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Aftermarket Parts Antitrust Action Against Insurers to Proceed After Five Year Delay
In April this year Judge James Ware of the U.S. District Court for the Northern District of California denied the summary judgment motions of several car insurers in a class action alleging they created a sham organization to eliminate competition in the market for repair parts. The plaintiffs in Perez et al. v. State Farm Mutual Automobile Insurance Co. et al. are California automobile insurance policyholders who allege that defendant car insurers set up the Certified Automotive Parts Association to provide inferior replacement parts in violation of California’s Cartwright Act and Unfair Competi-
tion Law. The plaintiffs also allege that the insurers unlawfully conspired to stifle competition in the auto repair market by agreeing to offer exclusively policies that provide inferior repair parts and to exclude other insurance companies. The original complaint was filed in 2006, and a third amended complaint was filed in November 2010. Defendants argued that the amended complaint should be dismissed because the plaintiffs did not meet the Twombly standard to establish a conspiracy. Judge Ware disagreed and held that the facts, if taken as true,
In a bid to capture more business from customers who shop online, Allstate Corp. has agreed to buy two popular online insurance sellers—Esurance and the associated site, Answer Financial. Allstate will pay a total price of about $1 billion– $700 million plus the tangible book value of the two firms acquired at close. Esurance is the third-largest provider of online auto insurance quotes through its website and a 24/7 call center. It sells in 30 states. Over the past five years, Esurance has more than doubled policies in force and grown premiums on average 20 percent per year, according to the com-
pany, which advertises heavily. It also sells other personal lines coverages. Answer Financial provides auto insurance quote comparisons from 20 brand-name auto insurance companies to buyers in all 50 states. The carriers it represents include Esurance, Travelers, Progressive, Safeco, Met Life Auto & Home, Unitrin and The Hartford. In July, it reported having 324,000 policies in force. Alltstate is buying the firms from White Mountains Insurance Group, Ltd., a Bermuda-domiciled financial services holding company with interests in property/casualty insurance and
See AfterMarket Antitrust, Page 12
Allstate Will Buy Esurance and Answer Financial
See Allstate Buys Esurance, Page 57
VOL. 29 ISSUE 6 JUNE 2011
Aftermarket Chrome Compromising Wheel Leads to $2.75M Judgment in California On October 11, 2006, at 6:00 a.m., Martin Nagel was driving his new 2006 Nissan 350Z northbound on the 405 freeway in Los Angeles just as LAPD motorcycle officer Steven Johnson was approaching him in the opposite lanes. At approximately 65 mph, the left front wheel of Nagel’s car fractured, separated from his vehicle, flew over the center divider and struck Johnson’s motorcycle. Johnson was knocked from his bike and slid approximately 150 feet. He suffered a number of injuries to his knees, hips, arms and back as well as dislocation of two fingers, a broken finger, a right shoulder injury and an in-
SPECIAL INSERT
tervertebral disc injury. Nagel had purchased his vehicle from Antelope Valley Nissan. The court established that Antelope Valley Nissan had applied after-market factory chrome to OEM wheels even though they should have known that this application could change the metallurgical properties of the wheels, including their hardness and tensile strength. Fourteen years prior to the accident (1992), Nissan North America had issued a technical service bulletin stating that dealers should not sell OEM wheels with aftermarket chrome, but Antelope Valley Nissan had done so. See AM Chrome Page 25
Shop and Product SHOWCASE
REGIONAL STORIES in this issue...
Local Repairers, Vendors Finish San Diego Marine’s Mustang . .p. 4 Suspect Wanted in Killing of Repair Shop Owner . . . . . . . . . . . . .p. 6 BMW North America Files to Dismiss Jobber Suit . . . . . . . . . . . . .p. 9 Farmers Insurance Shop of Year Hosts Extrication Training . . . .p. 14 Calif. May Consider Statewide Crash Tax Ban . . . . . . . . . . . . . . .p. 16 Nevada Low Cost Insurance Bill Moves to Senate . . . . . . . . . . . .p. 18 Women’s Industry Conference Held in San Diego . . . . . . . . . . . .p. 48
COLUMNS in this issue...
Amaradio — The Good Old Days . . . . . . . . . . . . . . . . . . . . . . . . . .p. 20
Espersen — The Value of Service Repair Information . . . . . . . . .p. 22
Franklin — Focusing Marketing Efforts . . . . . . . . . . . . . . . . . . . . .p. 26
Weaver — Shift Happens: The Story of Three Transmissions . . .p. 29
Insurance Insider — Allstate Deserves Credit for DRPs . . . . . . .p. 36
Schroeder — The Body Shop Garage Opens in Woodward, OK .p. 38
Yoswick — Repairing a Quarter Panel, Bumper, and Molding . . .p. 50
Evans — Repairing a Quarter Panel, Bumper, and Molding . . . .p. 52
Chess — Getting OSHA-Compliant Part 2 . . . . . . . . . . . . . . . . . . .p. 54
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2 JUNE 2011 AUTOBODY NEWS | www.autobodynews.com
Contents
COLUMNS Amaradio - The Good Old Days . . . . . . . . . . 20 Chess - Getting OSHA-Compliant on Signage, Electrical and Power Tools . . . . . . . . . . . . 54 Danalevich - Total Loss Fees Are Profits to be Gained, Not Given Back . . . . . . . . . . . . 24 Espersen - The Value of Service Repair Information . . . . . . . . . . . . . . . . . . . . . . . 22 Evans - Repairing Quarter Panel, Bumper, and Molding: No Time, No Money. . . . . . . 52 Franklin - Focusing Marketing Efforts on a Narrow Demographic Yields More Results . 26 Insurance Insider - Allstate, Founder of DRPs, Deserves Some Credit for Improving Repair Industry. . . . . . . . . . . . . . . . . . . . . 36 Schroeder - The Body Shop Garage Opens in Woodward, Oklahoma. . . . . . . . . . . . . . 38 Sisk - Great Bear Auto Teaches Customers What They “Auto Know” . . . . . . . . . . . . . . 40 Sisk - Keenan Cares About Cars, Charity and Environment, Part 2 . . . . . . . . . . . . . . 44 Weaver - Shift Happens: The Story of Three
Transmissions and a Limp Kia SUV. . . . . . 29 Women’s Industry Network Conference Held in San Diego. . . . . . . . . . . . . . . . . . . . . . . 48 Yoswick - Industry Trends and Changes in Future Vehicles at WIN Conference . . . . . . 50
Publisher & Editor: Jeremy Hayhurst General Manager: Barbara Davies Assistant Editor: Erica Schroeder Contributing Writers: Tom Franklin, David Brown, John Yoswick, Lee Amaradio, Rich Evans, Janet Chaney, Toby Chess, Mike Causey, Tom McGee, Ed Attanasio, Chasidy Sisk Advertising Sales: Joe Momber, Sean Hartman (800) 699-8251 Sales Assistant: Kristy Mangum Art Director: Rodolfo Garcia
Audi Wholesale Parts Dealers . . . . . . .50
Autoland Scientech . . . . . . . . . . . . . . .29
Automotive ID . . . . . . . . . . . . . . . . . . . .16
Serving California, Nevada and Arizona, Autobody News is a monthly publication for the autobody industry. Permission to reproduce in any form the material published in Autobody News must be obtained in writing from the publisher. ©2011 Adamantine Media LLC. Autobody News P.O. Box 1516, Carlsbad, CA 92018 (800) 699-8251 (760) 721-0253 Fax www.autobodynews.com Email: news@autobodynews.com
Western
NATIONAL AASP Awards Grants to NABC and Auto Education Institute . . . . . . . . . . . . . . . . . . 21 Aftermarket Parts Antitrust Action Against Insurers to Proceed After Five Year Delay . . 1 AkzoNobel to sell all 40 Company-owned Distributors of Sikkens, Lesonal, U-Tech, to LKQ Corp. . . . . . . . . . . . . . . . . . . . . . . 28 Allstate Will Buy Esurance and Answer Financial. 1 Americans Oppose Accident Response Fees. 55 ARA, Congress to Ensure Flood Damaged Vehicles Don’t Enter Used Market . . . . . . 27 Array of Collision Associations Serve New York Regionally and Statewide . . . . . 34 ASA Announces its 2011 Government Affairs Committee. . . . . . . . . . . . . . . . . . . 21 ASA Announces its Collision Operations 2011 Committee . . . . . . . . . . . . . . . . . . . 21 ASA Discusses New Refinish Regulation with EPA Officials . . . . . . . . . . . . . . . . . . . 21 Auto Glass Replacement Safety Standards Council Promotes Fixing Damaged Windshields . . . . . . . . . . . . . . . . . . . . . . . 53 BASF & AASP Official Sponsors of Repairer Driven Education . . . . . . . . . . . . . . . . . . . 55 Boyd Group Reports Strong 1Q Numbers, Sales Up 48.5% . . . . . . . . . . . . . . . . . . . . 33 CCC Announces 2011 Crash Course in April . 25 Chrysler Will Repay All Govt Bailout Loans this Year . . . . . . . . . . . . . . . . . . . . . . . . . . 55 CIF Makes Donation to Japan Tsunami Relief . 51 Farmers Insurance’s New DRP Changes Upset Some Owners. . . . . . . . . . . . . . . . . 28 Ford Has Located Replacement for MerckSupplied Japanese Paint Component . . . . 28 Gunder Supporters Release Infinity Insurance’s Voice Recordings, Insurer Apologizes . . . . 56 Infinity Insurance Apologizes for Gunder’s Auto Center Customer Recordings . . . . . . 56 Northwest Louisiana Collision Repair Association Hosts Local SkillsUSA Winning Students, Hertz Reps Speak . . . . 42 OK Attorney General and Insurance Commissioner Announce Joint Focus on Fraud . . . . . . . . . 35 Oklahoma Technical Students Place In Ford/AAA Student Auto Skills Contest Held in Okmulgee . . . . . . . . . . . . . . . . . . . 57 SEMA Show Registration is up Over Last Year . 28 State Farm to Phase out 24 Field Offices in Midwest . . . . . . . . . . . . . . . . . . . . . . . . 58 The Houston Auto Body Association Hosts Body Shop Owners and Managers at Appreciation Event to Meet New Members. 19 Tornadoes Devastate South, Halting Local Automakers’ Plants, Inundating Insurers . . 46 Toyota Profits Dive in 4th Qtr After Severe Supply Problems . . . . . . . . . . . . . . . . . . . 13 Xirallac® Pigment Plant to Relocate from Japan to Germany Following Tsunami . . . . 32
Indexof Advertisers
REGIONAL 9% of Californians Talk or Text While Driving According to Study. . . . . . . . . . . . . . . . . . . 8 Aftermarket Chrome Compromising Wheel Leads to $2.75M Judgment in California. . . 1 Bill Aimed at Lowering Insurance Premiums in NV Moves to Senate . . . . . . . . . . . . . . . 18 BMW North America Files Another Motion to Dismiss Case Involving California Paint Jobber . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9 CA May Consider a Statewide Ban on ‘Crash Taxes’ . . . . . . . . . . . . . . . . . . . . . . 16 CA Senate Committee Blocks Bill That Would Boost Insurance Commissioner’s Penalty Powers. . . . . . . . . . . . . . . . . . . . . 13 CA Senate Passes Airbag Fraud Bill Doubling Potential Penalties . . . . . . . . . . . . . . . . . . . 4 California Casualty Selects Mitchell as New Provider of Physical Damage Solutions. . . 16 East Bay CAA Hosts 25th Annual Golf Tournament . . . . . . . . . . . . . . . . . . . . . . . 14 Farmers Insurance Shop of the Year to Host Extrication Training . . . . . . . . . . . . . . . . . . 14 Fix Auto USA Adds Five Franchise Locations In Q1 2011. . . . . . . . . . . . . . . . . . . . . . . . . 8 Local Repair Shops, Vendors Refinish San Diego Marine’s Mustang . . . . . . . . . . . 4 Man Wanted in Killing of San Diego Auto Repair Shop Owner . . . . . . . . . . . . . . . . . . 6 Mercedes-Benz Announces Plans to Open First MB Driving Academy in Los Angeles, CA . 13 Montana Estimating Bill is Now Law . . . . . . . . 9 Pick A Part Opens New Auto Recycling Yard in Tolleson, AZ . . . . . . . . . . . . . . . . . . . . . 12 Poway, CA, to Get New 33,000 sq ft Body Shop . . . . . . . . . . . . . . . . . . . . . . . . . 6 School Auto Body Programs Compete for $50K Makeover, Winners to be Announced at 2011 SEMA Show . . . . . . . . . . . . . . . . 19 Sterling Autobody Partners With Allstate Insurance to Provide Cars and Tools to Local Students . . . . . . . . . . . . . . . . . . . . . 16
LKQ . . . . . . . . . . . . . . . . . . . . . . . . . . . .59
Matrix . . . . . . . . . . . . . . . . . . . . . . . . . . .8
Mazda Wholesale Parts Dealers . . . . . .49
BASF . . . . . . . . . . . . . . . . . . . . . . . . . . . .5
Mitsubishi Wholesale Parts Dealers . . .48
BMW Wholesale Parts Dealers . . . . . . .41
Nissan/Infiniti Wholesale Parts Dealers .38
California Superstores Automotive Group .15
PartsCheck Live . . . . . . . . . . . . . . . . . .60
BMW of Vista . . . . . . . . . . . . . . . . . . . . . .4
Buerge Chrysler-Jeep-Dodge . . . . .10-11 Carlsen Volvo . . . . . . . . . . . . . . . . . . . .34
Chief Automotive . . . . . . . . . . . . . . . . .19
Classifieds . . . . . . . . . . . . . . . . . . . . . . .58
Completes Plus . . . . . . . . . . . . . . . . . . .39
Crevier BMW . . . . . . . . . . . . . . . . . . . . .12 Downtown Motors of LA
(Audi, VW, Porsche) . . . . . . . . . . . . .13
MOPAR Wholesale Parts Dealers . . . . .23
Normandin Chrysler-Jeep-Dodge . . . .18
Power Chrysler-Jeep-Dodge . . . . . . . . .7
PPG . . . . . . . . . . . . . . . . . . . . . . . . . . . . .2
Quality Stainless Products . . . . . . . . . . .6
Rare Parts . . . . . . . . . . . . . . . . . . . . . . .40
RBL Products . . . . . . . . . . . . . . . . . . . .36
Rely-On Technologies . . . . . . . . . . . . . .14
Replica Plastics . . . . . . . . . . . . . . . . . . .44
Drew Hyundai-Volkswagen . . . . . . . . . .24
Riverside Metro VW-Honda-Hyundai-
Enterprise Rent-A-Car . . . . . . . . . . . . . .55
Safety Regulation Strategies . . . . . . . .26
Elk Grove Toyota . . . . . . . . . . . . . . . . . .34
Equalizer Industries . . . . . . . . . . . . . . .46 Ford Wholesale Parts Dealers
Nissan-Mazda . . . . . . . . . . . . . . . . . .27
SATA Spray Equipment . . . . . . . . . . . . .9
Scorpion Coatings . . . . . . . . . . . . . . . .21
AZ, CA, & NV . . . . . . . . . . . . . . . . . .37
Sierra Chevrolet-Honda-Mazda-Subaru .32
Garmat USA . . . . . . . . . . . . . . . . . . . . .22
Timmons VW-Subaru . . . . . . . . . . . . . .20
Galpin Motors . . . . . . . . . . .25, 30-31, 35
GM Wholesale Parts Dealers . . . . . . . .43
Harbor Hyundai . . . . . . . . . . . . . . . . . .26
Subaru Wholesale Parts Dealers . . . . .33
Toyota Wholesale Parts Dealers . . . . . .56
VIM Tools . . . . . . . . . . . . . . . . . . . . . . . .52
Honda/Acura Wholesale Parts Dealers .57
Volkswagen Wholesale Parts Dealers .47
Kia Motors Wholesale Parts Dealers . .45
Weatherford BMW . . . . . . . . . . . . . . . . .17
Hyundai Wholesale Parts Dealers . . . .42
Volvo Crash Wholesale Dealers . . . . . .51
www.autobodynews.com | JUNE 2011 AUTOBODY NEWS 3
Local Repair Shops, Vendors Refinish San Diego Marine’s Mustang Sgt. Edward Flak II returned from his third tour in Afghanistan on April 22 to find his ‘94 Mustang GT missing from his garage.
Flak’s Mustang before refinishing work
The 26-year-old Marine based in Temecula, CA, had purchased the car second hand from a friend about 4 years ago and couldn’t afford to repair the vehicle between his tours to the Middle East.
Almost the entire front end of the vehicle’s body had to be replaced
“When he left, the first thing he said about money was save money so I can get my car done when I get back,” Flak’s wife, Krissy told 10 News San Diego. Unbeknownst to Flak, Krissy and Janet and Jim Bird of Bird Family Tire and Auto in Temecula decided to repair the car for him while he was gone. The Birds’ daughter attends school with the Flak’s daughter and the subject of refinishing Flak’s Mustang came up one day. Krissy had been getting quotes of upwards of $10,000 to repair the Mustang while Flak was overseas. The crew at Bird Family Tire and Auto repaired the car’s engine and Bob and Shelley Kantin of Precision Paint and Body Works signed on to do the refinishing through a mutual contact with Jim Bird. “My original estimate for the body work on the car was $7,800 and I told Krissy if she could pay for about half of that, then the rest I would donate,” said Bob. Precision repaired some accident damage done to the vehicles left, rear quarter panel, hand-made a body kit Flak had purchased for the car fit properly, bought and installed new fenders, painted the vehicle and redid
the interior with some carpet and seat upholstery from Flak’s uncle.
Sgt. Edward Flak shakes hands with the group of people that helped to refinish his car
Kantin was able to get Smitty’s Auto Paint to donate some clear, primer and silver paint for the vehicle as well. Audio Addictions, All Out Paintless Dent Removal, Acappella Hair Design, Rancho Auto Parts, All Season Tint, SoCal Jax Wax, Pole Position and the local VFW Post also made donations and helped in the refinishing process to get the Mustang ready for Flak’s return. “Thank you guys so much, it’s so beautiful,” Flak said of the car’s reveal
place a deployed airbag?” Currently, there are no statutes requiring that an auto repair shop replace a deployed air bag, but the analysis suggests a law requiring that any vehicle entering an auto repair shop which has a deployed airbag must leave that repair shop in good working order. A previous bill SB 427, tabled in 2009 would have established the same misdemeanor with the same penalties for a violation as this bill and would have additionally required the parts invoice for any replacement airbag installed to be attached to the final repair invoice. That bill was vetoed by the Governor, citing that it was duplicative of existing law and, therefore, added very little additional benefit to consumers. The California Autobody Association (CAA) and the California New Car Dealers Association (CNCDA) opposed the 2009 measure citing the same administrative issues acknowledged by the Governor. The CAA and the CNCDA support this new measure.
4 JUNE 2011 AUTOBODY NEWS | www.autobodynews.com
The mustang’s racy paint job made the car stand out on the day of its big reveal
“Eddie was so surprised and it was so hard to keep this a secret for 2 months,” said Krissy, “Thanks to ... all who made this dream come true for my husband, he deserves every bit of it.” Original BMW Parts
CA Senate Passes Airbag Fraud Bill Doubling Potential Penalties
California Senate Bill 869 was passed in committee (9-0) on April 25. The bill modifies the state’s Business and Professions Code saying that a repairer who “fails to repair and fully restore the airbag to its original operating condition,” where the customer has paid for the airbag as provided in the estimate, is guilty of a misdemeanor punishable by a fine of $5,000 or by one year in prison, or both. Existing law caps penalties at $1,000, by imprisonment not exceeding 6 months, or by both fine and imprisonment. It is already fraudulent and a violation of the Automotive Repair Act to state on an invoice that an auto repair shop will repair or replace a part if it fails to do so. This bill strengthens the existing penalties on that violation specifically for airbags which are being replaced. The Senate analysis of the measure suggests that possibly in the future some consideration should be given to strengthening the law even further. The analysis asks, “Should there be a requirement to repair or re-
to San Diego’s North County Times. The car took about 5 weeks to complete, with many overtime and weekend hours put in to get the car ready for Flak’s return; the crew at Precision Paint and Body Works even worked Easter Sunday to finish the vehicle in time. “I think we took one day off in the 5 weeks it took to repair the car,” said Kantin.
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Extensive original BMW parts inventory Fast, friendly service and delivery Original BMW Parts Parts Manager: Bill Cox Main Phone: (760) 208-2350 Monday - Friday 7am - 7pm Saturday 8am - 5pm (No Saturday Deliveries)
BMW of Vista 1715 Hacienda Dr.,Vista, CA 92081 www.bmwofvista.com Wholesale Parts Manager: Mark Crueger E-mail: Markc@bmwofvista.com Call Direct: Fax:
(760) 208-2341 (760) 940-6395
www.autobodynews.com | JUNE 2011 AUTOBODY NEWS 5
Man Wanted in Killing of San Diego Auto Repair Shop Owner Authorities are asking the public for help in finding a man suspected of fatally shooting his former boss at a San Diego auto repair shop the victim owned and operated on April 19.
