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VOL. 31 ISSUE 12 DECEMBER 2013
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Collision Repair Classes, Meetings and Exhibitors Attract Shops to Largest SEMA Ever by John Yoswick
The 2013 Specialty Equipment Market Association (SEMA) show attracted more than 126,000 people—attendees and exhibitor representatives—to Las Vegas in November, filling the massive Las Vegas Convention Center and surrounding spaces with all things automotive. Show organizers say that count was up 7 percent over the previous year and was the highest ever. The collision repair and refinish section of the show boasted just over 200 exhibitors, a small but rapidly growing percentage of the more than 2,300 companies and organizations exhibiting at SEMA this year.
Although attendees could easily spend several days on the show floor
pecial SSEMA
Coverage coverage Pages: 1, 12, 16, 20, 22, 26, 28, 30, 36, 39, 41, and 43
The TV Cast of The Car Chasers: (from left) Eric Ables, Perry Barndt, Jeff Allen, Autobody News’ Barbara Davies, and Meggan Bailey. The Car Chasers is filmed at Flat 12 Gallery in Lubbock, TX.
Louisiana Insurer of Last Resort Will Pay $4,500 to Any Remaining 2005 Hurricane Claimants
million to roughly 18,500 claimants after Sullivan ruled against it last year. Citizens has budgeted $40 million to handle any claims resulting from the settlement, according to Chief Financial Officer Steve Cottrell. Sullivan’s 2012 judgment against Citizens worked out to $5,000 per claim, with 40 percent going to attorneys’ fees. Steve Mauterer, class counsel for the plaintiffs, told Sullivan that the lower settlement amount is in the best interest of the remaining property owners because it wraps up the case after years of litigation. See Last Resort Payouts, Page 15
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A state-run insurance company of last resort has settled the remaining claims in a class-action lawsuit tied to how it handled claims after hurricanes Katrina and Rita in 2005. State District Judge Henry Sullivan gave final approval to the settlement under which Louisiana Citizens Property Insurance Corp. will pay $4,500 to any remaining claimants. Each claimant will get about $3,000 after one-third is taken out to cover attorneys’ fees. It is not clear how many people will come forward to collect on the settlement and how much it will cost Citizens, which already paid out $108
to see it all, there were a number of meetings, events and classes specific
See Biggest SEMA Ever, Page 4
PartsTrader, Insurer Mandates Draw Industry Ire at Collision Industry Conference Held with SEMA by John Yoswick
Following a panel discussion on parts procurement at the Collision Industry Conference (CIC) in Las Vegas in early November, attendees spent nearly an hour voicing criticism of mandated use of any particular system. Tom McGarry of Axalta Coatings ProfitNet Management System noted that unlike several other systems, PartsTrader interfaces with estimating systems but not management systems. He also said a shop ordering parts might need to use one Tom McGarry electronic system in order to receive an automaker rebate, but the shop’s preferred vendor might use a different system, with State Farm requiring yet another. “It’s not a procurement decision anymore; it’s a marketing decision,” McGarry said. “How do you handle that?” Nebraska shop owner Andy Dingman, who participated on the
CIC panel, agreed that shops could be faced with using multiple systems. “And that’s going to be very efficient,” he added, sarcastically. California shop owner Randy Stabler, also on the panel, agreed. “The challenge here is the insurance community doesn’t understand by and large that when they increase the body shop’s costs, they have to pay for it somewhere,” Stabler said. “Lowering the payout isn’t increasing efficiency. If the insurers could take that Randy Stabler back to their corporations and figure out ways to reduce the body shop’s operating costs, then they can share in it, but reducing the payout doesn’t increase efficiency.” Stabler also said, however, that he’s “kind of perplexed” why the PartsTrader mandate has become “such a lightening rod” for an industry that has been accepting insurer mandates since the early days of computerized estimating. See Industry Ire, Page 6
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2 DECEMBER 2013 AUTOBODY NEWS | www.autobodynews.com
COLUMNISTS Franklin - Maintenance Marketing . . . . . . . 32 Franklin - Pasadena/Glendale Meeting: Jack Molodanof & Nicholas Cruz . . . . . . . . . 18 Sisk - Georgia Collision Industry Association Looks to the Future . . . . . . . 8 Yoswick - Scaled-down NACE to Replace ‘Glitz And Glamour’ With Renewed Industry Focus. . . . . . . . . . . . . . . . . . . 26 Yoswick - Use of E-Signatures is Customer Convenience, Faster Authorization Reduces Cycle Time . . . . . . . . . . . . . . 34 NATIONAL 3M Wins Top Spot at 2013 SEMA New Products Showcase Awards . . . . . . . . 43 AASP-PA Opposes Insurer Mandated Parts Procurement Programs . . . . . . . . . . . . 15 BLS Says Total Collision Industry Production is Up in June After Declining in April-May . . . . . . . . . . . . . 32 Brookings Institution Says Cash For Clunkers Ineffective . . . . . . . . . . . . . . . 11 California Most Consumer Friendly in Insurance. . . . . . . . . . . . . . . . . . . . . 16 California’s Stricter Chemical Rules Include DEHP Say Attorneys at AAPEX Presentation . . . . . . . . . . . . . . . . . . . . 16 Chief Automotive Technologies Introduces LaserLock™ at SEMA . . . . . . . . . . . . . 20 China’s 31st Collision Industry Show to be Held in February ‘14 . . . . . . . . . . 41 Collision Repair Classes, Meetings and
Exhibitors Attract Shops to Largest SEMA Ever . . . . . . . . . . . . . . . . . . . . . . 1 Consumer Federation of America Says Insurance Cost Has Gone Up 43% in the Last 25 Years . . . . . . . . . . . . . . . 28 December Retrospective: NACE Town Hall, CIC, SCRS, FTC. . . . . . . . . . . . . . . . . . 40 Deer-Auto Crashes Decline, Disease Cut Population . . . . . . . . . . . . . . . . . . . 30 FIX Auto Holds Conference Featuring “Marketing that Matters” . . . . . . . . . . . 21 Friedlinghaus Unveils Son’s 2013 Scion FR-S Dream Car . . . . . . . . . . . . . . . . . 20 Gene Simmons Brings his ‘Snakebit’ to SEMA, Vehicle is to Benefit a Children’s Hospital. . . . . . . . . . . . . . . . 12 GM Customer Care Adds New Loyalty Program . . . . . . . . . . . . . . . . . . . . . . . 35 GM Stock Rises as Government Sells Off More Shares, Government Could End Ownership . . . . . . . . . . . . . . . . . . 18 Joe Gibbs Racing, Motocross Won with their Let’s Go Moto Tundra. . . . . . . . . . 26 Kelley Blue Book Names 2014 Jeep Wrangler and Dodge Challenger Best Resale Value Winners. . . . . . . . . . 15 Mackin’s Auto Body is 2013 IMPACT I-CAR Elite Member of the Year . . . . . . . . . . . 20 Mitchell Releases Q4 2013 Industry Trends Report . . . . . . . . . . . . . . . . . . . 34 NABC Gifts Four Vehicles to Nevada Families at SEMA Luncheon. . . . . . . . . 36 OSHA Proposes Major Changes in Injury and Illness Reporting . . . . . . . . . . . . . . 23 Part 2: A Profile of the Evolving Collision Repair Marketplace . . . . . . . . . . . . . . . 38 PartsTrader, Insurer Mandates Draw Industry Ire at Collision Industry Conference Held with SEMA . . . . . . . . . 1 SEMA 2013 Entertains, Informs and Wows the Crowd . . . . . . . . . . . . . . . . . 22 SEMA Supporter Neil Young Talks about his LincVolt Project: Repowering the American Dream . . . . . . . . . . . . . . . . . 12 South Carolina’s David Montaro Writes Open Letter to Ed Rust Jr.. . . . . . . . . . . 14 Toyota and Mitchell Collaborate on All-New Mobile/Online Estimating System . . . . . 39 Transtar’s Custom Coffin Grabs Attention at SEMA . . . . . . . . . . . . . . . . . . . . . . . 28 VeriFacts Automotive Institutes ‘Dale Delmege Award’ at CIC, Winner is Paul Krauss . . 16 WD-40 and Chip Foose Keep Truckin’ at 2013 SEMA Show . . . . . . . . . . . . . . 30 Winner of Chrysler Custom Challenge at SEMA Show is Oriana Schooley . . . . 41 WSJ Report: Caliber Collision to be Sold to Private Equity. . . . . . . . . . . . . . . . . . . 3
to fetch more than $500 million in a sale, one of the sources said. At a Sherwin-Williams A-Plus Vison Group event last December, Rex Green who oversees the automotive aftermarket for BB&T Capital characterized the collision industry as a “star perfomer” in the investment world over the last few years, opening the eyes of Wall Street and large equity groups. A couple reasons for that, he said, was an increase in miles driven and new cars sold. He also called the broader automotive aftermarket an “absolute winner” from an investor standpoint over the last 10 years. The sales process was nearing completion and Caliber could announce its new owners soon, they said. It remained unclear who might emerge victorious in the auction—or whether a deal will ultimately materialize—but one of the sources said Blackstone isn’t likely to end up buying the company. There has been a flurry of auto-repair shop deal activity lately, including Advance Auto Parts Inc.’s October agreement to buy General Parts International Inc. for just over $2 billion. The takeover would create one of North America’s largest aftermarket auto-parts providers. Sears Holding Corp. recently said it’s considering selling its Sears Auto Center business.
Publisher & Editor: Jeremy Hayhurst General Manager: Barbara Davies Contributing Writers: Tom Franklin, John Yoswick, Janet Chaney, Toby Chess, David Brown, Rich Evans, Ed Attanasio, Chasidy Sisk Advertising Sales: Joe Momber, Sean Hartman, Bill Doyle (800) 699-8251 Sales Assistant: Louise Tedesco Art Director: Rodolfo Garcia
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REGIONAL $117.5 Million Settlement Pending Between Farmers Ins. and State of Texas over Illegally Reduced Coverage . . . . . . . . . 10 Caliber Collision Expands in Houston Market . 11 Chevy Gets Silverado Endorsed as the Official Truck of University of Texas Football. . . 10 Group 1 Buys 3 Dealerships from Moritz in Arlington, TX . . . . . . . . . . . . . . . . . . 10 HABA Charity Golf Tournament to Benefit Education Foundation. . . . . . . . . . . . . . . 7 Louisiana Insurer of Last Resort Will Pay $4,500 to Any Remaining 2005 Hurricane Claimants . . . . . . . . . . . . . . . 1 Louisiana Shop Sued in Claim that Hail Repair Not Done . . . . . . . . . . . . . . . . . . 7 Louisiana Tax Amnesty Expires Nov. 22 . . 11 Mid County Dealership Hosts Grand Opening in Port Arthur . . . . . . . . . . . . . 11 NCCI Recommends Cutting Louisiana Workers Comp Costs. . . . . . . . . . . . . . 11 Nissan Offers Free Charges for New Leaf Customers . . . . . . . . . . . . . . . . . 10 Pull-A-Part Acquires of Texas Auto Recycler and Shredder . . . . . . . . . . . . . . . . . . . . . 7
The owners of Caliber Bodyworks Inc., DBA Caliber Collision Centers, have put the chain of 157 US body shops up for sale, said sources to the Wall St. Journal. Interested buyers include private-equity firms such as Berkshire Partners LLC and Blackstone Group LP. The WSJ story said the sales process was almost over and new owners would be announced soon. Caliber, which is owned by a unit of Canadian buyout firm Onex Corp. and others, has attracted interest from other private-equity firms, including Blackstone Group LP and Berkshire Partners LLC in the past. Its most recent shop acquisition was nine Global Collision locations in Denver, CO. Caliber Collision Centers owns its 150+ body shops in California, Arizona, Nevada, Colorado, Texas and Oklahoma. An active consolidator, Caliber routinely solicits collision repair shop owners in news releases announcing its acquisitions. Caliber recently acquired four Houston-area body shops. In late September, it added 12 locations in the Sacramento, CA market. In June, the company bought three shops around Denver. Onex acquired Caliber in 2008, buying the Lewisville, Texas-based chain from another group of investors for about $170 million. Caliber is likely
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WSJ Report: Caliber Collision to be Sold to Private Equity
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A Frame Paint Booths . . . . . . . . . . . 10 Absolute Mitsubishi-Hyundai . . . . . 27 Accudraft Paint Booths . . . . . . . . . . . 4 AutoMax Hyundai Del City . . . . . . . 36 BASF . . . . . . . . . . . . . . . . . . . . . . . . . 5 BMW Wholesale Parts Dealers . . . . 39 Certified Automotive Parts Association (CAPA). . . . . . . . . . . . 9 Chevyland . . . . . . . . . . . . . . . . . . . . . 8 Classic BMW . . . . . . . . . . . . . . . . . . . 7 Classifieds. . . . . . . . . . . . . . . . . . . . 46 Dallas Dodge . . . . . . . . . . . . . . . . . 48 David McDavid Auto Group . . . . . . 17 Don Carlton Auto Group . . . . . . . . . 11 Equalizer Industries . . . . . . . . . . . . 12 Finnegan Chrysler-Jeep-Dodge . . . . 2 Ford Wholesale Parts Dealers TX, OK, LA, NM. . . . . . . . . . . . . . 33 Forklift Wrecker . . . . . . . . . . . . . . . . . 6 Fowler Honda . . . . . . . . . . . . . . . . . 34 Freedom Chrysler-Jeep-Dodge . . . 19 GM Wholesale Parts Dealers . . . . . 40 Honda-Acura Wholesale Parts Dealers. . . . . . . . . . . . . . . . . . 24-25 Houston Auto Body Association. . . 16
Huffines Chrysler-Jeep-Dodge Lewisville . . . . . . . . . . . . . . . . . . . 23 Huffines Hyundai Plano . . . . . . . . . 20 Hyundai Wholesale Parts Dealers . 35 I-CAR . . . . . . . . . . . . . . . . . . . . . . . . 46 KBS Coatings . . . . . . . . . . . . . . . . . 14 Kia Motors Wholesale Parts Dealers. 37 LKQ . . . . . . . . . . . . . . . . . . . . . . . . . 47 Mazda Wholesale Parts Dealers . . . 42 Mike Calvert Toyota. . . . . . . . . . . . . 26 Mitsubishi Wholesale Parts Dealers. 41 MOPAR Wholesale Parts Dealers . . 29 North Freeway Hyundai . . . . . . . . . 30 Ray Huffines Chevrolet . . . . . . . . . . 15 Reliable Chevrolet. . . . . . . . . . . . . . 18 Replica Plastics. . . . . . . . . . . . . . . . 22 Scoggin-Dickey Buick . . . . . . . . . . 31 South Pointe Chrysler-Jeep-Dodge. 13 Subaru Wholesale Parts Dealers . . 44 Toyota of Fort Worth . . . . . . . . . . . . 32 Toyota of Laredo . . . . . . . . . . . . . . . 21 Toyota Wholesale Parts Dealers . . . 38 Volkswagen Wholesale Parts Dealers. 43 Volvo Wholesale Parts Dealers . . . . 45 Young Chevrolet . . . . . . . . . . . . . . . 28
www.autobodynews.com | DECEMBER 2013 AUTOBODY NEWS 3
Continued from Cover
Biggest SEMA Ever
to those in the collision repair industry. Here are some of the highlights.
