting State Farm’s efforts to get our content removed from the Internet and will continue to fight back and notify the industry press about their actions,” Bradshaw says. “People should know that the IIHS, supposedly a nonprofit organization dedicated to highway safety, is nothing more than a puppet of State Farm, an organization responsible for putting unsafe cars on the road.” The new version of the video can be viewed directly at http://kandmcollision.com/open-letter/?utm _source=YouTube&utm_medium=Vi deo&utm_campaign=2ndVersionof AGLetter A link can also be viewed at: www.autobodynews.com.
Don Carlton
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www.autobodynews.com | OCTOBER 2014 AUTOBODY NEWS 29
Historical Snapshot with John Yoswick
—John Yoswick is a freelance writer based in Portland, Oregon, who has a body shop in the family and has been writing about the automotive industry since 1988. He is the editor of the weekly CRASH Network (for a free 4-week trial subscription, visit www.CrashNetwork.com). Contact him by email at jyoswick@SpiritOne.com.
October Retrospective—ADP, Non-OEM Parts, AAIA Study 20 Years Ago In The Collision Repair Industry (October 1994) Responding to complaints from the collision repair industry, ADP will be pulling the plug on a program that allowed dealers to promote discount retail parts prices using ADP’s “Parts Exchange New” system. “As a result of the issues that responsible parties of the industry brought to our attention, we will be taking discounted OEs off the ‘Parts Exchange New’,” ADP’s Rick Tuuri announced at the Collision Industry Conference (CIC) held in Nashville, TN. “They will be off the system by January 1, 1995. I want to emphasize that this is no reflection on the way the discounted OEs themselves are doing business.” Although the parts prices listed in the ADP database are the manufacturers’ suggested retail prices, the “Parts Exchange New” system allowed the names of dealers discount-
ing these retail prices to be listed on an estimate. More than 30 dealers were discounting retail prices through the system.
what insurers will pay, the shop was still being charged the same wholesale price. “The dealers are not giving a discount, they’re not giving anything up,” California shop owner Darrell Malott said. “They’re selling at wholesale anyway. All they’re doing is putting a different retail price down there. They can mess with that list price all they want because it doesn’t change what they sell it for. The system encourages them to play that game and at no cost to themselves. They’re giving California shop owner Darrell Malott was among those away our margin for their adcritical in 1994 of an ADP tool that allowed dealers to vertising so that they can be promote discounted retail parts pricing through the ADP estimating system. ADP eliminated the system in selected by a third-party to response to industry criticism. make us buy from a particuShop owners at a previous CIC lar OE vendor, and they didn’t have meeting had pointed out that while to give up a thing.” the discounted retail prices affected ►As reported in Autobody
News. ADP’s Claims Services Group (including its estimating system) was acquired by Audatex (now AudaExplore) in 2006. Tuuri (who left Audatex in 2004 and spent four years with I-CAR) became AudaExplore’s vice president of industry relations in 2007. Malott died in 1999.
15 Years Ago In The Collision Repair Industry (October 1999) After losing a $456 million class action jury verdict and being assessed an additional $730 million by the trial judge, State Farm has stopped writing for non-OEM crash parts on its estimates. The class action trial concluded early in October in Marion, IL, with the 4-man, 8-women jury finding against State Farm. A week later, trial judge John Speroni assessed the insurer a financial penalty, including $600 million in punitive damages. The total judgment against State
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Farm came to $1.1 billion. The insurer plans to appeal. In response to the verdict, State Farm stopped promoting non-OEM crash parts. A State Farm memo to its employees dated October 6 said, “Effective immediately, State Farm will temporarily suspend quoting nonOEM crash parts on repair estimates. This decision applies countrywide and in Canada, until further notice.” ►As reported in Hammer & Dolly. Other insurers also halted use of non-OEM parts temporarily, but most returned to the practice of calling for their use. State Farm has not, at least in the case of 25 parts types, including hoods, fenders, doors and decklids. The insurer did, however, appeal the ruling all the way to the Illinois Supreme Court; in 2005, that court overturned the lower court’s judgment against the insurer. The case remains in the news, however, because of a pending lawsuit over whether one of the judges on the Illinois Supreme Court at the time it overturned the verdict should have recused himself from the case because of election campaign donations the lawsuit alleges he received from State Farm.
10 Years Ago In The Collision Repair Industry (October 2004) The Automotive Aftermarket Industry Association’s recently released study, “Collision Repair Trends,” examines a number of the trends that continue to reshape the collision repair industry in the United States. “Total collision repair-related sales by aftermarket repair shops increased 5 percent in 2003 to $34 billion,” the report states, noting that this was driven by an increase in the number of miles driven and the increasing cost of collision repair per vehicle. The study forecasts that sales will increase 5.4 percent in 2004 and an additional 5.1 percent in 2005. AAIA found that there were roughly 43,360 shops that specialize in collision repair—34,700 independents and 8,600 dealership affiliated body shops. That’s a decline of about 2,000 shops since 1999. ►The AAIA earlier this year rebranded itself as the “Auto Care Association.” The total collision repair market is now estimated at about $33.7 billion—about the same amount as a decade earlier—but if total industry revenue had grown just by the rate of
inflation over the decade, today’s collision repair market would need to be about $44 billion to be equivalent. The current total number of shops is estimated at about 40,100—about 3,200 fewer than a decade ago, a decline of 7.4 percent. Dealership shops account for much of that decline, dropping to about 6,350 (down by more than 2,200) while there are about 900 fewer independent shops.
5 Years Ago In The Collision Repair Industry (October 2009) Last month’s press conference by Connecticut Attorney General Richard Blumenthal in which he condemned steering by insurers prompted a Hartford Business Journal columnist to write that, “It’s probably not the state’s business whether you, your insurer, or your Momma chooses the body shop that fixes your car.” If someone trusts an insurer enough to do business with them, freelance writer Laurence Cohen said, why wouldn’t they trust them to suggest a particular body shop even if other shops “are unhappy about not being included in the big hug from the insurers” and say that the preferred shops “often attach new equip-
PARTS PHONE: E!FAX: OF GEORGETOWN
ment with used chewing gum.” In a letter to the editor of the paper, Bill Denya, owner of Denya’s Auto Body in Meridan, CT, and a board member of the Auto Body Association of Connecticut, said what customers “don’t know about those secret deals is that the insurance companies typically put huge pressure on these preferred body shops to reduce costs—and increase insurance company profits.” Denya said Cohen may have been joking about “chewing gum” being used in repairs, but that the association has “documented countless instances of these shops doing significantly substandard repairs.” “If you needed heart surgery, would you allow your insurance company to select the least expensive surgeon for the job or would you want the best surgeon possible?” Denya wrote. ►As reported in CRASH Network (www.CrashNetwork.com), October 12, 2009.
