August 2020 West Edition by Autobody News

WE STEDITION

AUTOBODY AK / CA / HI / ID / MT / NV / OR / WA / WY

Shops Taking Action to Boost Business, Help Employees and Community by John Yoswick

Collision repairers around the country aren’t sitting still as business conditions continued to evolve as summer began. Here’s a cross-country tour of what’s happening as shops around the U.S. respond to the pandemic and its economic fallout. Helping employees and the community Shops continue to be generous in their efforts to help out their employees, their customers and their community.

Zach DeGroot, manager of Riverbend Body Shop in Grand Rapids, MI, said the shop covered some of the costs for police vehicle repairs after about a dozen such vehicles were damaged during rioting that followed a protest to denounce the death of George Floyd. DeGroot said the shop has always tried to do something extra on customers’ vehicles in for repairs, but is also trying to step that up, offering free detailing or “repairing unrelated damage on adjacent panels for customers so they do not have to pay out of pocket.” See Taking Action, Page 34

CA Governor Using Enforcement Measures to Slow Disease’s Spread by Kerry Crowley, Mercury News

California Gov. Gavin Newsom said the state plans to issue new measures

Gov. Gavin Newsom speaks on June 30

as early as July 1 that could require local jurisdictions to step up enforcement of a mandate requiring people to wear face coverings while in public or high-risk settings. During his June 30 press briefing, Newsom said he’ll announce stricter enforcement measures for health rules and “use that dimmer switch we’ve referred to and begin to toggle back on our stay-at-home order and tighten things up.” “We’ll be doing more to focus on enforcement in this state,” Newsom said. “Enforcement comes in See Enforcement Measures, Page 6

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AUTOBODYNEWS.COM Vol. 38 / Issue 8 / August 2020

Some Positive Trends for Collision Repairers Amid Pandemic Fallout by John Yoswick

Although the tough times shops are experiencing in some markets aren’t over, the summer has brought some sunnier trends for the industry. Here is a collection of some potential good news for collision repairers. Rebound in used vehicle values means fewer totals Given the link between used vehicle pricing and the percentage of collision-damaged vehicles declared total losses rather than repairable, collision repairers tracking the fluctuation in

second-hand vehicle values this year have to feel like they’ve been on a wild roller coaster ride. Vehicles are generally declared total losses when the cost of repairs exceeds some percentage of the vehicle’s value prior to the accident. When used vehicle prices drop, it takes less damage for repair costs to hit that total loss threshold. And drop they did this spring. Wholesale used vehicle prices in the first 15 days of April decreased 11.8% compared to a month earlier, according to Manheim. The used veSee Positive Trends, Page 46

Auto Dealer Parts Departments Continue to Serve Through Pandemic by Gary Ledoux

In the last few months, much has been written and discussed within the trade press about how body shops, insurance companies and car rental companies are faring with the business slowdown caused by the corona virus pandemic. Autobody News wanted to know how the auto dealer parts departments were faring. Between June 11 and June 15, Autobody News conducted a survey of car dealership parts departments. This included dealers of all makes from Ford, GM and FCA to Mini, Mitsubishi and Tesla, and everything in between. All responding dealers said they were involved in the wholesale collision business. All except one said they were involved in the wholesale mechanical business. Responding dealers leaned toward being either General Motors or Honda/Acura dealers. We asked the following questions and received the respective responses.

In March, April and May, was your wholesale collision business (primarily body parts sold to collision repair shops) up or down, and by what percentage? All except three dealers noted their wholesale collision business was down, some by as little as 15% and some by as much as 80%. The average was a decrease of 45% and consistent with the business losses experienced by collision shops. Of those that experienced an increase in wholesale collision sales, one dealer could not be reached for comment. Another, a GM dealer in Missouri, noted that a large hailstorm was the cause of the increase. The third dealer, Richmond Ford Lincoln of Richmond, VA, took a very aggressive and innovative approach to increase sales. “We took our outside salespeople off the road and had them working the phones five or six hours a day contacting customers to see who was open and who was not and if there was anything we could do to help them out,” said Parts Director See Serve Through Pandemic, Page 32