SCRS Holds Open Meeting The Society of Collision Repair Specialists’ (SCRS’) partnership with SEMA, which began in 2010, has proven beneficial for the show as well as the association. As it has in the past, SCRS held an open meeting on the show floor one evening to highlight both some industry news and some of the association’s recent activities. A year after Toyota used the meeting to introduce its concept of “predictive estimating,” the automaker announced at this year’s SCRS meeting a partnership with Mitchell International to deliver Toyota recommended procedures and bulletins within Mitchell’s new mobile/online estimating system in early 2014. Toyota’s Rick Leos explained that when a user adds a part to an estimate, all of the appropriate Toyota vehicle information will automatically appear, including related Toyota bulletins or Rick Leos procedures, and information on such things as one-time use fasteners. Leos said that by the end of 2014, the information will be available for all 2012 and newer Toyotas. He said he expects other automakers to make similar announcements early next year. “Will we be with other information providers? I have every intention of sharing all the same data with every one of them,” Leos said. “I’m not trying to hold it from anybody, and nobody has exclusive rights to it.” Also during the meeting, Tony Passwater, executive director of the Indiana Auto Body Association, urged shops to sign its online petition (http://tinyurl.com/lk8cuds) calling for an end to insurer mandates “that change our well-established business relationships, place vehicle owners in jeopardy and interfere with the free market system.” More than 460 people have signed the petition, which calls for state and federal authorities to investigate and prosecute “the tortious interference actions of property and casualty insurance companies that have been repeatedly
performed over the last 70 years,” calling insurer actions “as aggressive as a modern day mafia.” Passwater said he’d like to see the signature count hit 10,000, and suggested that shop owners also encourage their employees to sign. Also during the meeting, industry trainer Toby Chess used photos and acToby Chess tual parts removed from “repaired vehicles” to highlight the more than 20 cars he inspected over the previous two months that had improper or incomplete repair work. “The reality is this is going on a lot out there,” Aaron Schulenburg, SCRS executive director, said following Chess’ presentation. “Sometimes it may be being improperly equipped or trained shops, but often times it’s a matter of dollars and sense on the repairs, and the pressures that are put on, and how people are being asked to do repairs. That’s not an excuse, but it’s the reality of one of the causes of these types of repairs.”
Attorney outlines lawsuits John Eaves Jr., the personal injury attorney representing Mississippi shops and parts vendors suing State Farm over its mandated use of PartsTrader, held several meeting in Las Vegas during SEMA to explain the suit. He was also signing up individual shop clients looking to sue insurers for “unjust enrichment” based on procedures performed as part of John Eaves Jr. vehicle repairs for which the shop was not paid. Eaves said he is working with an economist to determine the likely damages in such cases, but he said an initial list of 62 such procedures has been developed, and preliminary analysis indicates a minimum loss of $675 per $3,500 repair. He said the suits could cover claims against an insurer over however long the statute of limitations allows (six years, in some states). Eaves said that while he is not being paid for the PartsTrader case— which he said will likely soon be replicated in other states—the unjust enrichment suits are being done on a contingency basis with a 40 percent fee of any collected funds.
4 DECEMBER 2013 AUTOBODY NEWS | www.autobodynews.com
The PartsTrader suit, filed in Hinds County Chancery Court, alleges that State Farm’s implementation of PartsTrader tortiously interferes with existing business relationships shops have with their parts vendors. In addition to an injunction halting State Farm’s implementation of PartsTrader, the suit seeks a ruling that State Farm is violating the terms of the 1963 Consent Decree, which placed limits on more than 260 insurer’s activities related to auto insurance and claims. See the October issue of Autobody News for more on the Consent Decree. Advice On Selling Your Shop SCRS offered about 20 training classes during SEMA, focusing on subjects from marketing and using social media, to cycle time reduction and new bonding and riveting techniques for vehicle repair. Among the classes attracting the most attendees was a panel discussion featuring four former shop multi-shop owners offering insights into the lessons they learned selling their businesses. Industry consultant and trainer Mike Anderson, who sold his two Virginia shops in 2010, cautioned against revealing too much informa-
tion about your business—sources of work, for example—to a potential buyer too early in the process. “I’ve seen MSOs come in to buy a shop from certain individuals who are too free with their information,” Anderson said. “The deal falls through and then those other people open a shop right next door. It’s not a done deal until the money in the bank.” Pat O’Neill, a former owner of seven 9-1-1 Collision Centers who sold to Caliber Collision Centers in 2011, recommends talking to a consultant or others who can help you know Aaron Clark what you can do to increase the value of your business. “And remember that it’s a negotiation until the very last day,” O’Neill said. “Stuff will come up on their side and stuff will come up on your side.” “It redefined ‘coming down to the wire,’ that’s for sure,” agreed Aaron Clark, who sold his five Collision Solutions shops in Indiana to ABRA Auto Body & Glass in 2012. Former CARSTAR executive Dan See Biggest SEMA Ever, Page 7
www.autobodynews.com | DECEMBER 2013 AUTOBODY NEWS 5
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Industry Ire
“That was then. Today it’s parts. Tomorrow it’s paint materials. What happens the day after?” Oklahoma shop owner Gary Wano responded. “If we don’t stop the mandates at some point in time, what are we doing?” Janet Chaney, who serves as the executive director of several state body shop associations, said it clearly comes down to the role parts play in a shop’s profit. “How many times have we been told what to do and we’ve agreed to it and it’s turned on us,” she said, drawing applause. Tony Passwater, executive director of the Indiana Auto Body Association, said he was struck by how often insurer specific mandates are about business processes, like parts ordering, that really have no benefit for customers, rather than on things like equipment, training and certifications that affect the repair quality a customer receives. Scott Biggs of Assured Performance Network said that when the federal government sets fuel-economy standards for new vehicles, it doesn’t tell the automakers how they have to go about meeting those goals. “If an insurer said we can’t sit idly by and let you continue to order parts via phone and fax when that’s such an incredibly inefficient process, they could say instead, ‘You have to use electronic parts order and procurement,” Biggs said. “But they don’t have to name the exact brand because it kills competition.” Similarly, Nick Bossinakis of Overall Parts Solutions, which offers a electronic parts ordering system, said one of the reasons this mandate is frustrating shops is that they may alNick Bossinakis ready be using an electronic parts procurement system that for them works better than PartsTrader. “You have (shops or parts vendors) that are out there listening to digital music on their iPod, and instead are now bringing them an 8track tape,” Bossinakis offered as an analogy. Aaron Schulenburg, executive
director of the Society of Collision Repair Specialists (SCRS), also noted that a mandate to use a particular system can elevate that system above other systems that shops find more efficient to use. “And why is the expectation that we as (shops) are forced to embrace things whether or not we believe they are good for us,” Schulenburg asked. “What I think is a more appropriate expectation is that the insurance industry embrace open platforms and choice. In instances where they’ve done that, it’s been more successful.” John Mosely, owner of one of the Mississippi shops suing State Farm over its PartsTrader mandate, said he has yet to find a single shop owner anywhere in the country who says he or she likes PartsTrader. John Mosley He said the industry “knows how to adapt and we’re not against parts procurement,” but opposes being required to use a particular system. He addressed his comments directly to George Avery of State Farm (also the chairman of CIC), who was sitting in the audience during the panel discussion. “George, I’ve had two conversations with you on the phone, and I appreciate your sincerity,” Mosely said. “You’ve always been, I feel, very honest. But this isn’t working. Is there anything you can do to please take this back to your company and tell them this is just another bad idea out of Illinois, kind of like ObamaCare.” Virginia shop owner Barry Dorn also addressed some of his comments directly to Avery. “George, your folks need to talk to your partners. I’m one of them,” Dorn said. “You need to explain to them why, at the end of the day, one stakeholder is taking away from the other two – how that’s fair, how that’s efficient, how that’s right and frankly, George, how that’s not corporate greed. I don’t blame your company or any insurer from wanting to make more profits. That’s why every one of us came in this room, for more profit. I get that. But if we are partners, we need to sit down and talk, and not just mandate to me how it’s going to be.” Dan Risley, executive director of the Automotive Service Association (ASA), said State Farm has not closed the door to discussions about Part-
6 DECEMBER 2013 AUTOBODY NEWS | www.autobodynews.com
sTrader, and that he feels they have “gotten the message.” But, he said, the association is also pursuing other avenues, including asking states if State Farm’s PartsTrader mandate is legal, and if so, considering legislation to make it illegal. Risley said, in his opinion, litigation should be only the last option because it shuts down communication. “You don’t see PartsTrader up there,” Risley said, pointing to the panel at CIC. “You don’t see State Farm up there. It’s for that reason: litigation.” Indeed, panel moderator Rick Tuuri said every effort was made to get State Farm and PartsTrader to participate on the panel. “The reality is once there’s litigation, everyone that’s involved has a tendency to move away from public discussion,” Tuuri said. “People stand down and cannot speak without their attorney present.” Consultant and former CIC Chairman Lou DiLisio was among the last to speak during the discussion. He circled back to an earlier comment Tuuri had made about how employees can inadvertently end up wasting company time working on something when the actual goal of the assignment they were
given isn’t clear. DiLisio reiterated that a mandate to use a particular system may be less effective than conveying the big picture and working together to find the best way to get there. “Maybe if these companies that have a desire to achieve a goal shared what that goal is, collectively we could come up with a better solution,” DiLisio said, drawing applause at CIC. John Yoswick, a freelance writer based in Portland, Oregon, who has been writing about the automotive industry since 1988, is also the editor of the weekly CRASH Network (for a free 4-week trial subscription, visit www.CrashNetwork.com). He can be contacted by email at: jyoswick@SpiritOne.com.
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Louisiana Shop Sued in Claim that Hail Repair Not Done
A Louisiana auto body shop is being sued by one of their customers who alleges they took her money, but never repaired hail damage to her vehicle. Linda Wilson filed suit against Wet Water Auto Collision Repair & Sales LLC and their insurer in the 24th Judicial District Court on Sept. 30. Wilson claims that after her 2008 Nissan Titan Truck was damaged by hail she contracted with Wet Water Auto Collision Repair & Sales to repair the body damage. The plaintiff asserts that she gave the defendant two checks in the amounts of $4,321.21 and $1,371.23. Wilson alleges that after months of keeping her vehicle Wet Water Auto Collision Repair & Sales never repaired the damage. The defendant is accused of breach of contract. An unspecified amount in damages is sought for loss of use of vehicle, loss of insurance proceeds to repair the vehicle, reimbursement for transportation costs and negligent infliction of emotional distress. Wilson is represented by attorney M. Ali Shahlaei of Gretna. The case has been assigned to Division J Judge Stephen C. Gefer.
HABA Charity Golf Tournament to Benefit Education Foundation The Houston Auto Body Association (HABA) announced recently that it will host a charity golf tournament on Dec. 10 at the High Meadow Ranch Golf Club in Magnolia, Texas, with proceeds benefiting the Collision Repair Education Foundation. The funds raised will support the foundation’s work to promote and improve the education of young collision repair professionals. It will also go to the Stuart Career Center in Baytown, Texas. The golf tournament is presented in conjunction with the Houston I-CAR Committee and will have an 8:30 a.m. shotgun start. The event costs $50 per player with multiple sponsorship opportunities. A Gold package, including a hole sponsorship and four players, is $540; a Silver package, including a hole sponsorship and two players, is $440; a hole sponsorship with no players, a Bronze package, is $340. Lunch ($1,500), breakfast ($500) and awards sponsorships ($350) are also available. Online registration is available. Deadline is Nov. 26 at 4 p.m. Go to habaonline.org and click on the logo to register.
Pull-A-Part Acquires of Texas Auto Recycler and Shredder
The Atlanta-based auto recycling company Pull-A-Part LLC, has completed the acquisition of the Corpus Christi, TX, location of UPull-It Auto Parts, Inc., an auto recycling yard owned by Johnson Development that is headquartered in Lakeway, TX. Corpus Christi becomes the third Pull-A-Part operation in Texas; Pull-A-Part had acquired a Mega U Pull location in El Paso and a UPull-It location in Brownsville earlier this year. The Corpus Christi operation is the fourth Pull-A-Part acquisition the company has made during the past 10 months, increasing the Pull-A-Part holdings to a total of 27 used auto parts stores in 12 states. “Pull-A-Part is excited to add Corpus Christi to our growing network of stores,” says Ross Kogon, president and CEO of Pull-A-Part. “We continue to actively invest in outstanding operations that allow us to serve more customers in more markets and scale our model across the country. The addition of this location expands our presence in the Texas and southwest markets, and we are proud to serve Corpus Christi.”
Continued from Page 4
Biggest SEMA Ever
Bailey, who has been involved both as a buyer and seller of shops over his career, said it’s never too early to start preparing for the sale of your shop. “It’s very emotional,” he said. “When you grow up in this business, there’s something that makes it feel almost shameful to sell your business. ‘What am I going to tell my friends? What am I going to tell my relatives?’ But the reason you’re building a business is to sell it. It’s very emotional so you need to talk it over with whoever is involved in the business with you, whether a spouse or sibling, and make sure you’re prepared to sell the business before you spend a lot of money working on a sale.” John Yoswick, a freelance writer based in Portland, Oregon, who has been writing about the automotive industry since 1988, is also the editor of the weekly CRASH Network (for a free 4-week trial subscription, visit www.CrashNetwork.com). He can be contacted by email at: jyoswick@SpiritOne.com.
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www.autobodynews.com | DECEMBER 2013 AUTOBODY NEWS 7
Southeast Associations
Chasidy Rae Sisk is a freelance technical writer from Wilmington, Delaware, who writes on a variety of fields and subjects, and grew up in a family of NASCAR fans. She can be contacted at crsisk@chasidyraesisk.com.
Georgia Collision Industry Association Looks to the Future with Chasidy Rae Sisk
Established 16 years ago, the Georgia Collision Industry Association (GCIA) has turned their sights to the future of the industry, both in terms of growing their association and in looking out for the next generation of collision repairers. As GCIA focuses on Howard Batchelor the future, they’ve also taken a stand against several problems facing the collision repair industry, as Executive Director Howard Batchelor explains. The GCIA was founded in 1997 by a group of concerned collision center owners and managers who felt that they need to form an organization to represent the interest of collision repairers in their state. Their mission is “to promote professionalism and consumer awareness of the automotive collision repair industry in Georgia.” GCIA also continues to inform and educate their members on new technologies, legislative issues and environmental concerns. Currently, GCIA has around 60 members, but they are always looking to increase membership and expand
ters throughout the state and to set up a group of committees within the organization. Though GCIA has not firmly defined these plans, they hope to establish legislative, membership and educational committees, at a minimum. According to Batchelor, “the purpose of these committees is to be actively working on projects that will benefit the industry.” GCIA’s focus on the future has created an additional goal, as well, which is to design a program to recruit young people to the collision repair industry. The increasing age of repairers and the lack of younger repairers entering the field has been a concern plaguing the industry nationwide for several years, and GCIA hopes to aid in rectifying this problem through their efforts. GCIA took a step towards this goal recently when they donated $2000 to Maxwell high School to help them purchase equipment and supplies for their automotive collision repair program. The funds were raised from sponsors at GCIA’s annual golf tournament on October 2, 2013, and board members Gregg Goff and Michelle Coombs presented the check to students and instructors in the program. Emphasizing the importance of supporting youth interested in pursuing a career in the industry, Batchelor notes, “the children in these programs are the future of our industry, so we want to ensure that they are provided with the tools, equipment and training necessary for success.” Although these future-foboard members Gregg Goff from FinishMaster & Michelle cused goals will benefit Coombs from Sports & Imports GCIA and the collision rethe association. Batchelor notes, pair industry in the long run, there are “being a volunteer association, it’s also several more pressing issues hard to find people to commit the time which GCIA is monitoring and with needed to grow the association. which they are staying actively inThough we continue to struggle with volved. When asked about the biggest participation and membership, we feel challenges currently facing the industhat through our efforts, we are im- try, Batchelor notes, “we feel that the proving the industry for all.” insurers are becoming increasingly inTheir efforts to expand the asso- volved in the collision repair process. ciation has led GCIA to establish sev- Collision repair facilities are the proeral goals for the imminent future: to fessionals, and they need to be able to create several additional GCIA chap- fix the car according to OEM recom-
8 DECEMBER 2013 AUTOBODY NEWS | www.autobodynews.com
mended procedures without the interference of insurance companies.” Naturally, the mention of insurer interference led to PartsTrader, and GCIA has taken a position against PartsTrader because, according to Batchelor, “we believe that insurance
GCIA presents check to Maxwell High School
companies should be involved in selling policies and settling claims, but they should not be involved in the operation of a collision repair facility.”