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On Creative Marketing with Thomas Franklin
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
End Useless Marketing—Redirect Funds and Get Results! The marketing world has changed significantly during the past few years. So much has moved on-line that most other marketing expenditures may no longer make sense in your area. If you track results from your marketing efforts, you have probably noticed the lack of business coming from print ads, print version yellow page, and other phone book ads. It may be time to pull the plug on non-productive marketing and make better use of those funds. As insurance companies establish toll-free numbers to report claims, you should probably stop marketing to most agents. Unless you have nearly unlimited funds to advertise just to keep your name in front of the public, you should probably end off radio and TV advertising. And stop paying for useless advertising schemes. These moves should free up money to pay for real marketing results. So where should you redirect these funds? Mainly you want to double up on-line and live contact efforts. On-line yellow page, Superpage, and similar services will allow prospective customers to find you. Enhancing your website, Facebook page and other social media will be one good use for expanded expenditures, but this should only be a start. As the volume of collision repairs decline due to advances in vehicle accident avoidance technology, to survive shops will have to embrace other profit centers. This may call for a new mindset not familiar to most shop owners and managers. For example, merchandise store marketing rule number one is “Get as many people as possible into the store!” People like to go to famil-
iar places and prefer not to have to try out a new place if they are happy with the old one. The intent is always to make a prospective customer’s first experience so incredible, they will always come back first before trying out any other place. How can a shop make use of this fundamental principle? Perhaps it’s time for shops to copy what dealerships have done for decades. Shop owners and managers accustomed to $2000 repairs and up, may scoff at a couple of hundred dollars here and there in profits from vending machines, accessories, audio sales, and cosmetic automotive merchandise. But keep in mind that many “profit-centers” have a second benefit as marketing opportunities. Every new person that comes into the shop should be given a powerful propaganda piece. This should be a booklet featuring the shop’s “special” features. Shop personnel often think prospective customers know what equipment shops have, and what they do, but this is rarely true. A booklet should spell out why a shop’s frame machine, welding equipment, and painting capabilities are better than the competition, and why special skills in repairing hybrids, electric vehicles, exotic cars and more make this the best shop to repair a vehicle. The reality is the public is generally unaware of shop expertise, and the unspoken message of the booklet is that our competitors are unlikely to have this high quality equipment and systems (even though they may have it too). Sharing or piggybacking businesses is increasingly popular as rents go up. Local grocery stores now often
have a Starbucks or similar concession in the store. Some hamburger chains now have a donut vendor concession or a pizza concession sharing the space. Sharing the cost of a space again frees up funds for marketing and perhaps advertising deals on line using Craig’s List, eBay and other sites. Auto glass, headlights, accessories, cosmetic fixes, running boards, pet restraints,, child proofing, older cars with no GPS are all profit-center prospects for sales and/or installations and add new names to an e-mail marketing list. A shop might want to partner with an automotive accessories vendor and provide an alternate display area—and not only share in the sales profits, but also profit from installations and again capture prospect names. In a shop where estimators only write estimates a few hours a week, product sales and installation fees can be an on-going supplemental commission opportunity.
Beyond front office space, a collision repair shop also has a huge amount of space compared to most businesses. Some shops open up repair space for mini-trade shows, and not only for collision repair products. Convention centers are costly places to hold trade shows, and small groups like furniture and equipment vendors could appreciate a local space to show products. This could bring in local businesses with company vehicles and provide an opportunity to solicit their vehicle repairs. Another alternative is more community-based uses of space. Sundays some shops make open space available for meetings, church groups, school groups, and boy or girl clubs or activities.. Kid’s activities bring parents, especially moms who can be good prospects for vehicle repair. Redirecting marketing funds like this will generate far more sales than old-style advertising and promotions.
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Tulsa Police Arrest Man for Vandalizing Cars
Tulsa Police officers arrested a man for vandalizing a number of vehicles at six car dealerships along Memorial Drive the night of Sept. 15. Officers said Williams Knox, 24, of Broken Arrow used the metal buckle from his belt to damage the windows of 20 to 25 vehicles parked in lots from 44th to 49th and Memorial just before midnight. A security guard spotted Knox and called police, officers said. They said they found him hiding behind a car.
They booked Knox into the Tulsa County jail on a complaint of malicious injury to property and possession of a controlled drug. Jail records show he was being held in lieu of $7,500 bond with a court appearance set for September 23, 2014.
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The Legal View with Erica Eversman
Erica Eversman is an attorney, frequent speaker and author on automotive legal topics. She has been quoted in such publications as The Wall Street Journal Online, USA Today, Kiplingers Personal Finance, Cars.com, Yahoo! News and other trade magazines.