The murder took place at Joe’s Auto Repair on Rosecrans St
A customer of the business who was dropping off her car came across the body of Jalal “Joe” Abou around 7:30 a.m. in the parking lot of his shop, Joe’s Auto Repair, located on 1930 Rosecrans Street. Abou’s body was found next to a silver Toyota with the driver side door still open. Witnesses reported hearing gunshots at the location at around 7:15 a.m. Nicolas Rosales, 47, a former mechanic at Joe’s Auto Repair on Rosecrans Street, allegedly shot 63year-old Abou to death at the garage
around 7:30 a.m that morning, according to San Diego police. Officers arrived to find the victim lying in a parking lot at the garage with several Good Samaritans trying to revive him with CPR, homicide Lt. Ernie Herbert said. Paramedics took over the lifesaving attempt before pronouncing the man dead at the scene. Family members said he was a husband and father of three who moved to the U.S. from Iraq nearly 40 years ago. They described him as active in the local Chaldean community. “He was a good person, hard worker, he have no enemy. I don’t know what happened,” Raad Hannosh, the victim’s nephew told10 News San Diego. Witnesses reported seeing a man parked near the shop in a dark green sedan with primer spots on it before the shooting and driving away shortly after the gunshots rang out, San Diego Police Department Lt. Kevin Rooney told 10 News San Diego. On April 28, detectives obtained an arrest warrant charging Rosales with murder in the death of Abou. Rooney declined to disclose what led investigators to identify Rosales as the suspected killer.
Rosales left his job at the victim’s business in October of 2010. Police declined to state specifically if Rosales quit or was fired, though he did say Rosales returned to the garage several times between the date of his termination and the slaying. Ex-employee Nicolas Rooney Rosales is wanted would not elaboin connection with rate on the reasons the slaying for those visits or discuss anything that may have transpired during them. Rosales, who is known to frequent the Tijuana area, may be driving a green 1997 Honda Accord, California license plate No. 5YRJ935, or a white 2000 Ford Explorer, California license plate No. 6NZN776, according to police. The suspect is 5 feet 4 inches tall and weighs about 180 pounds and should be considered armed and dangerous, Rooney said. Anyone with information on Rosales’ whereabouts is urged to call
San Diego County Crime Stoppers at (888) 580-8477. Abou has owned Joe’s Auto Repair for about six years, and customers were saddened to hear about what happened. “He was a really sweet guy and really honest. That’s why we bring our cars here,” customer Yvonne Prout told 10 News San Diego. “This is horrendous… I can’t imagine why anyone would shoot Joe. This is just nuts,” said Customer Philip Evans. “This is the worst thing that’s ever happened in this neighborhood.” On April 19, friends and customers left flowers, candles and sympathy cards in front of the auto repair shop. “People don’t do that for a mechanic,” neighbor Troy Hernandez told 10 News San Diego. “These are clients and customers who have been loyal to him for a long time, not just because he was good mechanic, but because he was a special guy.” Funeral services for Abou took place April 26 at St. Peter’s Church in El Cajon.
Poway, CA, to Get New 33,000 sq ft Body Shop The Poway City Council granted permission in a 4-1 decision at a meeting May 3 to allow a new auto body center to set up shop in the business park, located in the south of the city. Poway is a large suburb in northern San Diego county. Representatives from other Poway repair shops opposed granting Chrome Collision Auto Body Repair a permit to open up at 13175 Gregg Street, saying a repair shop there gives an unfair advantage and that they had been told they couldn’t run their businesses in that area. Competition among auto body repair shops had been a controversial at City Council meetings before. An August deal to relocate Toyota of Poway across the street on Poway Road included an auto body repair shop. That plan allows the dealership to use city-owned land rent free as long as it generates at least $3 million in revenue over the term of a 15-year lease. Auto body representatives at those hearings said that was an unfair government subsidy.
Several council members pointed out that this was different, as the city was not subsidizing Chrome Collision. City officials said using property in the business park for auto body repairs is allowed as long as vehicles are stored and repairs are done indoors, which Councilman John Mullin noted could increase costs for the shop. Councilman Jim Cunningham, who ultimately opposed granting the permit, wanted the city to look into whether other such shops had been denied permission to open shops in the business park. That desire failed to gain support on the dais. Some council members, including Dave Grosch and Cunningham, worried that the the shop would be inconsistent with the character Poway wants for the business park, noting that large technological firms would be more desirable. Mayor Don Higginson said the use conformed to city regulations and that Poway needed to conform with the demands of the market to avoid leaving lots vacant.
6 JUNE 2011 AUTOBODY NEWS | www.autobodynews.com
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www.autobodynews.com | JUNE 2011 AUTOBODY NEWS 7
9% of Californians Talk or Text While Driving According to Study An estimated 9 percent of California drivers talk or text on their cell phone while driving—despite state laws that prohibit such actions, a recent study has shown. In the first-ever survey of its kind, the California Office of Traffic Safety found that an estimated 9 percent of California drivers talk or text on their cell phone while driving. Officials also announced that, with approximately 55 percent of law enforcement agencies reporting in, at least 20,455 were cited for handheld cell phone use and texting during the first two weeks of a Distracted Driving Awareness Month campaign. “This study is highly significant for California,” said OTS Director Christopher J. Murphy. “It gives us a base to measure against in years to come as we combat this serious threat to safety on our roadways.” The observational study had researchers fan out to more than 130 intersections in 17 counties to observe whether drivers had a phone to their ear, were wearing a Bluetooth or headset device, were manipulating a handheld device, or were talking
while holding a phone in their hand but not to their ear. Of the 5,413 drivers observed across the state: •2.7 percent were talking into a handheld phone, either at their ear or in their hand. •4.7 percent were talking into a visible Bluetooth or headset on their right ear. •1.7 percent were texting or otherwise manipulating a mobile device. Officials consider the results to be the low-end indications of those engaged in these dangerous behaviors, since it’s not always possible to tell in a short, limited view observation whether someone is using a phone. A similar nationwide survey conducted by the National Highway Traffic Safety Administration in 2009 showed the same combined usage of 9 percent. Referring to the enforcement totals, California Highway Patrol Commissioner Joe Farrow said, “This shows how engrained the use of mobile devices have become. Even faced with laws, studies, and stories of tragedy, too many are not able to put down their cell phones. We have to
8 JUNE 2011 AUTOBODY NEWS | www.autobodynews.com
convince people of the dangers before they become the next heartbreaking story.” With fees and assessments, the total ticket for a first offense for talking or texting while driving in California is at least $159, and $279 for subsequent offenses. More than 275 local police agencies and 103 CHP offices have been mounting special zero tolerance enforcements against hand-held cell phones and texting by drivers in the state since April 4. Additional findings from the observational survey include: •Central California had the highest rate of usage – 12 percent, followed by Southern California at 9.8 percent and Northern California at 6.9 percent •Suburban usage leads the way toward danger with 10.3 percent overall usage, compared to 7.6 percent in rural and 8.7 percent in urban areas. •82.8 percent of all drivers observed as distracted by a hand held device were alone in their vehicle. The higher the number of passengers in the car, the less likely is the use of a hand-held device by the driver.
Fix Auto USA Adds Five New Franchise Locations In Q1 2011
Fix Auto USA has announced the addition of five franchise locations. The new locations represent Fix Auto’s expansion in the San Diego market to eight locations. Fix Auto USA, which added a franchise model to network membership in January 2011, currently has 39 franchise locations operating in three states: California, Colorado and Oregon. The new Fix Auto locations include: •Fix Auto El Cajon, formerly East County Auto Collision •Fix Auto Escondido, previously Henson and Son •Fix Auto La Mesa, operated at Drew Collision Repair Center •Fix Auto Mira Mesa, formerly Miramar Collision Center •Fix Auto National City, previously owned by Ball Auto Group Greg Carter, owner of Fix Auto National City, Fix Auto Santee and Fix Auto Mission Valley said the power of a larger network, powered by independent owners played a big role in his decision to franchise. “We are pleased to expand our franchise group with these operators in San Diego,” said Paul Gange, President and COO of Fix Auto USA.
Montana Estimating Bill is Now Law Montana’s House Bill 265, signed into law by Gov. Brian Schweitzer on April 28, gives heightened authority to estimating systems, requiring every operation and all costs identified by the estimating systems to be considered by insurers. The bill means that insurers cannot pick and choose which operations or costs they wish to accept or deny. Bill 265 is formally titled: An Act Providing That An Insurance Company May Not Unilaterally Disregard A Repair Operation Or Cost Identified By An Estimating System That The Insurer And An Automobile Body Repair Business Or Location Have Agreed To Utilize In Determining The Cost Of Repair. The bill was sponsored and supported by the Montana Collision Repair Specialists, said Bruce Halcro, president of MCRS and owner of Capital Collision Center in Helena, “Montana shops rallied to the cause and made multiple contacts to our state legislators when asked by the association. We are very proud of all our members in Montana. They made the difference.” Writing in support of the legislation in February, Denny Menhollt,
owner of Denny Menholt Chevrolet, in Billings (and a body shop owner), said: “HB265 is written to support a safe and economically sound collision repair. Insurers require usage of a database provider that identifies repair procedures. Many times, insurers then disallow or refuse to pay for these required procedures leaving the potential for unsafe repairs. Repairers then complete the required procedures, leaving no choice by to charge the consumer co-pay in addition to their deductible.” Menholt also expressed support for HB264, a bill to allow all Montana businesses as well as consumers to file a complaint with the state auditor’s office if they see code violations that negatively impact consumers. The bill would provide a mechanism to seek code enforcement. The bill was opposed by insurance lobby groups, but not necessarily by independent insurers. Ed Melcher, an insurance agent in Billings, supported the bill, saying: “ HB265 would help eliminate the potential for consumers having to pay additional monies above their deductible.” Melcher also supported HB 264.
BMW North America Files Another Motion to Dismiss Case Involving California Paint Jobber BMW North America filed another motion for judgment on the pleadings in a case involving a California paint jobber. The jobber, Nicolosi Distributing Inc. (NDI), alleges that BMW North America intentionally interfered with a contract NDI had with a BMW-certified shop. BMW North America began making its BMW certified repair shops use only BMW certified paint during their repairs while the repair shop in question, German Motors Collision Center, was still under contract with NDI for their paint materials. NDI contends that “BMW intentionally interfered with NDI’s contractual relationship with German Motors Collision Center... by the following conduct: BMW has decided to product its own paint line ... BMW requires auto body shops painting a BMW automobile to only use BMW paint. BMW forced German Motors Collision Center to enter into a written agreement ... which requires German Motors to use BMW paint on any BMW car painted at German Motors.”
NDI is also accusing BMW North America of interfering with a prospective economic advantage, violation of California’s Anti-Competition Act, Business and Professions Code Section 17200 and violation of Business and Professions Code Section 16727 in which a business’s actions lessen competition and create a monopoly on a trade or line of commerce. Nicolosi is asking for damages of $75,000 for the first and second claim, exemplary damages from Federal Court, injunctive relief from the third and fourth claims, attorneys fees, other relief from the Business and Professions Code violations, court costs and other relief as judged by the court. On April 20 BMW filed a second motion for judgment on the pleadings; the company had filed one in February of 2011 which was dismissed. US District Judge Susan Illston again denied BMW’s motion for judgment on the pleadings. The full text of the court documents can be seen at www.autobodynews.com.
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Aftermarket Antitrust
were sufficient to show that the insurers conspired to eliminate competition for auto parts. The defendants include State Farm Mutual Automobile Insurance Company, Geico General Insurance Company, Liberty Mutual Fire Insurance Company, and Allstate Insurance. The following legal analysis appears in a Legal blog by Williams Mullen law firm, written by James M. Burns In late March, a long-simmering antitrust action filed against several auto insurers and the Certified Automotive Parts Association (CAPA) in the Northern District of California, in which the defendants are accused of conspiring to promote the use of inferior quality repair parts for insured repairs, was finally cleared to begin discovery by District Court Judge James Ware. Judge Ware’s ruling in Perez v. State Farm Mutual Auto Insurance et al, finally permits the plaintiffs’ action to move forward into discovery, a full five years after the
case originally was filed and after two prior dismissals of the case by the district court were reversed by the Ninth Circuit. Unlike Judge Ware’s earlier rulings in the case (that plaintiffs lacked Article III standing to assert their claims—reversed by the Ninth Circuit in 2009—and a subsequent ruling that plaintiffs’ claims fell under the exclusive authority of the Insurance Commissioner, reversed in 2010), the defendants’ most recent motion to dismiss plaintiffs’ action focused on more pedestrian legal theories—whether plaintiffs’ Third Amended Complaint alleged sufficient facts to satisfy the pleading requirements of the Supreme Court’s Twombly decision and
whether the alleged agreement, even if proved, actually constituted a restraint of trade. Turning first to defendants’ Twombly argument, Judge Ware noted that plaintiffs had alleged that the defendants had “conspired to suppress competition on the basis of the quality of repair parts,” and that the alleged conspiracy had been furthered by “an agreement to create, finance and direct CAPA as a sham organization whose true purpose is to certify inferior-quality parts.” Acknowledging that “at this stage of the litigation, the Court does not determine whether actual proof of these facts is probable,” but only “whether a plaintiff has done more than offer a bare assertion of con-
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spiracy,” Judge Ware ruled that plaintiffs had sufficiently alleged a conspiracy to suppress competition and denied defendants’ Twombly argument. Next, Judge Ware assessed whether defendants’ alleged agreement, if proved, constituted a restraint of trade under the Cartwright Act, the California antitrust law under which plaintiffs’ action was brought. (Notably, plaintiffs’ claims were pled under the Cartwright Act, and not the federal antitrust laws, because similar claims—brought by the same plaintiff’s attorney—were found to be McCarran-exempt by the 11th Circuit Court of Appeals in 2004 in Gilchrist v. State Farm Automobile Insurance).
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Pick A Part Opens New Auto Recycling Yard in Tolleson, AZ
Pick A Part, an automobile recycling company headquartered in Phoenix, has announced the expansion of its self-service division with the addition of a new location at 83rd Avenue and Sherman in Tolleson, Ariz. Pick A Part is a Phoenix auto wrecker who allows customers to remove used auto parts using their own tools after browsing inventory for a 2 dollar entry fee, saying the self service concept ensures the absolute lowest prices (up to 70% off retail). Pick a Part, which opened in 2006, also has locations Phoenix and Mesa, for a total of three yards. The company claims the largest inventory of used auto parts and auto body parts in Arizona with thousands of of vehicles on site. Pick A Part says its newest facility will allow the company to meet the growing demand for self-serve auto parts. It also purchases virtually any scrap metal offered. JSL Management, Phoenix, owns Pick A Part. The company also is the corporate holding company for eight companies in the auto recycling, towing and scrap metal industries.
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Judge Ware noted that “the Cartwright Act, like the Sherman Act, makes a conspiracy among competitors to restrict output unlawful per se,” and that “output reduction does not simply refer to the number of units produced, but also involves a qualitative judgment.” Applying this principle, Judge Ware concluded that plaintiffs’ allegation of an agreement “to restrict output to a product of inferior quality counts as an output restriction,” and thus plaintiffs had stated an actionable antitrust claim under the Cartwright Act. After five years in the California courts, the case will now proceed into full merits discovery.
Toyota Profits Dive in 4th Qtr After Severe Supply Problems
Toyota has announced 4th quarter profits that are 77% lower after severe supply disruptions caused by the Japanese earthquake and tsunami. This is the lowest profit figures during any time in the past year and a half. Toyota announced that its declared profit for the three months ending 31st March 2011 was 25.4 billion yen. Sales also dropped by 12% to 4.64 trillion yen. The supply disruptions could cause Toyota to drop behind Volkswagen AG and General Motors in worldwide sales this year. Toyota said that the company expects local and international production to start recovering by June. This is earlier than the initial forecast of July to August. The company
added that production will be roughly 70% of normal levels. Toyota was able to resume production at all of the company’s Japanese plants on the 18th April, although at only half of the normal capacity. At this stage production is still severely hampered by shortages of rubber and plastics and electronic components. Honda said at the end of April that its fourth quarter net income decreased by 38% to 44.5 billion yen.
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Mercedes-Benz Announces Plans to Open First MB Driving Academy in Los Angeles, CA Mercedes-Benz USA announced that it is opening the company’s first Mercedes-Benz Driving Academy in Los Angeles in October 2011, offering a fully integrated driver’s education program and school that incorporates online, classroom and behind-the-wheel training for Los Angeles-area teens. The Mercedes-Benz Driving Academy unveiled details for its teen driving school at the annual California State PTA Convention, where approximately 2,500 California PTA members attended conferences from April 28 to May 1, 2011 in Long Beach, CA. Mercedes-Benz is appointing Carolyn Duchene as Director for the Mercedes-Benz Driving Academy, and she will be responsible for the launch and management of daily operations. A Mercedes-Benz USA employee since 1994, Duchene has held several positions in the areas of marketing, digital media, training and education, and customer service. “Our highly qualified staff will be a key differentiator for the MercedesBenz Driving Academy. We are recruiting and hiring the best talent for all areas of operation,” said Duchene. “The Mercedes-Benz Driving Academy will connect with students and parents using a personalized, customercentric approach that truly creates a unique offering among driver’s education services for new teen drivers.”
CA Senate Committee Blocks Bill That Would Boost Insurance Commissioner’s Penalty Powers
The California Senate Insurance Committee has blocked SB 631, a restitution bill that would give explicit authority to the California Insurance Commissioner to order restitution as part of an enforcement action against an insurance company, as of May 9. The insurance agent and broker community opposed Senate Bill 631, arguing it would have given the commissioner “unprecedented new powers to punish broker-agents and other licensees ‘in all instances’ where he finds any violation of the California Insurance Code,’” according to Insurance Brokers and Agents of the West. According to Sen. Noreen Evans, who sponsored the bill, existing law permits the commissioner to order restitution in some circumstances. Commissioner Dave Jones’ office believed that even when there are legal violations in which Californians are entitled to refunds or restitution, in many circumstances the commissioner had no specific authority to order refunds or restitution under current law.
www.autobodynews.com | JUNE 2011 AUTOBODY NEWS 13
Farmers Insurance Shop of the Year to Host Extrication Training On Friday, May 13th, Pan American Collision Center in San Jose, California was awarded the designation as “shop of the year” by Farmers Insurance Company. As part of the celebration for this achievement, the Collision Center collaborated with Farmers Insurance to host an advanced vehicle extrication training for local area fire departments, as part of their ongoing efforts to support the local community base they serve. Pan American has enjoyed a growing relationship over the past 18 years with Farmers, participating as a direct repair shop in the carrier’s “Circle of Dependability” program since its inception. “It’s always a difficult decision for us to nominate the shop of the year,” shared Farmers C.O.D. Supervisor of Northern California, William Walsh. “The reality is that all of the Circle of Dependability Shops are truly best in class, so we’re tasked with the responsibility to award the best of the best; and Pan American Collision Center was our choice for the Pacific Zone Shop of the Year Award.” The designation for the Pacific Zone includes repair facilities in both California and Nevada. Walsh continued, “This year was particularly tough because we not only looked at the key performance indicators like cycle time and customer service, but also the shop’s ability to be
forward thinkers. We consider a shop exceptional if they are able to align themselves with our vision to provide unsurpassed customer service, and Pan American fits this mold. Their revolutionized call center, dedicated CSI program, multiple locations, on-site rental car-company, certifications, advanced training and the wide range of services they are able to provide to our mutual customers further reinforces that they are ahead of the game. We’re fortunate to have them on our program and we want to recognize their dedication and hard work.” “It’s really quite an honor for us to be recognized for this distinction, because we know how tough the competition is, commented President of Pan American Collision Centers, Luis Alonso. “It’s a well-deserved recognition for our team, who works so hard for our customers and continuously goes above and beyond the call of duty to assure that they’re provided with the very best service. Our partnership with Farmers has allowed us to expand into multiple locations and by closely working with our C.O.D. consultant we have been able to offer our customers a better repair experience. Farmers and Pan American share the same philosophies and believe in putting the customer first.” Although Pan American has grown from a small two stall body shop, to a diversified multi-location collision repair service center, it still
East Bay CAA Hosts 25th Annual Golf Tournament The East bay Chapter of the California Autobody Association will hold its 25th annual golf tournament at the Diablo Creek Golf Course in Concord, Ca, on Saturday June 4th. This is one of the largest fundraising events the association does each year and donations collected go towards supporting local scholarships for students and instructors in the San Francisco Bay Area. Your entry fee per foursome includes: lunch, 18 Hole of Golf, Golf Cart, Chance for a Raffle Prize, Dinner and Dessert immediately following Tournament. Prices range from $520 per Foursome for Members ($130 per single) to $620 per Foursome for Non-Members ($155 per single) to Dinner & Raffle Only $35.00 per person. Any questions please contact: Lisa at 925-699-2031 or email: kayakgal@sbcglobal.net. Sponsorship opportunities are
also available. In return for your sponsorship the organization will place your name on a sign at your sponsored hole and announce your name during the dinner. Sponsorship pricing ranges from $200 for a single hole to $2500 for dinner. More information and registration forms can be found at www.ebaanow.com.