In fact, GCIA has invited John Mosley, Steve Plier and John Eaves to their January meeting to discuss the PartsTrader injunction and short pay lawsuits. GCIA is opposed to the PARTS Act legislation because “the OEMs have spent a considerable amount of money to design, test and certify these parts. We want to make sure that the parts that are installed on the vehicle meet these standards,” Batchelor explains. GCIA has not taken a position on Right to Repair because their members have not yet asked them to do so. Currently, GCIA has not introduced any legislation, but they’ve had discussions with several legislators about the loss of sales tax on P&M caps and manipulation of the database. They hope to See GCIA Looks To The Future, Page 14
www.autobodynews.com | DECEMBER 2013 AUTOBODY NEWS 9
Group 1 Buys 3 Dealerships from Moritz in Arlington, TX
Group 1 Automotive Inc. said that it has purchased three dealerships in Arlington, Texas. The retailer acquired the BMW, Mini and Cadillac dealerships from Moritz Dealerships of Dallas and Fort Worth, and it will operate each under the “Arlington” name. Moritz Dealerships will continue to operate its Chrysler, Chevrolet, Dodge, Jeep and Kia dealerships in the area. “Dallas, Texas, is one of the largest and fastest-growing luxury automobile markets in the United States,” said Group 1 CEO Earl Hesterberg in a statement. “These well-established businesses will give Group 1 a great platform for growth and will further expand our important, longterm relationship with BMW of North America.” The company, which reported $7.4 billion in revenue in 2012, estimates that the newly acquired dealerships will generate an additional $200 million in annual revenue. Group 1 of Houston owns 144 dealerships in the United States, the United Kingdom and Brazil. It ranks No. 4 on the Automotive News list of the top 125 dealership groups in the United States, with retail sales of 128,550 new units in 2012.
Nissan Offers Free Charges for New Leaf Customers
Nissan Motor Co. plans to offer free rapid charges for its battery-powered Leaf hatchback for new customers in Texas, experimenting with a strategy pioneered by Tesla Motors Inc. Starting Oct. 1, people who buy or lease a new Leaf in Dallas, Fort Worth and Houston will get unlimited free access for a year to public chargers operated there by NRG Energy Inc.’s eVgo unit, the companies said today in a statement. The companies may expand the service to other markets, depending on customer response, said Brian Brockman, a Nissan spokesman. “It’s a pilot program, so we’ll want to see how it goes,” Brockman said. “NRG has eVgo networks in other markets, and we have high hopes for this program.” Nissan has become the world’s largest seller of autos powered solely by electricity. A pricing reduction this year and low-cost lease deals have helped U.S. Leaf sales more than triple through August to a record 14,123 units. Tesla, the electric-car maker based in Palo Alto, CA, is expanding its supercharger stations to repower its Model S luxury sedan. Customers who buy 85 kilowatt-hour-battery versions of the car are guaranteed free charges at the stations for life.
Chevy Gets Silverado Endorsed as the Official Truck of University of Texas Football
Chevy has managed to get the Silverado named the official truck of University of Texas football. It will also be the official ride of Bevo, the Longhorns’ longhorn mascot. A Silverado will pull Bevo’s trailer to and from events.
That smells like a coup in the turf war over Texas being fought by pickup makers. Texas accounts for one in six full-sized pickups sold nationally. More are sold in just the Dallas and Houston areas combined than in any other U.S. state. The multiyear sponsorship deal between Chevy, the University of Texas athletics program and the school’s alumni group, the Texas Exes, is meant to connect the truck with the university’s famously rabid fans. The truck’s logo will appear on the backdrop for all Texas athletics official media conferences and interviews.
Hundreds of thousands of Texas homeowners may be poised to share a $117.5 million settlement between the state and Farmers Insurance, more than a decade after the company first clashed with regulators in court over its rates. Under the agreement, the company would issue refunds or premium reductions to current and former customers. It would also get credit for past premium cuts. The total would be one of the largest insurance settlements in
state history. Farmers admits no wrongdoing in the proposed settlement, which a judge is set to review in January, 2014. The Insurance Department had accused the company of illegally reducing coverage in its homeowner policies and charging customers too much. Refunds and credits would be issued 30 days after the court approves the agreement. It would cover Texans who had homeowner policies with Farmers between 2000 and 2003.
$117.5 Million Settlement Pending Between Farmers Ins. and State of Texas over Illegally Reduced Coverage
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Louisiana Tax Amnesty Expires Nov. 22
Louisiana’s delinquent taxpayers have until Nov. 22 to seek a reprieve from penalties in paying their backowed taxes, with state officials needing strong participation in the amnesty program to keep the budget balanced Revenue Secretary Tim Barfield wouldn’t provide specific numbers about dollars already paid through the program, but he said his department has received thousands of applications and the trends suggest the state will hit the $200 million it expected to collect. The big-ticket negotiations tend to go down to the final days of an amnesty program, as lawyers, accountants and taxpayers haggle over the larger debts owed to the state. The amnesty program began in September and runs through Nov. 22. People and businesses can apply to get caught up on their tax bills without any penalties and with only half the interest charges they would otherwise owe on the debt. The program covers most taxes administered by the Department of Revenue.
Mid County Dealership Hosts Grand Opening in Port Arthur
The local Texas partners of the group, Alfred Flores and Bruce Glascock recently acquired the Allen Samuels Dealership, changing its name to Mid County Chrysler Dodge Jeep Ram. Allen Tate, another partner in the venture, is on board as general manager and has worked in a Houston area location but is from the Beaumont and Vidor area. A well attended grand opening was held Tuesday at the location on U.S. 69. Glascock said the Golden Triangle and East Texas are great car dealership areas and almost seem recession proof with the number of refineries in the area. He cites service, sales, quality repairs and treatment of customers are keys to success. “Employee satisfaction is very important because if the employees are happy and proud of where they work then the customer will feel that energy,” Glascock said. In December 2012, Flores and Glascock sold Spring Chrysler Dodge Jeep Ram, one of the largest dealerships in the southwest Texas, to AutoNation. “This is a great community and we feel good things will come out of the Golden Triangle,” he said. “We want to make this dealership into No. 1 for customers.”
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Caliber Collision Expands in Houston Market
Caliber Collision Centers announced that it has acquired four Hanley Brothers Auto Specialists locations in the greater Houston market. Caliber’s four shop acquisition represents more than 100,000 square feet of collision repair facilities at 1517 Silber Road, Houston, TX, 6409 Richmond Ave, Houston, TX, 5015 Addicks Satsuma, Houston, TX and 25636 Aldine Westfield, Spring, TX. “Caliber’s acquisition of Hanley Brothers Auto Specialists locations expands our penetration and operational synergies in the Houston market,” said Steve Grimshaw, Caliber Collision Centers’ Chief Executive Officer. “Over the course of our discussions with Ken Hanley and his team, it became very apparent that their culture is a perfect fit with Caliber’s customer centric approach toward restoring our customers to the rhythm of their lives.” “We are proud that Hanley Brothers is now a part of the nation’s leading collision repair provider,” said Ken Hanley, CEO of Hanley Brothers Auto Specialists. “This partnership will allow the company to continue expanding across the Houston market, while providing Hanley Brothers’ customers with the same high standards of quality repair and personal service they’ve come to expect.”
Don Carlton ACURA OF TULSA
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NCCI Recommends Cutting Louisiana Workers Comp Costs
The National Council of Compensation Insurance (NCCI) is recommending Louisiana cut Workers’ Compensation costs by 5 percent to reflect greater workplace safety in recent years. According to the Louisiana Workforce Commission, employers across the state saw lighter losses in 2010 and 2011. These improvements, according to documents the NCCI filed with the Louisiana Department of Insurance, can be attributed to a decrease in the number of workplace injuries and a reduction in the average cost per claim.
Brookings Institution Says Cash For Clunkers Ineffective
A new analysis from the Brookings Institution’s Ted Gayer and Emily Parker found the Cash for Clunkers initiative was inefficient as an economic stimulus and only pulled forward auto sales that would have happened regardless of the Cash for Clunkers initiative. The study suggests that 700,000 old cars were traded in between July 1 and Aug. 24, 2009, but that consumers just bought cars slightly earlier than they would have without the initiative.
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www.doncarltonhonda.com www.autobodynews.com | DECEMBER 2013 AUTOBODY NEWS 11
SEMA Supporter Neil Young Talks about his LincVolt Project: Repowering the American Dream
Neil Young has launched a second career as an alternative fuel activist. Now he’s put his fame to work addressing media with a Green Performance Keynote at SEMA which featured his unique and still evolving LincVolt, a 1959 Lincoln Continental convertible powered by the UQM PowerPhase motor and controller system. The 59 Mark IV is an E85-burning plug-in hybrid. The technology under the giant hood is similar in concept to that in the Chevrolet Volt, an extended-range electric vehicle, but with a few significant differences. A self-confessed lover of big cars, Young explained that his proto-
type was designed to show that you can still be enviromentally conscious and reduce CO2 emissions while you enjoy classic car comforts. Speaking without notes, which he disdains, Young described his LincVolt as the fastest comparable car in its weight class, although he declined to say how fast or how much it cost. The LincVolt made its debut at SEMA in 2010 and, as Young has said since, it’s designed “to inspire a generation by creating a clean automobile propulsion technology that serves the needs of the 21st century and delivers performance that is a reflec-
Gene Simmons Brings his ‘Snakebit’ to SEMA, Vehicle is to be Auctioned in 2014 to Benefit a Children’s Hospital
You may not recognize Gene Simmons without his KISS make-up but his truck was a star of the Ford Blue Oval’s SEMA stand. Somehow he and his team managed to combine a 1956 F-100 with styling cues and the heart of a Shelby Mustang with a silver-onsilver custom paint job. The Snakebit uses the same grille as the Shelby ‘Stang at the front but has the tray of the F-100 at the back. The Snakebit 1956 Ford F-100 is a massive 5.4-liter V8 that pumps out an immense 550 horsepower. The supercharged V8 is mated to a six-speed manual gearbox. The wheelbase has been stretched 12.7 centimetres, while the box has been widened and dressed with a billet
machined floor to mimic wood. It is topped with a custom tonneau cover. The headlights and sequential taillights are custom-built, while 18-inch front and the 20-inch rear wheels are also inspired by Shelby Mustangs. It rides on Shelby-inspired 18-inch front alloys and 20-inch rear rims. The project truck is called Snakebit and it is the brainchild of Tom Foster of Industrial Machine & Manufacturing, a car builder based in Saskatchewan. The truck will be auctioned by Barrett-Jackson, and the proceeds will go to fund a children’s hospital in Saskatoon, Canada, the hometown of Simmons’ wife Shannon Tweed. That’s her on the left.
12 DECEMBER 2013 AUTOBODY NEWS | www.autobodynews.com
tion of the driver’s spirit.” The Lincvolt has an E85-capable Ford Atkinson-cycle four-cylinder engine that works with an onboard UQM 145-KW generator to charge the 21.4-kWh battery pack. From a Level 2 wall socket, the pack charges in about six hours, but the cellulosic ethanol in the tank can apparently charge the battery in approximately 60 minutes when the Lincvolt is idling. With a full battery, the car has a range of 50 miles and, thanks to a fuel economy rating of around 23.5 miles per gallon, the Lincvolt can go the distance: 400 miles without stopping. “LincVolt focuses on ultra-low carbon emissions as value, not mpg,”
says Young. Young took the car on a crosscountry trip in August, traveling
from San Francisco to Washington, DC, with a stop at the tar sands in Ft. McMurray, Alberta, to raise awareness about the car, the technology and the dangers faced if alternative fuels aren’t adopted more widely. Although he’s proud of his Canadian heritage, Young ignited a firestorm of controversy after his trip to the tar sands. It was perhaps to be expected when he was quoted as having said, “Fort McMurray looks like Hiroshima. Fort McMurray is a wasteland.” He talks about his work on the project in last year’s New York Times’ best-selling book, Waging Heavy Peace.
www.autobodynews.com | DECEMBER 2013 AUTOBODY NEWS 13
South Carolina’s David Montaro Writes Open Letter to Ed Rust Jr. Complaining about Wait Time on State Farm Jobs A South Carolina collision repairer has written an open letter to State Farm CEO Ed Rust, Jr., complaining about the wait time and lack of response from State Farm personnel on State Farm claims. David Montanaro of Coastal Collision Works in Charleston, SC, believes State Farm is intentionally making his customers’ claims an “administrative nightmare” because he is not on Select Service. The letter reads as follows: As of today’s date, we’ve been waiting 12 days on additional damage supplement approval for your policyholder/our customer. After sending numerous emails and leaving several voicemail messages for your supplements person, we still have no response. Every time my supplement coordinator inquires about how to correct the ‘no response’ problem (with not only State Farm claimants but with State Farm insured customers as well), he’s directed back to your supplements person. But the number of days it takes her to finally respond to a supplement request only increases. When we find additional damage, we typically stop repairs,
document and send the pictures and/or video via email to State Farm for approval. But State Farm says they have to actually see the damage in person before they can approve it. The most ridiculous thing about this is that even though a State Farm adjuster is in our shop every other day looking at a vehicle right next to the vehicle we need a supplement approval on, they refuse to look at it without your supplement person’s approval, which is nearly impossible to get in reasonable time. What kind of customer service is that? We’re a small business and it’s astonishing how many administrative hours we spend just trying to take care of our State Farm customers. And do you realize how this hurts your State Farm policyholders who want us to repair their vehicles? They’re becoming very educated on the way State Farm really feels about their policyholders. It also seems to me that this procedure is expensive and a complete waste of a State Farm adjuster’s time when they have to come back multiple times, instead of approving a supplement while he’s
Continued from Page 8
choices: get involved and turn a blind eye; GCIA members choose to get involved and try to make a difference in their industry. This desire to impact the future of the industry is also evidenced by the fact that GCIA is an affiliate chapter of the Society for Collision Repair Specialists (SCRS). This affiliation also allows GCIA to offer access to ALLDATA through SCRS as a benefit of membership. Another benefit is the association’s willingness to distribute Power of Attorney and Assignment of Proceeds documentation for their members’ use in their businesses, plus they offer a plethora of training videos and documents on their website.
GCIA Looks To The Future
hire a lobbyist soon to work with legislators on issues affecting the industry, and when they hire their lobbyist, they will begin working on their legislative agenda. GCIA is comprised of a group of collision repair professionals, and as such, their members understand that they can never have too much information about operating their businesses and the industry as a whole. They recognize that this profession requires a high level of expertise and knowledge to perform their daily duties, especially with the recent and continuous advancements in technology, so the association strives to keep their members informed about the collision repair industry in GA and beyond. They realize that in this rapidly changing industry, there are two
already here looking at another claim. By the way, we have all of the supporting dated emails and fax confirmations to show that State Farm is, in fact, receiving our requests. Coastal Collision Works has a commitment to handle every damage claim that comes through our doors with integrity and speed. Our customers have come to expect the highest quality in repairs, paint and customer service from us. We actually explain to them all of the procedures during the length of time their vehicle is in our shop. Therefore, when State Farm makes you wait indefinitely for a supplement approval, our customers are informed of the details. What the customers deserve and should expect from State Farm is a quick and professional response on their claims because that’s what they think they’re paying for when they choose you to protect their vehicles. As a matter of fact, according to the State Farm website under ‘State Farm’s Commitment to Our Policyholders,’ it states, ‘State Farm promises to be consistent, act promptly, explain decisions that are made with claims and to ensure their
Georgia Collision Industry Association (GCIA) PO Box 1252 Cumming, GA 30028 770-367-9816 www.gcia.org
Give us your opinion on matters affecting the industry.
write us! publisher@autobodynews.com
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policyholders obtain all benefits available provided by the insurance policy.’ Perhaps this commitment should be taught and instilled in each of your State Farm representatives because they’re obviously not honoring State Farm’s commitment to your policyholders. Montanaro wrote Rust on April 23, 2013, as well to explain what he called “serious issues” concerning State Farm’s treatment of his customers’ claims.