Parts Authorization, Indemnification and More—Documentation Part 3 by Chasidy Rae Sisk
Over the past two issues (see August and September Autobody News), industry attorney Erica Eversman has offered some insights into the various types of documentation that collision repair facilities can use to protect their interests and help them obtain proper compensation for work performed. In the final installment in this series on repair documentation, Eversman helps explain the purpose for and how to use the Parts Notice/Authorization and the Indemnification/Hold Harmless Letter, with a few additional documents. The Parts Notice/Authorization is an important form for repair shops to utilize since most states have statutes pertaining to the use of used or aftermarket parts which requires the shop to notify the consumer if these types of parts are used to repair their vehicle. When choosing the parts to use in a repair, the facility has several op-
tions: new OEM parts, aftermarket parts, or salvage yard parts (which the insurance industry commonly refers to as “recycled parts”), but dependent on and subject to state laws, the repair facility must be sure that the consumer understands which parts are being utilized in their vehicle—and that disclosure can be easily be substantiated by having their customers sign a Parts Authorization. Often, the insurance company instructs the repair facility to utilize aftermarket parts in the repair, but ultimately, the consumer is putting their life in the repairer’s hands, not the insurer’s. “Nothing gives a repairer the right to knowingly put an unsafe part on someone’s vehicle,” Eversman admonishes; however, there will be situations that repairers face when they are not entirely comfortable with the insurer’s suggestion to use particular used or aftermarket parts in the repair. In those situations, if the consumer is
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unwilling/unable to pay for new or new OEM parts when the repairer has concerns about using used or aftermarket, Eversman states, “the repair facility is ethically responsible for performing a safe repair, despite pressure from insurers, so the repairer must ensure that the consumer is notified that the repairer really prefers to use different parts during the repair process.” Although aftermarket or recycled parts may work just fine the majority of the time, there is always the potential for problems when parts used in the repair are not new OEM. In the event of an accident related to the failure of these parts, the repair facility needs to make certain it has protected itself by proving the insurer refused to pay for new OEM parts, the consumer was informed about the use of these parts but refused to pay the difference for the preferred parts, and the repairer possesses this signed document establishing the consumer’s notification and
consent. “People don’t want to think about accidents,” Eversman points out. “Generally, they don’t think of it until after an accident when they’re already vulnerable. We, as an industry, need to do a better job of educating consumers in advance.” In addition to the Parts Notice/Authorization, repair facilities that are averse to installing certain used or aftermarket parts should also ask their customers and the customer’s insurer to sign an Indemnification/Hold Harmless Letter which explains that the repairer is only using the specified parts because both the customer and the insurer insisted on them. This document makes the insurer liable for the use of the specific parts and documents their agreement to pay for any lawsuits or damages the repairer suffers for problems with the parts. Insurers rarely agree to sign this document, often opting to pay for the appropriate part instead, but if the insurer insists on the
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use of potentially unsafe parts and the customer agrees, the repair facility must protect itself from the insurer’s influence; otherwise, the insurer will claim it has no responsibility for the use of those parts in the repair. Because manufacturers don’t offer a warranty on aftermarket parts, using these in a repair can lead to a partial or complete restriction on the vehicle’s bumper-to-bumper warranty. OEMs cannot automatically void a warranty due merely to the use of aftermarket parts, but they can restrict or void the warranty if the aftermarket part results in problems with the vehicle or causes an accident due to part failure or malfunction. Still, many insurance companies’ DRP contracts require the use of aftermarket parts, yet they will not insure the shop’s liability if there is an issue. Though insurers say they will “guarantee” the work of a DRP shop, doing so requires assuming liability, which insurers invariably try to avoid. While they generally say they offer warranties on the aftermarket or used replacement parts, insurance companies’ warranties do not cover the facility’s workmanship unless specifically stated. As a result, consumers are too
often told by insurers that the insurer “guarantees the repair”, but if a consumer actually reads what the insurer is guaranteeing, it is often nothing more than a statement that it will try to address a problem with an aftermarket part after the consumer has addressed the warranty problem with the part manufacturer. Eversman states, “the insurance company’s guarantee is useless. Warranties are like insurance policies – they contain more exclusions than actual coverage. The insurers will say they don’t fix cars—they just pay for repairs and that all of the decisions for how the vehicle was repaired were the collision facilities; however, their ads brainwash consumers by creating the impression that insurers are involved in the repair. These ads focus on a magical restoration without the involvement of the consumer or the repair facility. Much of this glib advertising creates the wrong impression for consumers that doesn’t reflect reality.” Eversman also strongly discourages shops from offering a warranty on anything besides their workmanship, especially on parts. Thanks to the Magnuson-Moss Warranty Act, insurers can offer a warranty for the repairer’s workmanship and parts used
in the repair, though this puts them on the hook to assume liability in the event of a problem. Eversman advises shops to “refuse the insurer’s demands to offer aftermarket or recycled parts warranties. Repairers should clearly state in all customer documents that you guarantee your services and repair work, but never offer a warranty for any part used in the repair. Doing so only subjects repairers to potential lawsuits involving double or treble damages and the payment of the consumer’s attorney fees if there are issues with the parts.” In addition to the documents discussed in detail throughout this threepart series, Eversman feels that shops should also be aware of some additional documentation that they may find useful. The Customer Notice of Insurer Deficiency is a form that serves to inform the consumer of their insurance company’s refusal to pay for a proper, safe repair. Eversman notes, “this form can help with the public relations battle; the insurance companies don’t like to be called out on their actions, so they are more likely to handle the problem. It also reminds the customer that you are the collision repair professional and that you are re-
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fusing to perform an unsafe repair, despite the insurer’s demand that you breach this part of your contract with your customer.” The Customer Notice of Insurer Delay keeps the consumer in the loop by alerting them to the fact that the insurer is causing a delay in the repair process. The Vehicle Damage Insurance Election Form, which only applies in first-party cases, is a document that the customer can send to their insurance company demanding to know what specific remedy under the insurance policy the insurer is choosing. This forces the insurer to define whether it is “electing to repair” and accepting all liability for the repair or paying for the loss in money. Though the insurer is unlikely to sign this document, the customer can note their refusal to responds to the request, and this can be useful if a trial is necessary as the insured has the right to demand a response from the insurer to questions related to their claim. A Notice of Additional Cost is a nice way to inform the insurance company of an additional repair cost, granting them a specific amount of time to respond before resuming the See Documentation Series, Page 46
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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.