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reflects its roots as a family owned and operated business. The business is owned by the three children of the original founder, Melchor Alonso, and now even the third generation has joined the team to help expand on their grandfather’s dream of creating a first class repair experience for their customers. “It’s touching to see our kids working alongside us,” added Maggie Lesende, CFO of Pan American Collision Center. “It feels like just yesterday we were in their shoes helping our parents with the family business.” Pan American believes in giving back to the community, and as an extension of that model the repair facility has enlisted the expertise of well-known industry educator Toby Chess to provide extrication training for the local Fire Department. Chess said that “today’s vehicles are more complex than ever, and the fire departments are faced with difficult challenges when they respond to emergency calls involving trapped occupants resulting from a vehicle collision. Our goal is to help them be better
prepared to deal with these challenges by providing hands on training. We teach safety and stabilization, hybrid vehicle precautions, how to deal with late model ultra-high strength steel, as well as 6 different extrication techniques. I’m proud to be part of this effort and I applaud Pan American for putting this event together.” “We are very fortunate to be in a position to be able to give back to the community that has supported us for over thirty years and I want to thank Famers for their generous contribution and their commitment to see this through,” concluded Alonso. Pan American and Farmers Insurance introduced the first of what will be a series of extrication training and exercises during the May 13th Award Presentation. Two truck companies from San Jose Fire department cut apart vehicles donated by Farmers, in a mock collision scenario. The event also featured demonstrations of airbag deployment which the repair facility hopes can helpfirefighters become better prepared for the tough challenges they face on a daily basis.
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Sterling Autobody Partners With Allstate Insurance to Provide Cars and Tools to Local Students On May 4, Allstate Insurance Company and Sterling Autobody Centers will put cars and tools in the hands of Las Vegas vocational students so they can use their skills to make a difference for local families. Sterling, through the Collision Repair Education Foundation, will donate more than $10,000 in tools to Southeast Career Technical Academy and the College of Southern Nevada. Along with the tools, Allstate will donate a salvage vehicle to each school for students to repair to “like new” condition. Once the rides are refurbished, the vehicles will be donated to Las Vegas families in need. The donation to the schools took place on May 4, 10 a.m., at Sterling Autobody Centers, 3343 North Rancho Drive in Las Vegas. “Sterling’s donation of tools and equipment is an investment in the future of the students at Southeast Career Technical Academy and the College of Southern Nevada,” said Nick Notte, president of Sterling Autobody Centers. “Supporting their technical training and seeing them use their skills to provide the gift of transportation to two deserving families is
very rewarding.” Notte added, “This is an opportunity to highlight the Collision Repair Education Foundation and the National Auto Body Council (NABC), organizations that both Allstate and Sterling support. Our partnership with Family Promise helps us with that giving. Sterling hopes to employ many of the students who will benefit from our gift.” The two Las Vegas vehicles are part of Allstate’s commitment to donate a total of 60 refurbished automobiles to the NABC Recycled Rides Program. Sterling Autobody locations around the country will be refurbishing more than 30 cars. The recycled rides will then be given to families or non-profit organizations at multiple events later this year. “Our participation in the Recycled Rides Program is an extension of Allstate’s commitment to serve the communities in which we do business,” said Bill Daly, Allstate Claims vice president. Terry Lindemann, Executive Director of Family Promise, was also on hand for the presentation.
CA May Consider a Statewide Ban on ‘Crash Taxes’ California’s Senate Public Safety Committee held a hearing May 3 which evaluated the need to ban local governments from charging accident response fees or “crash taxes” for emergency responses to vehicle accidents. These crash taxes have become a popular choice with cities strapped for cash with government budgets continuing to shrink. SB 49 (Strickland) would prohibit a city from charging a fee to any person regardless of residency for the expense of an emergency response, except where a fee is otherwise authorized. This bill would not apply to a special district unless the district receives revenue from transaction and use taxes. “As local governments grapple with shrinking budgets, over 60 cities turned to charging for emergency response services in the form of accident fees or “crash taxes,” said Mark Sektnan, president of the Association of California Insurance Companies, which supports a ban. “However these new fees have not been a magic potion for cash-strapped cities. Several communities including, Roseville, Vista, Oceanside and Sacramento repealed their local ordinances because the projected revenue did not materialize, while their reputations with visitors and businesses were tarnished.”
Each city designs their ordinance in a different way. Most cities contracted with a third-party vendor that would bill residents or non-residents involved in an auto accident. The vendor would retain 17 percent of what is collected. Some ordinances target those that follow the law and have auto insurance, the at-fault driver and others just target out-of-town drivers. “These ordinances are very confusing for drivers who just experienced a car accident and then have to face a second blow when an unexpected bill arrives,” Sektnan said. “The fees charged range from $100 to over $2,000 for different services; the average bill is $200.” He said if insurers are forced to cover the bills, the costs would affect consumers’ premiums. A Harris Interactive poll found that three out of four consumers believe their taxes cover the time and services provided by emergency response providers following a traffic accident. As a result, most drivers believe additional accident response fees charged by local governments are excessive. Arizona and Utah are among other states approving legislation to ban these fees during 2011 legislative sessions. A similar bill is awaiting action on the governor’s desk in Kansas.
16 JUNE 2011 AUTOBODY NEWS | www.autobodynews.com
California Casualty Selects Mitchell as New Provider of Physical Damage Solutions Mitchell International, Inc. announced that California Casualty, a national provider of automobile and home insurance for individuals in the fields of education, law enforcement and public safety, has selected Mitchell as its new long-term provider of repairable estimating and total loss valuation solutions. Under the terms of the multi-year agreement, California Casualty will implement Mitchell WorkCenter Total Loss and Mitchell’s repairable estimating solution. WorkCenter Total Loss was developed in conjunction with customer satisfaction and vehicle pricing expert J.D. Power and Associates. Michael Lloyd, material damage manager for California Casualty, said, “We selected Mitchell as our auto physical damage solutions provider of choice due in large part to WorkCenter Total Loss’s accuracy, ease of use and transparency. The solution provides valuation reports that consumers trust and readily accept, enabling California Casualty to settle total loss claims more quickly and with higher levels of customer satisfaction.”
“Mitchell is gaining rapid momentum in the insurance market with leading-edge solutions such as WorkCenter Total Loss, which is quickly becoming the industry standard for consumer-friendly vehicle valuations,” said Scott Kozak, senior vice president, Insurance Sales & Service for Mitchell International. California Casualty will also implement Mitchell’s appraisal solution for its estimating needs. The solution connects field appraisers with estimating, aftermarket and recycled parts sourcing through a single screen to determine the most cost effective repair decision.
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Bill Aimed at Lowering Insurance Premiums in NV Moves to Senate Residents of Nevada will have to continue to struggle to pay high insurance premiums because Assembly Bill 299 was defeated in a vote April 25. Assemblyman Kelvin Atkinson of North Las Vegas had sponsored Assembly Bill 299 to help residents struggling to pay their mortgage and medical bill be able to afford their car insurance. It is been found that those who are struggling financially will often make sure to pay their mortgage and medical bills but will have to forego their car insurance premiums simply because they cannot afford them. Current Nevada state law requires a vehicle owner to purchase an insurance policy that includes coverage of bodily injury or death in the amounts of $15,000 per person or $30,000 for two or more people per accident. Atkinson’s bill would lower those amounts to $10,000 and $20,000 respectively. Assembly Bill 299 would set forth the requirements a low income car owner must meet before being granted access to the cheaper auto insurance policy. While the state
insurance commission would set the rates for the low income car insurance policies, it is known that an extra fifty cents would be added to all auto insurance policies in the state of Nevada to help cover administrative costs. Even though the bill fell to a 2616 vote, which was only two votes short of the two-thirds majority required, the bill did receive enough votes and nominations for re-consideration. This means that the bill will continue to be worked on and improved so that both sides can come to an agreement regarding low income car owners being extended lower car insurance rates. However, on April 26 supporters of the bill were able to swing some key votes and pass the bill out of the Assembly on a 29-13 vote. The battle has now shifted to the Nevada Senate, where Democrats have a mere oneseat advantage. Under existing law, an owner of a motor vehicle in this State must provide liability insurance for the motor vehicle. Such liability insurance must include, at a minimum, coverage for
18 JUNE 2011 AUTOBODY NEWS | www.autobodynews.com
bodily injury or death in the amount of $15,000 per person and $30,000 for two or more people per accident and coverage for property damage in the amount of $10,000 per accident. Section 6 of this bill creates the Low-Cost Automobile Insurance Pilot Program. Section 8 of this bill provides that a low-cost automobile insurance policy issued through the Program must include coverage for bodily injury or death in the amount of $10,000 per person and $20,000 for two or more people per accident and coverage for property damage in the amount of $3,000 per accident. Section 9 of this bill establishes the factors that the Commissioner of Insurance must consider in setting the rate for a low-cost automobile insurance policy. Section 9 also provides the methods that an insured may use to pay the rate for a low-cost automobile insurance policy and prohibits the financing of the rate with a third party. Section 10 of this bill establishes the requirements that a person must meet to purchase a low-cost automobile insurance policy. Section 11 of
this bill requires that a low-cost automobile insurance policy be purchased through a producer of insurance. Section 12 of this bill prohibits a producer of insurance, servicing carrier and the Administrator of the Program from charging any additional fee or requiring the purchase of any additional product or service in connection with the sale of a low-cost automobile insurance policy. Section 13 of this bill establishes the conditions under which a low-cost auto insurance policy may be cancelled or not renewed. Section 14 of this bill prohibits a person who purchases a low-cost automobile insurance policy through the Program from purchasing additional liability coverage or from purchasing liability coverage other than a lowcost automobile insurance policy for any additional vehicles in his or her household. Section 14 allows a person to purchase up to two low-cost automobile insurance policies for his or her household and to purchase other types of coverage, such as collision or comprehensive coverage. See Premiums, Page 19
Continued from Page 18
Premiums
Section 15 of this bill requires an insurer who sells motor vehicle liability policies in this State to participate in the Program. Section 16 of this bill authorizes an assessment of not more than 50 cents on each private passenger vehicle covered by a motor vehicle liability policy sold or renewed in this State. Sections 17-21 of this bill provide that a low-cost automobile insurance policy satisfies the minimum requirements for liability coverage otherwise required by law. Section 22 of this bill requires the Commissioner to report to the Legislature before the 2013 Legislative Session on the effectiveness of the Program.
The Houston Auto Body Association Hosts Body Shop Owners and Managers at Appreciation Event to Meet New Members The Houston Auto Body Association hosted their first annual Body Shop Owners and Managers Appreciation
event at the Cadillac Bar in Houston on May 19 at 7 pm. The event drew about 150 in at-
tendance according to HABA’s President James Brown. HABA decided to host this event in lieu of their monthly members’ meeting this month in order to show prospective members and local industry people more about the organization and their members’ interests. The event was such a success that the HABA has decided to conduct the event annually. “The HABA wanted to host this event to show our appreciation to the body shop owners and managers in Houston and the surrounding areas,” said Brown. “We also wanted to provide the opportunity for everyone to see what the HABA was all about in a fun and relaxing atmosphere.”
online and must be postmarked by August 31, 2011. The winning school will be announced during SEMA 2011. In 2009, the non-winning Makeover grant applicant schools received close to $200,000 in product donation. Yes, the non-winners!
Through the Makeover’s application, the schools must list an itemized $50,000 wish list and through these lists, the Foundation can seek out industry supporters and companies to donate these requested items for the schools. Over 50 schools from across the coun-
Over 150 people attended the Appreciation Event, covering the Cadillac Bar’s dance floor
The association also had six new shops sign up for membership after attending the event.
Active HABA member Larry Cernosek enjoys the reception
For more information about the Houton Auto Body Association please visit www.habaonline.org.
School Auto Body Programs Compete for $50K Makeover, Winners to be Announced at 2011 SEMA Show
You can help your local secondary and/or post-secondary collision program receive a $50,000 Makeover through the Collision Repair Education Foundation’s 2011 Ultimate Collision Education Makeover school grant. The application is available to download
try applied for the 2010 Makeover grant. In total, 35 schools each received an average of $5,000 in products, supplies, and equipment for a total value over $175,000. Please contact Brandon Eckenrode at Brandon.Eckenrode@edfoundation.org or 847.463.5244.
www.autobodynews.com | JUNE 2011 AUTOBODY NEWS 19
Action Counts The Good Old Days with Lee Amaradio Jr.
The danger in focusing on the past is that we sometimes forget to deal with the present in a productive manner. By this I mean that we want everything to be as is was and keep thinking that things soon will return to the way they were pre-recession. I’m not trying to say things won’t return to our past prosperity but we cannot let it control our actions today. I took a look at my shop recently and realized that I was putting off necessary maintenance on almost everything. My mindset was ‘as soon as we get the extra money I will get that done’ or ‘I will buy that extra piece of equipment.’ Without realizing it, I had put everything on hold. I was also unconsciously sending a message to my staff that things were much worse that they actually were. This in turn created a trickle down effect that affected the morale of the entire shop. I didn’t realize any of this
until I heard some rumors that we were in financial trouble. People had begun to draw their own conclusions because we had tightened up so much. Yes, we needed to adjust and tighten things up, but we were far from any financial trouble. Other than complaining about my credit lines getting cut nothing I said ever implied that we were in any financial trouble. But simply because we had begun to watch everything and make everyone accountable people drew their own conclusions. The danger is that perception can become reality, to many people, so to say, “don’t worry, we are fine” didn’t seem to boost my staff’s confidence. I had an employee meeting to try to kill any rumors. That seemed to help but there was still a sense of uneasiness amongst my staff. This was amazing because what concerned them the most was something that I hadn’t even
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Lee Amaradio, Jr. is the president and owner of “Faith” Quality Auto Body Inc. in Murrieta, California. Lee is president of the CRA as well as an advocate for many other industry groups. He can be contacted at lee@faithqualityautobody.com
thought about, which was their future employment. As a leader, I was so focused on tightening up that every time anyone ask to spend money on anything I just complained and said ‘no.’ So the result of my attitude created insecurity among those I employed. The attitude I had taken to belt tightening gave them the feeling that they may be my next cut, which was not the case at all. This doesn’t mean that I wouldn’t terminate a deadbeat employee but unconsiously I was making everyone nervous and this was not my intention. I was adding additional stress to my crew and I was neither a good leader nor helping them produce, as they should. I’ve realized now that even though times are different they are really better than any of us want to admit. What I mean is that things could be much, much, worse. Everything comes down to how we look at things. The
message we send our employees with our attitude as owners can really change how they see things. I started doing some much-needed maintenance and purchased some more key pieces of equipment. I haven’t thrown caution to the wind because we need everything we have done or purchased but I let employees know it was happening. The payoff is already evident because I am watching my staff’s attitude become more focused and more relaxed. I am seeing that no matter how often told them ‘everything is fine’ they needed to see action to feel comfortable about their future with me. I was sending the wrong message by not moving ahead because I was looking back all too often. Now, all of my plans are for the future and where we are heading. Because the “good old days” will only be the “good old days” as long as we allow them to be. Look to the “Good New Days” Ahead…
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ASA Discusses New Refinish Regulation with EPA Officials
ASA collision leaders met recently with top EPA Office of Compliance officials to discuss the EPA automotive refinishing regulation. ASA members also briefed members of Congress on the new paint regulation. ASA supports the regulation but has been concerned about some enforcement efforts. Some state agencies oversee enforcement of the regulation while others are leaving compliance to the U.S. EPA. This enforcement diversity has created some issues relative to the regulation. One of the concerns is the regulation exemption for “Coatings applied from a hand-held device with a paint cup capacity that is equal to or less than 3.0 fluid ounces.” ASA worked with the U.S. EPA in preparing background for the auto refinishing regulation. ASA hosted the EPA at its trade show, the International Autobody Congress and Exposition (NACE), and in various ASA member shops around the country to help educate the EPA about shop systems, training and proper equipment. ASA will continue to work with EPA and state agencies on compliance issues for the auto refinishing regulation.
AASP Awards Grants to NABC and Auto Education Institute
The Alliance of Automotive Service Providers (AASP) has awarded Industry Improvement Grants to the National Auto Body Council (NABC) and the Automotive Education & Policy Institute (AEPI). The grants were approved at the AASP’s national board of directors meeting in Raleigh, NC in April. The NABC grant will go toward helping create a Spanish-language glossary of collision repair terms for Spanish-speaking shop employees and customers. The money for the AEPI will assist in creating a Web-based collection of legal decisions made in favor of collision repairers. The AASP also voted to participate in the Society of Collision Repair Specialists’ Repair Driven Education (RDE) series at SEMA in Las Vegas in November. “After experiencing last year’s RDE first hand, I was impressed with the caliber of the content provided,” said AASP President Rick Starbard. “It was great to be able to experience educational seminars that are truly repairer driven, and our association is proud to be a part of that experience in 2011.”
ASA Announces its Collision Operations 2011 Committee
ASA has announced its 2011 Collision Division Operations Committee. Dan Stander, Fix Auto Highlands Ranch, Littleton, CO, continues his two-year term as Collision Division director. As such, Stander serves on ASA’s board of directors and is chairman of the ASA Collision Division Operations Committee. Additional members of the operations committee announced by ASA’s board of directors include Ronald Scott Benavidez, Mr. B’s Paint & Body Shop Inc., Albuquerque, NM, who is serving as assistant division director; Stacy Bartnik, CARSTAR Franchise Systems Inc., Overland Park, KS; Jeff Brunz, Master Europa Paint & Collision, Fort Worth, TX; Tommy Clayton, Tommy’s Dent Service, Gibsonville, NC; Virginia Duncan, AAM, Duncan’s Collision Inc., Boardman, OH; Dustin Eckhart, AAM, Hernandez Collision Center, Hinesville, GA; Mike LeVasseur, Keenan Auto Body Inc., Clifton Heights, PA; and Steve Tomaszewski, Alpine Collision Center, Grand Rapids, MI. Members of ASA’s Collision Division Operations Committee represent shops of varying sizes from across the United States. The committee works on behalf of all ASA collision members.
ASA Announces its 2011 Government Affairs Cmte
ASA has announced its 2011 Government Affairs Committee (GAC). Members of the GAC include Roy Schnepper, AAM, board representative and committee chairman, Butler’s Collision Inc., Roseville, MI; David Lanspeary, AAM, affiliate representative, Dave’s Auto Repair, Youngtown, AZ; April Hernandez Miller, AAM, collision division representative, Hernandez Collision Center, Savannah, GA; Douglass Kirchdorfer, AAM, mechanical division representative, Downing Street Garage, Denver, CO; and Charles Elder, AAM, member at large, Ray Gordon Brake Service, Tallahassee, FL. Members assumed their positions at the close of ASA’s annual business meeting May 9–11 in the Washington, DC, area. ASA’s board of directors established the Government Affairs Committee to assist in developing state and national legislative objectives on an annual basis. The committee works closely with Bob Redding, ASA’s Washington, DC, representative. For more information about ASA’s legislative objectives and activities, see www.TakingTheHill.com.
www.autobodynews.com | JUNE 2011 AUTOBODY NEWS 21
ALL OEM Information
The Value of Service Repair Information with Dan Espersen
With the ever changing complexity of today’s vehicles that confront you and your team on a daily basis, access to manufacturer’s repair information is and will be one of the most important tools you will utilize on a daily basis. Whether you are an Estimator, Manager, Insurance Adjuster, Technician or part of the Production Team, proper repair procedures from the manufacturer will allow you to identify, negotiate and explain key repair plan thought processes. It will also assist and manage critical business Indicators such as cycle times, hours per day, sublet repairs, technician efficiencies, overall productivity and profits. Many considerations arise when preparing a repair plan for your customers whether they are your Insurance Partners, everyday customers, or Technicians. Issues such as minimal supplements, factory recommendations correct documentation, customer satisfaction and a cost effective repair are only a few issues that one needs to consider. Questions such as these will confront you or your staff daily. ● Should I section this or replace the entire panel? ● How do I handle this Hybrid? ● What SRS parts do I need to replace after the accident? ● Can we reset the Tire Pressure Monitoring System? ● Does my Technician know how to remove the trim panel on this vehicle? ● Can we repair this suspension here at our shop? ● How can I provide my customers detailed repair documentation if they require it? Documentation will be the most critical link you will have when determining a repair strategy. So when is the best time to access or source this valuable repair information? Pre-Production or During the Production phase of repair? The answer to both of these is ‘yes,’ based on your collision operation and processes. Accessing Manufacturer repair information during the Pre-Production phase or at the time of the repair plan is an effective way of properly identi-
fying critical repair decisions. You noticed I said “repair plan” and not estimate?