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Kelley Blue Book Names 2014 Jeep Wrangler and Dodge Challenger Best Resale Value Winners
Kelley Blue Book has named the 2014 Jeep® Wrangler and 2014 Dodge Challenger winners of its 2014 Best Resale Value Awards. For the fourth consecutive year, Jeep Wrangler has been named Best Resale Value in its class and ranked on the Top 10 list for the third year in a row. With record setting sales numbers month-over-month this year, Dodge Challenger also earned a spot on this year’s Top 10 list of vehicles with the best resale value. “Jeep continues to dominate in its segment and among the top 10 list, increasing its residual value 3.9 percentage points from just last year,” said Eric Ibara, director of residual consulting for Kelley Blue Book. “New to this year’s list is the Dodge Challenger, which heavily contributes to Dodge’s success for the 2014 model year, along with other strong
vehicles from the brand.” Kelley Blue Book’s KBB.com Best Resale Value Awards are based on projections from the Kelley Blue Book® Official Residual Value Guide and determined by a skilled staff of automotive analysts. These prestigious awards honor vehicles expected to maintain the greatest proportion of their original list price after five years of ownership. “Chrysler Group is honored that Kelley Blue Book has named the 2014 Jeep Wrangler and 2014 Dodge Challenger winners of its Best Resale Value Awards,” said Reid Bigland, Head of U.S. Sales, Chrysler Group LLC. “These prestigious awards serve as great recognition of our commitment to producing quality, reliable, and desirable products, all while maintaining great resale value.”
AASP-PA Opposes Insurer Mandated Parts Procurement Programs The Alliance of Automotive Service Providers of Pennsylvania (AASPPA) is the latest collision repair association to add its voice in opposition to insurance company requirements for their direct repair facilities to use specific parts procurement programs specified by the insurer. In an open letter to the industry, Gregory C. McVicker, Collision Division director for AASP-PA, explained, “The Alliance of Automotive Service Providers of Pennsylvania firmly agrees that the free market of automotive parts sales in the Pennsylvania collision repair industry is best left in the hands of the professional repairers across the state.”
McVicker continued, “This type of oversight by the insurance industry is not only detrimental to the longterm viability of the 2000+ collision repair businesses in the state of Pennsylvania, but will have a negative impact on the overall efficiency of the parts process for the consumer in PA as well.” The letter concludes, “Ultimately, due to the negative impacts on the collision repair business and the consumer from increased cycle-times and lost efficiency and profitability caused by such insurer mandated parts programs, the AASP-PA officially opposes any such program being forced on the collision repair shops in Pennsylvania.”
Continued from Cover
ers had their 2005 hurricane claims mishandled, and early estimates had put the final round of settlement claimants at about 7,500 people. Sullivan, who has presided over the case since the beginning, said the settlement “is in the best interest of the remaining class members” and called it a just resolution to a “tough fight.”
Last Resort Payouts
The lower percentage for attorneys’ fees is intended to “try to put the same amount in everyone’s hands,” he said. Plaintiffs’ attorneys have said that as many as 40,000 Citizens policyhold-
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California’s Stricter Chemical Rules Include DEHP Say Attorneys at AAPEX Presentation
California continues to enact stricter rules on the use of chemicals, including some that are used in automotive repair. Attendees at the Automotive Aftermarket Products Expo (AAPEX) in Las Vegas heard that automotive aftermarket companies have already suffered from existing state regulations and will likely be encountering more restrictive regulations. Lawyers from the Washington, DC-based Arent Fox LLP presented an overview of California’s chemical management rules. Under the state’s Proposition 65 law, which is intended to protect consumers from hazardous chemicals, there are 800 chemicals identified which are believed to be harmful. Companies using these chemicals are required to have warning labels on them. According to Debra Albin-Riley, one of the Arent Fox lawyers, a company can use a listed chemical if the potential exposure to a person poses no significant risk. Proposition 65 allows the attorney general or private citizens to sue companies to enforce the law. She said there have already been 2,000 such actions. “Oftentimes, these lawsuits really don’t have merit,” she said. Defendants have 60 days to comply with the law or to respond.
One such chemical is DEHP, which Victor Danhi—one of the attorneys on the panel—described as a “plasticizer” that is used in 60 percent of all plastic products. Danhi noted that in June of 2013, an oil filter wrench contained DEHP. This past October, a manufacturer, distributor and retailer received a notification about a steering wheel containing DEHP. In 2012, a manufacturer and retailer were sued because an auto crimping tool kit allegedly contained DEHP in its vinyl handle. In such cases, defendants can seek “injunctive relief,” pay a civil penalty which can be as high as $2,500 per day, or agree to a settlement, Danhi said. “Most of these cases result in settlement,” Danhi said. Danhi said it’s important to address lawsuits as soon as possible. Defendants have the option of asking the state attorney general to negotiate a settlement. In California, defendants have the option of seeking to join an “opt in” settlement. Defendants can choose to “opt in” to a settlement agreed to by the state attorney general. There is usually a limited time period for opting in. Maureen Gorsen, another attorney, offered an update on the California Green Chemistry Initiative, passed in
VeriFacts Automotive Institutes ‘Dale Delmege Award’ at CIC, Winner is Paul Krauss of Craftsman Auto Body in VA
VeriFacts Automotive announced the winner of its inaugural Dale Delmege Award, a segment of its Achievement in Collision Repair Excellence (ACE)
“The fact that Craftsman Auto Body continues to grow and maintains their level of performance speaks directly to the leadership shown by the entire operation.” The Dale Delmege Award recognizes the significant and lasting contributions of Dale Delmege throughout each segment of the collision repair industry, and will recognize a collision repair center consistently producing and delivering verified repair quality. “I know of few people as committed to, and influential in, their pursuit of the long term betterment of our industry than Dale Delmege,” said Farzam Afshar, Dale Delmege presents his eponymous award to CEO of VeriFacts. Paul Krauss (r) CEO/President of Craftsman Auto “I am pleased to be able to Body of Chantilly, based in Sterling, VA recognize the scale of Dale’s conAwards, on Nov. 6 at CIC in Las Vegas. tributions over the years by naming our Dale Delmege spoke briefly and pre- ACE Award for the exceptional collisented the award to Paul Krauss, owner sion repair center the Dale Delmege of Craftsman Auto Body of Chantilly, Award.” based in Sterling, VA. Craftsman is a a Dale Delmege has been Collision third generation, family-owned collision Industry Conference Chairman 1999– repairer with multiple locations across 2000, and a Lifetime Member (since Virginia. 2001) of the Society of Collision Repair In presenting the award, Delmege Specialists (SCRS). He is a Hall of Easaid, “I have known Paul Krauss for gles member and a National Auto Body many years and have always known the Council Founding Member and Direccommitment to excellence he has in- tor, as well as a CIECA Founding Memstilled in his people,” said Delmege. ber, Director, and Chairman.
16 DECEMBER 2013 AUTOBODY NEWS | www.autobodynews.com
2008. The law calls on the state department of substance control to determine if products can be made with more sustainable materials. “There is absolutely nothing in this with merit to businesses,” Gorsen said. Under this law, which became effective in October of 2013, the state will be asking businesses for lists of chemicals used in their products. She noted that manufacturers, importers, assemblers and retailers will all be affected. Companies using listed chemicals will be asked to identify “potentially viable alternatives.” Gorsen said rules governing the use of five products will be announced in April of 2014. The state expects to have a list of 2,354 chemicals covered by 2016. Gorsen said anyone can petition the state to add chemicals to this list. Once a chemical is added to the list, it cannot be delisted for three years. “The subjectivity in how they list is going to be amazing,” Gorsen said. Manufacturers of listed chemicals will have 180 days to submit a compliance plan. Once the state receives the plan, they will decide what the regulatory response will be. Gorsen said the state will have a “web of shame” on its website for companies failing to comply with the law.
California Most Consumer Friendly in Insurance
California has the most consumerfriendly auto insurance industry in the US due to state regulations, the Consumer Federation of America (CFA) says in a report released this month. Twenty-five years after California voters passed Proposition 103, which imposed regulations and rate controls on auto insurance companies, the measures have been declared a huge success by the CFA, which recommends other states adopt similar measures. California is the only state that has seen a decrease in insurance rates since 1988, when Prop 103 was passed. Other states have seen an average increase of 43.3 percent, according to the report, What Works. Wisconsin is at the median for rate increases over the 25-year period, with a 56-percent jump, and Nebraska registered the largest increase at 108 percent. In California, rates have declined slightly since 1988, with a 0.3-percent decrease. Seven million consumers in California received more than $1.43 billion in premium refunds under Prop 103, according to the report.
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www.autobodynews.com | DECEMBER 2013 AUTOBODY NEWS 17
Western Associations
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
Pasadena/Glendale Meeting: Jack Molodanof & Nicholas Cruz with Thomas Franklin
The October 24, 2013 meeting of the chapter was held at the Brookside Country Club, 1133 Rosemont Ave, Pasadena, California, as usual. President Linda Holcomb was back, assisted by board member Chuck Bistagne. The meeting was dedicated to an update by the CAA lobbyist for the past 20 years, attorney Jack Molodanof. Jack started by praising the work of the new California Department of Insurance Commissioner, Dave Jones. Jack said Dave has brought a real focus on the collision industry concerns to his department. In the past a CAA member complaint would go to one staff member and probably get lost in a pile of random concerns. Under Dave Jones, several knowledgeable people have been assigned to our industry and constituent concerns are dealt with quickly. Jack provided a printout of current Department of Insurance regulations for all members attending the meeting. He said these are valuable negotiating tools that enable a shop to get paid for all necessary line items on an estimate. He was shocked that some shops would accept an insurance company estimate rather than writing their own. He noted that the insurance company and the shop have two different objectives when writing an estimate. The shop, of course, wants to write an accurate estimate of what is needed to return a vehicle to pre-accident condition. The insurance company, on the other hand, is primarily interested in settling the claim, and at the lowest possible cost. In pursuit of their objective, the insurance adjuster may try to omit certain operations that the shop deems necessary. Jack says with a copy of the regulations in hand, a shop can demand to be paid for all necessary operations. There may be
some dispute over how much will be paid, but there can be no dispute over whether or not an operation is necessary. Jack said the main concern here is the filing of complaints to force insurance companies to pay what is required. He said they're not likely to comply if no one complains. A report form was also provided at the meeting. This issue resulted in questions and discussions about the consequences of filing a complaint report. Shops with a direct repair relationship noted complaints could result in a loss of DRP status or some sort of retaliation. Independent shops would have no such concern. Jack noted that a lack of filed complaints when the time comes to discuss regulations Jack Molodanof could tilt the talk file photo in favor of the insurance industry. They can now say if no one is complaining why should a regulation be imposed? Some members asked if filed complaints had resulted in shops being paid for disputed services. Jack noted that two shops had filed to be paid for storage time and since regulations require that payment, both shops were paid—perhaps not as much as they preferred, but paid for the storage nonetheless. It appears that complaints go beyond resolving a specific shop dispute. An abundance of complaints establishes an area ripe for regulation. Shops objected strongly to being held responsible for problems created by the use of aftermarket parts required by an insurance company. As a result, among the many recent changes to regulations, is the
GM Stock Rises as Government Sells Off More Shares, Government Could End Ownership General Motors could be free of government ownership by year’s end, and that sent the company’s stock up. News that the government sold $1.2 billion in GM stock last month was released by the Treasury Department Tuesday. It didn’t say how many shares were
sold. But based on the average price in October, the government now owns less than 4 percent of GM. Buckingham analyst Joseph Amaturo says the government could be out by the end of December. He says that could clear a path for dividends in 2014.
18 DECEMBER 2013 AUTOBODY NEWS | www.autobodynews.com
requirement that insurance companies that require the use of aftermarket parts be responsible for faulty parts rather than putting that responsibility on the shop that installed them to comply with the insurance company requirements. Jack also discussed some changes to Board of Automotive Repair (BAR) regulations like windshield replacement standards and some successes on the legislative front. For example, BAR fines have been increased from $2500 to $5000, but for simple mistakes, it is now possible to receive nontechnical training, like Write-it-Right or ethics training, instead of a fine. On the legislative front, the insurance industry tried to kill new collision repair regulations but the CAA helped kill that effort. Another battle has been the impact of a minimum wage increase on specialized technicians who provide their own tools. A small business like a collision repair shop would have
to pay double the increased minimum wage, possibly rising to as much as $20.00 an hour. There is also an effort to head off the attempt to impose a sales tax on services that already exists in some states. This would obviously be a disaster for small businesses that provide mostly services. In addition to the presentation by Jack Molodanof, Nicholas Cruz from HUB International also provided some information on upcoming health insurance changes as the Affordable Care Act rolls out. Basically the message is that it is constantly changing. The three major carriers in California are holding back on announcing increases in rates until the last minute. Cruz says HUB International is now available to CAA members to get answers to their many questions. The regional office for HUB International Insurance Services is at 4371 Latham St., Suite 101, Riverside, California 92501. Phone 951-788-8500.
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www.autobodynews.com | DECEMBER 2013 AUTOBODY NEWS 19
Mackin’s Auto Body is 2013 IMPACT I-CAR Elite Member of the Year, Award Given at CIC Meeting in Las Vegas
Mackin’s Auto Body in Vancouver, WA, was chosen as the 2013 IMPACT I-CAR Elite Member of the year, exemplifying excellence in the collision industry. IMPACT is the marketing arm of RDA. IMPACT provides programs to keep the collision shops competitive and I-CAR provides the education to repair the vehicles properly. Mackin’s Auto Body is third generation family owned and operated business. Makin’s has been in business for 86 years with 8 locations in Oregon and Washington. They employ 100 people. Owners Suzanne and Larry Mackin know how to give their customers professional and reliable auto body service. They joined as an IMPACT Elite member because they see value in the many benefits the program offers. Makin’s “Does it right” every time and we are proud to call them the 2013 IMPACT I-CAR member of the year. RDA/IMPACT is the largest national group of refinish jobbers
Friedlinghaus Unveils Son’s 2013 Scion FR-S Dream Car
dedicated to providing quality services and products to their collision shops. RDA has 19 members, representing 185 locations. Members
service over 3,600 collision centers throughout the US and do over $400 million in sales as a group, comprising around 15% of the refinish business nationwide. Those interested in RDA/IMPACT should contact Robert McKenzie, Jr. directly at 731-217-9081 or via email at robertemckenzie@me.com. Visit their web site at www.impactcollisionsolutions.com or contact Melisa Jolls at 908-251-5713.
Ryan Friedlinghaus and the team at West Coast Customs unveiled the sweet 16 dream car for Friedlinghaus’ son ‘Lil Ryan’ at the BASF booth during the 2013 SEMA Show. Lil Ryan has grown up in the West Coast Customs shop and has seen his father transform ordinary vehicles into extraordinary works of art. The Scion FR-S features a custom paint blend of BASF R-M Onyx HD Low VOC Productive Systems paint called “WCC Whitegold”; a 2.0 4-Cyl Boxer DOHC 16V 200Hp;
a 6-speed sequential automatic transmission with paddle shifters; TEIN suspension; 5 piece Five-AD Aero Lip Kit; custom Roadwire and Ultrasuede interior; and Giovanna wheels wrapped in Continental tires. This Scion will send Lil Ryan onto the LA streets in West Coast Customs style. BASF hosted various celebrity autograph sessions and presented the latest in car color technology from its Glasurit, R-M and Carizzma Colors paint lines at its SEMA booth.
Chief Automotive Technologies Introduces LaserLock™ at SEMA, “A Product Category of its Own”
Chief Automotive Technologies introduced its LaserLock™ live mapping™ system at SEMA. Chief’s LaserLock system includes a new laser scanner with out-of-level measuring capabilities; 45 targets and a wide range of attachments; a lockable, portable workstation equipped with dual flat screen monitors, computer and color printer; and exclusive Chief software. “The LaserLock measuring system is so advanced, it is in a product category of its own,” explains Lee Daugherty, Chief global data product manager. “LaserLock precisely measures up to 45 individual points on a vehicle simultaneously in real time. This live, multipoint mapping enables technicians to measure and monitor dimensional changes as they occur during pulling, so there’s no need to recalibrate after every pull, and there is less risk of accidentally putting more damage into a vehicle. LaserLock live mapping is computerized measuring for the next generation.” The lightweight, durable new LaserLock scanner features an ergonomic design with easy-to-reach handles and a compact profile that maximizes the laser’s line of sight. As a result, LaserLock can simultaneously measure more reference points than any
other system on both full-frame and uni-body vehicles. In fact, LaserLock can map an entire vehicle at once, making it possible to repair vehicles with diamond or twist damage, as well as frames that have both front and rear damage. LaserLock’s stateof-the-art design allows for vehicles to be measured even when they’re not level, so set-up time is reduced. This also makes LaserLock a natural choice for the estimating bay, where it can be used with a simple twopost lift to measure every vehicle, resulting in better scheduling, more efficient repair plans, improved cycle times and happier customers. Recognizing that modern vehicles are increasingly complex to repair, LaserLock includes a step-by-step tutorial program to help technicians make higher quality repairs quickly, accurately and profitably. The system includes on-screen photos of recommended targets and attachments, as well as where they should be placed. Chief also includes free interactive live support.