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CA Dials Back Openings on Beaches, Restaurants, Theaters & More

CONTENTS

by Renee Schiavone, Patch 2020 SEMA Show Still On, Despite Growing Number Of COVID-19 Cases in Nevada ��10 Arrest Made of Suspect in CA Auto Shop Owner ��16 CA Governor Says State Weighing Enforcement Measures to Slow Disease’s Spread ��1 CarMax Settles Environmental Protection Lawsuit Brought on by CA District Attorneys ��11 Face Masks Now Mandatory While Outdoors in Oregon ��16 Nevada Governor Mandates Masks in Public as COVID-19 Cases Hit Record Number ��6 NV Auto Dealer Trade Group to Focus on

3M Shows Support of Collision Repair Industry During Pandemic ��47 9 Companies, 8 States Involved in U.S. DOT Automated Driving Systems Initiative ��22 Amazon Acquires Autonomous Ride-Hailing Group ��52 Auto Dealer Parts Departments Continue to Serve Through Pandemic ��1 Autobody News Writer Recognized for

CAR Coalition Urges Data Control ��55 Diving Into the Fascinating World of Fasteners ��38 EV Maker Lucid Motors to Open 20 Retail and Service Locations in North America

Vehicle Initiative ��6

Through 2021 ��52

Reopen Soon ��20 SEMA Supports Legislation to Forgive All PPP Loans Less Than $150,000 ��50 Tech Industry Could Help Nevada Rebound From Pandemic Restrictions ��17 Update: 59 Looted Hellcats Recovered, Story Takes Tragic and Bizarre Turn ��14 WA Gov. Extends Halt on Reopening, Warns More County Restrictions on Table ��8

GM to Call Up Hundreds of Laid-Off Workers to Meet Production Demand at Key Truck Plants ��4 I-CAR Names Peevy to New Role ��52 ®

Industry Legend Dick Schoonover Dies ��55 Most Expensive States for Car Insurance in 2020 ��54 Oil Prices Suppressed by Low Demand, How Auto Retail May React ��12 Shops Taking Action to Boost Business, Help Employees and Community ��1 Some Positive Trends for Collision Repairers

COLUMNISTS Anderson - Making the Most of the ‘Parts’ Portion of Your Business ��30 Attanasio - Will COVID-19 Change Your Marketing and Advertising Plans Forever? ��43 Chess - An Overview of Corrosion Protection Products: Part 1 of 2 ��24 Phillips - Industry Veterans Erick and Shelly Bickett Share Insight About Collision Industry ��40

2020 SEMA Show Safety Announced ��52

Visitors crowd the beach during the Memorial Day holiday weekend as Southern California saw a relaxing of the restrictions put in place due to the coronavirus pandemic. July 4 will likely look different. Credit: David Buchan, Shutterstock

Publisher & Editor: Jeremy Hayhurst General Manager: Barbara Davies Contributing Writers: John Yoswick, Janet Chaney, Toby Chess, Ed Attanasio, Chasidy Sisk, David Luehr, Stacey Phillips, Victoria Antonelli, Gary Ledoux Advertising Sales: Joe Momber, Bill Doyle, Norman Morano (800) 699-8251 Office Manager: Louise Tedesco Digital Marketing Manager: Bryan Malinski Art Director: Rodolfo Garcia Graphic Designer: Vicki Sitarz Online and Web Content Editor: Abby Andrews Accounting Manager: Heather Priddy Editorial/Sales Assistant: Randi Scholtes Office Assistant: Dianne Pray

Serving Alaska, California, Hawaii, Idaho, Montana, Nevada, Oregon, Washington and Wyoming. Autobody News is a monthly publication for the collision industry. Permission to reproduce in any form the material published in Autobody News must be obtained in writing from the publisher. ©2020 Adamantine Media LLC. Autobody News P.O. Box 1516 Carlsbad, CA 92018 (800) 699-8251 (760) 603-3229 Fax www.autobodynews.com editor@autobodynews.com