Often times a certain repair procedure may be available and if you don’t know it, the vehicle can halt in production due to supplements, authorizations, parts orders, or sublet repairs. Whenever a vehicle is stopped or delayed during the production process, cycle times will increase, efficiencies decline and overall shop profitability is affected. If thought was given to proper repair techniques, locations and practices during the repair plan or prior to production, these critical performance indicators would ultimately benefit. For example: You are developing an estimate on a 2007 vehicle that has structural damage to the front. Do you know if the structural component can be repaired or should it be replaced? If you have to replace it, can it be sectioned and where? Without the correct repair procedure, you may develop your estimate based on prior experience, here say, Industry accepted practices or the ever popular guess. As the vehicle moves into production, parts have been ordered, the estimate has been sent or uploaded and approved and the technician is diligently disassembling it. Upon further examination after disassembly, your technician states that the damaged structural component cannot be repaired with the method on the estimate due to the fact that he or she thinks the component is made of advanced high strength steel. Production stops, a supplement is generated, approval for additional repairs are pending and parts are re-ordered. If the proper repair and identification procedures were accessed from
22 JUNE 2011 AUTOBODY NEWS | www.autobodynews.com
Dan Espersen is ALLDATA® CollisionSM Program Manager. Dan is a Gold Pin Member of the Collision Industry Conference (CIC) and holds an AA Degree in Automotive Technology. He has 35 years of experience split between the collision industry and in the mechanical automotive industry.
the Manufacturer at the time of the repair plan, this scenario could have been avoided. Now ask yourself, “How much time are you now spending reacting to the estimate that was prepared incorrectly utilizing the prior scenario” and would you ultimately generate less work for yourself if you performed repair research prior to production or when developing a repair plan? During the production phase, a technician ultimately benefits by being efficient or keeping his hands on the vehicle. Locations of components, testing procedures, disabling operations, material identification and overall proper repair procedures are only a small portion of what today’s collision technicians face day in and day out. By providing them with access to Manufacturer’s information, can they
increase their overall productivity and efficiencies? Ask yourself this question the next time that your technician cannot locate a component or remove a certain part without instructions. If they had access to the procedures would they limit or eliminate these time consuming scenarios? In summary, vehicle complexity is changing at a rapid pace and in order to be current with all of the complexities, we need to utilize the latest repair strategies and procedures that are available to us. A proactive approach, a proper repair plan and an awareness and utilization of published procedures from the manufacturer are effective ways to manage our time and your team. This will ultimately provide a safe and accurate repair to our valued customers. Isn’t this what we are all in business for?
www.autobodynews.com | JUNE 2011 AUTOBODY NEWS 23
Shop Strategies for Savings
Walter Danalevich, AAM, has been the owner of Santa Barbara Auto Refinishing since 1979. Contact him at: sbarbody@earthlink.net.
Total Loss Fees Are Profits to be Gained, Not Given Back with Walter Danalevich
As an auto body shop owner for over 30 years, I understand total loss vehicles are a part our industry’s day to day business. With the addition of more and more electronic gadgets, gizmos, and the installation of additional air bags it is not unusual to have an insurance company choose to total a vehicle, and retain the auction salvage, rather than roll the dice on the possibility of a multi-thousand dollar supplement and being held responsible for other liability issues. This is usually the standard insurance game plan unless you come across a naive insurance appraiser who does not value his job. Recently our body shop in Santa Barbara, California, was involved in an insurance claim involving a customer’s 2005 limited edition Scion XB which accidentally ran into a shopping center wall while exiting a shopping mall parking structure. The
driver must have experienced one heck of a distraction to cause so much damage to the right front of his vehicle. Upon closer inspection we discovered the right front frame was kinked enough to require replacement of the frame rail. The engine would need to be removed to install the frame rail which resulted in additional labor placing the car in the total loss category. While the appraiser was leaving our repair facility he commented his insurance company is very attracted to low mileage fuel-efficient compact vehicles such as this one. Later that day, I went out to the Scion and noticed there was a tag on the windshield stating the vehicle now belonged to the insurance company. I asked myself how this could be when the vehicle owner has not been notified or given information on his options of retain-
ing the vehicle or accepting full retail value from his insurance company. Even more intriguing, the next day I received a phone call from the Insurance Salvage Auction company requesting to pick up the Scion. I was surprised at what felt like a decision to essentially steal the low mileage Scion instead of getting notification from the owner on what he has decided. Soon after receiving the 24-hour is-the-vehicle-released call from the salvage auction company, I contacted our customer and reported the aggressive efforts by his insurance company who seemed to have overlooked providing us with a completed itemized repair estimate. Neither did they make a reasonable offer of retail value settlement to their insured. The customer responded he would prefer having his car repaired. I advised him to request a copy of their repair estimate. I also
recommended he do his homework in obtaining some comps on the value of his low-mileage vehicle. I advised him not to be “intimidated” or feel rushed by the insurance company who had already sent him an e-mail declaring they will “limit their storage fees to only two days.” A couple days later, the customer received the insurance repair estimate and forwarded the attachment to our shop where we confirmed the vehicle as a total loss. Vehicle valuation #1 was also sent to the insured who asked if I would assist in the settlement process. Upon reviewing the valuation report I noted there were several listed comps, which were not from our area, resulting in a lowering the settlement value offered to the insured. Another major item, to the insurance company’s advantage, was there was no mileage posted on any of the
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vehicles reported. This alone can significantly reduce the value of the insurance company’s settlement offer. I reviewed the posted locations and values with five of the proposed comparable listings and discovered four vehicles had significantly higher mileage and sold for almost $1,000 more than what was reported in their #1 valuation report. This got the attention of our customer and he proceeded with his own follow-up on the posted listings. I recommended he speak to the insurance company, report his findings, and declare several of their valuations not valid. A second valuation was soon received allowing for a $1,500 buy back from his final settlement cost to retain the vehicle. The customer e-mailed the insurance company creating a paper trail of their inaccurate comps and requested valuation #3. About four days later the customer forwarded me a
copy of a new valuation which provided an increase of over $500 from the first valuation which the insurance company insinuated he accepts. Here’s something to think about, calculate how much would result if each insurance company total loss claim was shorted by $500—Gee, what a nice investment fund that would create. The customer was still undecided about accepting the full insurance settlement offer or go with a ‘buy back.” After a few days he came to a decision to let his baby go to the “Auto Auction Heaven” and accept the increased settlement offer. This month’s article savings message is about assisting your customer in their time of crises and not being intimidated by the insurance “SCREW U CUSTOMER CARE HOTLINE.” You have now gained a customer for life while adding to your bottom line for teardown, labor, and storage fees.
CCC Announces 2011 Crash Course in April
Continued from Front Page
In April CCC Information Services Inc. announced the availability of its 2011 Crash Course, titled “Changing Expectations of the Connected Consumer.” In addition to an analysis of traditional market trends, the document developed by CCC Lead Analyst Susanna Gotsch focuses on new technology’s ability to provide transparency to the companies and customers doing business in the autophysical damage industry. “Peoples’ willingness to be much more transparent as potential customers, means they expect their demands/needs at a minimum will be met,” said Gotsch. “But companies that go beyond simply meeting demands to delight their customers will see their efforts rewarded. A company demonstrating that it knows a customer’s needs/desires, meets them, and exceeds them, is creating an experience that the customer will want to talk about with family and friends.” In addition to the Adobe® PDF version of 2011 Crash Course available on the CCC News and Insight page, Gotsch presented a Crash Course webinar on April 21st. For more visit www.cccis.com.
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The civil case was heard in Los Angeles Superior Court in front of Judge Melvin D. Sandvig and suit was brought by law offices of Ian Herzog for plaintiff Johnson. Damages awarded were settled at $2.75 M. The Nissan Dealership claimed that any defects were actually the fault of other defendants who performed the chroming, stripping and plating of the wheels, and numerous parties were involved in complaints and cross complaints. Additional settlements may occur with these parties.
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On Creative Marketing with Thomas Franklin
Tom Franklin has been a sales and marketing consultant for fifty years. He has written numerous books and provides marketing solutions and services for many businesses. He can be reached at (323) 871-6862 or at tbfranklin@aol.com. See Tom’s columns at www.autobodynews.com under Columnists > Franklin
Focusing Marketing Efforts on a Narrow Demographic Yields More Results
Many years ago I went through a training program offered by a company called Expansion Consultants, Inc. One of my instructors offered the hypothesis that “any unwanted situation can be resolved with sufficient communication.” He used the expression “universal solvent” to describe how communication can dissolve problems. I’ve often tested this idea, especially in marketing. At one point I came up with the idea that “any failure to thrive is a combination of not reaching out widely enough, frequently enough or cleverly enough.” Then one day I spoke to a body shop owner who disproved at least one part of my idea. He had reached out as widely as anyone could in his area. He sent out a piece of promotional literature to 10,000 homes in his area. But he said he had not gotten even one job from that mailing.
Today marketing professionals are focusing on a narrow demographic rather than a wide one. By tracking customer purchases, website searches, and publications read, advertisers target very specific types of prospects. A collision repair center following this approach would avoid a vast general mailing to all prior customers, and instead focus on specific types like senior citizens, young drivers, parents with children who drive, women who drive specific makes of vehicles, and more. Another narrow approach used by marketing professionals is a season and time focus. Mothers Day promotion for adult women, Labor Day promotion for working men, and also start-of-school-year promotions for parents. For collision shops, collecting information on customers’ teen-agers can
be valuable. Young drivers cause a high percentage of accidents. For shops getting involved in the new cosmetic car upgrade market, a Valentines Day promotion could be effective. Self-caused minor damage may be overlooked until a time comes to travel. A pre-vacation Memorial Day promotion could bring in those vehicles. The Internet has become so much a part of our lives these days, we may sometimes forget that most of that “free” information we get on-line is paid for by advertisers. If you watch carefully, you’ll notice how the ads on websites change with the time of year. You may also notice how companies that track your on-line searches are able to send you e-mail ads that reflect your personal interests. How might you use this approach to creating more effective promotional reaches out to your customer and prospect base? It all comes back
to your effectiveness at collecting and using customer information. Collision repair shops are generally high velocity workplaces. Estimators are in a hurry to get the keys and get the car in the shop to begin work. The vehicle driver may be in a hurry to drop off the car and get to work or back with the kids. A better time to collect information may be when the customer is picking up the repaired vehicle and pleased with the quality of the repair. If these don’t net information about the customer’s job, family, organizational ties and personal interests, an on-line or phone survey may get what is needed to do targeted promotions. Shop owners are justified in wanting to minimize the number of front office employees and related costs. But a careful analysis of how many additional vehicles a good data collection person could bring in should reveal
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that the benefits could greatly outweigh the costs. The days of waiting for repair customers to drive in are long gone. These days the certainty of sufficient insurance referrals is diminishing. It’s time for shop owners to catch up with the times and begin using professional marketing tools to bring in new business. Take a look at the variety of ads aimed at you. You may sometimes wonder why you are the target of a particular ad. Advertisers are just guessing what will interest you, but obviously they guess right often enough to justify the cost of the ads. It’s time for you to become more creative with your promotion. Who have you not reached out to? Who have you considered not worth reaching out to? Who have you given up on reaching out to? (If no response, try something else). Don’t set limits. Everyone can be reached with some message. If you collect enough information up front, the odds are good that you’ll connect with your prospects a large percentage of the time and that will more than pay for your time and trouble.
ARA, Congress to Ensure Flood Damaged Vehicles Don’t Enter Used Market
The Automotive Recyclers Association (ARA) is calling on Congress to review implementation and enforcement of the National Motor Vehicle Title Information System (NMVTIS). As many of the nation’s waterways hit historic crests, thousands of motor vehicles from Illinois to Mississippi have been submerged under these waters. Now more than ever, it is essential that NMVTIS be fully implemented and the underlying statute enforced to help prevent the unknowing sale of these flood-damaged vehicles. NMVTIS, a national electronic system that provides consumers with valuable information about a vehicle’s condition and history, can play a crucial role in helping ensure that these flood-damaged vehicles are not sold to unsuspecting consumers in the used-car market. “After Hurricane Katrina, the Department of Justice (DOJ) reported that truckloads of flooded vehicles were being taken out of Louisiana to other states where they were dried out, cleaned, and readied for sale to unsuspecting consumers in states that do not brand flood vehicles”, said Michael Wilson CEO of the ARA . “NMVTIS
must be fully implemented and utilized now so that similar events are not repeated, and flood damaged motor vehicles can be efficiently tracked before unsuspecting consumers purchase these vehicles”, Wilson added. Flood damaged vehicles are considered ticking time bombs, slowly being eaten away as water corrodes onboard computers and other vital components like airbags systems. These vehicles are deemed unfit by insurance companies, but too often are given token repairs and sold to unsuspecting consumers. NMVTIS helps prevent vehicle histories from being “washed” or concealed because it serves as a national repository of vehicle brand information. Fully implemented, NMVTIS will have data from every state and will be queried before any state issues a vehicle a new title, making it extremely difficult to wash a “flood” designation from a motor vehicle. Such fraudulent and unsafe practices can only be stopped if all states participate fully in NMVTIS and all “individuals” and “entities” that are required to report to the system are held accountable. “Regrettably, DOJ has limited resources to do this. Con-
gress should intercede and permit individual state enforcement agencies to work more closely with DOJ to identify and implement efficient methods to increased participation. One way to enhance the program’s success is to allow the fines collected from NMVTIS violators to be directly allocated back into the program and its law enforcement activities. Only with sufficient resources can DOJ and the appropriate state law enforcement colleagues target all businesses/individuals whom are operating under the radar and fulfill their obligations under the statute”, Wilson asserts. Since 1943, the Automotive Recyclers Association (“ARA”) represents an industry dedicated to the efficient removal and reuse of “green” automotive parts, and the proper recycling of inoperable motor vehicles. ARA represents the interests of over 4,500 auto recycling facilities in the United States and fourteen other countries around the world. With programs such as the Certified Automotive Recycler Program (CAR) and other partnerships, ARA members continue to provide consumers with quality, low-cost alternatives for vehicle replacement parts.
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AkzoNobel to sell all 40 Company-owned Distributors of Sikkens, Lesonal, U-Tech, to LKQ Corp. AkzoNobel Automotive & Aerospace Coatings Americas will sell all of its company-owned paint distribution locations in the United States to LKQ Corp. After the deal is effective May 27, 2011, LKQ will carry the Sikkens, Lesonal and U-Tech brands. The deal is part of a plan to broaden AkzoNobel’s North American distribution. The company said it remains committed to the U.S. market and believes a vibrant and diverse distribution network is mandatory for success in the rapidly evolving collision repair industry. “LKQ Corporation is one of the most recognized and respected names in the automotive industry,” noted AkzoNobel A & AC Americas General Manager AB Ghosh. “We are proud to have them as a part of our growing North American network of distribution partners.” Ghosh continued, “We are constantly challenging ourselves to improve our global leadership position. Our strength exists in our core competencies which are providing exceptional
products, technology, and service to the collision repair industry. By moving toward independent distribution in North America, we can now bring even greater focus to those areas which make us unique and set us apart from our competition.” “We have long admired the body shop solutions offered by AkzoNobel,” noted LKQ’s co-CEO Robert L. Wagman. “Their ability to deliver value added solutions in combination with being a color technology leader makes it an honor to partner with the world’s largest coatings company.” Wagman continued, “LKQ currently has relationships with thousands of collision repair shops throughout the United States. We are excited about the opportunity to work with the AkzoNobel team. This transaction reflects LKQ’s commitment to being a one-stop-shop solution to the collision repair industry by providing superior products and services. By adding AkzoNobel’s portfolio of brands to our product offerings validates that commitment.”
Ford said May 2 that it has found nonmetallic black and metallic red paints to replace colors that were not available after the March 11 Japan earthquake. “Our team has done a wonderful job of putting in replacement colors and those will be produced in the June and July time frame,” Mark Fields, Ford’s president of the Americas told Automotive News. “The order bank is now open again.” On March 25, Ford told dealers they could not order any more metallic tuxedo black and several shades of metallic reds. German supplier Merck KGaA, the sole producer of a paint pigment for automakers such as Ford and Chrysler Group, hasn’t been able to operate its
Japanese factory because it is too close to a nuclear reactor crippled by the quake (see related story this issue.) Merck’s Onahama factory could take four weeks or more to restart once company engineers can gain access to the facility. Six other metallic colors in Ford Motor Co.’s lineup will go out of production in the next few weeks and months because of the shortage of Xirallic, Ford spokesman Todd Nissen said. Those are: Bordeaux reserve, lava red, Kona blue, sangria red, earth and bright magenta, Nissen said. Ford will replace those colors with similar metallic shades, he said. “In the end dealers and customers will still have a full
Farmers Insurance’s New DRP Changes Upset Some Owners
Shop owners are reacting strongly and negatively to the latest DRP agreement from Farmers Insurance’s “Circle of Dependability” program. Long-term members say that the DRP agreement says shops must perform criminal background checks of employees and not employ anyone who has been convicted of a felony. Shops must purchase and use CSI services and an electronic estimate auditing tool approved by Farmers. Like State Farm program members must now charge Farmers based on the most favorable rates offered to any other insurer. Most controvesial of all is a requirement that the shop must at any time allow Farmers to inspect and audit the company’s books and records, including balance sheets and income and cash flow statements. Last year, Farmers Insurance Group limited consumer and collision repair facility choice by directing its DRP shops to sublet PDR jobs exclusively to two national PDR firms, PARS and Dent Wizard.
June 2011
SEMA Show Registration is up Over Last Year
Companies are taking SEMA booth space much earlier this year, as indicated in a recent report by Show management. Exhibit space sales in net square footage is up 14% year-to-date and total exhibitors are up 18% yearto-date. This brings the total number of exhibitors as of May 17, to 1,615—a strong indicator that in 2011, the SEMA Show is a top priority for manufacturers and buyers. The growing collision-repair section of the 2011 SEMA Show is now branded “Collision Repair & Refinish.” The area will be one of 12 floor sections featured at the 2011 SEMA Show, Tuesday–Friday, November 1–4, 2011, in Las Vegas. “The number of exhibitors and educational seminars for the collision repair and refinish market increases year after year,” said Peter MacGillivray, SEMA vice president of communications and events. “The new name, Collision Repair & Refinish, is just one way that the SEMA Show is evolving to better and more accurately reflect the growing presence of this market.” Details about the SEMA Show are available at www.SEMAShow.com.
Ford Has Located Replacement for Merck-Supplied Japanese Paint Component (see related p. 32)
28 JUNE 2011 AUTOBODY NEWS | www.autobodynews.com
range of colors to pick from,” Nissen said. The color replacement will not affect vehicle pricing. Ford and Lincoln dealers will receive specifics about when certain vehicles and those various colors will go out of production, and when they can order replacement colors. The updates will come in the next few weeks and months, Nissen said. For now, Ford will replace tuxedo black on 2011 models with a nonmetallic color simply called “black.” It’s similar to the black Ford offers on the 2011 Mustang. Tuxedo black is featured on the Ford F-150 and Super Duty pickups, the Ford Expedition and Lincoln Nav-
igator SUVs, the Ford Explorer crossover and the Ford Taurus and Lincoln MKS sedans. The metallic reds are available on the Super Duty, Expedition, Navigator, 2012 Ford Focus compact, the Ford Econoline van and the Ford Ranger pickup. The color red fire will be replaced by toreador red, Nissen said. He did not have other replacement color names yet. The other outgoing colors with Xirallic affect most of the Ford and Lincoln lineup but Ford will slowly phase those out as it offers the replacement shades, Nissen said. All of Ford’s replacement colors See Ford Paint, Page 33
Gonzo’s Toolbox
This is a new story by Scott “Gonzo” Weaver as posted on his website, www.gonzostoolbox.com. See his book “Hey Look! I Found The Loose Nut”, which provides a Good Laugh for Mechanics of Any Age. The book is available at amazon.com. Contact Gonzo at Gonzosae@aol.com
Shift Happens: The Story of Three Transmissions and a Limp Kia SUV with Gonzo Weaver
Jo was a new customer referred by an old-time regular. Her little Kia SUV had a transmission problem that seemed to be getting the best of the transmission shop. The story goes that the Kia was constantly in limp mode, and would never shift properly—ever. As always seems to be the case when a simple problem can’t be solved simply, somebody started the diagnostics off in the wrong direction. Little did I know this was a simple problem. But, as I see it, each and every type of diagnostic work that you do requires a certain step by step procedure that you must follow. Missing a step, or completely overlooking a step, usually means you’re going to miss that simple problem all together. This was no exception. From what information I could gather the person who diagnosed it at the transmission shop wasn’t the
same person who installed it. So after the tech put the last bolt in the transmission, he set the car out front, and told the front office, “Got the transmission in that Kia.” The front office considered it done, and the call went out for Jo to pick it up. She didn’t make it around the block before she was back at the front counter in a “not-so” pleasant mood. You can just imagine the situation at the counter, not happy I’m sure. After some deliberation, and very little diagnostics the transmission shop came to the conclusion that it must be a bad transmission. Luckily, the ride that had brought Jo there was still in the parking lot, so she left the Kia for them to re-do the whole job. A week later, it was supposedly done. This time a different tech had installed the second transmission. Un-
fortunately, he made the same mistake as the first tech. When Jo came to pick up her car the shop owner took her for a ride to be sure that the repairs were made to her satisfaction. It was a short drive. This time, the owner said he was going to pay for the transmission, and would even purchase one from the dealership just to be sure it wasn’t their mistake in rebuilding it. But even the dealer transmission failed to shift properly. The tranny shop was at a loss, they decided to make a few calls for some help, and that’s when my phone rang. Now, I’m not one to diagnose anything over the phone. I just don’t think it’s a smart way of taking care of such problems, because you never quite know what you’re getting into. But the tranny shop owner sounded desperate, and now the repair costs were coming out of his pocket.