20 DECEMBER 2013 AUTOBODY NEWS | www.autobodynews.com
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FIX Auto Holds Conference Featuring “Marketing that Matters” The 11th Annual Fix Auto USA National Conference hosted nearly 200 collision industry members at the Boulders Resort in Scottsdale, AZ. The event took place Sept. 15–18, 2013, and featured the theme “Marketing that Matters.”
Fix Auto said the main purpose of the conference was to foster professional growth in its attendees, a community that included not only Fix Auto collision repair members, but the insurance representatives and vendors with which they partner during the course of daily business. The keynote speaker, former major league pitching standout Jim Abbott, discussed his ADAPT concept, which illustrated how repairers can change and mold themselves to
meet and overcome any obstacle. In addition, author and consultant Scott Deming illustrated how attendees can capitalize on brand loyalty to drive business to their doors. Other speakers included Michael Bennett, North America marketing director for Axalta Coating Systems; Susanna Gotsch of CCC Information Services Inc.; Fix Auto member Richard Fish; and a panel of industry veterans who discussed the role parts play in collision repair today and in the future. The conference also granted professionals in attendance to display their giving side through the Bike
Build for Charity program. Sponsored by Mitchell International and facili-
tated by Impact 4 Good, a company that specializes in leadership development applied to philanthropic causes,
Fix Auto participants worked in teams to build the bikes by competing in bike-related team activities that were both physically and mentally challenging. A group of children associated with the StarShine Academy in Phoenix, a school specializing in the education of students from at-risk communities, were the designated recipients of the assembled bicycles, which they received in person. Safety helmets were part of the donation as well. “One of Fix Auto’s underlying principles is giving back to the com-
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munities we serve,” said Fix Auto President and COO Paul Gange. “The Build a Bike Charity was a nice variation on this philosophy and was a great way to wrap our general sessions. “Throughout the year we focus on our mission of enhancing the opportunities for independent repairers through collective marketing, robust resources and the benefit of shared knowledge and connectedness that is uniquely available through the Fix Auto network. We challenge our team
to raise the bar at our annual conference, and this year’s conference set a new standard. We thank everyone who participated and look forward to the opportunity to enhance our program even further next year.”
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Parts Dept. Hours: Monday - Friday: 7:30am - 6pm Saturday: 8:30am - 5pm www.autobodynews.com | DECEMBER 2013 AUTOBODY NEWS 21
SEMA 2013 Entertains, Informs and Wows the Crowd
22 DECEMBER 2013 AUTOBODY NEWS | www.autobodynews.com
OSHA Proposes Major Changes in Injury and Illness Reporting The Occupational Safety and Health Administration (OSHA) has proposed a major change to its rules regarding the way that employers report injury and illness data to the agency. On November 7, 2013, the OSHA Assistant Secretary Dr. David Michaels announced a new proposed rule that would require establishments with more than 250 employees, which are already required to keep injury records, to electronically submit them to OSHA on a quarterly basis, and establishments with 20 or more employees in industries with high injury and illness rates to electronically submit their injury and illness logs each year. Michaels said OSHA will post the data on its website, once personally identifying information is removed. Michaels said the newly proposed submission requirements will enable employers to compare their safety records against peers and will allow workers to know the safety records of potential employers. Aggregating data across industries also will help researchers identify emerging hazards and patterns, Michaels
said. On January 9, 2014, OSHA will hold a public meeting on the proposed rule in Washington, D.C. In addition, OSHA is accepting public comments for 90 days, until February 6, 2014. Under current rules, employers are required to post annual summaries of injury and illness reports in a common area where employees can see them. While the OSHA website contains raw numbers about incidents at certain workplaces, it doesn’t describe what the injury was or how it occurred. Business groups say they are likely to oppose the plan, claiming that raw injury data can be misconstrued or may disclose sensitive information that may be misused. Marc Freedman, executive director for labor policy at the U.S. Chamber of Commerce, said the mere recording of an injury does not tell the full story about the circumstances surrounding it or whether the company has a good safety program. “Making company-specific data on injuries available for all to see would be a major problem and would likely lead to companies being tar-
geted by outside groups who want to characterize these employers as having bad safety records,” Freedman said. Michaels announced the rule on the same day the Bureau of Labor Statistics released its estimate that there were almost 3 million nonfatal U.S. recordable workplace injuries and illnesses by private-industry employers in 2012. The incidence rate of injuries only in the private sector declined to 3.2 cases per 100 full-time workers in 2012, a decrease from 3.3 per 100 in 2011. The incidences of serious injuries and illnesses resulting in days away from work, job transfer, or job restriction—called the DART rate— remained steady in 2012. The BLS data indicated also that no one particular industry experienced an increase in injury or illness rates for 2012. Other key findings include the following: ● Manufacturing was the only private industry sector in 2012 in which the rate of job transfer or restriction only cases stemming from injuries/illnesses exceeded the rate of cases re-
sulting in days away from work, continuing a 15-year trend. ● Of the 3 million reported cases, the vast majority (more than 2.8 million) involved nonfatal occupational injuries. More than 75% of such injuries occurred in service-providing industries. ● Industries with the most frequent reports of workplace illnesses were goods-producing industries (34.3%) and manufacturing (29.5%). ● Injury and illness rates, although relatively unchanged from 2011, were significantly higher for public sector workers, with 5.6 cases per 100 fulltime workers. “Three million injuries are three million too many. We can and we must do better,” Michaels said. He called the proposed submission requirements “an effective, inexpensive, and non-prescriptive way” to encourage employers to do this. With the likelihood that OSHA reporting requirements could change soon, it’s important for businesses to make sure they understand and remain in compliance with OSHA’s recordkeeping rules.
www.autobodynews.com | DECEMBER 2013 AUTOBODY NEWS 23
24 DECEMBER 2013 AUTOBODY NEWS | www.autobodynews.com
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Industry Insight
—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.
Scaled-down NACE to Replace ‘Glitz And Glamour’ With Renewed Industry Focus with John Yoswick
Perhaps one of the most symbolic indications of the many transitions the International Autobody Congress and Exposition (NACE) continues to go though was the event’s 2013 keynote address speaker, Mike Anderson. Without the 30,000 attendees the show enjoyed throughout the 1990s, organizers couldn’t bring in the big-name political and celebrity speakers of the past, which have included George H.
W. Bush, Norman Schwarzkopf and Colin Powell. But Anderson, a former shop owner and now one of the most popular industry trainers, speakers and consultants in the country, instead offered the more than 500 attendees at the NACE opening session in Las Vegas a more personal, industry-focused message that received a standing ovation. “We had the celebrities who repre-
sent our industry,” Dan Risley, executive director of the Automotive Service Association (which sponsors NACE) earlier this year, said of Anderson and the speaker at the show’s siDan Risley multaneous opening session for the mechanical industry.
NACE Organizers Promise Big Changes for 2014
From the opening session of NACE 2013 through the closing press conference, speakers and organizers voiced a “Wait ’til next year” message. Indeed, the show will undergo some dramatic changes next year, as the Automotive Service Association (ASA) works to regain some of the lus-
ter NACE has lost over the past decade. NACE next year will shift to summer in Detroit, Michigan, home (at least symbolically) to the United States’ Big Three automakers. The OEMs will play a pivotal part in the “rebirth of NACE,” ASA’s Dan Risley promised at NACE this year, with
more of the car companies exhibiting at the event and hosting factory tours. Also helping draw attendees, Risley said, will be the Collision Industry Conference (CIC) and I-CAR annual conference, being held the two days prior to NACE in the same location.
“That’s what this show is supposed to be about. It’s a show for the industry, about the industry. Mike is among the ‘rockstars’ of our industry. That’s who attendees want to hear from. That was well-received.” The more casual, less glitzy opening session was emblematic of a show that attracted fewer than the 2012 announced attendance of 16,000. Risley and event organizers refreshingly
“We think that’s a win for the industry,” Risley said. “One of the things ASA did a couple years ago was a split from some things. It caused a divide in the industry. It hurt us. It hurt the show. We recognize that. So we’re going in the opposite direction and doing everything we can to promote industry unity.
We think it’s best for the industry and for the show as well.” Though Detroit’s population and financial stability have suffered over the past several decades—the city filed bankruptcy earlier this year—NACE organizers said the downtown convention center has been refurbished and a headquarters
Joe Gibbs Racing, Motocross Won with their Let’s Go Moto Tundra in the Toyota Dream Build Challenge Cup
Joe Gibbs Racing, Motocross took hold of a Toyota Tundra pickup to make into the Let’s Go Moto Tundra. The Let’s Go Moto is barely recognizable as a Tundra thanks to the NASCAR-inspired 8-foot pit box on the bed. The overhauled truck back combines racing functionality with after-racing recreation and relaxation. Before, during and after the race or session, the Let’s Go Moto keeps bikes and riders at their best with integrated tool storage, spare parts, a power washer and a helmet dryer. After the race is over and bikes put away, the truck doubles as a rolling outdoor entertainment center complete with retractable shades, TV and refrigerator. It’s the perfect way to unwind after a long race—or relax in the sun without ever throwing your leg over the bike at all. Founded in 2006 by Coy Gibbs,
son of NFL Pro Football Hall of Fame Coach and three-time Sprint Cup Champion team owner Joe Gibbs, the team is sponsored by Toyota and Yamaha—with Justin Brayton and Josh Grant riding for the team. Both riders were involved in the design and building of the Tundra (above and right) that would serve as an all-purpose transport for the bikes and the entire racing team.
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26 DECEMBER 2013 AUTOBODY NEWS | www.autobodynews.com
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made no effort to try portray NACE as something it wasn’t, saying it met their modest expectations given it was being held just three weeks before SEMA, also in Las Vegas. With 170 exhibiting companies, the trade show was down more than 25 percent from the previous year, and was the smallest since 1985. Rather, organizers sought to take advantage of some of the opportunities the smaller scale of the event allowed. The annual ‘welcome party,’ for example, took place on the tradeshow floor as the first day concluded, and a “mainstage” in the exhibition hall offered a dozen free seminars over the two days, also helping to keep attenhotel with attractive room rates is just a block away. More so than in Las Vegas and New Orleans (the site of NACE in 2012), there is a large population of shops within an easy drive of Detroit, show organizers pointed out, and the event has never been held in that part of the country.
dees in the tradeshow itself. And perhaps more than any other year, NACE speakers and organizers placed a lot of emphasis on setting the stage for the even more significant overhauling of the event next year (see sidebar). Anderson’s kick-off speech included many anecdotes and lessons from his travels around the industry since he sold his two shops in 2010; this year he will spend more Mike Anderson than 340 days on the road, offering training sessions or
ASA has hired a new company to manage the show, replacing Hanley Wood after nearly two decades. It is also abandoning the ASRW “Automotive Service and Repair Week” moniker that never truly caught on. “It needed to go,” Risley said. “Stated differently, NACE and CARS (the mechanical in-
consulting in 48 of the 50 U.S. states. He said that’s helped him realize he was wrong in the past to judge shops largely on whether they participate in insurer direct repair programs (DRPs). “I’ve learned instead to judge people by the quality of the work they do,” Anderson said. “If you’re a DRP and you do quality work, I say God bless you. If you’re a non-DRP and do quality work, I say God bless you. I realized I was too judgmental. I realized at the end of the day we all have a vested interest in judging people based only on whether they do a proper repair.” He said too often issues other than quality repairs get too much focus in
dustry show held with NACE) have brand equity. We want to utilize that. NACE and CARS mean something to people.” Risley hinted at ancillary events, like the automaker factory tours, that might be open to attendees during NACE 2014, potentially including Yankees vs. Tigers baseball games, the
the industry. He asked how many shop in the room had repaired a late-model Toyota, Honda or Hyundai recently, and hundreds of hands went up. But when he asked how many had performed a zero-point calibration on those vehicles – as the automaker repair procedures call for – only a few hands went up. “If we don’t do this, I don’t care if you’re a DRP or non-DRP, we failed the consumer who trusted us,” Anderson said. He said a study following the 1986 Space Shuttle Challenger disaster found that a culture at NASA of “relaxing safety standards to meet fiSee Scale-down NACE, Page 31
Henry Ford museum, the General Motors Heritage Center, BASF’s headquarters, and tunnel access to the casinos and other attractions of Windsor, Ontario. “We want to make the show a different experience,” Risley said. “When you go to SEMA, that’s a different experience. There’s lots of glitz and
glamour. It’s fun. It’s a great show. I like to go to it personally. But I want our show to be different from an attendee perspective. When we go to Detroit, we’re going to give you that. We’re going to give you something in Detroit that you will not be able to get anywhere else in this country.”
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www.autobodynews.com | DECEMBER 2013 AUTOBODY NEWS 27
Transtar’s Custom Coffin Grabs Attention at SEMA by Ed Attanasio
At the largest and busiest SEMA show ever many companies were undoubtedly asking themselves— how can we stand out among all of the booths, cars and products at this enormous show? While many companies chose to display cars and motorcycles in their booths to highlight their products, Transtar Autobody Technologies of Brighton, MI, went in a completely different direction this year by thinking outside of the box (or in it) depending on your perspective.
Celebrity Painter Seth Bolden, owner of Aggressive Designs, created this amazing airbrushed coffin for Transtar Autobody Technologies’ SEMA booth this year
This leading manufacturer of automotive refinish and specialty coatings partnered with well- known motorcycle painter Seth Boldman of Aggressive Designs and the finished product was an intricately painted casket with a very beautiful female/angel on the lid that used Transtar’s No Mix® Basecoat and Clearcoat and was proudly displayed in the Transtar booth. Known for routinely doing custom work for celebrities such as Criss Angel, Rhianna, Tom Cruise, Pink and Christina Aguilera, Bolden’s casket attracted a crowd throughout the entire SEMA show. With that “wow” factor that no one could resist, hundreds of pictures of this art piece were taken each day and the comments ranged from “That’s how I want to go!” to “I see the light!” according to Stacey Wilcox, the marketing manager at Transtar Autobody Technologies. “The quality of both the
artistry, as well as the products used to create it was evident and we were happy to introduce our line of products to so many new faces. Seth is highly creative and his work is amazing. This casket set us apart during SEMA and that’s exactly what we were shooting for.” Bolden was proud of his coffin creation and designed it with his client and friend magician Criss Angel in mind, he explained. “We wanted to do something completely different and really blow their minds. I’ve done 10 motorcycles for Criss and when he sees this coffin, I have a feeling he’s going to want it. The theme in Heaven and Hell and it shows an angel emerging as demons grasp at her feet. We put at least 100 hours into it and it’s been a real attention getter during this entire show.” (The suggested price for Angel: $25,000) Bolden was happy to attract attention to his sponsor’s booth with his coffin, he said. “I’ve been working with Transtar now for almost ten years and they became our full-time sponsor four years ago.” Bolden said. “Transtar is a great company and we love all of their products, including their basecoats, primers, clears—even their tape. They ask me to test their products through their research and development efforts all the time and we like trying them out. I use Transtar exclusively and it’s been a wonderful relationship.” Aggressive Designs in the City of Industry, CA, employs a staff of five and works out of a 5,000 square foot shop. Known as a leader in the motorcycle custom paint industry, Bolden receives rave reviews for pretty much whatever he paints. Boldman is renowned for doing custom paint jobs on bikes of all types for companies such as Big Bear Choppers and leading Harley Davidson dealers, as well as for television shows and movies. “We’ve been recognized in top motorcycle and car magazines for many of the custom projects we have rolled out of our shop. We’ve built a reputation for providing over the top custom painting and airbrushing work by using the latest techniques and high quality paint products, like Transtar.” Transtar is a leading manufacturer of automotive refinish and specialty coatings. The company has broad distribution across North America, with a significant presence in Latin America and other key markets. For more information about Transtar’s products and services, please visit www.tat-co.com .