American Icon Automotive Finishes �� 20

Innovative Tools & Technologies, Inc �� 25

Audi Wholesale Parts Dealers �� 36

Kearny Mesa Subaru-Hyundai �� 23

AutoNation Collision Parts �� 2

Kia Downtown Los Angeles �� 18

AutoNation Honda Costa Mesa �� 12

Kia Motors Wholesale Parts Dealers ��44-45

AutoNation Infiniti Tustin �� 14

Kia of Carson �� 34

AutoNation Roseville ��8-9

Kia of Irvine �� 30

BMW Wholesale Parts Dealers �� 42

Larry H. Miller Chrysler-Jeep-Dodge-Ram �� 12

Car Pros Kia �� 26

Mazda Wholesale Parts Dealers �� 50

Car Pros Kia Renton �� 40

Mercedes-Benz Wholesale Parts Dealers �� 52

Certified Automotive Parts Association �� 14

Michael Hohl Motor Company �� 6

Classifieds �� 54

MINI Wholesale Parts Dealers �� 42

Colortone Automotive Paints �� 24

MOPAR Wholesale Parts Dealers �� 33

Courtesy Chevrolet San Diego �� 37

Moss Bros. Chrysler-Jeep-Dodge �� 21

Cutter Chrysler-Dodge-Jeep-Ram �� 6

Nissan/Infiniti Wholesale Parts Dealers �� 53

DCH Auto Group Temecula �� 22

Porsche Wholesale Parts Dealers �� 51

Tesla Battery Day Gets a Concrete Date ��55

Eagle Abrasives, Inc �� 19

PPG Refinish �� 13

Tesla Exec Hints at Service Center

Eckler’s Automotive �� 11

Reno Buick-GMC �� 12

Equalizer Industries, Inc �� 32

RGI Spray Booth Company �� 10

Fairview Ford-Lincoln-Mercury �� 38

SATA Dan-Am Company �� 5

Ford Wholesale Parts Dealers �� 49

Sierra Chevrolet-Honda-Subaru �� 31

Frank Subaru �� 26

Spanesi Americas �� 17

Galpin Motors �� 41

Subaru Wholesale Parts Dealers �� 47

Garden Grove Kia �� 30

Symach �� 20

Glenn E. Thomas Dodge-Chrysler-Jeep �� 15

Tacoma Dodge-Chrysler-Jeep-Ram �� 27

GM Wholesale Parts Dealers �� 43

The Bay Area Automotive Group �� 39

Haldon Company �� 35

Vintage Flatz/Cumberland Products �� 16

Honda-Acura Wholesale Parts Dealers ��28-29

Volkswagen Wholesale Parts Dealers �� 46

Hyundai Wholesale Parts Dealers �� 48

Volvo Wholesale Parts Dealers �� 50

Amid Pandemic Fallout ��1

Expansions to Support Growing Fleet ��36 Tesla Model 3 Rear Bumper Flies Off After Driving Through a Puddle ��23 Tesla Worth More Than Volkswagen, Toyota and Honda Combined ��37 Uber, Lyft Drivers Considered Employees Under CA’s New Gig Worker Law ��18

NATIONAL

See CA Dials Back, Page 17

‘Solving the Tech Shortage’ Column ��54

Affordability in Talks Over Electric

Petersen Automotive Museum Set to

As Californians gear up to see an Independence Day like no other in modern day history, the list of things revelers can do to celebrate is shaping up to be even more restrictive. Gov. Gavin Newsom announced several new orders on July 1, activating the “dimmer switch” in the state’s reopening process he’s touted frequently before. Effective immediately, business

INDEX OF ADVERTISERS

REGIONAL

WIN Announces Award Winners ��52

Industrial Finishes and Systems �� 7, 56 autobodynews.com / AUGUST 2020 AUTOBODY NEWS 3

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GM to Call Up Hundreds of Laid-Off Workers to Meet Production Demand at Key Truck Plants by Jamie L. LaReau, Detroit Free Press