From his frantic explanations of no codes, no shift, and no idea of the problem, he kind of put me on the spot, so … I suggested a computer. Heck, why not… ya changed the tranny three times for Pete’s sake, obviously that ain’t it. I probably shouldn’t have done that, but I think he wanted to try and save as much money as possible without resorting to taking it to another shop. Well, a new TCM didn’t work either. Now, the car is finally coming my way. Jo was a little unsure whether or not there was anyone out there who could find the problem, but her friend told her that it couldn’t hurt to let me see what I could do for her. I’ll give it a try. When the car showed up at the shop I took it around the block once to verify the condition, and then put it up on the lift. While it was on the lift See Three Transmissions, Page 32
www.autobodynews.com | JUNE 2011 AUTOBODY NEWS 29
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Continued from Page 29
Three Transmissions
I decided to drop it into gear and check it against the scanner. To my surprise, it shifted perfectly. I’m not kidding—absolutely perfect. I dropped it back on the ground, and went for a ride again. I didn’t even make it around the first corner before it got stuck in limp mode just as it was before, this dang thing can’t pull itself out of a pot hole. Back up on the lift, and wouldn’t ya know it, shifts perfectly—AGAIN! What’s the deal here? I did it several times, just so I could be sure of the results I was getting. After a few trips I checked the wiring to the transmission while it was on the ground. Uh-oh, the main ground to the TCM wasn’t there. How in the world was it there when it was in the air? Ah-ha! It’s moving the wire! Yes, it was moving the wire all right, and a few more than just the TCM ground lead. The locator page showed the TCM ground wire was bundled with several other ground leads that were
all attached to the main chassis ground, which wasn’t attached to a thing, but was dangling by the battery box. Turns out the whole problem started when she had her battery changed at a department store repair shop, and they didn’t have the right size to fit the car. They disconnected the chassis ground wire, so the taller battery would fit. When I told Jo what I found, the two of us pieced together the how and why it happened. Her only comment was, “Well, shift happens.” All said and done with, the transmission shop paid for the entire repair, and gave her back what she spent with them. Everyone involved was glad to have the problem solved, and the car back on the road as good as new. I like this gal, she’s become a regular at the shop these days. What a card! Always has some sarcastic comment for me, but at the same time a very understanding nature and takes life in stride. I’d love to have a couple of dozen customers just like her. As she always tells me… “If you can’t live on the bright side of life… start polishing the dull one.”
Xirallac® Pigment Plant to Relocate from Japan to Germany Following Tsunami Xirallic® pigments from Merck create glitter and sparkle in automotive coatings and provide a distinct shimmer to enhance color intensity and color purity. Xirallic® pigments are suited for exteriors due to their additional layer, which provides improved weather resistance. The only place where Xirallic is made is in Onahama, Japan, about 45 km from Tokyo Electric Power Co’s Fukushima reactor, which was closed soon after the March 11 magnitude 9.0-earthquake. The shutdown of the plant affected many of the world’s auto makers, including Ford, Chrysler, Volkswagen, BMW, Toyota and GM. Previously Chrysler told dealers that the company plants to limit orders for vehicles in 10 different colors that employ Xirallic pigment. Ford had already told dealers it could no longer take orders for F-150 trucks and other models using “tuxedo black” and three shades of red. The plant will be one of the first Japanese parts facilities that will move elsewhere as a result of the disaster. Germany’s Merck said May 10 it will shift production of Xirallic pigments from Japan to Germany.
Tsunami and radiation damage forced Merck to halt production in March. Operations at Onahama resumed May 8. Regular production output is expected by June. It will continue until Merck has readied its plant in Germany. According to The Nikkei, timing and location for the new site have yet to be determined. “Our top priority is to ensure as soon as possible an uninterrupted supply of Xirallic pigments to our customers around the world,” said Peter Halas, Head of the Pigments and Cosmetics unit at Merck. These parameters no longer fit a plant 35 miles from the Fukushima reactor, and in a town, where tsunami waves as tall as buildings were observed.
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Continued from Page 28
Ford Paint
are paints Ford has used in the past or offers now on certain vehicles, such as the Mustang’s black. “We’re still using the same paint suppliers,” Nissen said. “The metallic look doesn’t only come from Xirallic. We’ve used pigments before that gave metallic looks.” In the case of tuxedo black, Ford didn’t have a similar metallic formula-
tion that could be developed in a short period of time, Nissen said. That’s why Ford is using the same black it has elsewhere in the lineup while it works on a metallic replacement, Nissen said. Ford does not anticipate the hiccup in the outgoing metallic colors will hurt sales. And Ford plans to bring the original metallic colors back eventually. Said Nissen: “As that supplier, Merck, comes back on line, we’ll continue to work to see if that pigment can be phased back in.”
Boyd Group Reports Strong 1Q Numbers, Sales Up 48.5%
Sales increased by 48.5% to $81.6 million from $54.9 million in Q1 2010; True2Form Collision Repair Centers, Inc. and eight other new locations contributed $22.5 million of sales. Samestore sales increased by 11.5%, excluding the impact of foreign exchange translation. Gross margin improved to 45.2% compared with 44.9% in Q1 2010. Adjusted distributable cash increased to $3.0 million compared with $2.8 million in Q1 2010.
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Payout ratio of 38.2% compared with 31.3% in Q1 2010, due to higher level of distributions. Net earnings were $0.9 million, compared with $1.9 million in Q1 2010.
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www.autobodynews.com | JUNE 2011 AUTOBODY NEWS 33
Array of Collision Associations Serve New York Regionally and Statewide by David M. Brown Special to Autobody News
New York is well represented by regional and statewide collision associations. The largest is the Centereach, NY-based New York State Auto Collision Technician Association with 1,500-plus members, including small and large shops, industry-related businesses and 10 regional collision-repair associations. These regional affiliates represent shops in Greater Binghamton; Syracuse; Rochester/Buffalo; the Capital District, in the Albany area; Rome-Utica; Greater Newburgh; and the Hudson Valley. Another NYSACT affiliate, The Westchester-Putnam-Rockland Auto Body Association, also serves Duchess County and the Bronx. Two others are the Long Island Auto Body Repairmen’s Association (LIABRA) and the Autobody Craftsmen’s Guild covering the five boroughs of New York City. Founded in 1982, NYSACT is guided by Executive Director Ed Kizenberger and an elected board of
directors led by a president, currently Mike Orso, owner of Nick Orso’s Body Shop and Service Center in Syracuse. Staff also includes legal counsel and a legislative lobbyist. The organization influences and effects state legislation through its lobbyist as well as with grass roots approaches such as members’ letters and e-mails to representatives and other public relations efforts. “We have a full legislative program and enjoy broad-based bipartisan support in both the state assembly and senate in Albany,” explains Kizenberger, with two decades-plus in the collision industry. “Our goal at the state capital is to support legislation that protects consumers and independent auto body shops from unfair claims practices,” notes Orso, who is elected by the board and conducts NYSACT regular meetings. Toward that end, one of the group’s recent efforts has been to help create an advisory group comprising the state’s Department of Motor Vehicles, its Insurance Department, the in-
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surance companies and the repair industry. The group also sponsors an annual Lobby Day, providing members an opportunity to speak individually with their legislators at the capital. A fair and equitable marketplace for all collision repair professionals comes about as a result of education, Orso explains. “We are educating our member shops to best serve their customers with safe proper repairs by elevating their awareness of liability,” he explains. “Education also means keeping shops reminded as to who the ‘true customer’ is—the consumer,” he adds. “When shops understand the need to remain independent and not acquiesce in the whims of an insurance company, the consumer benefits, too.” Kizenberger also heads the Long Island group. Founded in 1975, LIABRA is the oldest and largest trade association for collision repair professionals in New York, with 500 members, including shops, dealerships and other related businesses. Its shops are located from
the Queens border along the north and south shores of Nassau and Suffolk counties to Montauk, 90 miles east. The group is similarly administered as NYSACT, with an elected board of directors directed by an executive board, legal counsel and a lobbyist in Albany. Working to further industry and consumer interests, LIABRA is a framework for unifying shop interests such as discontinuing unfair claims practices, Kizenberger explains. With NYSACT, the organization interacts with government regulators to benefit shop owners. In addition, the association recently helped promulgate an industry code of ethics in pursuance of its goal to ensure the public the highest quality and safety standards in auto collision repair. LIABRA schedules about eight meetings annually as well as offers a number of educational programs on subjects such as time-management, OEM materials, estimating, employee management and environmental comSee NY Collision Assns, Page 39
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OK Attorney General and Insurance Commissioner Announce Joint Focus on Fraud
Oklahoma Attorney General Scott Pruitt and Insurance Commissioner John Doak announced plans to revamp how insurance fraud is investigated and prosecuted in Oklahoma. “Our two offices are statutorily bound together when it comes to investigating fraud,” Doak said. “By working together, we can improve the investigation and prosecution of those who perpetrate fraud and better protect insurance ratepayers.” Pruitt and Doak’s offices have begun analyzing how best to coordinate resources and refine the process by which both offices initiate, prepare and complete claimant fraud investigations for prosecution. The Insurance Department intends to focus on higher-level fraud and other insurance crimes committed by agents and company executives that costs Oklahoma’s ratepayers millions of dollars annually. The Attorney General’s Office will expand prosecutions and investigations of claimant fraud. “I want to make Oklahoma a dangerous place to be an insurance crim-
inal,” Doak said. “If you are an agent or a company executive who is violating the trust of Oklahoma’s insurance consumers and the laws of this state, you can expect to be investigated and prosecuted by the Oklahoma Insurance Department and the Attorney General’s Office.” As the cornerstone in building his anti-fraud crime team, the Attorney General has hired former prosecutor Vincent Antonioli to head the Workers’ Compensation and Insurance Fraud Unit, and plans to hire additional investigators and prosecutors to begin vigorously pursuing and prosecuting claimant fraud in workers’ compensation and insurance at large. Michael Copeland has joined the Oklahoma Insurance Department as a fraud attorney. Copeland will develop and direct investigative procedures that deliver on Doak’s promise to better protect Oklahoma consumers from insurance fraud. Copeland previously served as an assistant attorney general and later as special prosecutor for the Republic of Palau, a former United States Protectorate.
“We are confident our plan will result in increased prosecutions of high-level fraud committed by a few bad actors in the industry and reduce everyday fraudulent claims that are driving up the cost of insurance and doing business in our state,” Pruitt said. The Oklahoma Anti-Fraud Unit also employs experienced Council on Law Enforcement Education and Training (CLEET) certified law enforcement officers that conduct investigations of various white-collar crimes related to insurance fraud. The Anti-Fraud Unit works closely with a number of local, state and federal law enforcement agencies and prosecutors to bring offenders to justice. The Anti-Fraud Unit also conducts regulatory investigations of civil violations within the insurance industry. The Anti-Fraud Unit works closely with the OID Legal Division in these administrative proceedings to discipline those entities engaged in wrongdoing. Oklahoma is a “mandatory reporting” state when it comes to suspected or alleged fraud. This means
that insurance companies doing business in the State of Oklahoma are required by law to immediately report suspected insurance fraud to the AntiFraud Unit. Report insurance fraud and related white-collar crimes to the AntiFraud Unit by calling (800) 522-0071 or (405) 521-6614.
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Inside Insurance with The Insurance Insider
The Insider is a corporate-level executive with a Top 10 auto insurer in the U.S.. Got a comment or question you’d like to see him address in a future column? Email him at Auto.Insurance.Insider@gmail.com
Allstate, Founder of DRPs, Deserves Some Credit for Improving Repair Industry “The Insider” is an auto insurance company executive who wishes to remain anonymous in order to speak freely. This column offers an unvarnished look at various issues impacting the collision industry from the insurance perspective—Ed. Who benefits the most from direct repair programs? Insurers will tell you the consumer. Repairers will say the insurance company. The consumer has no idea and doesn’t care. They just want their car fixed correctly and quickly. In my humble opinion, the shop receives the biggest benefit. The insurance company does benefit but not more than the shops on the program. Yes, many insurance companies report millions in profit every quarter, but do you really think they make their money by not paying for things such as block, prime, and fill or for OEM parts? If you believe that, you should do some research before you say it. A wise man once said, “Better to keep your mouth shut and let everyone assume you’re stupid, rather than open your mouth and remove all doubt.” Insurers aren’t raking in doubledigit profits on the backs of the body shops. Insurance companies capitalize on a marketplace that has shops willing to provide discounts for volume. You wouldn’t do anything different if in a similar position. Do insurance companies profit from insureds using the direct repair program? Of course they do. Insurers benefit from the reduction in severity and rental car expense, for example. If insurance companies weren’t making money, DRPs wouldn’t exist. Do the shops make money from participating in a given DRP? You bet. If shops weren’t making money participating in direct repair programs, they wouldn’t be working with that carrier. For every shop owner I see struggling to keep their doors open, I can provide a secondary list of those that are very well-heeled. Don’t misinterpret what I’m saying: I don’t begrudge anyone financial success and independence. But I don’t have the patience or desire to listen to a shop
owner complain about losing money as he or she drives to the airport in a new Mercedes for their vacation in the Bahamas.
Even though insurance companies make a lot of mistakes, DRPs aren’t one of them. DRPs took an archaic body shop trade and transformed it into the collision repair industry. For decades, the body shop trade didn’t change. In fact, it has been suggested that the early caveman provided the same level of service that customers received from shops preDRP. I was unable to validate that, but it’s difficult to argue a lack of differences between the caveman and the 1970s shop owner. For those who are long in the tooth, it seemed like yesterday that the body shop trade with rife with uneducated technicians running their own businesses. There was a “mom and pop” body shop on every corner. The training you received as a body man was from the old guy coughing up a lung as he sanded a 10-foot-long quarterpanel that was supposed to be replaced, according to the handwritten, illegible estimate. Insert DRP here. That’s when the industry was transformed. In other words, every shop owner in this country should personally thank Allstate for starting what is largely viewed as the industry’s first nationwide DRP. DRPs have done more to change and improve this industry than any other single factor. You may dispute it, but shops without DRPs are like Sonny without Cher or the Patriots without Tom Brady. Okay, I’m being a little overdramatic. But the fact remains that if
36 JUNE 2011 AUTOBODY NEWS | www.autobodynews.com
you had a toolbox and a cave, before DRPs you too could be a shop owner. DRPs caused the body shop trade to grow into a legitimate business and industry. You had to change the way you did business or you couldn’t compete. Insurance companies were looking for professional, well-maintained shops. Most shops, for example, purchased an electronic estimating system because it was required as part of a DRP. Why purchase the equipment and software to upload electronic images of the damaged vehicle? If you guessed that an insurance company required it, you are right. Hopefully, you are starting to see a pattern. The collision repair industry doesn’t change very quickly, especially when there is an associated cost. Unless an insurance requires some-
thing as part of a DRP, most body shops won’t do it. Before anyone drops to their knees to praise Allstate, I should state that the advent of DRPs also spawned a monster called the unethical adjuster. That probably warrants an article itself. I guess you need to take the good with the bad, but to me, the good that DRPs brought significantly outweighs the negative impact caused by the unethical or immoral behavior of some. The point of this article was to make you think about one thing: Who has benefited the most from the direct repair programs that some shops swear were the demise of this great industry? The answer is obvious: Body shops. Collision repairers would still be using a hammer and chisel if it wasn’t for insurers demanding a quality, costeffective repair.
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www.autobodynews.com | JUNE 2011 AUTOBODY NEWS 37
Shop Showcase
Erica Schroeder is a writer and editorial assistant for Autobody News in Oceanside, CA. She can be reached at eschroeder@autobodynews.com.
The Body Shop Garage Opens in Woodward, Oklahoma with Erica Schroeder
Kevin Ham looks at his shop—The Body Shop Garage—in rural Woodward, OK, and sees a lifelong dream coming true. While it took almost four years for the 45-year-old body man to get his own shop running, it’s something that he’s wanted to accomplish since he was 16. “I’ve just always known I wanted to have my own shop,” said Ham. Ham has worked for other body shops in the area for the duration of his career and really began making steps towards having his own business in 2007. He bought a building on the end of Main Street from his cousin’s wife’s grandfather and began the lengthy process of getting the shop ready for his business. Ham rewired the entire place, installed better lighting, sandblasted brick pillars and repainted. During the 3 years it took Ham to refinish the shop he continued to work for another shop in the area and built cus-
tom hot rods out of the shop-in-progress. Woodward is a small town of about 10,000 with only 3 competing repair shops in the area, so buzz that Ham was trying to own his own shop soon started to circulate the town. One year ago, Ham bought the
able to finally get his place running. “Since it’s been going I’ve hardly stopped,” said Ham, “It doesn’t even seem real.” The business now sits at about 6,100 square-feet, although Ham is also eyeing another adjacent building
The front of The Body Shop Garage building in 1946
The front of The Body Shop Garage today
building connected to the one he was restoring to make his shop space bigger. Then after almost four years of refinishing the place, the small business loan he applied for went through and he was
and may expand there in the near future. Ham, one other full-time repair man and one part-time repair man, have seen 6–8 cars each week since the shop opened in the first week of March. Ham’s son Kurt also helps
with the shop work. Ham projects that the business will be able to gross about $500,000 per year, based on two years of estimates and invoices of his own work he saved while working at another shop. Ham wanted to estimate how much work he could produce by himself while finding out if owning his own shop would be financially feasible. “I’m really an ‘Owner/Operator’ —the business depends on my production too,” said Ham. The business has really taken off since it opened, and Ham has decided that he won’t be taking any DRP contracts in his shop. “I’ve really resisted that [DRPs]; there’s supposed to be no steering but as far as I’m concerned that’s what it is,” said Ham. Ham feels as though DRP programs put the insurance adjuster’s job on the body shop, and that the quality of his work is all he needs to rely on to
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Ham grew up in Woodward and met a lot of industry people while working for nearby shops over the years, making finding new customers and vendors for his own shop much easier. Ham relied on English Color and Supply (see Autobody News May 2011) to supply him with all his paint needs, but they went above and beyond what was expected. “They’re people that will really stand behind you,” said Ham. Ham buys his paint—BASF brand—as well as a spray booth and a used frame machine from English Color. They also supplied him with some items he needed on consignment; a new paint bank, The inside of the shop floor area; the Coca-Cola sign cabinet, scale, a computer and paint on the left wall was in the building originally and Ham has decided to restore it to preserve some of shaker. Ham thought they were the buildings history going to provide these materials “How do they know I wouldn’t used but they came through with all get 80% of the business they’re sup- new supplies for the shop. posedly driving to my shop on my The biggest obstacles Ham ran own?” asks Ham. into while getting his business started Ham says he is confident in his mostly had to do with securing a small abilities and his work as well as his business loan. He applied for the loan ability to get work into his shop. in May and was not approved until “I’ve already got so much going November. on, I can’t do the adjusters’ job for “I really wanted to get this them too,” said Ham. thing started in the summer because bring plenty of work into his shop. Ham also feels that the ‘benefits’ of a DRP for a shop—the supposed increase in business from insurance companies driving customers to their DRP shops—isn’t all it’s cracked up to be.
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I knew the winter would slow body shop end of the business he’s things down,” said Ham. But with still been getting calls and requests for the bank loan taking so long Ham his hot rod services—the chief reason had no choice but to start getting the business running in the winter. Starting in the winter slowed a lot of the supply deliveries Ham needed and made some of the final building renovations difficult. Capital improvements like pouring new concrete and laying a new roof were put on hold because they are temperature(l-r) Body man Steven Ferguson, Body man Hunter Wellman, sensitive tasks. Kurt Ham and owner Kevin Ham all wore Marines T-shirts to Ham also found a pay tribute to our armed forces lot of the local and state for his desire to purchase a third concoding enforcement to be a hurdle for opening the business, but ever since nected building and further expand his business. it’s been open Ham has had a steady “I can’t turn off the hot rod busistream of work. “There’s just been this buzz,” ness,” said Ham, “It’s part of me.” said Ham, “I never thought I could do The Body Shop Garage it—and now I’m getting to do it.” Ham’s hot rod business has not 518 Main St stopped either. Although he’s been try- Woodward, OK 73801 ing to focus more on the commercial, (580) 334-4071 Continued from Page 34
NY Collision Assns
pliance. The association also publishes a monthly magazine for its members and offers workers comprehensive and health care insurance. By joining the Long Island group, shops also become members of NYSACT, Kizenberger explains. “Associations struggle in the tough economy as all businesses do,” he says. “We’re confronting challenges such as the overcapacity of shops against the amount of work available. Consumers are driving less, and that means a reduction of repair opportunities.”
Westchester-Putnam-Rockland Auto Body Association Harrison, N.Y.-based, WestchesterPutnam-Rockland Auto Body Association was founded in 1952 as the Westchester Auto Body Association and today comprises 100 body shops. Even 60-plus years ago, the shops realized that together they could better affect legislation and insurance company problems as well as ex-
change ideas and common problems, explains its executive director, Frank Ferraro. Its mission emphasizes information dissemination and education: “to keep shop owners informed of the constant changes and technological developments in the auto industry” and “to provide education and updates on… new laws and regulations… ” Also, to that end, the association produces a monthly magazine detailing local, state and national news, and regulations relating to the industry, including Environmental Protection Agency changes and updates. Autobody Craftsmen’s Guild Officing on Staten Island, the Autobody Craftsmen’s Guild was founded in 1960. Membership in the guild includes membership in NYSACT, explains one of its three executive directors, Joe Amato. Training is one of ACG’s goals. “Typically our general meetings are organized around a topic or a task,” he says. “We’ll have a vendor or jobber come in to speak with the members or we will have a class on estimating or about a new product such as waterSee NY Collision Assns, Page 43
www.autobodynews.com | JUNE 2011 AUTOBODY NEWS 39
Shop Showcase
Chasidy Rae Sisk is a freelance technical writer from Wilmington, Delaware, who works in a variety of fields and subjects, and grew up in a family of NASCAR fans. She can be contacted at crsisk@chasidyraesisk.com.