Is Angie’s List Impartial or Is She Playing Favorites? with Ed Attanasio
Some body shops swear by Angie’s List and call it the “Anti-Yelp,” but in the end, isn’t it just another advertising-based review system? If you’re not familiar with Angie’s List, it’s a paid subscription supported website containing crowd-sourced reviews of local businesses. They currently have 2.3 million paid members, although the company lost $1 million last year. Right now, Angie’s List is under fire and many small service companies have put her on their enemies list. Poor Angie is getting bad feedback from subscribers, investors and businesses alike, for bad reviews from low-rated businesses, disappointing earnings, executive departures, and lawsuits alleging misleading practices. Then, there’s the younger, hipper competition offering similar information for free. Angie’s List wants users to think they’re consumer-driven, when in fact 70% of their revenue comes from advertising. “It’s not advertising from Coca Cola, it’s advertising from the companies they rate,” Jeff Blyskal, a senior editor for Consumer Reports explained. While companies do not pay to be listed on Angie’s List, companies can pay to appear higher up in the search results—which Blyskal believes compromises the validity of the Angie’s List sorting system. “If you’re looking for a contractor, you’re only going to look at page one or two. That skews the ratings,” said Blyskal. “It’s about who advertises and I don’t think they’re being straight with the public on that.” In a recent statement, Angie’s List founder and CMO Angie Hicks said, “Angie’s List is built on a foundation of fairness and transparency. Everything at Angie’s List starts with the consumers. The consumers give the reviews and assign grades. The companies’ A–F ratings are the average of the consumer reviews we receive. Companies that are A–B rated are eligible to advertise with Angie’s List, but they must offer a discount with that advertisement and if their grades fall below a B, we pull their advertising.” Hicks also noted that the company puts itself through an outside audit in order to determine that the data-han-
dling process is fair to all businesses listed on the site, and that these audits have “always found Angie’s List reviews a fair, impartial, trustworthy source.” Angie’s List has been criticized for the fundamental contradiction between its mission statement which states, “Companies can’t pay to be on Angie’s List,” while in reality its toprated businesses are allowed to advertise. Small business owners (like body shops) are crying foul, because they’re aware of the fact that if a company advertises with Angie’s List, their negative reviews will be removed. The company’s effort to keep advertisers happy reveals their conflict of interest, which is why subscribers and businesses are claiming that Angie is playing favorites. Angel Iraola from Net Business Consulting & Solutions in Santa Rosa, CA has advised his clients in the past to use Angie’s List, because for many years it was better and more credible than Yelp, he claimed. But no longer, Iraola said. “The A- and B-rated companies on Angie’s List can buy their way to the top of the default search results and that makes it patently unfair. My automotive repair clients are gravitating more now toward Yelp, because they’re not so blatant about giving special treatment to advertisers.” One body shop owner (who chose to be anonymous fearing bad reviews from Angie) said the following: “It seems to me that just a few short years ago Angie’s TV commercial was completely different. She seemed to end each one with the statement ‘no company can pay to be on Angie’s list.’ But, now they’re forced to make money and advertising seems to be the way they’re doing it. I think ‘truth in advertising’ should pertain to everyone, especially those that claim complete transparency but don’t adhere to their own claims. Do we even know if Angie is the real owner or just a paid actor like Flo on the Progressive commercials? I’ve lost my faith in this site, so we don’t use it anymore and we took their link off our web site as a result.” How can a body shop owner be certain that Angie’s List is on the up and up or playing games with your re-
36 OCTOBER 2014 AUTOBODY NEWS | www.autobodynews.com
views? Iraola says do your due diligence and get everything in writing. “Angie’s List is just like any other review site” Iraola said. “They need to make money somehow and at the beginning they were going to the customers to get it. But, how many people are going to pay $100 annually to find good, honest companies if they know that these companies are also paying for their positions on Angie’s List? That’s one of the biggest problems with Angie’s List. Are the toprated companies really there because they do excellent work or are they there because they bought that spot? Once any review site loses its credibility and the end users doubt its validity, problems will follow. I hope Angie’s List can figure out a way to re-invent itself, so that my clients will want to get involved and the customers will believe in it again.” When it comes to review-based sites, Iraola prefers Yelp to Angie’s
Welcome to the ALL NEW
List, especially for body shops. “Yelp is more relevant and many shops still don’t like it, but in the end it’s their best way to go. I tell collision marketing people to manage your Yelp page and respond to every review, both positive and negative. Use it as a tool and stay on it, because if you let a bad review sit, it looks like it’s justified. And stay away from Angie’s List at least for now. They will undoubtedly re-invent itself to a certain degree very soon, because right now they’re losing traction.” Curtis Nixon is the president of AutoBody-Review.com in Chino Hills, CA, a company that verifies every customer review by tapping into a database that confirms their identity and thereby gets true reviews for its body shop clients. “The big problem with these review sites is that they do not contain verified reviews,” Nixon said. “We make sure that the customer See Angie’s List, Page 38
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www.autobodynews.com | OCTOBER 2014 AUTOBODY NEWS 37
Roseville, MN, Police Fire Local Auto Body Shop After Employees Take Squad Cars on Joyride
The Roseville Police Department in MN has hired a new auto body shop after employees from its former vehicle repair vendor reportedly drove squad cars at “irresponsible” speeds on the way to be fixe, as reported by Johanna Holub at LillieNews.com. According to the department, on the morning of Thursday, Sept. 4, there were two phone calls from “concerned citizens” regarding two marked squad cars “being driven at excessive speeds” on County Road C, which has a 40 mph speed limit, from Victoria Street to Western Avenue. The department found the vehicles were being driven by employees from a local auto shop the department used for repair services. The employees came to the Roseville Public Works garage to pick up two squad cars that needed body work following a police pursuit that took place overnight, and were supposed to drive the vehicles to the repair shop. They had authorization to do so, according to the police statement. After discussing the matter with the owner of the auto repair business, the department decided to “end
business dealings” with the shop. “The department recognizes its accountability to the community,” the statement reads. Lt. Lorne Rosand said the vehicles were equipped with everything “except the rifle,” which is secured in the police armory before a vehicle is taken to any location for repair work. Because the department contracts several vendors for service including a local dealership, Rosand said mechanics often pick up police vehicles and drive them to the shop for repairs. Certain repairs also require a test drive to be sure the problem is fixed. They’ve never had a problem with vendor employees driving their vehicles unprofessionally until now. “It’s not uncommon for civilians to drive our cars,” Rosand explained. “We just hope they do so in a manner that represents the city in a very positive way. These two individuals did not.” But, from now on, the department plans to put in the “best effort possible” to have a city mechanic or police officer drive squad cars to be repaired, Rosand added.
NABC 20th Anniversary Golf Fundraiser, January 14, 2015
The National Auto Body Council (NABC) is holding its 20th Year Anniversary Golf Fundraiser on Wednesday, January 15, 2015 in Palm Springs, California. The fundraiser at the Tahquitz Creek Golf Resort will be a highlight of special activities NABC is planning to commemorate its anniversary. Hertz will continue as the presenting sponsor for the annual event, which is one of the NABC’s major sources of funding to support its ongoing community service programs. These programs include NABC’s signature Recycled RidesTM, First Responder Emergency Extrication (FREETM) and the Distracted Driving Initiative. “Last year’s golf event was a sold-out success, with a lot of positive feedback from participants, and plans are underway to raise that bar even higher this year,” said David Merrell of Parts Trader and Domenic Brusco of PPG Automotive Refinish, co-chairs of the NABC fundraising committee. Companies interested in sponsorships should contact the NABC at 1-888-667-7433 ext 119 or email M.mcmanus@NationalAutoBodyCouncil.org
Continued from Page 36
Angie’s List
doing the review indeed had their car repaired by the shop they’re reviewing. We illicit the reviews by doing a customer satisfaction survey and we’re finding out that about 25% of the customers are writing reviews on our site as a result. This way, both body shops and customers can rely on these reviews, because they’re real.” AutoBody-Review.com charges its body shop clients a monthly fee and does not offer advertising to get any shop at the top of any list. “Staying objective is crucial and that’s why our reviews carry weight. We never manipulate reviews or call customers to have them changed or delete any review, negative or positive. Our playing field is 100% level, so if a shop does good work, they get praised and vice versa. Selling ads for prime positions is definitely a clear conflict of interest and not the right way to do things, in my opinion. The customers should dictate position, not the almighty dollar and that’s why we will never sell ads to our body shop members—ever!”