General Motors Co. has a problem with absenteeism at its vital truck plants just when it needs every single body it can get on the assembly line.GM is working feverishly to replenish supplies of the in-demand pickups and full-sized SUVs after idling its U.S. factories from lateMarch through mid-May amid the coronavirus pandemic. Take Fort Wayne Assembly in Indiana, where GM builds its Chevrolet Silverado and GMC Sierra fullsize light-duty pickups. The plant has about 4,100 hourly workers and nearly 1,000 of them are off for various reasons—as many as 200 workers are off for COVID-19 related reasons. So it is increasingly harder for GM to hit the daily build target of 1,290 pickups there. If you look down the assembly line, you’ll likely see something that should never be, said a person familiar with the plant, but who is not authorized to speak to the media and asked to not be named. “They’re at full schedule, but they have every single person on that assembly line, including management, and management is not supposed to be on the line,” said the person. “It’s all hands on deck, just to build trucks.” To alleviate the problem, GM told union leaders at Flint Assembly, Fort Wayne Assembly and Arlington Assembly in Texas it will be adding hundreds of permanent workers to the plants, some starting in early August. They will not be new hires, but rather GM workers laid off at other plants who will be given the chance to permanently transfer to one of the truck facilities. “It is ... no secret that we have people on layoff from Detroit-Hamtramck and upcoming at Spring Hill, so it makes sense to shore-up our workforce in the important truck and heavy-duty SUV plants,” said another person familiar with the situation but who asked to not be named because they are not authorized to share that with the media. A GM spokesman did not comment on managers helping build pickups, other than to say GM is doing everything to address the production challenges in the plants while

keeping workers safe during the pandemic. “We are operating our plants as efficiently as possible while accommodating team members who are not reporting to work due to concerns about COVID-19 in the community,” said GM spokesman David Barnas. By month end, GM will have access to a wider workforce. Effective July 31, GM has said it will cut the third shift at its Spring Hill Assembly plant in Spring Hill, TN. The move impacts 680 workers there, 525 of whom are production and skilled trade employees. The cuts are the result of slow sales of the Cadillac XT5, Cadillac XT6 and GMC Acadia SUVs made in Spring Hill. Likewise, GM still has 430 workers laid off from Detroit-Hamtramck Assembly after the last Chevrolet Impala sedan rolled off the line Feb. 27. GM was going to transfer many of those people to the Lansing Delta Township plant, where it builds the Buick Enclave and Chevrolet Traverse SUVs, but then GM decided to keep that plant at two shifts. GM declined to provide specific details on the number of employees it will transfer to the truck plants, but, Barnas said: “We will follow the provisions of the national agreement. But we believe our staffing plans will allow us to continue supporting three production shifts at Fort Wayne, Flint and Arlington to meet strong customer and dealer demand for our pickup trucks and full-sized SUVs.” The union’s contract allows laid-off workers first dibs to rehire at the plant that they were laid off from, then they can apply for a job at a plant within a 50-mile radius of their home plant. The region expands from there. If a worker declines a transfer, they typically remain laid off, according to the contract. “All of these transfers are being done in accordance with the agreement that was negotiated based on seniority and transfers,” said Brian Rothenberg, UAW spokesman. At Flint Assembly, where GM builds its full-size heavy-duty pickups, it is running at full capacity. Workers usually hit the daily production target, but sometimes they fall short by a dozen or so, said Eric Welter, UAW Local 598 shop chairman