Great Bear Auto Teaches Customers What They “Auto Know” with Chasidy Rae Sisk
From the street, Great Bear Auto in Flushing, NY looks like a typical auto
fication and certification in AC Refrigeration. A d d i t i o n a l l y, Audra serves on the advisory committees for Farmingdale Automotive Technology and GoGreen Auto. She has also received many certificates from Professional Technician’s Seminars. Great Bear Auto Great Bear Auto’s 15,000 square-foot building in Flushing, NY employs five people, body shop, but the shop is anything boasting specialists in every field inbut typical as I found out after a few cluding diagnostics, auto body and minutes of conversation with owner, mechanical repair. The shop utilizes Audra Fordin. computerized diagnostics and up-toGreat Bear Auto has been in the date equipment throughout its 15,000 same location for nearly 80 years and square feet including a state of the art has been run by the same family; howalignment machine, chassis cooler, ten ever—concurrent with Audra’s own- lifts as well as modern paint mixers ership as its first female owner and and booths. Great Bear is ASE certioperator—the shop’s focus has ex- fied and is currently working on bepanded to include education as well as coming I-CAR certified. repairs. Great Bear does not participate in Great Bear Auto was founded in any direct repair programs as they 1933 at its present location. Four gen- work for the customer; however, they erations of the Fordin family, headed accept all insurance and are happy to by Oscar Fordin, was involved in the deal directly with the customer’s inauto salvage yard business and opened surance company. They also accept the shop when he grew more intermost extended warranties and offer ested in auto repair. Originally, the discount car rentals. family owned many shops in the As part of their efforts to sustain Queens area, but the rest of the famthe environment, Great Bear Auto reily have sold their shops, leaving only cycles tires, metal, anti-freeze, oil and batteries. Additionally, they have recently completed hybrid and alternate fuel training and now service and repair hybrid and electric vehicles. Not only is the work completed at Great Bear Auto fully guaranteed, the customer is also educated about the repairs needed and performed. In order to better Owner Audra Fordin stands under a lift on the shops work floor serve their customers, they Great Bear which was taken over by also boast free Wi-Fi, easy access to his son, Larry, then Oscar’s grandson, shopping and transportation and a chilBill, and now, Bill’s daughter, Audra. dren’s play area in the waiting room. Audra has been in the automotive English, Greek, Spanish and Korean is industry for most of her life. Her pro- spoken in the shop to best serve their fessional licenses and certifications in- cosmopolitan customer base, and the clude ATTP, NY State Motor Vehicle shop sends email reminders to their and Motorcycle Inspector, ASE certicustomers to keep them updated on the
40 JUNE 2011 AUTOBODY NEWS | www.autobodynews.com
status of their repairs. Seeking to empower women and put control back in the drivers’ hands, Audra also teaches a free monthly
power steering, bulbs, coolant, fluids, and wipers, as well as anything her audience may have questions about. Students also learn some easy do-it -yourself car repairs to enable them to save money. The course has recently expanded to include an iPhone app, available through iTunes, as well as clothing and a DVD which are available at www.womenautoknow.com. Due to her general Audra also participates in a weekly radio show through ABC expertise in the automocalled Autolab tive industry, Audra Fordin also sits on a panel of experts workshop: “What Women Auto Know.” Using an analogy to compare which participate in a weekly show, parts of the car to parts of the human Autolab, on ABC radio. During their show on March 5, body, her comprehensive course teaches women about maintenance, 2011, the panel discussed the recent safety, tires, brakes, emergencies, See Great Bear Auto, Page 58
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www.autobodynews.com | JUNE 2011 AUTOBODY NEWS 41
Northwest Louisiana Collision Repair Association Hosts Local SkillsUSA Winning Students, Hertz Reps Speak
The Northwest Louisiana Collision Repair Association held their monthly meeting in the Collision Repair Classroom at Louisiana Technical College in Shreveport, LA on May 3. The meeting was brought to order by President Chris Fielder by reading the anti-trust statement, which is required to begin every NWLCRA meeting. Also hosting the meeting was Secretary-Treasurer Bill Burnside. The group discussed the recent SkillsUSA Competition and asked for all the local winners that were attending the meeting to stand, introduce themselves and tell a little about themselves. Joshua Taylor is a Senior at Northwood High School and is a Collision Repair student of Caddo Career & Technology Center. Joshua took First Place in the Collision Repair Technology category. He is currently working at Shouse Collision Repair & Frame Center. Jerry Shouse, owner of Shouse Collision Repair & Frame Center, said Joshua is currently working with estimating. Joshua is going to compete at
the National Skills competition. Hunter Lyman is a Senior at Captain Shreve High School, and is a Collision Repair student of Caddo Career & Technology Center. Hunter took First Place in the Auto Refinish Technology category. He has been working with Red River Chevrolet while at school and has been offered a full-time permanent position with them after graduation. Next, was Ryan Hickman, a Senior at Airline High School and a student of Bossier Parish Technical School. Ryan took Third Place in the Collision Repair Technology category. He is currently working at Bellevue Paint & Body in Haughton, LA. Lastly was Marquette Tolbert, a Senior at Woodlawn High School and a student at Caddo Career & Technology Center. Marquette took Second Place in the Collision Repair Technology category. He has been working at Moffitt Mazda Porsche Audi Volkswagen Body Shop. He is going to be attending Louisiana College, with future
plans to also attend Louisiana Tech University. George Jackson, Instructor for the Collision Repair Program at Caddo Career & Technology Center, and Mark Monroe, Instructor for the Collision Repair Program at Bossier Parish Technical School were also at the meeting. Jackson praised the efforts of all the students that participated in this statewide competition. He said the students used their Spring Break to prepare for the Skills Competition. He also stated that the students are now preparing for Nationals. He made a request to any Collision Center for help with any type—training, painting, etc.—that would be helpful to a student preparing for the Nationals, to contact him to arrange times. If anyone wants to donate funds, this also would be greatly appreciated and welcomed. If anyone would like to offer help to the students headed to Nationals, please e-mail Bill Burnside at cssi4@hotmail.com
Bill Burnside, Secretary-Treasurer for the NWLCRA, stated that the NWLCRA historically has donated funds for the First Place winners that go to Nationals. A motion was made and seconded to pay $100 for each First Place winners in each category of the competition. Congratulations to Joshua Taylor, First Place winner in the Collision Repair Technology category, and Hunter Lyman, First Place winner in the Auto Refinish Technology category. Many of the NWLCRA members that also helped by judging this event were present at this month’s meeting, and were recognized for their continued service to the Collision Repair Industry. Bill went on to discuss an Industry Day meeting that will be held on June 14, 2011. This Industry Day will center around speakers including Chuck Sulkala, a widely recognized speaker and spokesperson for the Collision Repair Industry, and Mike Sprinkle, Texas Business DevelopSee NWLCRA, Page 47
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Continued from Page 39
NY Collision Assns
borne paints.” The group schedules about six of these annually, he notes.
Gas & Repair Shop Association of NY Independent of NYSACT is the Gasoline & Repair Shop Association of N.Y., based in Albany. GRANY represents 330 members in the eastern part of the state, from Westchester County to the Canadian border and Herkimer County
to the Vermont, Massachusetts and Connecticut borders. The association is one of five affiliates of the Albany-based New York State Association of Service Stations & Repair Shops, which lobbies on members’ behalfs at the capital and works with state agencies. This group is an affiliate of the Service Station Dealers of America—Allied Trades. GRANY was founded in 1972 by service station dealers during the first energy crisis, explains its associate director, John Casazza. The executive
director is Ralph Bombardiere. Today, the membership includes 35 percent convenience stores, 45 percent repair shops and 20 percent body shops. In addition to providing members a variety of insurance and other benefits, GRANY offers professional training for automotive technicians and inspectors. “Our overriding goal is to protect the interests of these independent businesses as well as the motoring public,” Casazza says.
The biggest challenge in the future for the auto-repair industry, including collision shops? According to Cazazza, it’s clear: “Insurance companies.”
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Shop Showcase
Chasidy Rae Sisk is a freelance technical writer from Wilmington, Delaware, who works in a variety of fields and subjects, and grew up in a family of NASCAR fans. She can be contacted at crsisk@chasidyraesisk.com.
Keenan Cares About Cars, Charity and Environment, Part 2 with Chasidy Rae Sisk
This is a continuation of our article started in April’s Autobody News. To read part one, see www.autobodynews.com
Solar panels sit off to the left of Keenan’s Middleton, DE, location
Keenan Autobody makes efforts toward using green, not just in their logo, but also in their business practices as part of their effort to protect the environment. Keenan at Middletown, Delaware is the only shop of their eight locations which boasts solar panels, demonstrating Keenan’s efforts to protect the environment. Few shops in the country use solar energy to operate, but Keenan opened their Middletown shop in 2009 as a prototype with the hopes of expanding the use of solar power to the rest of their shops in the future. Per Craig Camacho, Marketing Director of Keenan Autobody, “we are in growth mode at the moment and are looking to acquire another shop or two prior to expanding our solar, but yes, we will be moving forward with solar at more of our shops”. Using 248 solar panels which transfer solar energy into usable electricity, Keenan at Middletown utilizes solar power for 65% of their energy needs. When they are not operating, they resell the recycled energy credits back to the grid. According to Vice President of Keenan Autobody, Michael LeVasseur, “this was not only the right thing to do for the environment but it was also a solid business decision”. Several of the solar panels are located on the front left side of the building, but the majority of the panels are installed in the half acre field directly behind the shop. Keenan plans to expand this project to the rest
of their shops eventually; however, in the meantime, Keenan Autobody continues to make other efforts as part of their Green initiative aimed at conserving the environment. All Keenan shops use water-borne paint systems and participate in recycling as part of Keenan’s Green Initiative. The Middletown shop consists of 14,000 square feet and employs fourteen workers. Like Keenan’s other shops, Keenan at Middletown utilizes all of the latest equipment, such as the car-o-liner, the evo-system and the latest inverter-type resistance spot welders. In addition to being ASE certified, they are considered I-Car Gold and a CIC Class A facility. All of Keenan’s shops are Verifacts VQ shops and are in compliance with Envirosafe. Keenan is affiliated with ASA, CIC, SCRA, NABC, Fix Auto and DuPont Performance Alliance. Keenan processes insurance claims according to CMS standards per the industry standard, and they participate in up to 21 direct repair programs at each shop.
Keenan Autobody is the only shop of 8 locations to use solar panels
Keenan Autobody utilizes a 10step production process in order to provide their customers with quality work, and they also offer a national life-time guarantee, promising to correct any future problems regardless of where the customer moves throughout the nation. Keenan also participates in many fundraisers for local charities, such as the Ronald McDonald House and Recycled Rides, among many others. In 2010, Keenan at Middletown was one of the shops which were involved for the first time with the First Responder Extrication Event which benefits firefighters, police and
44 JUNE 2011 AUTOBODY NEWS | www.autobodynews.com
EMTs. During this event, professional trainers instructed these civil servants
Not only is Keenan Autobody’s road sign green, but so are their shop practices
on the proper ways to extract people from cars in order to avoid explosives and ensure safety practices. Keenan
plans to participate in this event annually. Keenan was founded in 1952 by Joseph Keenan in the back of his garage, but the organization has expanded to include eight shops. Although Don Keenan is not often present at the shop, he is the majority owner and President of Keenan Autobody, and he is available for consultation when necessary. Keenan Auto Body's 13th Annual Charity Golf Outing will be held June 9, 12 pm to 8 pm at Penn Oaks Country Club. It is benefitting both the Russella Education Fund and Little Smiles. For more information contact Craig Camacho, or call the shop at: Keenan at Middletown 5077 Summitt Bridge Road Middletown, DE 19709 (302) 279-1007
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Tornadoes Devastate South, Halting Local Automakers’ Plants, Inundating Insurers Tornadoes ripped across the southeast portion of the US brought destruction in April and May. States hardest hit were Alabama, Mississippi, Tennessee, Georgia, Virginia and Arkansas, and now Missouri. Alabama was the hardest hit in April with over half of the fatalities. As of end of April 28 the confirmed death toll was at least 250, but that will rise as of the May 22 Joplin monster tornado. “It looked like it was probably a mile wide,” Birmingham, AL, Mayor William Bell said of the funnel cloud to CNN. Tuscaloosa, AL, mayor Wal-
The front of the building after the storm
tornado on April 16 that caused major damage to the shop. “Even though the building has been condemned and is now gone, we are blessed,” said Co-Owner Tana Malerba, “No one was in the building at the time that the tornado hit. We also found a temporary location six miles down the road from where we were located while we rebuild.” The front of Coats’ Raleigh location before the storm hit The tornado took ter Maddox predicted it would take off the entire roof of Coats brick building and both side walls of the months for the town to recover. building collapsed. The bays and shop President Barack Obama had alfloor were no longer separated from ready expressed condolences by phone to Alabama Gov. Robert Bentley the outdoors after the storm. One thing that did survive the when he approved his request for emerstorm was the shop’s Garmat spray gency federal assistance on April 28. In Hueytown, AL, shop owner booth. The booth did sustain some Jason Wilson was in his business— damage, but all mechanical components and the attached mixing room Jimmy’s Auto—when he heard the tornado warning sirens. He gathered his were saved despite the all but de-
Inside Coats’ Raleigh location before the storm hit
family, including his two children, and decided to ride out the storm in the shop. About an hour afterward, Wilson stood in the parking lot, stunned, looking at the roof of the store. The roof had been blown off the building as they huddled inside, he said. “We was fixing to go home and heard the siren,” he said to Alabama website al.com. “We took cover. It’s about all you can do. And then it just blew the roof off.” Wilson, his wife, his father and his two children escaped without a scratch. Coats Auto Body and Paint in Raleigh, NC, experienced an intense
See storm video at autobodynews.com
stroyed building that housed the booth. Between Coats’ employees and local vendors, Coats was able to move their business to neighboring Garner, NC, within eight days. Malerba said the business is just waiting on some outside vendors to complete their work before the shop will be back running at 100%. The Garner location will be a temporary home for the business until they can rebuild their original Raleigh location. Insurers also began the daunting task of tallying the home and auto damages of their clients on April 29.
46 JUNE 2011 AUTOBODY NEWS | www.autobodynews.com
Alabama Insurance Commissioner Jim Riding said that he is reaching out to the state’s property insurers to provide a coordinated response to the storms as soon as possible. “We want to hit the ground running to deliver an effective response to all Alabamians affected by these tragic storms,” he said to Insurance Journal. “As soon as the companies settle on locations for their disaster response headquarters, we will share that information with the public.” State Farm Spokesperson Jim McCullen said that said by April 28 the insurer already had 3,300 claims in Alabama and the count continues to rise, according to Insurance Journal. He said that the company was somewhat fortunate in that it already had teams working in Arkansas in the wake of a series of tornadoes that went through the South Central portion of the country in early April and a quick response should ensue. The dangerous conditions also halted production at the Toyota and Mercedes-Benz plants in Alabama as of April 28.
A Mercedes plant spokeswoman said April 29 that Mercedes had halted operations because suppliers were unable to deliver parts due to the storms, according to the Tuscaloosa News. A spokeswoman for the automaker also told Automotive News the plant would remain down until May 2 following the tornado. Toyota spokesman Mike Goss said the engine plant stopped work April 27 when it lost power. He said the power could be out at least through May 1. Other automotive factories in the region, including Hyundai Motor Manufacturing Alabama in Montgomery, and Honda of Alabama Manufacturing in Lincoln, reported no direct damage from the tornadoes. However, representatives for Honda said the automaker is evaluating the storms impact on their suppliers all across Alabama, which may affect the company’s output later this spring. Coats Auto Body and Paint 434A US 70 Highway East Garner NC 27529 (919) 833-6877
Continued from Page 42
NWLCRA
ment Manager for DuPont. There will be four sessions for the NWLCRA sponsored event. Each session will have four classes that will cover Computers, Measuring for Estimating, Parts and Allied Product Tracking. Daniel Wheeler of Software Works Consulting will discuss the computer changes that are going to occur in the next 12 months. Measuring for Estimating will be discussed by Marvin Garcia of Car-O-Liner. 3M will discuss their upcoming parts program concerning the repair/replace considerations, and managing Allied materials cost. Dupont will have a special class in the morning on Building Customer Pay and an afternoon class on Blueprinting. The Industry Day is going to be limited to the first 100 people that sign up for the seminars in order to keep class sizes small and interactive. The NWLCRA will also be partnering with the National Auto Body Council (NABC) during the Industry Day in order to collect cell phones for the Cell Phones for Soldiers Program. The
NWLCRA will have a drop-off area for the phones during the Industry Day and will also be handing out materials to attendees about having a drop-off location at their own businesses. The program collects used cell phones and turns them into cash, which is used to buy calling cards for soldiers to call home with. Bill also discussed the current legislature that’s meeting in Louisiana and the issues before them. Some of the Bills are 338 and 583. Bill 338 is to prohibit the use of handheld cellular devices while driving. Bill 583 is to prohibit the use of after-market high intensity lights. Bill also talked about degweb.org, the Database Enhancement Gateway, developed to help improve the quality and accuracy of collision repair estimates, through proactive feedback from the collision repair industry and other “end users” to the Information Providers (IPs) that supply the supply databases for the various estimating products. This month’s guest speakers were Stephanie deCalongne and Caroline Haraguchi from Hertz Local Edition. They were invited to speak by Don Brown of Precision Autobody.
deCalongne began by discussing the well-known car rental company and how they have changed over the years. One of the changes has been how they have branches that focus on the Collision Industry. She said that their location, 2119 Airline Drive, Bossier City, LA, works with the local Collision Industry to provide vehicle rentals for the owners of the vehicles being repaired. They have been working closely with the Collision Repair Industry since 2003. Before this, Hertz made a well-known name by offering vehicle rentals at airports. What makes the Local Edition different than renting at the Airport, is a lower rental charge because they don’t have to charge the Airport Use Tax which is required for all airport rentals. The average savings is around 10% on normal charges. deCalongne stated that they are able to offer a large variety of vehicles because they are able to share fleets with all locations of Hertz. They are able to truck vehicles all over the region to meet the needs of heir customers. Caroline Haraguchi added that they are the first company to offer a lower age to rent a vehicle; they are
able to rent to people 20 years of age. They are able to rent one way, with unlimited mileage, no hidden fees, and direct billing. They can offer a collision repair facility a direct billing for cases such as a redo. In most cases, they are able to offer direct billing to the insurance company, if they are provided with a claim number. Deposits can be waived in some instances for certain insurance companies. Their deposit, when one is required for direct billing, is only $50. State Farm Insurance and Progressive Insurance companies allow Hertz to rent to 20-year olds, and for 18-year olds to drive the rental. Stephanie closed the meeting by passing out flyers that allows NWLCRA members to get a discount when using Hertz. This will give a 20% off weekly/weekday rates, weekend rates starting at $21.49/day, free pickup and return service, and age 20+ renting. Members can visit their Hertz location and mention they are a member of the Northwest Louisiana Collision Repair Association, and provide a CDP number to receive a member discount. Visit www.nwlcra.org for more information.
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www.autobodynews.com | JUNE 2011 AUTOBODY NEWS 47
Women’s Industry Network Conference Held in San Diego
The Women’s Industry Network (WIN) held their 5th Annual Conference May 1–3 at the Westin Gaslamp Hotel in San Diego. WIN was organized to enhance the collision repair industry—and the role of women within it—through education, networking, and sharing of resources.
zational effectiveness company which focuses upon the optimization of customer value by aligning corporate objectives with the individuals responsible for delivering results. The co-author of Strategy, Leadership, and the Soul gave her thoughts on business strategy in a male-dominated arena. Sertl gave copies of her book to everyone attending the keynote and awarded audience member, Amanda Shelly of Saint-Gobain Abrasives, with the ‘Ms. Anthony’ award, represented by a contemporary version of Susan B. Anthony’s trademark alligator bag. Sertl had spoken about An-
The Westin Hotel Gaslamp
Attendance for this year’s conference was up 30–40 percent, according to Chairwoman Kim White. The event attracted over 150 attendees and featured speeches from motivational and industry experts as well as break out sessions where attendees could receive detailed, personalized tips for their businesses. The event was attended by Autobody News’ Assistant Editor, Erica Schroeder, and Barbara Davies, General Manager and Co-owner. Speakers discussed a variety of topics designed to enhance business and personal skills as a whole. “We are proud to offer sessions that will spark new ways of thinking, better performance, and greater understanding of industry issues,” said White. In the opening session White also thanked the current board for their work this year including the organizations first, and very successful, booth at the International Autobody Exposition and Congress (NACE) in 2010. The organization was able to increase their membership and exposure with the booth as well as their Women’s Track Classes that they offered during NACE.
Executive Coach Jennifer Sertl The information sessions started with keynote speaker Jennifer Sertl discussing Business Strategy and Leadership in the 21st Century. Jennifer Sertl Sertl is president and founder of Agility3R, an organi-
Keynote speaker Jennifer Sertl and ‘Miss Anthony’ award winner Amanda Shelley
thony’s influence on her life and the lives of women everywhere during her speech. She supports the Susan B. Anthony House in her hometown of Rochester, NY.