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NY Shop Owner’s Forgotten Lottery Ticket is a Nearly-Lost $2.9 Million Winner by Victoria Antonelli, Online Editor
A missed step in Jerry Ritieni’s routine on July 19 almost cost him close to $3 million. When the Extreme Auto Body owner stopped at Cumberland Farms in Syosset, NY, to buy $10 in Quick Pic lottery tickets, he placed the winning numbers in his center console, instead of their usual spot—on his visor mirror. Ritieni found the tickets a month and a half later while searching for his Vermont house keys. After entering the numbers online at his shop, he became a millionaire in the blink of an eye. “I’m a joking kinda guy, so my son, friends and employees didn’t believe
think he’s serious, he hasn’t left the shop during business hours in 22 years, and
he’s been gone for almost an hour!’” Ritieni, 48, says he will continue to work. “The money is life-easing, not life-changing,” Ritieni explains. “I never had a retirement plan, which was always a concern of mine, so it’s nice to have that taken care of.” Ritieni’s 20-year-old daughter and 17-year-old son are his priorities, specifically their college tuition. He also bought the building next door to his shop for expansion purposes. “I drove into a Maserati dealership next door to the lottery office while my son was in the car, just to mess with him,” said Ritieni. Ritieni said he’s happy with the way the com-
munity responded to his win. “I live by my father’s words: Be honest, be fair, and do the right thing and you’ll be fine,” said Ritieni. “A lot of the locals said I won because of good karma and I believe that to be true.” Ritieni said he is not affiliated with any insurance companies or DRPs, and that the customer is the priority. “Everybody wants to make a living, but money is not my driving factor,” said Ritieni. “I don’t believe in taking advantage of people. At my shop, everybody gets what they paid for, and everybody gets treated the same.” After a cash buyout and tax deductions, Ritieni collected $1.3 million.
“He thought it was one of his friends at first,” said Joe Sokolowski, the owner of the shop. Sokolowski said when the car started Harlack opened the door to stop the thief. A surveillance video, aired on WTAE Pittsburgh Action News 4, showed Harlack being dragged away by the car before hitting the side of a tow truck and falling to the ground, with a broken leg. The thief sped away, hitting eight cars and totaling the Subaru before running away.
Sokolowski said he wished that Harlack wouldn’t have tried to stop the thief. “I just hope he’s going to be okay,” said Sokolowski, who has worked with Harlack since the shop first opened and considers his colleague a close friend. Ultimate Auto Body specializes in complete collision repair and works on the police cars for the City of Pittsburgh Bureau of Police and the Mount Oliver Police Department. The auto body shop is continuing operations during this difficult time; however,
Sokolowski said it is frustrating as a small business to have Harlack in the hospital and the thief at large. Autobody News contacted the police department for an update and learned no arrests have been made. Ultimate Auto Body Shop is offering a $500 reward to identify the thief.
that I had won the lotto, until I sped out of the parking lot,” said the Massapequa local. “Kenny [an employee] said, ‘I
Extreme Auto Body owner Jerry Ritieni in front of his NY shop with the winning ticket (Photo courtesty of VICTORALCORN.COM)
Theft and Serious Injury at PA Auto Body Shop by Stacey Phillips, Assistant Editor
An attempted auto theft at a collision repair shop in Pittsburgh, PA on August 30 left the shop manager seriously injured in the hospital and nine cars damaged. Pittsburgh police are investigating the incident that took place at Ultimate Auto Body Shop, in business for more than 30 years. Mike Harlack, the manager, noticed someone getting into a new Subaru that had just been dropped off that morning and was ready to be put on the rack.
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John Yoswick is a freelance writer based in Portland, Oregon who has been writing about the collision industry since 1988. He is the editor of the weekly CRASH Network (for a free 4-week trial subscription, visit www.CrashNetwork.com). Contact him by email at jyoswick@SpiritOne.com.
Industry Insight with John Yoswick
CIC Committees Look at Autonomous Vehicle Issues, Impact of “Length of Rental” Formulas Lawmakers and regulators on a state, federal and international level are working to make sure they can stay ahead of the quickly-developing “driverless vehicle” technology—but what will it mean for collision repairers? That was one of the questions considered in a presentation at the most recent Collision Industry Conference (CIC), held in Detroit, Mich. The committee looked at what laws and regulations are being enacted surrounding the technology, and what that could mean for collision repairers, insurers and other industry segments. Steve Regan, chairman of the committee, said that for insurers, the new and costly safety-related equipment involved in autonomous cars will impact repair costs. Access to or use of “black box” data will continue to be an issue. And liability related to the repair of the vehicles could be an issue for insurer offering garage-keepers, as well as liability policies for collision repairers.
The auto manufacturers and system suppliers will potentially face liability if their systems are controlling these vehicles, Regan said, but some of that liability is addressed in the state and federal regulations being enacted. “We started tracking these laws and noticed the missing component,” Regan said. “There’s no protection in any of these laws for those who are fixing the cars.” That’s an issue the industry will need to continue to monitor, Regan said.