at the plant. He declined to disclose the total number of pickups the plant targets to build each day. “We do need some help,” Welter told the Free Press. “We’re getting 100 people. They’re laid off anyways and they need the work. They’re coming from Detroit-Hamtramck, Spring Hill, Pontiac and Milford.” Welter said he learned of the 100 new permanent jobs July 13. Flint will start getting about 50 of them Aug. 10, the other on half Aug. 17, Welter said. The news hit him two days after the Free Press first reported GM will temporarily reduce its Wentzville Assembly plant, near St. Louis, MO, to two shifts starting July 20. Heavy absenteeism there among nervous workers as cases of coronavirus surge in the surrounding community was cited as a reason. When asked how long Wentzville’s third shift would be laid off and whether Wentzville would get transfers from other plants to help boost production of the midsize pickups and full-size vans it builds, GM’s Barnas said only, “We are working on a staffing plan at Wentzville that will allow us to return to three production shifts as soon as possible in order to meet strong customer and dealer demand for our mid-size trucks.” Welter said absenteeism is high at Flint Assembly, too. “It’s up there, roughly 600 people are on some sort of leave of absence, whether it’s sick leave and personal leave, and then we have people on vacation and an extra 100 on COVID leave,” Welter said. “It’s tough on the plants. But we’re running.” There are about 5,000 workers at Flint. Seven workers have tested positive for coronavirus since the plant restarted in mid-May, Welter said. The 100 workers on “COVID leave” are those who have an immune disorder and cannot work, or they are in quarantine due to exposure to someone who tested positive for the COVID-19, or they have to care for someone with the virus. “It’s a difficult environment to work in. My people are stepping up to get it done,” Welter said. “But it is hot wearing masks all day and doing the heavy work.” At Fort Wayne, GM will add 318

workers, according to a report sent to workers by shop chairman Rich LeTourneau. The report, obtained by the Free Press, is dated July 10 and says there are 737 members on family leave status, 268 members on sick leave and 157 members on leave for “something other than sick leave.” The workers will start arriving the first two weeks in August. The plant has nine confirmed COVID-19 cases, said the person familiar with the plant. By policy, GM does not release the number of COVID-19 cases in plants. LeTourneau’s letter reads: “At this point, GM has no intentions of shutting any plants down, we are being told. They do not see an end in sight as it relates to COVID-19 either.” When asked to comment on that point, GM’s Barnas said, “People on our team should not be concerned about coming to work. All of our sites are following multilayered safety protocols that are working very well to keep people safe by reducing the possibility that COVID-19 can enter the plant and preventing any spread within the plant.” Barnas said the same plant protocols can help keep people safe outside of work, especially social distancing and wearing masks. Local union leaders at Wentzville and Arlington have asked GM to shut down the plants as cases of coronavirus in their surrounding communities surged. But GM has keep both running. It’s not known how many workers Arlington will get because no one from Arlington replied to a request for comment. The UAW negotiated its current contract prior to the outbreak of coronavirus, so there is no clause to address how to handle it. The union and the automakers must stay in continual discussions on ways to address the changing situation. “I told the company a month ago this is only going to get worse, so you’ve got two choices here: You shut the plant down or you run two shifts,” said the person familiar with Fort Wayne. “They said we’ll play it when we get there. The two shifts are an option.” We thank the Detroit Free Press for reprint permission.

4 AUGUST 2020 AUTOBODY NEWS / autobodynews.com

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NV Auto Dealer Trade Group to Focus on Affordability in Talks Over Electric Vehicle Initiative by Michael McGrady, The Center Square

A Nevada automotive dealer trade group says it’s willing to work with state regulators after Gov. Steve Sisolak announced a new initiative to consider an electric vehicle mandate in the state. Dubbed the Clean Cars Nevada initiative, Sisolak’s administration will begin evaluating regulations to increase the number of electric vehicles available in the state starting in fiscal year 2024. The initiative will contribute to Nevada’s climate change recovery plans, Sisolak’s administration says. The Nevada Franchised Auto Dealers Association told The Center Square its segment of the industry supports offering more fuel efficient vehicles as long as there’s “a focus on consumer affordability.” “Nevada’s franchised auto dealers are in full support of improving fleet-wide fuel economy for new vehicles available for purchase by all Nevadans,” Andrew MacKay, the trade group’s

Continued from Cover

Enforcement Measures many different shapes. Primarily local enforcement.” Newsom said the state has financial resources to step up enforcement in counties or cities where local officials choose not to comply with health rules. The governor twice referenced the need for Californians to follow the statewide order to wear face coverings issued June 18 when discussing new guidance expected to be released ahead of the July 4 holiday weekend. “We have conditioned $2.5 billion in our state budget on applying the spirit and the letter of the law as it relates to health directives at the county level,” Newsom said. “If local officials are unwilling to enforce and are being dismissive, we will condition the distribution of those dollars. Again, $2.5 billion.” Newsom indicated it’s no coincidence the state is stepping up its plans to enforce regulations ahead of the July 4 weekend as state officials are particularly concerned about the spread and