28 DECEMBER 2013 AUTOBODY NEWS | www.autobodynews.com
Consumer Federation of America Says Insurance Cost Has Gone Up 43% on Average in the Last 25 Years
Holding automobile insurance regulation in California as an example, the Consumer Federation of America issued a report on showing that auto insurance expenditures in America rose by 43 percent on average over the past quarter century. The report holds that the median state, Wisconsin, rose 56 percent over that time, while in Nebraska rates rose by as much as 108 percent–increases that occurred despite increased automobile safety and the arrival of several new carriers in the insurance markets. “These escalating rates, which are made worse by the use of non-driving rating factors by major insurance companies, limit the ability of lowand moderate income drivers to comply with state insurance requirements,” the report states. The report’s authors called for prior approval regulation similar to California to be considered for the rest of the nation. The Property Casualty Insurers Association of America promptly issued a statement in an effort to debunk the report: “Opponents of competition-based rating systems such as the Consumer Federation of America have the misguided impression that prior
approval systems keep insurance rates down. However, National Association of Insurance Commissioners (NAIC) data demonstrates that on average states with competitive-based regulatory systems have the lowest average annual premiums when compared to the countrywide average and states with prior approval systems.” The CFA report analyzes the auto insurance regulatory systems of each of the 50 states from 1988 through present. The report singles out California and the landmark insurance reforms in Proposition 103 just days after the 25th anniversary of the ballot initiative. Prop. 103 passed on Nov. 8, 1988, and made sweeping changes in the oversight of auto insurance in California, including requiring prior approval for rate hikes and establishing an intervenor process in which people who challenge rate hikes can get compensated for doing so. Based on estimated savings to California drivers outlined in the report of $100 billion since 1988, or $8,125 per household, the authors called for prior approval regulations similar to Prop. 103 for the rest of the states.
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www.autobodynews.com | DECEMBER 2013 AUTOBODY NEWS 29
WD-40 and Chip Foose Keep Truckin’ at 2013 SEMA Show by Ed Attanasio
It was déjà vu all over again when Chip Foose and WD-40® partnered at the 2013 SEMA Show in Las Vegas one more time to raise money for charity while creating an incredible one-ofa-kind custom built vehicle. This year, the WD-40/Foose collaboration created an astonishing off-road truck that will eventually be raffled off to one lucky winner, with proceeds benefitting three SEMA Cares charities. Named the WD-40®/SEMA Cares Foose Ford F-150, this truck was the very first vehicle to be built inside the new state-of-the-art SEMA Garage— a facility that allows SEMA member companies to test and prototype parts, try its 3D modeling and printing, and use its full-scale photo studio, among other things. “The SEMA Garage is considered to be the most advanced shop of its type in the world,” WD-40® spokesperson Greg Kershaw explained. “Through a partnership with the Alex Xydias Center for Automotive Arts (AXC), underprivileged teens and young adults were able to work alongside leading SEMA man-
ufacturers to install parts and equipment on this special project vehicle. This was an amazing unique learning experience for these young people and surely something they will never forget.” This is the sixth vehicle WD-40® Company and SEMA Cares have
Chip Foose once again partnered with WD-40® to build this breathtaking one-of-a-kind truck
teamed up to build and the fourth vehicle Chip Foose has designed with them. To date, WD-40®/SEMA Cares vehicles have raised almost $600,000 for SEMA Cares charities. Equipped with high performance aftermarket parts, the WD-40®/Foose truck is a tribute to off-roaders all over the world; passionate truck enthusiasts and aftermarket companies who have called upon WD-40® Company prod-
Deer-Auto Crashes Decline, Disease Cut Population
Deer-related vehicle crashes totaled 1.22 million in the 12 months ended June 30, according to a statement Monday from State Farm Mutual Automobile Insurance Co., the biggest U.S. car and home insurer. There were “fewer deer to hit this year,” Kip Adams, a director at the Quality Deer Management Association, a group that promotes sustainable hunting, said in an interview before the report was released. The population had been cut by car accidents in prior seasons “plus a lot of deer dying of disease,” Adams said. Crashes are most common in October and November, which are in the mating season for deer, the Bloomington, Illinois-based insurer said. Collisions cost an average of $3,414 in property damage nationwide, a 3.3 percent increase from a year earlier. “We’ve seen up to $6,000,” said Dave Huskey, who manages Minor Wreck Express, an auto repair business in Iowa. He said engineering advances have helped protect people inside the cars, though vehicles are still vulnerable to damage, often involving bumpers, side panels and windshields. “The cars look worse because they’re absorbing the impact rather than passing it on to the passengers,” Huskey
said in a telephone interview. “It takes a lot of damage to get inside the frame.” Reports of Epizootic Hemorrhagic Disease spiked in 2012 for deer from Louisiana to Montana. The virus spreads through biting flies, or midges, and causes fever and internal bleeding. “With the tendency toward warmer, shorter winters, the midge is reaching higher levels,” said Brent Rudolph, a wildlife research specialist with Michigan’s Department of Natural Resources. The heat “creates conditions that are really good for the midges.” Rudolph said there were about 15,000 deaths reported from the disease in Michigan in the summer. That compares with “a few thousand” in prior years, he said. West Virginia led the country for the seventh straight year as the state where motorists are most likely to hit a deer, according to the report. One in 41 drivers there will probably strike a deer in the next 12 months, the insurer said. Montana drivers are next most likely to crash, followed by vehicle operators in Iowa, South Dakota and Pennsylvania. Hawaii has the lowest chance of collisions, with odds of about 1-in6,787. New York drivers are the 24th most likely to have deer-related mishaps.
30 DECEMBER 2013 AUTOBODY NEWS | www.autobodynews.com
ucts for six decades. Kershaw said the truck must have involved over 200 people and close to 50 different companies to create the WD-40®/SEMA Cares Foose Ford F-150 truck. “So many companies and individuals stepped up to make this truck happen,” Kershaw said. “To see all of these elite companies coming together for a really worthy cause is pretty amazing. Everyone added their touch and their flavor to the finished product and what we have now is unlike anything else. It truly is one-of-a-kind and the person who wins it will have a piece of art on four wheels.” Instead of being auctioned like previous WD-40®/SEMA Cares vehicles, the enhanced 2013 Ford F-150 Lariat will be raffled off to one lucky winner in early May 2014. With raffle tickets only costing $50 starting on Nov. 1, owning a Foose-inspired truck is now more accessible than ever to all automotive enthusiasts. “Can you imagine winning a oneoff vehicle like this—worth more than $80,000 with all parts and labor—for only $50?” said Chip Foose, president and CEO of Foose Design. “By pur-
chasing raffle tickets, you’re also supporting a great cause.” Proceeds from the raffled vehicle will benefit three SEMA Cares charities—the SEMA Memorial Scholarship Fund, which is dedicated to fostering the next generation of automotive leaders and innovators; Childhelp®, an organization that provides services to abused and neglected children; and Victory Junction, an organization that provides life-changing camping experiences to special needs and chronically ill children. Theresa Contreras is a painter/rebuilder for L&G Enterprises in San Dimas, CA and once again she played an integral role in the build. She has been building vehicles for SEMA for more than a decade and was pleased to be a part of this build. “When it all comes together like this, it’s a win-win for the sponsor, the charities and all of the companies that contribute,” Contreras said. “It’s more than just the truck—it’s about people helping each other and working together to make this a better world and a better industry.” The custom vehicle was painted
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with BASF Onyx HD paint by LGECTS Motorsports and features a Whipple supercharger, Gale Banks Straight-Shot performance system and Magnaflow cat-back exhaust system that give its 6.2L V8 more than 600 horsepower. To make it off-road ready, the truck also features a converted front Raptor suspension with
ing and a WARN winch, the custom Ford F-150 also has a Boatec Raptor fiberglass hood, fenders and bedsides. AMP Research supplied and installed power running boards, bedsteps and a tailgate extender to make it easy to get in and enjoy the plush Katzkin leather interior and top-of-the-line Clarion sound system installed by Audio In-
The WD-40®/SEMA Cares Foose Ford F-150 was built by 200 people and more than 50 companies donated products and time
ICON Vehicle Dynamics 3.0 coilovers and upper uniball billet arms, as well as ICON rear triple bypass shocks with Atlas 3.0+ leaf springs. Outfitted with Baja Forged front and rear bumpers by LGE-CTS Motorsports, a custom bed cage, Bulldog LED light-
novations.To top it off, the custom truck is riding on Falken Wild Peak A/T 37x12.5R17 tires wrapped around 17” x 9” MHT Fuel Maverick wheels in a matte Graphite finish. “We’re celebrating WD-40® Company’s 60th anniversary, and it’s
great to see the next generation of automotive professionals and enthusiasts getting excited about working on a vehicle that’ll bothturn heads and help support a wonderful cause,” said Tim Lesmeister, vice president of marketing for WD-40® Company. “This vehicle—any off-roader’s dream—would not have been possible without the vision of Chip Foose and his team, the hard work of the Alex Xydias Center students, and the time and resources of our generous build partners.” Partners on the WD-40®/SEMA Cares Foose Ford F-150 include: Foose Design, Source Interlink Media, LGE*CTS Motorsports, Whipple Superchargers, Icon Vehicle Dynamics, MHT Wheels, Boatec, Magnaflow, BASF, Katzkin, Audio Innovations, Amp Research, FuelTool, Bulldog LED Lighting, Banks Power, HushMat, Mag-Hytec, Warn Industries, Optima Batteries, Falken Tire, PowerBass, Atlas Spring, Clarion and Metra Electronics. To learn more about the build and how Chip Foose uses WD-40 Multi-Use Product and the new WD-40 Specialist® line of products, visit WD40.com/Foose. To learn more about the raffle, visit WD40.com/TruckRaffle.
Continued from Page 27
Scaled-down NACE
nancial and time constraints” set the stage for that failure. “If we continue to let certain things dictate our industry, we’re going to have a catastrophe like the Space Shuttle Challenger,” Anderson said. In some ways, he said, insurer pressures to improve cycle time have forced the industry to be better business people, whether or not that was the intention. “But if we keep focusing on cycle time and…severity because we’re afraid about the costs being too high, if we start focusing on the wrong things, we’re going to have a catastrophic event just like NASA did,” Anderson said.
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On Creative Marketing
Maintenance Marketing with Thomas Franklin
I knew this one shop owner who was obsessed with the new. He wanted to be out in front of other shops in every way possible: superior equipment, better trained personnel, and of course, innovative marketing. He was always trying new things with his marketing but this got him into some serious trouble. While he was concentrating on the new, another shop grabbed one of his DRPs, and another one replaced his position as authorized repair shop for a major dealership. With his intense focus on the new, he forgot about what I would call, “maintenance marketing.” No one likes to be taken for granted—especially high volume sources of business for a shop. This shop owner assumed his rapid cycle time, his use of used and aftermarket parts, and his always giving priority to the DRP vehicles would be enough to hold on to that DRP forever. Any recently divorced husband or wife could have told him this was a faulty assumption. One might provide a good home, high quality food and clothes and abundant money to a spouse and yet lose that relationship due to a lack of real attention. This shop owner might have saved that DRP with something as simple as an occasional call and very personal lunch with the DRP decision-maker. The dealership decision-maker would probably have required more elaborate contacts and more frequent communication. Sadly he neglected both of them at a significant cost to his shop. As important as it is to maintain close relations with referral sources
like insurance companies and auto dealerships, perhaps the most important source of business to keep in contact with is prior customers. As times have changed this has become a trickier business. Young customers will generally be in touch with the Internet, Facebook, Twitter and other social media sites. This provides an obvious way to stay in touch and pass along shop improvements in equipment, technology, personnel training, and elements of specific interest like color matching. Older customers may now be conversant with the Internet and websites but possibly less so with social media. This could make updating these customers a bit more difficult. But he bigger question is, how are the shop marketing people to know which customers fit into the young or older category without specifically asking customer age on the information form? Old customer info forms generally asked for birthdays and anniversaries to send targeted greetings. Newer forms probably also ask for an e-mail address, but how many now ask for Facebook, Twitter and other social media designations? These info forms are often neglected in shops already, but in this new high-tech age such neglect can be a costly marketing and sales omission. Insurance companies are frequently combining and consolidating, sometimes forcing customers to change companies. With steering still going on, either directly or indirectly, a shop has to counteract insurance company efforts to force old
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
customers to go to the new company’s preferred shop. A shop’s best hope for retaining these customers is a steady stream of information about the shop’s superior ability to deal with the rapid changes in vehicles. Promoting the shop’s ability to handle electric and hybrid vehicles, vehicles constructed with lighter weight materials like plastics, aluminum, magnesium, and other special metals can reassure the customer that this continues to be the best shop to come to. This message can easily be gotten out through the website and social media, but those off that track can still require old methods of communication. With the cost of postage stamps continually rising, direct mail can be costly. E-mail is by far the best if a shop can be sure its message doesn’t wind up in a spam file. For the shop’s best old customers, it would be appropriate to make a phone call periodically if only to ask the customer to
check his or her e-mail for the latest update, and of course to ask about the condition of the customer’s vehicles.. In yesterday’s world, a shop could employ a marketing guy or gal to make the rounds and keep in touch with referral sources and customers. Today’s world calls for a marketing person with intimate knowledge of social media and especially effective email management. E-mail tracking can tell whether or not a specific email has been received and opened. Today’s astute on-line marketing professional should note if some of those messages have not made it to the recipient and tag those for a phone call. A lack of adequate attention destroys many kinds of relationships. For most shops, referral sources and prior customers are the gold that keeps things running and maintaining an ongoing marketing effort to keep them happy should be the shop’s top marketing priority.
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BLS Says Total Collision Industry Production is Up in June After Declining in April-May According to the latest data released from the U.S. Department of Labor Bureau of Labor Statistics (BLS), the total production picture for the auto body repair industry improved in August, building upon gains since June after experiencing declines in both April and May. The industry’s total production, which is defined as the total average weekly hours by month multiplied by the total number of production and non-supervisory workers employed
each month, closed August, 2013 at 6.66 million man hours, up from 6.59 million man hours in June. Production hours in August 2013 stood at 0.4 percent above August 2012. The growth in production came chiefly from an increase in production and non-supervisory employees, up 600 in August to 173,900. The average weekly hours worked by production and non-supervisory employees declined to 38.3 hours in August from 38.4 hours in July.
32 DECEMBER 2013 AUTOBODY NEWS | www.autobodynews.com
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Industry Insight 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.
Use of E-Signatures is Customer Convenience, Faster Authorization Reduces Cycle Time After a non-drivable car gets towed into your shop, how long do you generally have to wait to get a signed authorization from the customer to tear-down or begin work on their vehicle? Would that customer be more apt to sign the form more quickly if they didn’t have to come to your shop in order to do so? And could getting customer signatures more quickly in some cases allow you to start and finish work more on their vehicle more quickly, potentially improving your cycle time and cash flow while reducing rental car costs? Those are the kind of questions Pat Beavers, chief operations officer of the 11-shop CollisionMax chain in the Philadelphia area, hoped to address through the use of e-signatures. Pat Beavers Anyone who has
bought a piece of real estate or paid taxes electronically knows that putting ink to paper is no longer always necessary for a signature to be considered valid and legal. “We’ve used it successfully over 600,000 times over the last six years in 48 states and two Canadian provinces,” Vince Brigidi, president of the CEI Group, a fleet accident management company, told attendees at the Collision Industry Electronic Commerce Association (CIECA) Implementation Conference in San Diego this fall. “The process of obtaining customer’s authorizations is antiquated. The electronic signature is legal and effective. And there are significant efficiencies to be gained and rental days to be saved by doing this.”