Mitchell’s Greg Horn Greg Horn, from Mitchell International, gave an Industry Trends update following Sertl’s keynote. Horn began by giving some statistics about our driving habits over the last few years. Accidents are at their lowest rate since 1950 and that Americans have been driving less as gas prices continue to soar—two factors that will no doubt effect the collision repair industry. Horn gained nods and chuckles from the predominantly female audience when he compared statistics on male driving habits vs female driving habits. Male drivers are more reckless and cause the vast majority of accidents. Horn also recounted that the disruption for Japanese automakers caused by the earthquake and tsunami in March could result in more than just scattered and short-term parts shortages. The most popular Japanese sedans are assembled in U.S. plants using locally sourced parts, Horn said, but parts shortages are more likely for the higher-end brands, such as Lexus, and for smaller vehicles such as the
48 JUNE 2011 AUTOBODY NEWS | www.autobodynews.com
Honda Fit and Toyota Prius, which are still built and imported from Japan. But Japan also is the third-largest producer of automotive-grade steel, and exports 43 million tons of it a year. Decreases in output from those factories (all Japanese companies have been asked to reduce their electrical use by 25 percent) are raising steel prices globally, Horn said. That will likely affect pricing for all sheet metal parts, OEM and non-OEM, and as those prices rise, prices for used parts likely will rise as well. “So you’re going to see this event’s impact stretch well into next year,” Horn said. “We’ll have to wait and see what the final tally is, but we’re going to see inflation overall in average repair severity because of rising parts prices.” He also talked about the viability of alternative-fueled vehicles in the coming years due to a federally mandated mpg average of 35.5 by 2016 for all new cars and trucks. This will change the way cars are repaired and the cost of repairs due to new technology and materials used in new vehi-
cles to make them meet these standards, said Horn. WIN then held their Annual Membership Meeting during lunch on May 2, where they acknowledged the work done by their separate committees this year and announced their new board for 2011-2012. Current Board Member Mary Kunz not only won the Cornerstone 2011 Award for her contributions in 2010, but was also honored as one of the departing board along with Kim White, Jeanne Silver and Geri Kottschade. The 2011–2012 Executive Committee was named as follows; Victoria Jankowski, Chair, Jennifer Justice-Haley, Vice-Chair, Margaret Knell, Administrative Vice-Chair, Denise Caspersen, Secretary, and Teresa Bolton, Treasurer. Other Board Members for 2011 will be announced shortly. The goals for the 2011–2012 Board will be to grow the network, build a sustainable funding base and align and build an infrastructure to support WIN’s vision. The six students who won scholarships to attend WIN this year were
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also acknowledged; Ozarks Technical Community College’s Hannah Nickles, Southeast Community College’s Kendy Maddox, Center of Applied Technology North’s Rickia Mines, College of Western Idaho’s Jessica Crowley, Green River Community College’s Jessica Gauthier, and Southeast Community College’s Mollee Lunkwitz.
Jessica Rose Crowley (L) receiving the Cornerstone Scholarship Recipient Award from Teresa Bolton (ASA) and Mary Kunz (R)
Student Jessica Crowley also won the Cornerstone Scholarship Award, an award presented by Teresa Bolton that consists of a financial contribution from WIN to continue school. “Being awarded the Cornerstone Scholarship is a gift. I plan to use this
gift to give back to others,” said Crowley. “I aspire to emulate each and every woman that I came in contact with at the 2011 WIN Conference.” Two Instructor Scholarships to attend WIN were given this year to Michele Charlebois-Didreckson with Ozarks Community College and Rodney Bolton with The Center of Applied Technology North. Two additional scholarships were given to collision repair center employees to attend WIN, winners were Tona Haywood with Gautier’s Auto Body and Glass, Inc. in King George, VA, and Teresa Super with TGIF Body Shop in Fremont, CA. Day two of the conference began with the Annual Scholarship Walk Presented by Enterprise; over 100 women attending the conference participated in the walk and were able to raise over $5,000 through individual and corporate donations. On the Lauren Fix last day, keynote
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speaker Lauren Fix opened with a www.takeanap.info. discussion entitled ‘Using Your FeThe conference also consisted of male Force for Good Car-Ma.’ Fix is an automotive writer (Guide to Loving Your Car, The Car Coach) as well as a former race car driver, mechanic, and driving instructor, known for many media appearances. Fix focused on All 2011 scholarship winners lined up at the Opening Session ‘what comes around, goes around’ and that women in a networking breakfasts and activities male dominated industry need to designed for members to get to know focus on empowering themselves. each other better as well as several “The glass ceiling is only there if one-hour break out sessions in 5 topic you put it there,” said Fix. areas. Fix said she was impressed with WIN and the conference itself, she Leadership From the Inside Out had excellent feedback from attendees Keynote speaker Jennifer Sertl spoke after her speech and said the group rein a breakout session using the ally represented all different aspects of metaphor of a light bulb’s wattage to the industry. describe how to ‘separate your focus.’ “I’d never heard of the group She told everyone to decide a ‘wattage’ [WIN] before being asked to speak at of focus they have in a given increment the conference—but I was thoroughly of time (weeks or months) and to sepimpressed,” said Fix. arate that wattage into a certain portion for each category including internal relationships, external relationships, orNapping is a Good Thing The last keynote speaker of the conganization, implementation, industry ference was Dr. Sara Mednick, Dr. education and reflection. Mednick is an Assistant Professor of Sertl also encouraged attendees Psychiatry at UC San Diego, who reto make a list of 18 people they hope viewed research on sleep deprivation to meet in their lifetime. This list is and naps. Eliciting chuckles from the audience when she announced she would be discussing ‘napping,’ Mednick explained the link between adequate With attendance of over 150, sessions and REM sleep and networking games were quite busy productivity and creativity. Shownot so much about meeting the perDr. Sara Mednick ing that adequate son, but about knowing how to hansleep drastically affects their workdle the situation if you were to meet force’s productivity had the audience the person. taking the topic a bit more seriously “You can’t admire a quality in by the speech’s close. someone without having that quality Mednick showed charts from her or the potential for that quality in research showing that REM sleep duryourself,” said Sertl. ing a daytime nap can make up for sleep deprivation at night, and enSocial Media couraged businesses to allow approSocial Media guru Helen Todd gave a priate rest breaks, including napping. basic overview of how a business’ soWith more productivity demanded by cial networking presence can reach businesses, Mednick showed that getmore clientele if used correctly. She ting adequate REM sleep is not only gave tips on how often to post on socritical, but is a much more permanent cial media pages, what to post and solution then downing a cup of coffee. other advertising options within social More information about Dr. Medmedia that can garner attention for nick’s research can be found at See WIN, Page 51
www.autobodynews.com | JUNE 2011 AUTOBODY NEWS 49
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.
Industry Trends and Changes in Future Vehicles at WIN Conference Current industry trends—and a look prices and the vehicle production disahead at the electric, fuel-efficient and ruption caused by the earthquake and Chinese vehicles that could be showtsunami in Japan continue to buoy dewith Attanasio ing up in collision shopsEd in the coming mand and prices for used vehicles, he years—were the focus of one pointed out. speaker’s presentation at the recent “That 3-year-old Honda Accord Women’s Industry Network (WIN) is 20 percent more valuable than it conference. was last September, and the 3-year-old Greg Horn, vice president of in(Nissan) Sentra is up 12 percent,” Horn cited as examples. dustry relations for Mitchell InternaHorn also discussed the impact tional, told about 160 attendees at the WIN event in San Diego, that one that increases to federal fuel economy positive trend for collision repairers standards are havhad been the rebound through early ing on automakthis year in the total miles driven by ers. In late 2009, U.S. motorists. the Corporate Av“But we’re starting to see the eferage Fuel Econfect of gas prices impact the miles we omy (CAFE) drive,” Horn cautioned. requirements were He said that MasterCard Spendchanged to require Greg Horn, ingPulse, which tracks gas purchases each automaker by Mitchell VP, at hundreds of U.S. locations, reported 2016 (rather than Industrial Relations in early May that the 4-week average by 2020, as earlier of retail gas demand had dropped for established) to sell a fleet that averthe sixth consecutive time. ages 35.5 miles per gallon. “So we’re potentially in for a “That is an ambitious goal,” Horn pretty significant impact as we get to said. “A lot of auto manufacturers for early summer in the reduction of acciwhom it takes four years to get from dents and repairable cars,” Horn said. the drawing board to the showroom He said insurer data indicated an floor, are in a state of panic.” uptick in claims in the third- and Global automakers, Horn said, fourth-quarters of last year, boosted in are looking at the most fuel-efficient part by some extensive hail and storm cars they sell elsewhere in order to damage in several regions of the counbring those vehicles into the U.S. martry. ket. Though its late summer debut has Shops also have benefited from a been delayed indefinitely by the situsizable rise in the value of used vehiation in Japan, the Scion IQ is one excles, which allows for higher repair costs before a vehicle reaches the total loss threshold. Horn said the average vehicle appraised in the first quarter of 2011, for example, had an actual cash value of $12,772, up from the same quarter a year earlier even though the average age of the vehicles appraised in 2011 was almost a year older than that in 2010. ScionIQ, a new microcar was to have sold in “So a car is older but worth more the US in late summer, has nine airbags in value,” Horn said. “That’s a good thing for us in the collision repair ample of new micro-cars coming to business because that means we have U.S. streets. The tiny vehicle, powered more opportunity to repair the cars. by a 90-horsepower, 1.3-liter 4-cylinWe’ll put more in the repair column der engine, will be sold as a 4-passenthan we will the total loss column.” ger vehicle even though the headrests The percentage of vehicles de- for those in the backseats butt up clared a total loss dipped slightly in against the back glass. Horn said to 2010, and Horn and others expect that help the vehicle meet federal safety trend to continue this year. Higher gas standards, it has nine airbags.
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50 JUNE 2011 AUTOBODY NEWS | www.autobodynews.com
“The good news is you’re going to survive the crash. You’ll suffocate afterwards, but you’ll survive the crash,” Horn joked. Similarly, Chevrolet is introducing the Sonic, a less-well-equipped version of the Aveo, Horn said, and Nissan is introducing the $9,000 Micra (on which the radio and air conditioning are options). Chrysler will bring in the Fiat 500, which is four inches shorter than a Mini Cooper, and Mini is showing a concept vehicle that is a foot shorter than its existing vehicles. The problem with many such vehicles for collision repairers, Horn said, is their low values will tend to put them into the total loss category even with only minor damage. The Ford Fiesta is coming back into the U.S. market at about $14,000, Horn cited as one example. One of the vehicle’s distinctive features are its
long Xenon headlights, which stretch much of the length of the fender and, as Horn said, “are about half an inch from the edge of the front bumper cover.” Replacements sell for $480 each.
Ford Fiesta’s replacement headlights cost $480 each
“In a couple years when those cars are valued at about $10,000, rearending someone and having the bags blow and the windshield and both of those headlights go? You’re not going to be fixing a lot of those Ford Fies-
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tas,” Horn told the audience at the WIN conference. Automakers also will continue to try to shed weight from vehicles in an effort to meet tougher fuel economy standards, Horn said. That’s why shops are already seeing increased use of exotic alloys, titanium and aluminum. BMW cut 50 pounds from its 5-series by making the engine cradle out of plastic, Horn said. “This is going to change how we put cars back together,” Horn cautioned. “The B-pillar for the Volkswagen Passat comes from the factory
laser-welded in. Most techs would open the doors, look at the number of welds, drill out the welds and try to weld it back in. Volkswagen does not allow for that. In the collision repair environment, their requirement is that you use adhesive bonding to put the two pieces, the inner and outer B-pillar, back together. Because it’s a boron-alloy steel, if you weld it back in and you apply too much heat to it in the MIG welding process, you can actually weaken the structure of that metal, throw off the pillar airbag sensors, and potentially cause some se-
vere harm to the passengers in a subsequent collision.” Horn closed his presentation with a look at some of the vehicles that Chinese automakers—a number of which have plans to enter the U.S. market—currently produce. Horn said Great Wall Motors is predicting a U.S. launch in 2015, following the model used by Kia some years ago, with sales in several states and entry into the rental fleet. The company will use feedback from that limited launch to make improvements before selling on a broader scale.
Horn said the expected low cost of early Chinese vehicles in this country will likely lead to more totals than repaired vehicles. But the success of any of the Chinese automakers here will largely be dependent on their ability to set up the replacement parts infrastructure that is needed, Horn said. Sterling Motors and Daihatsu, he said, failed largely because a lack of parts availability led to repair delays and total losses. “The folks that have the best infrastructure for supporting their brand will be the Chinese brands that survive going forward,” Horn said.
Continued from Page 49
really a ‘brochure’ about your services and business while a social media page is interactive and allows users to create a conversation about your services and business—a marketing tool that cannot be quantified. Social media questions can be directed to helen@socialitysquared.com
important your own personal coloring is in selecting clothes and accessories. Ann is the owner of Never Pay Retail in Denver, CO.
harassment and discrimination complaints can be stressful and frightening. The outcome of an investigation provides the basis for critical employment decisions and a prompt, thorough and unbiased review is an essential part of both preventing liability and maintaining a healthy workplace. Webber created the blog Evil Skippy at Work to provide an entertaining view of what makes workplaces great and not-so-great. See this blog at www. evilskippyatwork.com and also at www.jimwebber.net.
WIN
your business. Todd favored social media giant Facebook during the presentation, citing that most of the conference attendees used Facebook above other social networking mediums to promote their businesses. She also favored a social media presence over a traditional website chiefly due to the fact that a website is
You Are Your Business Card Ann Fulton presented a lively discussion about how important it is to dress appropriately for your own professional, age and lifestyle and how to
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Lean in the Front Office Emphasis has been placed on focusing on lean processes in body shops however going lean also applies to processes and organization in the front desk area of any business. There is a large amount of paperwork involved in any repair shop, and assuring that the paperwork is flowing quickly and correctly throughout the job is essential. Eliminating redundancy and clutter and accurately labeling all supplies is a quick way to get started. The quickest, most efficent way paperwork can flow is the path it should take. Hot Button Employment Issues Jim Webber, an experienced employment lawyer and human resources manager from Washington state, led this session focused on legal requirements for employers. The session covered harassment issues and prevention, workplace ethics, and tips for supervisors. Webber pointed out that investigating Jim Webber
Sponsors The WIN event was sponsored by AkzoNobel, Allstate, ASE, BASF Refinishing, Enterprise, DuPont, State Farm Insurance, Hertz, 3M, Sterling Autobody Centers, GEICO, Fix Auto, CARSTAR, PPG, Marco’s Collision Centers, CSi Complete, ABRA Auto Body and Glass, LKQ, CAPA, Finish Master, Symphony Advisors, 1-800 Radiator, Sherwin-Williams Automotive Finishes, Mitchell International and CCC Information Services. “WIN has accomplished so much thanks to the support from our members and sponsors ... we are incredibly fortunate and ever grateful for their generosity,” said Kim White. For more information visit www.womensindustrynetwork.org.
CIF Makes Donation to Japan Tsunami Relief
The Collision Industry Foundation (CIF) is proud to announce its donation of $1,650 to the American Red Cross to benefit the victims of the Japan tsunami from the donations made through the Collision Industry Conference (CIC). The donations were collected at the CIC meeting held at the Meadowlands Expo Center in New Jersey this past March after industry member Toby Chess suggested a collection
for those in need. “It’s always heartwarming to see people, even in these hard times, reach out to help others who have lost so much” said Bill Shaw, President of the CIF Board of Trustees. Relief and clean-up efforts are ongoing in Japan due to the catastrophic levels of devastation that resulted from the earthquake and subsequent tsunami back on March 11, 2011.
www.autobodynews.com | JUNE 2011 AUTOBODY NEWS 51
Custom Corner
Rich Evans is the owner of Huntington Beach Bodyworks and an award winning painter and fabricator. He offers workshops in repair and customization at his facility to share his unique talents. For contacts and design samples visit www.huntingtonbeachbodyworks.com
Repairing Quarter Panel, Bumper, and Molding: No Time, No Money with Rich Evans
Challenges—they seem like they’re always coming up. Since I did the Car Warriors TV show, where we were always fighting the clock with only 72 hours to build a complete car, it seems like everybody wants to hit me with a time challenge. My buddy, Diggity
hammer. When I cut my panel I made sure that the top and the lower part of the quarter panel still had a spot weld holding it to the inner structure. This way when I come in with the slide hammer the quarter panel is still going to move, because otherwise I’ll have
On Creative Marketing
in. Take your time as you weld it. Weld very small areas, keep heat control because you don’t want it to warp and then you’ve got to watch the rest of the metal. If you see it start to suck in, get your nail gun and pull out your low areas. Every time you weld it,
So after getting it welded in, I have a little metal finishing to do. I’ll do a skim coat of mud over it just to true it in, get some of those low spots because I don’t have a lot of time to metal finish it completely with a file. So I shape it with a skim coat.
check it. This will save you a lot of time and a lot of Bondo™. A lot of guys want to slap Bondo™ over it but try to outsmart the metal. That gives you more seat time under your belt to where you can utilize this process on another project.
I usually never skim coat anything any more than twice—once just to get the 36 grit scratches out and any pinholes. Using the 3M Dynamic Mixing System is key for me. Ever since I started using it I don’t have any pinholes. I don’t have to mix
with Thomas Franklin
Dave, you might know him from the to put this up on the frame rack and Pimp My Ride TV show, called me up pull it. I needed to avoid all that beto throw out a challenge. cause of the time constraints. Dave backed his 2002 This actually worked out pretty with DickEscalade Strom into a brick wall and ripped about a well. I got my window in there, cut three inch tear down the right quarter out the damaged piece of metal. Now panel. He also hit the rear bumper and I can flatten out the piece that I cut out tore the right molding. Here’s the real to use as a pattern. I get another piece problem: Dave’s got to have his SUV of metal, I use the break and bend it. I back the following day, which is ex- clamp the piece I cut out of the metal actly 24 hours, because he’s got a big on there, scribe it, come back, cut it meeting for a new movie he’s doing out. I actually keep them both together and he can’t show up with his ride and use the nibbler to follow around it damaged. as close as I can get it and then follow Now he’s asking to get this fixed up with the grinder. That means it’s in 24 hours (seemingly impossible, with Lee Amaradioexactly Jr. the shape and size I need. right?) so I’m thinking how to create a If you’re putting your template on process that can make this happen in the outside, you’re going to be a little 24 hours. I’ve got to replace the quarbit smaller on the inside because of ter panel, the rear bumper and the where that break is. It’s actually going molding. To top it off, he says, ‘I’ve to cause you to be a 20 gauge short so got zero budget’ so this is a ‘bro deal.’ make sure you keep the length at the I’ve got to do what I’ve got to do and end if you’re coming from the inside. use what I have on the table. If you want to use the pattern on the inHere are the steps and the side then you’ll be an 1/8th inch longer processes that I used to beat the clock. because you want this piece to fit. You can judge if I was successful. The So you can either TIG weld it or first thing I decide is ‘no parts,’ we’ve MIG weld it. You’ve got to take your with Sheila Loftus got to fix everything. I see that I need time either way. I’m going to TIG to cut a window—try to keep every- weld it. I’ll actually put it in with the thing as small as possible—especially MIG welder just to get it set where I to cut and replace a piece with another need it and then come back with the piece of metal. The metal was actually TIG welder but before that I need to 20 gauge, so I checked the gauge of shape the metal with the English metal to make sure I was replacing it Wheel and flatten it all out. To get it exactly. the right shape you’re going to need I cut a piece out of the quarter to fit it a couple times, go back and panel, then cut the ripped area out of forth, fit it until you’ve got your conthat so I can flatten the panel. I was tour right. able to get inside it and get the strucAs soon as it’s fitting as close as ture part of it straight using a slide you can get it, you’re ready to tack it
Opinions Count
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Your Turn
Shop Showcase with Janet Chaney
52 JUNE 2011 AUTOBODY NEWS | www.autobodynews.com
Bondo™, I don’t have to worry about the mixture, don’t have to worry about air making the pinholes. If you don’t know about the 3M Dynamic Mixing System, check it out. It’s a big time saver and gives you better quality results, less waste, more productivity. It’s everything you need in one gun. Once I get the body work done, I’m come back in with some PCL Primer. I’m going to load the primer up and hit it with some 80 grit, 3M longboard. Then I’m going to come back and get rid of the 80 grit
protection, less welding, less sparks, less interior that has to come apart. It’s actually a stronger bond then a weld. This stuff is amazing. Technology is changing and you’ve got to change with it. The gun makes it a lot easier to apply it. I’m usually feeling pretty spoiled by 3M, they’re definitely the go-to for me when it comes to new products, anything and everything. 3M just about carries it all. Getting back to the body work, I lay the panel bonding adhesive on the damage area—the bumper—instead
Now we’re down to about three hours before Diggity comes to pick this vehicle up and that gives me just enough time to put the bumper and the bumper sensors on, apply the molding, and get the tail light back in. That’s another project, another clock, another challenge under my belt. Diggity comes and is just blown away that I ‘pulled another rabbit out of the hat’ as he put it. I tell people ‘never think negative, always go with the positive.’ Think “hey, I can do that,” put yourself to the challenge.
money to fix it or if you owe a favor to somebody, this is a good way to utilize the money because this job would run about $4,000 maybe $4,500 by the time you got done buying the rear bumper, quarter panel, tail light, molding, and all the materials involved in it. So Diggity Dave came up $4,500 to the good. He owes me a favor now so I’ll hit him up when I’m ready for my favor and maybe I’ll have to put him through the same test he put me through. A challenge on the table, race
scratches with 150. Then I guide coat it again, come back with 400 wet. Now I’m ready for paint. I’m going to apply the sealer, the base coat and the clear coat. Whatever system you guys are using in your shop, go with that. I still have the bumper and the side molding to fix. I don’t know how many guys are using the 08115—the panel bonding adhesive—but I love this stuff. Every day I find a new use for it. This stuff sands really well, it dries and hardens really true, and it’s flexible—so I’m using it as a plastic repair product. It usually takes 24 hours to cure but if you hit it with a heat lamp you can get it to cure within an hour or two. I know a lot of guys use it for putting quarter panels on, which is a better process, less welding, less work. It’s a better repair at the end of the day because when you’re priming each side of the panel and the inner structure of the quarter panel then it’s taking the place of corrosion
of using Bondo™. This is going to adhere and it’s not going to shrink. I sand it with 80 grit on the plastic. I shape it just like the Bondo™. You want to heat these panels first, shape it, get its best shape, take all the low areas out, file it down with some 80. Come back for the cracks and any low areas, and fill it with the panel bonding adhesive. I sand it with 80, feather everything with 150, then 320 around that. Then back with the PCL flexible primer. It’s more a flexible, durable product for anything moving. You want to make sure you use the right products, especially on a project like this where I don’t have any extra room to breathe. I can’t take any chances of something messing up on me. Next is getting into the paint booth, getting my color on, come back in with my Transtar clear with the HT hardener, zap that on there. I didn’t use a two-hour clear which is a bit more yellowish. I apply my three coats as I always do.