Nevada Governor Mandates Masks in Public as COVID-19 Cases Hit Record Number

executive director, said in a statement to The Center Square. “We look forward to partnering with our partners during this rulemaking process and are committed to working with Nevada regulators. As this process moves forward, it is imperative that any regulations are considered with a focus on consumer affordability.” Sisolak said in a statement introducing the initiative June 22 “it is critical for Nevada to continue accelerating efforts to address climate change, including capturing the many benefits of sustainable transportation options for Nevadans.” “This kind of decisive action is the first of many steps we will be taking as part of my commitment to addressing climate change under the State of Nevada Climate Initiative,” he added. The press statement also noted the state will work towards inclusion and affordability for consumers of all origins. We thank The Center Square for reprint permission.

by Michael McGrady, The Center Square

Nevada saw a record number of daily new COVID-19 cases on July 15, just as Gov. Steve Sisolak announced a face covering mandate for people going out in public.

indeﬁnite executive order mandating that face coverings be worn by most people in public settings, which includes stores and other businesses. Sisolak said in a statement that the mandate serves as an “opportunity to limit our risk for ex-

“opportunity to limit our risk for exposure and infection, and to keep our businesses open and our economy moving. For Nevada to stay safe and stay open, we must make face coverings a routine part of our daily life.” — Steve Sisolak The state saw 507 new cases on July 15, the highest number of daily new cases since the pandemic began in March, according to Department of Health and Human Services (DHHS) data. That number is up from 355 daily new cases on July 14 and 462 daily new cases on July 13, which was previously the highest number of new cases. Sisolak on July 15 issued an

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posure and infection, and to keep our businesses open and our economy moving. For Nevada to stay safe and stay open, we must make face coverings a routine part of our daily life.” Nevada has 15,240 total COVID-19 cases and 498 deaths, according to the department. We thank The Center Square for reprint permission.

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Continued from Page 6

Enforcement Measures

2020 SEMA Show Still On, Despite Growing Number Of COVID-19 Cases in Nevada by Michael Gauthier, CarScoops

transmission of COVID-19 at family gatherings. The governor said people have a tendency to “let down their guard” in the presence of their extended family and expressed concern over the potential for an uptick in positive tests following a weekend where people will gather and may not wear masks. “We’re going to need to do more expressing our concern about that, messaging more about the seriousness of face coverings and physical distancing and being a little bit more aggressive with regard to guidelines for the 4th of July,” Newsom said. Citing data compiled by the California Department of Public Health, Newsom said the positivity rate from coronavirus tests in California has increased from 4.4% two weeks ago to 5.6% over the last 14 days. He also noted the positivity rate has climbed to 5.9% over the last seven days and said he soon expects to add four counties to the 19 that are already on

The coronavirus pandemic has canceled a number of auto shows including events in Detroit, New York and Geneva. However, the SEMA Show is still moving forward despite the

fact the U.S. is experiencing a second wave of infections. Just last month, organizers announced “thousands of exhibitors and attendees are registered and planning to attend the 2020 SEMA Show,” scheduled to take place in November at the Las Vegas Con-

vention Center. At the time, SEMA’s Vice President of Events Tom Gattuso said, “We are steadfast in our belief that our members and our industry will recover more quickly from the current climate by safely coming together to share ideas and look ahead to strategize for 2021 and beyond.” He went on to describe this year’s show as “one of the hardest events we have produced,” but also “among the most gratifying.” More recently, SEMA said the show is still scheduled for November and they’re “working closely with the state of Nevada and local health officials, and are in communication with experts on safety protocols to provide show goers with a safe, productive and successful show.” Among the safety measures being discussed are “social density concepts like directional traffic flow and distancing measures” as

well as the use of face masks. That’s on top of increased cleaning, reduced touch points and streamlined food services with touchless and cashless transactions. Of course, SEMA has acknowledged the situation is “very fluid” and things could potentially change. However, they’re promising to keep people informed with regular updates throughout the summer and into September. That’s probably a wise decision as some states have been reporting more than 10,000 new cases of COVID-19 daily. Nevada isn’t as hard hit as California or Florida, but its Department of Health and Human Services confirmed 849 new cases of COVID-19 on July 15. That brings the state’s total number of confirmed cases to 30,468 and the number of new daily cases has been trending upwards since mid-June. We thank CarScoops for reprint permission.