Testing with a repairer CEI manages claims for fleet, government and insurer accounts, using a network of more than 3,600 collision
Mitchell Releases Q4 2013 Industry Trends Report
Mitchell announced the availability of its Industry Trends Report (ITR) for the fourth quarter of 2013. Providing deep analysis of alternate parts use and actual cash value trends in auto physical damage, along with education on eBilling and ePayment trends, technology solutions and implementation strategies, the latest ITR offers valuable data to insurance carriers and payers, collision repair centers and key constituents in the P&C market.
The Auto Physical Damage edition Mitchell Vice President of Industry Relations Greg Horn builds on the last ITR article that looked at the drivers of severity for repairable estimates. The Auto Physical Damage edition of the report dives deeper into the model-specific data, analyzing whether vehicle age and the correlating increase of alternate parts availability affects repairable estimate cost. "A look at the average repairable estimate cost for a three-year-old Camry shows a spike in the cost of the overall repair from 2010 onwards," said Horn. "My first assumption was that the cost of the repair would be driven by more complex vehicles that have more expensive components." Detailed analysis revealed that alternate parts use was found to keep costs down but
continued to fluctuate while labor cost increased. For the first time, the Mitchell ITR includes a section from J.D. Power that analyzes actual cash value trends for vehicles in the United States and Canada. They report that more lease trade-ins and gently used vehicles will enter the market, providing some relief to the high values seen in the used car market.
The Casualty edition Healthcare regulations drive change in many areas including the electronic exchange of health information. As such, the newest casualty edition of the ITR focuses on beneficial technologies such as eBilling and ePayment, two solutions that allow P&C payers to improve operational efficiency and reduce costs. The feature article provides background on the regulatory landscape affecting eBilling, the benefits to P&C carriers and payers, and proper methods for electronic payment preparation and implementation. A bonus article by Ryan North, Senior Director of Information Systems, highlights DevOps, emphasizing the importance of internal collaboration between product delivery and operations teams to ensure customers receive the best possible experience.
34 DECEMBER 2013 AUTOBODY NEWS | www.autobodynews.com
repair shops. Brigidi said CollisionMax is part of that network, and CEI worked with Beavers to set up a system to enable CollisionMax to obtain authorizations and other required customer signatures electronically. “Sometimes in the past we’ve sent someone to a customer’s house to Vincent Brigidi get a paper documents signed, or used FedEx,” Beavers said. “We have a shop full of technology for everything else we do to repair the car and speed the process, but when it comes to having a piece of paper signed, the best we can do is FedEx or fax it?” Here’s how the system CollisionMax created with CEI’s assistance works. Say a vehicle is towed into a CollisionMax shop. The shop can email the customer a link to the electronic authorization form it needs the
Welcome to the ALL NEW
customer to sign. It could be CollisionMax’s own form, or the custom one the insurer involved needs to have signed. The customer can read or even print the form from their computer, phone or tablet, then “sign” their name simply by typing it into the space provided. The signed form then is electronically returned to CollisionMax. Over a 3-month period and more than 300 non-drivable claims, CollisionMax compared the traditional method of obtaining customer signatures to the e-signature method. The results convinced Beavers that e-signatures are the way to go. Using the traditional method, 62 percent of the needed signature were obtained the same day, and 18 percent were obtained the next day. The balance took 3 days or more (in the longest case, 9 days) and the overall average was 1.94 days. By using e-signatures, however, CollisionMax obtained 97 percent of
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the signatures the same day and the other 3 percent the next day. “Pat and I feel even that 3 percent is going to come down,” Brigidi said. “Some of it may have been user-error on our side.” The longest amount of time it took to obtain the authorization was just 26 hours, and the overall average length of time: Just over one hour. “From the insurance company perspective or whoever is on the hook for paying that bill, that means dollars,” Brigidi said. “These are all nondrivable claims, all claims in which the vehicle is sitting there, the insurance company is paying for a rental, and the driver is without their vehicle, In the CollisionMax world alone, there’s probably $200,000 or more in rental savings for non-drivable vehicles.”
Customers very accepting While customer surely found the process more convenient than making a trip to the shop, Beavers said, his company received little in the way of comments from customers. Brigidi said that tells him the process is accepted if not an expected way of doing business for customers today. In order for e-signatures to be enforce-
able, customers must be given a choice whether to use it, but Beavers said during the study not one customer declined to sign electronically. Brigidi said 47 states have signed onto the Uniform Electronic Transactions Act, which makes electronic signatures legally valid. (The three other states—Washington, Illinois and New York—have their own state laws governing the use of e-signatures.) CollisionMax has shops in both Pennsylvania and New Jersey, states that have different requirements for shop in terms of authorizations to be obtained, but the system worked well in both states. Brigidi said that of the 600,000 esignatures his company has obtained over six years, not one has been challenged as invalid. But, he said, in addition to tracking the day and time of the authorization, the system tracks the IP address of the device on which the customer signed the authorization, allowing it to be tracked back, if necessary, to the location or device from which it was provided. Beavers said he wants to use e-signatures for all the customer authorizations the shop must obtain, even for drivable vehicles. It reduces paper use, is convenient for the customer, and
would allowthe shop to use the same process for all claims. Customers dropping vehicles off could use a kiosk at the shop to sign electronically, or could be sent a link to the document via the phone they are carrying. “When you think about some of the delays and how long some of those cars sit while we’re waiting to be authorized, to me they are all like checks waiting to be processed,” Beavers said. “The new standard is minutes, not hours or days.” Beavers also said the potential savings and additional audit trail for insurers are obvious. “I have some speculation that some shops are using that authorization part of the process to benefit themselves,” Beavers said. “Maybe they don’t expedite the authorization at times because they have plenty of work. Typically for the insurers, the proverbial clock starts to tick only when we have a signed authorization. So if a shop has delayed that for whatever reasons, the pressures aren’t on so much.” Brigidi said he was surprised to learn an e-signature system hadn’t been integrated into the estimating or shop management systems, but believes that will eventually happen.
GM Customer Care Adds New Loyalty Program
GM Customer Care & Aftersales, the service and parts division of General Motors, announced Oct. 29 that it has added a new loyalty rewards program for independent body shops purchasing select GM collision parts. Shops enrolled in the program earn points when purchasing GM OE doors, wheels, mirrors and lighting assemblies from GM dealers through the OEConnection CollisionLink online parts-purchasing network. Points are awarded for parts purchased on insurance estimates only for GM vehicles two model years and older. Points are awarded at the rate of one point for each dollar spent. Accumulated points can be used to purchase a wide selection of merchandise, travel, entertainment and new GM vehicles. All CollisionLink users will receive an email request to sign up. To sign up for CollisionLink, visit the OEConnection website.
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NABC Gifts Four Vehicles to Nevada Families at SEMA Luncheon nated vehicles refurbished by Gerber Collision, Caliber Collision, Sterling The National Auto Body Council Auto Body Centers and Collision Au(NABC) presented four vehicles to thority. Las Vegas area families through its NABC Vice-President Liz Stein Recycled Rides program on Nov. 7 at knows that without the support of the Las Vegas Hotel & Casino during body shops, insurance companies and the 2013 SEMA Show. At a luncheon other sponsors, the NABC Recycled attended by 200 collision professionRides would never happen. “This proals, including insurance companies, gram offers a lot of people in this inmanufacturers, vendors, body shops, dustry an opportunity to really impact parts manufacturers, recyclers and disthe community and change peoples’ tributors, NABC celebrated its Recylives. How many times does that hapcled Rides giveaway for yet another pen, where we can really improve the daily lives of families that really need it and deserve it?” In addition, Family Promise received a 15passenger van donated by Enterprise Rent-a-Car and repaired by Gerber Collision in a surprise presentation. “We were so happy to find this van for Family Promise of Las Vegas, because these larger vans are always in demand and From left, NABC President Nick Notte, Stacy Spear, former recipient of a Recycled Rides vehicle and NABC Executive very hard to find,” Chuck Director Chuck Sulkala at the annual NABC Recycled Rides Sulkala, Executive Direcluncheon during the 2013 SEMA Show tor of the National Auto year during SEMA. By refurbishing Body Council said. “Family Promise and recycling cars donated by insurdoes a tremendous job by enabling so ance companies, Recycled Rides has many families to regain their stability been praised for its green approach and independence. We recognize that and for gifting a total of 48 vehicles owning a car they can count on could to-date. be the key to regaining both their finanThe recipient families this year cial well-being and their self-respect. were chosen by Family Promise of Las Vegas, an organization that helps homeless and low-income families to transition from homelessness to stability and independence. “Without a car, life can be very difficult and tiring,” said Terry Lindemann, executive director of Family Promise of Las Vegas. “Daily tasks like going to the grocery store or the doctor’s office are not easy for people without reliable, safe transportation. Recycled Rides is a wonDevlin, the son of recipient Michael Antongnazzi derful program and the people at seemed to enjoy his new, recycled ride NABC are incredible. We’re so thankful to the NABC and all of the local Recycled Rides is a wonderful program body shops and insurance companies that enables so many of us in the collithat helped. Every year NABC reaches sion repair industry to partner with our out to us and helps our member famicolleagues and make a positive impact lies by providing these vehicles and in peoples’ lives.” every year it’s very emotional.” Diamond Clark, a single mother Participants in this year’s multi- of six children, received a van from the car gifting at SEMA included EnterNABC Recycled Rides program this prise Rent-A-Car, State Farm year. She looked both relieved and exInsurance, Allstate Insurance Com- cited, but most of all-very grateful. pany, Esurance and Hertz, which do“Last summer, my vehicle died by Ed Attanasio
36 DECEMBER 2013 AUTOBODY NEWS | www.autobodynews.com
and I could not get to work, so I lost my with sustaining an independent future. job,” Clark said. “As a result, we got Family Promise of Las Vegas serves evicted from our house because I couldup to 25 families daily in one of three n’t afford the rent. We've been riding the housing programs designed to assist bus this entire time, having to leave at families achieve sustainable futures four in the morning to deliver the kids and lasting independence. to school and getting home really late every evening. Now I have a job and a car, so things are turning around for me.” Family Promise is a non-profit organization with 177 networks nationwide that organizes houses of worship, community agencies, and social service agencies into a community-based inter- From left, Howard Putterman of Enterprise Rent-a-Car; Terry faith hospitality network. Lindemann, the Executive Director of Family Promise and Tom Family Promise’s Family Csekme with Gerber Collision celebrated another successful Mentoring Program is a year of the NABC Recycled Rides program homelessness prevention initiative The National Auto Body Council that trains volunteers to act as advisors is a non-profit organization dedicated and advocates for at-risk families, to enhancing the image of the collision helping them achieve goals and main- industry and for more information visit tain self-sufficiency. Families that www.NationalAutoBodyCouncil.org; graduate from the program’s transi- Facebook at facebook.com/Nationtional sheltering program are enrolled alAutoBodyCouncil or its Twitter feed in a mentoring program to assist them @AutoBodyCouncil.
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www.autobodynews.com | DECEMBER 2013 AUTOBODY NEWS 37
Part 2: A Profile of the Evolving Collision Repair Marketplace
by Vincent J. Romans & Mary Jane Kurowski, The Romans Group
Part 2 of the annual series by Vincent Romans and Mary Jane Kurowski, examines the MultipleLocation Network Operators and $20+ Million MSO and Independent Shop Population.
2012 U.S. Collision Repair Market The three market segments, $20+M MLO, $10 to $20M MLO, and multiple-location networks, MLNs, roll up to a marketplace profile as reflected in the following chart.
The $7.2 billion total for these three segments represents 23.5 percent of the annual collision re-
56 percent over the past 30 years, with the sharp decline we have witnessed since 1990 tapering off. Since 2006, we have seen a reduction of approximately 9,800 independent and dealer-operated collision repair facilities within the United States, a 22 percent decline. Over the next decade, we believe that market share will continue to shift to the $20+M MLOs, the $10 to $20M MLOs, and to the franchise multiple-location networks, MLNs. This market share shift will eventually move the industry toward a less frag-
mented and capacity-normalized model. As we approach 2020 and
recognized or accepted as being the “correct” number for estimating the auto repair claims market size. There continues to be a wide range of opinions, anecdotal information and various government and private sector data reporting on and determining a meaningful and relevant collision repair market size. Our best-efforts proprietary approach yielded an estimate for insurance-paid repairable claims expenditures for 2012 of $27.7 billion with a conservative approximation of con-
sumer-paid repairs at $3.0 billion, resulting in combined insurance and consumer-paid claims for MLO’s targeted repairable vehicle market segment for 2012 of approximately $30.7 billion. The total number of collision repairers within the United States continues to have value as the traditional data point for calculating market share. Those repairers who operate and integrate collision damage estimating and shop management systems while leveraging other technology asSee Evolving Marketplace, Page 42
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pair revenue processed for 2012, indicating a fragmented collision repair industry with much upside for further consolidation. Our estimated U.S. market size for the number of independent and dealer collision repair locations at year end 2012 is 35,200. This estimate continues to reflect the long-term decline which began in the late 1980s. The number of independent and dealership collision repair facilities in the U.S. has declined by
the trend in industry contraction and consolidation continues, the number of repair locations will move closer to the 30,000 level. Based on our longitudinal research and analysis involving published third-party industry sources, property and casualty insurance, private sector and government sources, and industry knowledgeable and experienced professionals; we continue to ascertain that there is no one certain number that is universally
38 DECEMBER 2013 AUTOBODY NEWS | www.autobodynews.com
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Toyota and Mitchell Collaborate on All-New Mobile/Online Estimating System necessary parts, CRIB notes, and TIS manual pages (describing, for example, non-reusable parts) are featured in the system. Mitchell’s new mobile/online estimating system is being developed to promote Toyota recommended repair procedures during the Toyota Wholesale Parts set up their own booth at SEMA where they announced the new mobile/online estimating system in collaboration estimating process. The with Mitchell Inc. new solution should reAt SEMA, Toyota Motor Sales, U.S.A., duce the time required to write a collision Inc., exhibited at their own wholesale estimate by eliminating the need to referparts booth. The company announced an ence multiple sources when repairing a all-new way of delivering recommended Toyota vehicle to its pre-accident condirepair procedures through a partnership tion. It will also provide standardized inwith Mitchell, a leader in providing techformation needed throughout the entire nology, connectivity, and information sorepair process. lutions to the collision repair and “Our goal is simple, to ensure cusinsurance industries. The system protomer safety and confidence,” said vides all the information needed for the Rick Leos, Collision Program Develrepair upfront providing the shops the oper, Toyota Motor Sales, U.S.A., Inc. choice of referencing what they want, “By combining Mitchell’s expertise in while safely ignoring what’s not necesestimating and Toyota’s quality repair sary. The idea is to eliminate the back procedures, we have found a way to and forth between different sources, help repair shops save time and money, products and multiple subscriptions. All while decreasing cycle time and reduc-
ing supplements. It’s a win for our customers, repair experts, and insurance companies alike.”
Rick Leos, Collision Program Developer, and Jason Wright (r), with Toyota Wholesale Parts in Torrance, CA
“Mitchell is excited to offer direct access to repair procedures from Toyota within a collision repair estimate,” said Jim Brady, Vice President, Product Management, at Mitchell. “By capitalizing on Mitchell and Toyota’s core
competencies and strengths, together we will create a dynamic solution in which Toyota vehicle information automatically appears when parts are added to an estimate.” Toyota’s integrated repair procedures include recommendations on parts that should be replaced rather than re-used along with supporting information detailing the non-reusable parts. Toyota repair procedures will be available with the release of Mitchell mobile estimating in 2014. To learn more about Toyota’s partnership with Mitchell or see a prototype of Mitchell’s mobile estimating solution with integrated recommended repair procedures, see: www.youtube.com/ watch?v=GBvDz0iIzOY.
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Historical Snapshot
—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.