‘Length of rental’ formulas discussed Also at CIC in Detroit, a panel tackled a new twist on the issue of cycle time. The topic: Do insurer formulas used to calculate the number of “rental days” on an initial estimate drive down cycle time? Do they set unrealistic expectations for consumers? Do they add friction and inefficiencies? Or do they do some combination of all
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of these things? Pat O’Neill of Bodyshop Revolution, who moderated the discussion, noted that there is a wide variation in the formulas shops and insurers use to determine expected “length of rental” (often used as a proxy of “cycle time”) and even in the statistics about average length of rental that are reported by the rental car companies or information providers. Data provided by Enterprise Renta-Car, for example, found that length of rental in the secPat O’Neill ond quarter of this year averaged 10.7 days nationally, but ranged from a low of 8.9 days to a high of 14.1 days in another. With a 5-day difference between some states, repairers on the CIC panel asked, is it reasonable for an insurer to set length of rental expectations using a national formula? Panelist Darrell Amberson of
LaMettry’s Collision in Minnesota read some of the formulas that the CIC committee had collected that insurers use (or require their direct repair shops to use) to establish the initial completion date, which may be included on the paperwork given to the vehicle owner. Those formulas ranged from one day for every three hours of labor to one day for every six hours of labor on the estimate. Some formulas allow the shop to exclude weekends or delays caused by parts. Panelist Aaron Schulenburg of the Society of Collision Repair Specialists said one insurer acknowledged to the association that it recognized its hours-per-day formula for its direct repair shops was outside the norm for the industry, but that it set that goal to make sure its shops prioritized that insurer’s work over one who had set an unrealistic hours-per-day goal to try to get its work prioritized. If the goal is to drive performance, Schulenburg said, that’s one
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thing. But when it establishes unrealistic expectations for the consumer, and requires multiple adjustments by the shop and rental car company to the completion date information, that impacts efficiency and customer satisfaction. He said it’s also unfair for a shop to have to pick-up the cost of a rental if repairs exceed a calculation based on an unrealistic formula. “The shop didn’t sell a rental coverage policy, and they didn’t profit from the sale of that policy,” Schulenburg said. “My concern is: Is that the best way to drive behavior,” Amberson asked about the formulas. “If you’re going to push us to fix cars faster, is that really the best way to do it? I might suggest there are more cooperative ways to do this. This feels like a negative approach with a negative consequence if we don’t achieve what you’re looking for, and on top of that causes us to create an unrealistic expectation to the customer, which only irritates and frustrates them.” Amberson said that his company is making an effort to reduce cycle time by using blueprinting – but that “the formulas insurance companies use have very little to do with the improve-
ments we’ve shown in our numbers.” Chris Andreoli of Progressive Insurance, the lone insurance company representative on the panel, agreed that the customer should not be given inaccurate completion date information, but that length of rental formulas can be used as a starting point in that conversation. He agreed that using the same formula for every vehicle across the nation isn’t as accurate a system as he believes the industry will develop as data sophistication improves. He predicted that at some point shops and insurers will be able to establish more Chris Andreoli accurate completion dates based on data that will include year, make and model of vehicle, as well as market or region. “I think that’s where the level of sophistication needs to go in the industry,” Andreoli said.
Not a lot of consensus The panel did not seem to agree on how often consumers currently are being given an accurate completion date.
Curtis Nixon of UpdatePromise.com said his company’s research indicates shops are hitting promise dates 88 percent of the time; however, he shared data showing the impact on CSI Curtis Nixon based on the number of times a promise date changes, a chart that showed the impact on CSI for as many as 12 such promise date changes on a job. The rental car companies on the panel seemed to experience more changes to the initial completion date information than an 88 percent accuracy stat indicates. “We do see a lot of changes,” said Mckenzie Spalding of Choice Auto Rental, a regional company in the Twin Cities market of Minnesota. “It happens a lot.” “We see an average of 2-4 changes that occur per claim,” concurred Frank LaVioila, assistant vice president for collision industry relations at Enterprise. Amberson said using better data instead of arbitrary formulas could reduce or eliminate such changes, which impact shop and rental car company
efficiency as well as potentially lower customer satisfaction. Because of such formulas, Amberson said, “Sometimes we meet the customer’s basic expectations but we’re not exceeding the customer’s expectations. We’re not wow’ing them. We’re not creating raving fans. And that’s what we should be striving for. We should be striving for excellence, not just a tolerable experience for the customer.”
ASA Announces Plans to Relocate Headquarters
It’s been a busy season for the Automotive Service Association (ASA) as the national office prepares to relocate its headquarters in a few weeks from Colleyville, Texas, to nearby North Richland Hills. In addition, the association recently held its successful NACE|CARS trade show in Detroit. Effective immediately, the association’s 800-ASA-SHOP (2727467) number is changing to (817) 514-2900. Please update your records to reflect this change. And effective Oct. 1, 2014, the association’s new headquarters will be located at 8209 Mid-Cities Blvd., North Richland Hills, TX, 76182.
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Auto/Steel Partnership to Present During OEM Collision Repair Technology Summit at SEMA Show The Society of Collision Repair Specialists’ (SCRS) OEM Collision Repair Technology Summit will be held on Wednesday, Nov. 5th at the Las Vegas Convention Center during the SEMA Show. The Summit will allow the industry to explore how automotive design, technology and materials impact repairability, and how in turn repairability influences structural design and David Rigg development. The full-day program will include four unique panel discussions with automakers, equipment suppliers, certified repair facilities, and OEM certifiers/auditors and will also feature special presentations from subject matter experts on automotive materials. Registration is required to attend and seats will be limited. Register today at: www.semashow.com/scrs. As the newest development to the agenda, SCRS has announced that David Rigg, Project Lead with the
Auto/Steel Partnership (A/SP) Advanced High-Strength Steel (AHSS) Repairability Project, will provide a detailed overview of the market developments and repairability research taking place between the steel industry and the automakers. The A/SP is a collaboration between the steel company members of the Automotive Applications Council of the Steel Market Development Institute and Chrysler Group LLC, Ford Motor Company and General Motors Company to pursue research, validation and education that help automakers enhance vehicle safety, fuel economy and improve design and manufacturing. Through the A/SP, automakers and steel companies have worked to drive improvements and innovation in vehicles on the road—and in repair businesses— today. “Participating in the SCRS OEM Collison Repair Technology Summit allows us the opportunity to interact with the leaders of the automotive repair industry to better understand their needs, so that we can incorporate them into our project plan,” said Terry Cullum, director of the A/SP. “Our goal is
to share the latest technology on these innovative advanced high-strength steel materials so that they can be repaired in the field using the best practices developed from our repairability project.” Rigg will deliver visibility into the technological advancements being made in the steel industry relative to automotive materials, and an overview of how their market is developing as a result of increased collaboration towards ever evolving safety and sustainability goals. He will share reasons behind the automakers’ continued reliance on steel as a critical substrate; and what their industry is doing to aid in the development of that relationship. The presentation will ultimately address how repairability plays a role in material research and development, and the prevalence steel will have in the vehicles of tomorrow. In addition to his role with the A/SP, Rigg serves as Global Service Lead - Structures, Front and Rear Closures at General Motors where he is responsible for the development, consensus, documentation and implementation of Global Service Re-
quirements. He also represents service at the Advanced Vehicle Development Center for body structures. In his previous position as Body Service Engineer, Rigg was responsible for authoring collision repair manuals; however, his career with GM extends back to 1998. Rigg’s formative years were spent working in his father’s body shop making the traditional advancements from washing cars to eventually straightening frames and writing estimates. His first-hand experience in the repair community has given him valuable insight into the collision repair industry. For more information about SCRS’ Repairer Driven Education (RDE) series, and to register for the OEM Collision Repair Technology Summit and other RDE sessions, please visit: www.semashow.com /scrs.