Make sure you keep your quality because that’s everything. Make sure you do your fits, stay at your level, ask questions. I’m glad I was able to help a good buddy out, Diggity Dave from Pimp My Ride. Hopefully, this will help some of you guys in similar situations when you get into a time constraint or even if you want to save a few bucks if
against the clock, at the end of the day, his car’s done in 24 hours and I’m on to the next one—that’s what I live for. Live, breathe and eat building cars, fixing them—never too good to work on anything. My daily focus is waking up and having something else to work on and always trying to get the cooler projects. If you don’t use it you lose it, that’s the key to my game. I’m never too good to do something and I expect you guys to be the same way, always try to better yourself at what you do, everyday try to learn something new. I want to thank 3M for their products, especially what I call the ‘Bondo gun’: the 3M Dynamic Mixing System, and the panel bonding adhesive. Tune into Car Warriors every Wednesday night on Speed channel, go to my Facebook fan page, Rich Evans Designs, and stay up with me on my daily challenges and projects. We’ll talk to you next month!
The Auto Glass Replacement Safety Standards Council (AGRSS) promotes safe auto glass industry standards, which an auto glass technician should follow. Consumers should ask these questions before a replacement windshield installation: • Will the old adhesive be removed from the vehicle frame? If the adhesive isn’t removed down to the adhesive manufacturer’s recommended level, the fit may not be tight and the new adhesive won’t bond correctly.
• Will the technician wear gloves to keep from contaminating the glass? If oil and dirt get on the edges, the new adhesive (called urethane) may not bond correctly. • Will the new urethane adhesive stand up to the high deployment pressure of airbags? The best available manufacturer equivalent urethane adhesive should be used, not butyl tape. Ask for adhesive made by Dow, Sika or the original car maker’s adhesive supplier.
Rich shows Diggity Dave the cutouts he did to repair the quarter panel
you’re doing this for a friend or family or somebody that doesn’t have the
Auto Glass Replacement Safety Standards Council Promotes Fixing Damaged Windshields
As shop owners and techs know, car maintenance isn’t just under the hood. A cracked windshield is a safety risk. It can impair the driver’s vision and put passengers at risk. Most automotive safety experts rank the windshield as the third most important safety component in today’s vehicles, behind seatbelts and airbags. Laws require seatbelt use and prevent tampering with airbags, but there are no laws that govern replacement windshield installation.
• How long does the urethane adhesive need to set until the vehicle can be driven? Every urethane has a “safe drive-away time.” For more information, visit www.glassdoctor.com.
Search:
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www.autobodynews.com | JUNE 2011 AUTOBODY NEWS 53
Hey Toby! with Toby Chess
Toby Chess is an I-CAR program instructor, Welding specialist, and former salvage yard operator. Toby is universally known in the collision industry for his charitable works, worthy causes, and magic tricks. He can be reached at tcspeedster@yahoo.com
Getting OSHA-Compliant on Signage, Electrical and Power Tools The other day I was teaching I-CAR’s • Do you have a spill containment workers protection program and I had container (absorbent material in a the techs show me their blowers. (I’m small garbage can works, but it must referring to the nozzle blowers on air be marked and placed in accessible hoses here, not hand-held dryers.) I area.) found 3 illegal ones. I asked the question “How much is the OSHA fine for Safety & Signage these blowers?”with and the production David McClune manager said it was $7000. I was in Arizona, not California, at the time. I inquired if the shop had been fined and his reply was “I read your article and I am in the process of getting OSHA approved blowers.” It made me feel that all this work is worthwhile. Let’s get started on the second installment of the article.
California Autobody Association
Year in Quotes
Electrical with John Yoswick • Check all extension cords for damage (repaired with electrical tape and broken grounds are a big no no). • All high voltage boxes labeled with a DANGER Sign • Do you have an OSHA approved • All outlet covers installed first aid kit? • Are all energized parts of electrical circuits and equipment guarded against accidental contact by approved cabinets or enclosures? • Make sure there is a Richard 3 foot barrier with Steffen marked around all electrical boxes
Collision Repair Association of CA.
Walkways • Make sure that all in ground pulling pots are flush with surface when not in use. Most of the time the covers are
Transition Planning with John Yoswick
bent and they are out on the floor, which creates a tripping hazard.
You will also need the proper signage. Speaking of signage, here are some of
Shop Showcase with Karyn Hendricks
Shop Showcase
54 JUNE 2011 AUTOBODY NEWS | www.autobodynews.com
with David M. Brown
the more common ones that are needed in the body shop. Flammable and Combustible Materials • Is proper storage practiced to minimize the risk of fire including spontaneous combustion? • Are all hazardous drums with flammable materials grounded? • Are all flammable liquids kept in
closed containers when not in use? • Are stored oxygen tanks separated by 25 feet from flammable stored gas cylinders? • Does the facility have enough fire extinguishers as per city ordinances? • Are all fire extinguishers charged and are properly tagged (you also have someone in the shop check and
sign the tags once a month)? • Do you have a class D fire extinguisher for a magnesium fire?
Here is a chart of the symbols on the fire extinguisher and what materials it can be used. • Are all fire extinguishers free from obstruction? • Is a fire extinguisher mounted within 10 feet of any inside storage area of flammable materials?
Chrysler Repays Government Bailout Loans Six Years Ahead Chrysler Group repaid $7.6 billion in loans to the U.S. and Canadian governments on May 23, nearly two years after the No. 3 automaker was rescued. The company said it made a payment of $5.9 billion to the U.S. Treasury and $1.7 billion to Export Development Canada, retiring loans that allowed Chrysler to exit bankruptcy in June 2009. Chrysler completed repayment of the loans six years ahead of sched-
ule. “Less than two years ago, we made a commitment to repay the U.S. and Canadian taxpayers in full and today we made good on that promise,” Sergio Marchionne said. Previously Marchionne announced, “Chrysler is undergoing an extraordinary industrial and financial turnaround, and Fiat is ready to take control, in order to bring even greater stability and strength to the relationship in the interests of both.”
openings of ½ inch or less? • Are all power tools grounded cords?
have
Batteries • Are batteries stored on a spill containment tray?
Power Tools • Are portable fans provided with full guards or screens having
The next article will deal with MSDS sheets and safety programs that are necessary for OSHA compliance.
BASF& AASP Official Sponsors of Repairer Driven Education SCRS says BASF is the first official sponsor of SCRS’ 2011 Repairer Driven Education (RDE) program at SEMA 2011. It is the second year in a row that BASF has been first to commit support to RDE, which will take place in the afternoons on each day of the SEMA Show in Las Vegas this November. The resources sponsors provide serve as a foundation for the program, and demonstrate the commitment participating companies have in regard to industry education.
“For over a decade, we have been increasing our support for collision repair educational and improvement programs,” explained BASF Manager of OEM and Industry Relations Joe Skurka, whose company is committing to RDE at the Master’s level. “We want our customers to thrive, not just survive, and helping provide the tools to make this happen is one of our core strategies. We see both SCRS and the Repairer Driven Education series as viable opportunities to support this strategy.”
Americans Oppose Accident Response Fees The Insurance Research Council (IRC) found in a survey that 68% of adults oppose local governments charging accident response fees to individuals involved in traffic accidents, according to their insurance industry survey. Requiring insurance companies, rather than the individuals involved in an accident, to pay accident response fees had little impact on the level of support for accident response fees. Lawmakers in a dozen states have enacted legislation prohibiting local governments from imposing accident response fees. Several more have debated similar legislation. The insurance industry generally opposes local response fees. When told that requiring insurance companies to pay accident response fees could mean higher auto insurance costs, 69 percent of survey respondents disagreed with the idea of local governments charging accident response fees. “Efforts to fund emergency response services through accident response fees stand in direct conflict with the fundamental notion that certain government services should be paid for
by all taxpayers—not just those who are unlucky enough to actually need the services,” said Elizabeth Sprinkel, senior vice president of the IRC. The study, Public Attitude Monitor 2011, Accident Response Fees, was based on telephone interviews with 1,012 adults countrywide conducted in January 2011 by the market research firm Harris Interactive. The IRC results track with another survey by Harris Interactive for the Property Casualty Insurers Association of America that also found these fees unpopular. In that survey, three out of four adults (76 percent) said they believe their taxes cover the time and services provided by emergency response providers following a traffic accident and additional accident response fees charged by local governments are not necessary. The IRC results track with those of another survey by the Property casualty Insurers of America (PCI). Three out of four adults believe their taxes cover the time and services provided by emergency response providers following a traffic accident.
www.autobodynews.com | JUNE 2011 AUTOBODY NEWS 55
Gunder Supporters Release Infinity Insurance’s Voice Recordings, Insurer Apologizes Barrett Smith, with Autodamage Experts, has released a voice recording of a call made by a representative of Infinity Insurance to one of Ray Gunder’s customers. Listen for yourself by downloading the WAV file at www.autobodynews.com. The recordings have been widely quoted in the appealed case which was recently resolved in favor of State Farm. Smith comments: “This type of underhanded practice goes on more often than most are aware or would like to believe and needs to be curtailed, and one sure way is for it to be exposed to the masses and for those who conduct themselves in this way to fear exposure. “For those of you who know Ray Gunder and the manner in which Gunder’s Auto Center operates, listening to this recording will likely make your blood boil... it did mine. This “supposed” claim professional is trying their best to interfere with and undermine the relationship between Gunder’s and at least one of its customers. Who knows how many times this takes place? Continues Smith, “One has to ask themselves, what type of person has the lack of conscience and nerve to lie to a customer about a shop in which
this claim-person has never dealt with or have first hand information to support what they say? “The simple fact is she doesn’t and it is apparent she is merely doing as told and reading from a prepared word track intended and designed to disparage Gunder’s good name and destroy the confidence the customer had in selecting Gunder’s. A selection based upon their experience in having their vehicles repaired at Gunder’s more than once in years past, and have earned their respect! “This so-called claim professional likely considers herself to be a honest and ethical person who cares for her family and attends church on Sunday; but on Monday, goes to work and does things that she is told….regardless if right or wrong and does so despite her personal, ethical or moral convictions, just as a mercenary or a paid assassin would go about their business, hiding behind the corporate Infinity Badge. “So one has to ask why a large insurance company would do this? Simple, because they have an agenda to control the collision industry and they have done so without being held accountable and have reaped huge profits. Profits that were once the collision repairers.
“The very scary part; they and others who chose to conduct business in this manner will continue to do so to discourage any repairers who choose to step up and say no to underpayments for necessary processes and materials needed to properly serve their clients.” Ray Gunder adds, “Know this and take serious heed. As long as the rewards outweigh the risks, like a child sneaking cookies, insurers will continue to increase their efforts to profit off the backs of others’ hard work and sweat while avoiding the liabilities that come with underpaid repairs. And if you don’t merely submit and allow them free reign over your business, you too will become a victim of this vile and unethical practice of lies and deceit about you and your business. “Just like slapping the child’s hand for taking too many cookies, or punching the bully in the nose when he comes to take your lunch money, it’s only when the risks begin to outweigh the rewards that bad behaviors will change. “Each repair professional out there needs to make a conscientious
choice to either become a part of the solution or remain part of the problem. The choice is yours. Use it wisely. “As for Gunder’s, we will continue to do our part to instill accountability and deter insurers from harming us and our customers. There is strength in numbers and together we con conquer these types of practices in a short time frame… regardless, you can be assured I’ll continue to “Pound That Rock.” The person or persons responsible for these slanderous, outrageous lies (Lisa Whitehurst being one of them) will be held personally accountable. I have to wonder if she knows the effect her hurtful lies could have the twenty-five families dependent on work at Gunder’s Auto Center, all of which are honest, hardworking, ethical people. Is it okay to hide behind her “Infinity Corporate Badge” and attack anyone she’s told by management to suppress their voice? Opinions welcome.” Ray Gunder Gunder’s Auto Center (863) 688-7897
Infinity Insurance Apologizes for Gunder’s Auto Center Customer Recordings
On May 3, Infinity Insurance’s Regional Claims Manager, Tim Waldron, called and spoke to Ray Gunder of Gunder’s Auto Center in Lakeland, FL, and repeatedly apologized for the recent comments made by an Infinity claims person to one of Gunder’s customers who captured it on a recorder. The voice heard is that of Infinity Insurance Claim Person, Lisa Whitehurst saying the following word track to one of Gunder’s Auto Center’s customers: “I spoke with our re-inspector, who went out and re-inspected the vehicle at the body shop,” Whitehurst said in the message. “He said that this body shop has been known to give us issues in the past with other vehicles that they’ve repaired and apparently they are known for overcharging a great deal for the amount of damages and trying to add things that aren’t relevant to, you know, the repairs. They’re also known for holding the vehicle hostage until all the payment is made.”
As a result of the egregious statements made by Infinity’s representative, Ray Gunder immediately contacted his legal counsel, Brent Geohagan, who promptly sent a letter placing the insurer’s claims manager on notice and demanding that Infinity Insurance agree and confirm, in writing within 10 days, that such wrongful conduct on behalf of any Infinity Insurance representative will cease and desist immediately with no re-occurrences. In response, Tim Waldron, Infinity Insurance Company’s Regional Claims Manager, called and spoke to Ray Gunder personally and repeatedly apologized for the recent comments and conduct of the claims person and her manager and advised Ray that this was an isolated incident and further assured him that the matter would be addressed and that no such conduct would take place in the future with Gunder’s nor any other repairers stating: “this is not the way Infinity conducts its business.” Ray Gunder says he has accepted the apology.
56 JUNE 2011 AUTOBODY NEWS | www.autobodynews.com
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Continued from Front Page
Allstate Buys Esurance
reinsurance, including OneBeacon. Allstate, which has seen its personal lines business shrink, said the deal lets it expand its service to consumers who prefer to buy direct online rather than through personal agents. It allows it to compete with Progressive and Geico, which have strong web insurance shopping sites. “Consumers today expect to have their specific needs met by their insurance companies. Our strategy is to focus on individual preferences and utilize different value propositions for distinct consumer segments,” said Thomas J. Wilson, Allstate’s president, chairman and chief executive officer. He said Allstate agencies do “an outstanding job of serving customers who want a local personal touch and prefer to purchase a branded product.” But Esurance will expand the company’s ability to serve customers who are “more self-directed but still prefer a branded product.” He said Answer Financial will strengthen Allstate’s offering to indi-
viduals who want to be offered a choice between insurance carriers and are brand-neutral. The move has some Allstate agents concerned. “Many Allstate agents are viewing the proposed acquisition suspiciously. The company has been hell-bent on growing its direct channel for years, but only recently has it had any success,” said Jim Fish, executive director of the National Association of Professional Allstate Agents, Inc. “Who knows, the success of the Esurance business model and technology platform could ultimately improve and transform Allstate’s direct channel into a powerhouse. Should this come to pass, Allstate agents would feel more expendable than ever.” According to Fish, Allstate is shedding seasoned agencies in favor of larger agencies with more staff. “[S]o adding this acquisition to the agents’ woes, can only create more angst. Without a doubt, the agents want Allstate to be successful – but not at their expense,” he said. Allstate said Esurance and Answer Financial will retain their brand names. Esurance has some 1,7000 employees and 14 regional offices. Wil-
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son said Allstate would now be the only company serving all of these consumer segments with unique insurance offerings. “This transaction is also attractive for our shareholders. Association with Allstate will improve Esurance’s marketing effectiveness and it can leverage our world-class pricing and claim capabilities. This also offers us two additional sources of growth and an immediate increase in customer relationships,” Wilson said. Premiums for policies sold by both Esurance and Answer Financial were $1.2 billion in 2010. Gross premiums written by Esurance were $839 million for the year. Esurance had 839,000 policies-in-force, including 328,000 policyholders at Answer Financial. The Esurance segment added approximately 65,000 policies-inforce during 2010, an increase of 8 percent, according to the company. The transaction has been approved by both companies’ boards of directors and is expected to close in fall 2011. The transaction is subject to regulatory and other customary closing conditions, including review by antitrust authorities and state regulators.
White Mountains Chairman and CEO Raymond Barrette said the online insurance operation Allstate is acquiring has grown from a start-up to rank among the top online insurers in 10 years. “We have happily invested significant capital in what we believed was a unique business. Allstate agrees and can now take it to a new level,“ Barrette said.
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Oklahoma Technical Students Place In Ford/AAA Student Auto Skills Contest Held in Okmulgee The Ford/AAA Student Auto Skills is a nationwide automotive technology competition for high school juniors and seniors interested in pursuing careers as automotive service technicians. The Oklahoma state championships were held in Okmulgee at the end of April, and students from local schools were able to walk away as winners—some with a ride to the national portion of the competition inhand. The competition tests students’ automotive knowledge, workmanship and problem-solving abilities with a written test as well as a race against the clock to diagnose and properly repair intentionally “bugged” vehicles. Each year, Oklahoma State University Institute of Technology in Okmulgee is the host for this statewide contest. This year’s contest brought together juniors and seniors from 10 technology centers across Oklahoma. This year’s first place winning team was from Moore Norman Technology Center in Norman. Students Lathan Springer and Donovan Peters, along with instructor Lee Dow, made up the winning team. They will represent the state in the National
Hands-on Finals in June at Ford Headquarters in Dearborn, Michigan. AAA Oklahoma and Ford Motor Company sponsor the competition to encourage technically-minded young people to pursue careers in the automotive service industry. At stake during the competition are scholarships, prizes and letters of recommendation to future employers. In 2010, 10,500 automotive technology students competed for a share in a record-high $11.5 million in scholarships available through the state and national competitions. The winners of the competition were: • First Place: Lathan Springer, Donovan Peters and instructor Lee Dow from Moore Norman Technology Center in Norman. • Second Place: William Cotton, Payton McCuistion and instructor Shelly Smith from Meridian Technology Center in Stillwater. • Third Place: Cameron Kaiser, Matthew Hart and instructor Darren Barnhill from Indian Capital Technology Center in Muskogee. • Fourth Place: Ray Busby, Daniel Carroll and instructor Stacy Estes from Red River Technology Center
www.autobodynews.com | JUNE 2011 AUTOBODY NEWS 57
Continued from Page 40
Great Bear Auto
law in England to charge women and men the same insurance premiums, and they responded to a consumer report regarding the reliability of underride guards on big rigs. The panel, as usual, fielded calls from listeners with questions about their vehicles. According to Audra, “Everything I do is against the stereotype of the way the automotive industry is run.” She cites the rarety of being a woman in charge of an auto shop, her
motto to “tell NOT sell,” and her focus on educating the customer about vehicle repairs, safety and after care, as evidence of what shops can do to make themselves stand out amongst the competition.
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State Farm to Phase out 24 Field Offices in Midwest
State Farm plans to phase out two- save $8 million in leasing and builddozen claims offices in three states in ing-operations costs in the next five favor of “mobile workers” based in years. homes, agent offices or collision-reWhile many workers would repair centers, the Bloomington-based main in their current communities, insurer announced. some managers would move to consolSome of the estimated 1,300 em- idated fields offices in the three states. ployees affected in Illinois, Indiana and The consolidation includes Michigan—including 17 at a Spring- claims-processing centers in Marion, field claims center—would remain in Collinsville, Champaign, Peoria, Mothe communities where they now work. line, Rockford, Elmhurst, Tinley Park “It’s the changes in technology. and Arlington Heights. Claims are more ‘virtual’ now, and we The number of claims-processing didn’t necessarily need all of these facenters Michigan and Indiana will be Give us your opinion on mattersinaffecting the industry. cilities,” said Missy Lundberg. reduced from nine in each state to two. State Farm estimated it would Agent offices are not affected.
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