December Retrospective: NACE Town Hall, CIC, SCRS, FTC with John Yoswick
20 years ago in the collision repair industry (December 1993) A NACE “Town Hall” meeting on December 4 brought together a panel of 14 industry experts. They each offered their own views on how the re-engineering of the industry will or should take place. The forces behind the drive for change, they agreed, are consumers, information technology, legislation and perhaps most importantly, the inefficiencies of the current system. “If we can eliminate all the delays in the repair process based on insurance approval, that would streamline the process tremendously,” Dennis Kiyohara of AutocheX said. “You don’t need DRPs to streamline the process. You can get all those things you want – hassle-free service, faster repairs – without doing direct repair. The technology is the driving force. I think we have to get (insurers) to say, ‘Here’s what we want and here’s how we measure.’ Mutually create the performance standards and trust will follow performance.” —From coverage of the 1993 International Autobody Congress and Exposition (NACE).
15 years ago in the collision repair industry (December 1998) The effort to develop a new method to calculate refinish materials appears to be losing steam. The Collision Industry Conference (CIC) task force that began to look into the issue about a year ago reported in December that it has done as much as it can do. Charlie Baker, chairman of the task force, said the group has essentially agreed that a system based on the square footage of the area to be refinished looks promising, but that it is now up to others to determine if a square-footage system is workable. “The problem is that moving from this point forward is a very expensive proposition,” Baker said at the CIC meeting in Dallas, Texas. “The task force is not going to spend thousands of dollars to generate the computer model that might be necessary. As a task force we’ve come about as far as we can go. Now somebody has to say, ‘Okay, the industry really wants this.’” Baker also said he has found in-
creased resistance to a change among shop owners. “Many shops today feel the existing system is flawed, but it is workable,” he said. “So there’s a pretty good hesitancy within the industry to change from a proven system. Those who have worked with today’s system have figured out how they can be accurately reimbursed, and they tend not to be looking too hard for an alternative method.” At least one shop owner on the task force agreed with Baker’s assessment. “I was one of the proponents of finding a better way to calculate paint materials,” Kansas City shop owner Bill Eveland said. “A year later, I’m not sure that the old system is completely broken. If you put the right number to it, the right rate per refinBill Eveland ish hour, it works.” Eveland said the estimating system providers say their refinish current times are based in part on part size, so the system, though not perfect, is already somewhat based on square footage. —Paint and materials calculation methodology has remained an industry issue, being discussed most recently at a CIC meeting earlier this year.
10 years ago in the collision repair industry (December 2003) Dan Risley, executive director of the Society of Collision Repair Specialists (SCRS), said the association opposes efforts by insurers to require direct repair shops to use a particular estimating or imaging system. He said SCRS surveyed 15 larger insurance companies and found that 46 percent had such a requirement. “SCRS is extremely disappointed in these results, and we’d like to see some significant change in that percentage over the next year,” Risley said, saying the association will be contacting insurers about this issue. “SCRS believes that requiring a repair facility to have a specific estimating system is no longer a technology chal-
40 DECEMBER 2013 AUTOBODY NEWS | www.autobodynews.com
lenge; it is more of a mind-set change.” —As reported in CRASH Network (www.CrashNetwork.com), December 7, 2003. SCRS this past September, as part of its effort to oppose State Farm’s mandated use of PartsTrader, issued a new position statement, condemning insurer mandates, “particularly those that specify required vendors, business platforms or internal processes that must be followed.”
5 years ago in the collision repair industry (December 2008) As of press time, one of the bigger news stories of 2008, a proposed merger (announced last April) between Mitchell International and CCC Information Services, had yet to be finalized. The primary hold-up has been approval of the deal by the Federal Trade Commission (FTC), which last summer issued a second request for information from the parties involved.
Art Amolsch, senior editor of the independent FTC: Watch newsletter, said such second requests are fairly infrequent and likely an indication that the agency has some concerns about the merger. A number of shop owners and others in the industry have said off-therecord that they’ve been interviewed or have submitted written comment to the FTC. Some expressed concern, for example, about possible declines in the responsiveness to industry requests— such as those through the Database Enhancement Gateway—that could result if the industry has just two major estimating systems (the other being Audatex). As of this point, it appears the next headline about the merger— whatever it may be—is likely to be in 2009. —As reported in Autobody News. In March of 2009, CCC and Mitchell mutually called off the merger plan after the FTC won a preliminary in-
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junction to halt it. “We brought this case because of the impressive body of evidence developed by staff demonstrating that the combination of these two competitors would substantially lessen competition, ultimately leading to higher prices and less innovation for consumers,” David Wales of the FTC said. CCC and Mitchell opted not to commit resources to a protracted FTC fight. “We have reached the point in the regulatory process in which our customers, employees and shareholders are best served by continuing as independent companies,” Alex Sun, president and CEO of Mitchell, said.
China’s 31st Collision Industry Show to be Held in February ‘14
The China Automotive Maintenance and Repair Trade Association (CAMRA) will be holding its 31st annual collision industry trade show in Feb. 2014 and is inviting international collision professionals to attend. Running from Feb. 26 to Mar. 1, 2014, the Auto Maintenance and Repair (AMR) trade show consists of nearly 1,200 exhibitors and 58,000 visitors annually, with vendors and consumers having the opportunity to interact with national product manufacturers, car dealers, repair shops and repairers.
Winner of Chrysler Custom Challenge at SEMA Show is Oriana Schooley The Chrysler brand awarded the winner of its Chrysler Custom Challenge at the SEMA Show yesterday, Nov. 6. During a live streaming of the event on the auto show floor, three judges, Chrysler Brand President and CEO
Chrysler Custom Challenge Winner
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the West Coast Customs display. Video can be viewed at: youtu.be/V_9LUM87iXM. “The Chrysler Custom Challenge provided Chrysler car enthusiasts a chance to creatively express their skills and passion for customization,” said Chehab. “And SEMA’s show floor provided us with the perfect stage to announce the winners and have their vehicles recognized and displayed at the show and online.” The three finalists and their vehicles were invited to Las Vegas for a paid-trip of seven days, six nights, where they will be given full access to the show, work alongside the West Coast Customs team and enjoy an intimate dinner with Chrysler executives and West Coast Customs. As part of the grand prize, Oriana Schooley will receive a trip to the North American International Auto Show, a luxury travel package for herself and a guest and more than $15,000 in other cash/prizes. Ryan Friedlinghaus is also set to feature the winner and finalists in an upcoming episode of the “West Coast Customs” television series (FOX) that
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www.autobodynews.com | DECEMBER 2013 AUTOBODY NEWS 41
Continued from Page 38
Evolving Marketplace
sociated with claims processing such as estimate and repair order auditing, capacity scheduling,
planning and utilization, call center, and data mining and analysis of key performance metrics results will be the collision repair providers last standing and preferred by insurance and other claims-generating companies. Our summary findings concluded that in 2012 there were 68 independent and dealership collision repair $20+M MLOs processing $4.5 billion annually through 1,363 production locations. While these $20+M MLOs represent 3.9 percent of the estimated 35,200 collision repair facilities nationally, they process 14.7 percent of the $30.7 billion in insurance and customer-pay collision repair revenue. On average, the $20+M MLOs process $3.3 million per production location, over four times more than the average annual revenue for
<$20M MLO repairers of $775,718. There are many smaller independent and dealer non-MLO repairers that achieve greater-than-the-industry average annual revenue, especially those who represent and operate in the
$10.0 million to $20.0 million segment. For the $20+M MLOs, the following chart reflects seven-year trends for the total number of MLO organizations, the number of collision repair facilities, and the market size for collision repair revenue. • The repairable vehicle revenue market moved upward slightly for 2012 • The downward trend for the number of collision repair facilities continues • The number of $20M MLO repair organizations trended up slightly for 2012
chise and brand banner network, are all included as part of our multiple-location network segment for 2012. • Combined they represent a total of 922 locations generating approximately $1.3 billion in vehicle repair revenue or 4.4% of the U.S. repairable market • As a group, they have been relatively flat for both total number of locations and revenue for the last three years • CARSTAR now squarely positions itself as North America’s
largest MSO/MLN of independently-owned collision repair facilities • ABRA markets and includes its franchise operator segment as part of its MLO platform of independent, multi-region collision repair facilities. • Fix Auto, a franchise and extended brand network, represents that it is an international network of independently-owned and operated collision repair centers whose owner operator entreSee Evolving Marketplace, Page 44
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42 DECEMBER 2013 AUTOBODY NEWS | www.autobodynews.com
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3M Wins Top Spot at 2013 SEMA New Products Showcase Awards by Ed Attanasio
People come to SEMA to see the cars, the girls and the celebrities and to network with their vendors and colleagues, but among the most popular exhibits and presentations include cutting-edge automotive products. An award from SEMA can be a game changer and help to fast track a product’s path to success. It’s the equivalent of the Academy Awards for the
SEMA Chairman of the Board Nate Shelton and SEMA President and CEO Chris Kersting present 3M’s Steven Widen with the award for Best New Collision Repair & Refinish Product
movie industry, but only without the red carpet, fancy gowns and paparazzi. During a breakfast on Nov. 4, the winners of the 2013 SEMA New Products Showcase Awards were an-
nounced. This year, more than 2,000 new products were submitted for consideration by SEMA, but only a handful were nominated. 3M™ took home the top honors in SEMA’s Collision Repair and Refinish Product category for their innovative new 3M™ Body Protection System, making it the biggest winner of the show within the collision segment. The night before, Steve Widen, U.S Marketing Supervisor, 3M Automotive Aftermarket Division, received a phone call from SEMA, that was both surprising and exhilarating, he said. “They called to tell us we were a finalist and invited us to the breakfast. It was definitely a very pleasant surprise and a great start to our show. We got off on the right foot and then when we won, it just got better! Tons of work went into the new 3M Body Protection System, so it’s very satisfying for sure.” According to 3M, its newest Body Protection System is reinventing the way repair technicians can match textured finishes found on today’s vehicles for rock protection and sound deadening. The innovative 3M Body Protec-
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tion System helps painters spray low viscosity textured finishes with fine, medium, coarse and splattered patterns. The technology behind the 3M Body Protection System includes the 3M™ Accuspray™ HGP Spray Gun with a pressurized inlet and 3M™ PPS™ Type H/O Mini Pressure 3M won first place in SEMA’s Collision Repair and Refinish Product Cup, the 3M™ category for its innovative new Body Protection System Rocker Protector able to easily replicate textures, but Pouch, and 3M™ Paintable Undercoating Pouch. The 3M Rocker Pro- now they can by leveraging our protector Pouch is available in 3-ounce prietary 3M Accuspray technology and 5.5-ounce sizes, and the 3M with unique product delivery platPaintable Undercoating Pouch is forms. It will revolutionize how textured finishes are applied in the available in 5.5-ounce size. The 3M Body Protection System future. And, as the use of these textured finishes continues to expand solves a major pain point for automotive professionals, and gives them a for sound deadening on thinner subtool for greater productivity, including; strates, the need for the 3M Body • Ability to adjust pressures and spray Protection System will increase expattern, allowing for better match to ponentially.” Criteria that ranked high on the OEM textures. • Ability to cut in half application time judges’ selection for the New Product of textured finishes to rocker panels, Showcase Awards included superiority wheel wells and undercarriages in of innovation, technical achievement, quality and workmanship, consumer many cases. • The pressurized 3M Accuspray spray appeal and marketability. Widen noted gun allows the product to be sprayed that 3M’s Body Protection System has at any angle making it easier to reach excelled in every one of these areas, he lower rocker sections and inside explained. “It’s going to help body shops in wheel wheels. • The painter can easily adjust the a big way, because now we’ve put a spray pattern to reduce overspray and tool in the hands of painters and preppers that will save them time and of masking. • Painters can easily achieve a perfect course, money,” Widen said. “There texture match, which contributes to isn’t an OE texture out there that we improved repair quality and higher can’t replicate with this system. Work that used to take three hours can now CSI scores. • The pouch sizes allow estimators be performed in 10-15 minutes, with and repair technicians to attribute more accuracy and zero guesswork. exact product usage to each job, im- It’s going to increase productivity considerably; the cleanup is very simple proving the job costing on estimates. • The 3M Accuspray system reduces and there’s a minimal learning curve. cleanup time and virtually eliminates We released the Body Protection System on August 1, and we’ve already the need for solvents. Widen believes this product is reached our sales goals for the rest of much-needed and was designed to the year.” Creative Autobody Solutions of fulfill a need that has existed for many years. “There hasn’t been any- Tempe, AZ captured the second p l ace thing new out there in delivery award with its spray - out cards conprocesses for the past two decades, structed of ABS and the third place so the 3M Body Protection System runner up award went to Shelwes Tools is pretty significant,” Widen said. & Body of West Helena, AR , for its “Painters and preppers haven’t been Shelwes Automatic Contour Sander.
www.autobodynews.com | DECEMBER 2013 AUTOBODY NEWS 43
preneurs are committed to working together to improve performance and better serve the market. • Maaco positions itself as a collision, auto body repair and auto painting franchise organization. • We continue to see interest on the part of single-location and smaller multiple-location collision
10.4 percent. • Of the 68 $20+M MLO organizations, 40 do business in only one state. Of those 40 organizations, 33 are independents and 7 are dealers. • Within the top ten rankings, only three independent and two dealer MLO organizations strategically positioned themselves in only one state at the end of 2012. • The West has the highest number of $20+M MLOs with at least one location in that region;
repairers to investigate and consider the benefits of joining multiple-location franchisor and banner networks. Our geographic market representation for the $20+ million MLOs is highest in the Southeast at 28.3 percent. In 2008, the West was the dominant region with a 25.4 percent share; it now represents 25.7 percent of the market. The lowest $20M MLO representation continues to be in
28 MLOs are present which represents 41.2 percent of MLOs. The companies represented within the top ten MLO organizations have not substantially changed since 2006. While their share of all collision repair locations has been relatively constant, revenue among this group has been increasing year over year in total as well as per location. We do see significant share growth and higher ranking with
Continued from Page 42
Evolving Marketplace
Within the top ten $20+M MLOs, five are independent and five are dealer groups. These ten
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the Northeast at 5.6 percent which is down 4.8 percentage points from their 2006 share of
Caliber, Boyd and Service King relative to the other top ten MLOs since 2006.
44 DECEMBER 2013 AUTOBODY NEWS | www.autobodynews.com
organizations account for 56.1 percent of all $20+M MLO production locations and 54.1 per-
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cent of all $20+M MLO revenue. These top ten MLOs display trends similar to the total $20+M MLO group; higher revenue produced through fewer production locations. Smaller and non-MLO repairers, those with total collision repair revenue below $20 million annually, vary widely in claims revenue processed per location. For the top ten independent $20+M MLOs, the average repair revenue per location significantly surpasses that of their smaller and non-MLO counterparts at $3.2 million versus $775,718; more than four times greater average revenue per location. Top ten dealer $20+M MLO performance also exceeds their smaller and non-MLO counterparts at a repairs-processed average of $3.9 million per location versus $1.0 million per location for smaller and non-MLO dealer repairers; about four times more revenue per location. The trend for both the independent and dealer groups is toward higher revenue per location in the MLO versus non-MLO segments.
Comparing the top ten independent and dealer $20+M MLOs, the independents have 118 percent more locations producing 71 percent more revenue than dealer repair organizations. However, in 2012 the top ten dealer repairers manage $3.9 million in average revenue per location versus $3.0 million per location for top ten independent organizations.
age revenue per location was $3.2M. The following map depicts the geographic concentration of the top ten $20+M multiple-location operators. The number of production locations within the top ten independent $20+M MLO group has slowly but steadily been on the rise since 2006. The total number of production locations has in-
creased along with their representative share of all $20+M MLO locations to 44.8 percent from 40.5 percent in 2006. This groupâ&#x20AC;&#x2122;s share of all $20+M MLO revenue has increased to 42.9 percent, up 8.9 percentage points from 34.0 percent in 2006. (See chart below.) The following map depicts the geographic concentration of the top ten independent $20+M MLOs who, with the exception of the mountain region, have a fairly even distribution across the 48 states. (See map below.) The following chart reflects our estimate of approximately 107 MLO repair organizations that process between $10M and $20M in revenue annually through approximately 530 production locations. Their combined total annual repair revenue is $1,370M or 4.5% of our total collision repair industry market size.
The average revenue per location for the $10M to $20M segment is $2.6M as compared to the $20+M segment where aver-
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