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Aluminum Association to Present During SCRS’ OEM Collision Repair Technology Summit In early August, the Society of Collision Repair Specialists (SCRS) announced the launch of the first issue-specific collision repair industry forum being held at the SEMA Show. The OEM Collision Repair Technology Summit will be held on Wednesday, November 5th at the Las Vegas Convention Center and will explore how automotive design and technology intersect with repairability, and how developments in this area impact the collision repair process and the professional businesses planning for their future in the ever-changing landscape of this industry. Registration can be made at www.semashow.com/scrs. In addition to panel discussions with technology experts representing the automakers, certified repair facilities, equipment suppliers, and certifiers/auditors, the program will feature special presentations from subject matter experts on automotive materials. SCRS announced that Doug Richman, Technical Committee Chairman of the Aluminum Transportation Group (ATG) will offer insight into the role aluminum will play in collision re-
pair businesses now, and in the future. “The ATG is eager to share with SCRS session attendees key insights on aluminum’s long history in the automotive industry,” said Richman. “Aluminum-intensive vehicles have been in the marketplace for many decades and are regularly repaired as needed. Within the next ten years, seven out of 10 new pickups produced in North America will be aluminumbodied, according to a recently released survey of automakers conducted by Ducker Worldwide. As Doug Richman aluminum use in auto bodies grows exponentially in the next decade, we applaud the SCRS’ efforts to educate and train repair professionals to be better prepared for the change in status quo materials that come through their shop doors.” Richman will deliver visibility into the technological advancements being made in the aluminum industry relative to the automotive market, and an overview of how their market is de-
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veloping as a result of increased integration into our modern fleet. He will share reasons behind the automakers interest in, and use of, aluminum; and what their industry is doing to aid in the development of that relationship. In addition to his role with the ATG, Doug Richman is Vice President of Engineering and Technology for Kaiser Aluminum. He joined Kaiser in 1996 and was appointed to his current position in 2001. Before joining Kaiser, Richman was Vice President of Automotive Castings for Alcan Aluminum and his background also includes almost 20 years of experience in development and design management at General Motors. Richman is a long-standing member of the ATG, serving as technical chairman of the sub-committee. He also serves as co-chairman of the Society of Automotive Engineers (SAE) Light Metals committee. The OEM Collision Repair Technology Summit is made possible through support from PPG Refinish Products, Ford Motor Company, BASF, Toyota Motor Sales and The Hertz Corporation.
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Volvo is trying to regain a foothold worldwide with the introduction of its XC90 full-size crossover, the first for China’s Zhejiang Geely’s acquisition of the Swedish automaker from Ford in 2010. The premium seven-seater will contend against models like the Lexus RX350, BMW X5 and Chevrolet Tahoe. Its arrival is considered critical for Volvo dealers who have watched sales plummet since Ford, in the midst of financial difficulties, sold the brand to the Chinese company for $1.8 billion.
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SCRS Posts Tribute to March Taylor for Supporting and Inspiring the DEG Seven years ago this month in August of 2007, the Society of Collision Repair Specialists (SCRS) and the collision repair community lost a dear friend and tremendous asset with the untimely passing of March Taylor. Those that were fortunate enough to have been touched by March knew him as a dedicated family man, an innovative shop owner, an experienced master technician, and a selfless and iconic collision industry leader and contributor. He was a fixture within SCRS, March Taylor the SCRS Board of Directors and a mentor to many of us in our careers and businesses. March was passionate about addressing inaccurate estimating data and volunteered his time collecting, researching and processing hundreds of database inquiries. He was a technician at heart and was insistent on identifying areas where the data failed to reflect the real world requirements technicians’ face in the repair process. His work was the catalyst and inspiration behind the creation of the Database Enhancement Gateway (DEG), and the concept to have a centralized point for our industry to submit inquiries to.
The DEG (www.degweb.org) is an initiative that was developed to help address collision repair estimates data, through proactive feedback from the collision repair industry to the information providers (IPs) that supply the databases for the various estimating products. The DEG was created, and is equally funded and maintained by SCRS, Alliance of Automotive Service Providers (AASP) and Automotive Service Association (ASA). It is a perfect example of our organization putting membership dollars at work to address real issues in the industry. The DEG has processed more than 7,000 inquiries from the industry, many of which have resulted in changes to the estimating system database, or necessary explanations of how they work. The process is simple, the shop submits the inquiry to the DEG and the administrator works with the representatives from the IPs to bring the inquiry to resolution. Here are some great recent examples of responsive results from DEG submissions: 7112 - 2004 VW Beetle Left Door Skin 6939 - 2013 VW Beetle Roof Panel 6602 - 2013 Chevrolet Camaro SS Side Body Drip Molding If you are using electronic estimating systems to itemize your repair process and price your services, it is important to pay attention to the information being used to create the estimate.
Talk to your estimating staff about the DEG and visit www.degweb.org to check it out today. The DEG and all of its successes are dedicated to the memory of our good friend, March Taylor.
MS is the 4th Most Expensive State for Car Ownership Overall
Mississippi is the third-most expensive state for annual estimated gasoline costs, at $1,231. Other costs are not too outrageous: the state ranks as the 21st most expensive for insurance at $901, and repair costs come in at $356 per year. But thanks largely to those gas prices, owning a car in Mississippi comes with an annual estimated cost of $2,487.
WI is the 5th Cheapest State in Which to Own a Car
Repair costs are about in line with Ohio’s, at an annual estimated cost $329, and insurance is the third-cheapest of all states at $658. Wisconsin, though, is 1 of 22 states with gasoline prices over the annual estimated cost of $1,000 ($1,031). That’s over half the annual estimated car ownership cost of $2,018 in the state.
AASP-PA Offers Two New Membership Levels
Since the Alliance of Automotive Service Providers of Pennsylvania (AASP-PA) formed in 1955, it has been a member association for shop owners in the state, but now, the association has decided to offer two new membership levels. For the first time, AASP-PA will offer free memberships to students studying in the automotive field in a PA school, and the association will also offer a low-cost membership to industry professionals, such as technicians, towers and service writers, among others. AASP-PA’s goal in offering these two new levels of membership is to continue to further their initiative of educating all automotive service providers throughout the state of PA, and the Student Membership level in particular will aid in their attempts to engage the younger generation and show them the value of education, leadership and involvement in industry associations. The association’s Student Membership level is available to students studying in the automotive field in a PA high school, technical school or at the university level. The free Student Membership includes an electronic version of “Pennsylvania Automotive
& Insider News,” the association’s bimonthly magazine, and invitations to select chapter meetings and training events as well as free enrollment in ASE’s Student Certification Program (a $30 value). To sign up, students can visit www.aasp-pa.org/memberresource/student-membership.aspx. The Technician Membership is available to anyone working in the automotive industry in PA, such as technicians, tower and service managers. Technician Members will receive an electronic copy of “Pennsylvania Automotive & Insider News” bi-monthly, invitations to select chapter meeting and training events, reimbursement for the cost of up to three ASE Certifications, and potentially, a discount on personal electric bills. The cost of a Technician Membership depends on whether the individual’s employer shop is a member of AASP-PA; the fee is $50 per year for employees of member shops, or the Technician Membership costs $100 annually if the employer is not an association member. For more information or to sign up, visit www.aasppa.org/member-resource/technicianmembership.aspx.
44 OCTOBER 2014 AUTOBODY NEWS | www.autobodynews.com
WY is the Most Expensive State in the US for Car Ownership
With relatively cheap repair and insurance rates, why is Wyoming the most expensive state in which to own a car? Gas prices. The state is the most expensive for annual estimated gas costs, and it’s not even close. Wyoming is over $350 more expensive per year than second-ranked Alabama. It costs about $1,588 annually to fill your car up in Wyoming. At $324, repair costs are reasonable, as is insurance at $792. In total, it costs about $2,705 per year to own a car in the most expensive state.
FL is the Third Most Expensive State in Which to Own a Car
According to Bankrate.com there is no one cost that is astronomical in Florida when it comes to owning a car, but all three factors Bankrate measured were on the high side. Estimated annual repair costs are $377, 11th most-expensive among the 50 states and D.C. Insurance costs are $1,124, comfortably in the top-10 most-expensive states, and gasoline costs are $1,015. Overall, the cost of owning a car per year in Florida is about $2,516.
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Season 34 of MotorWeek 2014 Features Collision Mitigation, Traffic Alerts Season 34 of MotorWeek, television’s longest-running automotive series, celebrates the reinvention of the automobile. Upcoming 2015 and 2016 models will feature the highest level of infotainment, safety, and driver’s aid technology ever on four wheels and MotorWeek will cover all of it in exciting detail. This new technology is transforming how automobiles interact with consumers as well as how they drive, paving the way for the emergence of the autonomous, self-driving car. The new season of MotorWeek premieres on public television stations nationwide beginning Sept. 5, 2014. Season 34 of MotorWeek will highlight advanced functions such as Collision Mitigation, Lane Keep Assist, Rear Cross Traffic Alert, and other driver aids that are a step towards cars that completely drive themselves. While this approach may be somewhat alarming to automotive enthusiasts, it will be a boon for everyone that loves or needs the everyday freedom that driving an automobile provides. “The autonomous automobile will not only continue America’s love affair with the automobile, but move it to an even higher level of usefulness,” says John Davis, MotorWeek Host
and Senior Executive Producer. One new technology, Collision Mitigation, which uses a radar aided braking system to slow and even stop a vehicle to avoid a collision, will become a special focus of MotorWeek’s continuing commitment to driving safety. In season 34 MotorWeek will
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inaugurate a new test for cars with automatic braking systems. MotorWeek will add a low speed barrier test, the first all-new test in our Road Test regime in a generation. This new barrier test was created to measure the effectiveness of the various automatic braking systems among different makes and models. MotorWeek Season 34 will reveal how automatic braking systems react in low speed collisions; one of the most common accidents causing billions of dollars
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NJ is 5th Most Expensive State for Auto Ownership
in insurance claims for injuries and property damage. The season premiere of MotorWeek features the newest addition to the BMW family, the exotic 2015 BMW i8 advanced hybrid, the compact 2015 Lincoln MKC utility, the 700-plus horsepower 2015 Dodge Challenger SRT Hellcat, along with the all-new 2015 Acura TLX. Other highlights from MotorWeek’s new season include road test reviews of the 2015 Chevrolet Camaro Z28, designed and engineered to be the fastest street-legal Camaro ever built; and the new 2015 Lexus NX, the brand’s first compact luxury crossover. MotorWeek’s line-up of popular segments returns with Master Technician Pat Goss offering do-it-yourself car care advice at Goss’ Garage. Yolanda Vazquez will continue to tackle consumer news and trends in FYI and Motor News. Roving reporter Zach Maskell goes Over the Edge with a quirky and fun look at the auto world in overdrive, while Brian Robinson reviews the newest motorcycles and scooters in Two Wheelin’. MotorWeek also continues its decade-long emphasis on the widening availability and practicality of hybrid and electric vehicles in Green Motoring.
It costs more to fix your car in New Jersey than in any other state, with an annual estimated cost of $393. New Jersey is also the third-mostexpensive state for auto insurance at $1,244 per year. Gas, though, is affordable, with New Jersey ranking as the sixth cheapest state in this category at $783. For owning a car in New Jersey, you pay about $2,421 per year.
Ford and Chrysler Up, GM down in August Car Sales
It was an up and down sales month for the Big Three US automakers, with Chrysler and Ford seeing gains while General Motors saw retail sales decline, though fleet sales made up some of the ground. All told, a total of 1.58 million light vehicles were sold in August, according to data from Wards Auto. This brings the year-to-date total to 11.3 million units, a 5% increase over 2013.
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CA Has 100K+ Plug-In Cars and Counting
Cumulative sales of plug-in electric cars in California have surpassed 100,000, industry experts announced Sept. 8, according to reports in the Sun.com by Morgan Lee. As of the end of August, Californians had purchased 102,440 plug-in cars, including both all-electric vehicles and plug-in hybrids that run on a combination of electricity and gasoline, according to figures compiled by HybridCars.com and Baum & Associates, a Michigan-based market research firm. The sales records date back to December 2010, when the all-electric Nissan Leaf and plug-in hybrid Chevy Volt
sion repair facilities to protect their businesses by contacting a local attorney to begin drafting these vital documents. Erica Eversman is the Chief Counsel for Vehicle Information Services, Inc. and founder of the Automotive Education and Policy Institute.
Continued from Page 35
were first introduced to consumers in select U.S. markets. California regulators celebrated the milestone as the state bets on plugin vehicles to meet aggressive goals for reducing emissions of heat-trapping gases linked to global warming. “This milestone shows that industry and government can work together for the good of the environment and the good of the consumer,” California Air Resources Board Chairman Mary Nichols said in a statement.
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repair, since this saves rental car time for the insurer. It also gives the impression that the insurance company must respond to you because you’re in control of the repair process. Lastly, an Authorization and Release gives you the right to use photos or videos of the repaired vehicles for your own purposes (such as on your website). Obtaining proper repair docusouthwestern.autobodynews.com mentation is essential to providing Give us your opinion on matters affecting the industry. Register and login to comment customers with the best possible repair. Eversman encourages all colli-
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