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CarMax Settles Environmental Protection Lawsuit Brought on by CA District Attorneys Alameda County District Attorney Nancy O’Malley announced June 11 that her office, along with 16 other District Attorney’s Offices in California, settled an environmental protection action against CarMax Auto Superstores California, LLC.

The settlement was based on the unlawful handling and disposal of various hazardous materials and hazardous wastes. The action was filed in Orange County Superior Court. There are two CarMax facilities in Alameda County, one in Fremont and one in Pleasanton. The Alameda County DA’s Office conducted waste inspections at both locations and uncovered systemic violations of the management and disposal of hazardous waste items and confidential customer information. “Today’s settlement is a win for the environment,” said O’Malley. “I want to make it very clear to any business operating in Alameda

County and the state of California: there is no excuse for improper disposal of hazardous waste. You put us all at risk when you pollute our soil and our waterways. The state as well as local district attorneys will continue to work together to investigate and bring to justice businesses that ignore our important environmental protection laws.” CarMax Auto Superstores California, LLC, is an automotive retailer that operates more than 190 dealerships in at least 28 states, including California. In the ordinary course of business, CarMax handles, transports, stores, manages, uses and disposes of hazardous materials. Additionally, CarMax generates regulated quantities of hazardous waste from its automotive inspection, service and repair departments. Numerous inspections by the California Department of Toxic Substances Control along with local environmental regulators found CarMax facilities were out of compliance with the hazardous materials and hazardous waste laws. District Attorney investigators

from Alameda County and several other counties conducted undercover inspections of CarMax’s trash containers, which revealed the illegal disposal of hazardous auto body sanding dust, sanding pads, automotive paints, clear coats, solvents,

$300,000 for investigative costs. CarMax will also make an additional payment of $300,000 to fund supplemental environmental projects furthering consumer protection and environmental enforcement in California.

“I want to make it very clear to any business operating in Alameda County and the state of California: there is no excuse for improper disposal of hazardous waste.” — Nancy O’Malley non-empty aerosols, other hazardous substances used during the auto body repair process and confidential customer information. In accordance with the Hazardous Waste Control Law and Hazardous Materials Release Response Plans and Inventory Law, the stipulated judgment mandates training, reporting and compliance with the regulations on hazardous materials, and hazardous wastes. The settlement totaling $1.6 million requires CarMax to pay $1 million in civil penalties and

CarMax was cooperative throughout the investigation and implemented training and compliance programs at each of its facilities. The case was brought in conjunction with the District Attorney’s offices of Orange, Riverside, Los Angeles, San Bernardino, Fresno, Stanislaus, Kern, Ventura, Sacramento, Placer, San Diego, Solano, Sonoma, Santa Clara, San Mateo and Contra Costa counties, where CarMax facilities are located. Source: Oﬃce of the District Attorney Alameda County

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Oil Prices Suppressed by Low Demand, How Auto Retail May React by Jason Unrau, CBT Automotive Network

American oil prices have rallied back from an all-time low of negative $37.63 per barrel for May futures on West Texas Intermediate (WTI) crude on April 20. At that price, a seller would actually have to pay to have the buyer take their inventory—an unlikely scenario that would typically see sellers hold their product until the prices rebound. Last week, the WTI crude index was up to $41.40 per barrel before it began to regress once again. At the opening bell July 20, WTI crude was down to $40.25 per barrel. The price drop continues to reﬂect the decrease in demand for gasoline during the coronavirus pandemic. Fox Business is reporting usage remains below pre-pandemic consumption levels and demand is once again falling as infection rates are climbing. Relative Gas Prices Regular-grade gasoline prices tanked to $1.66 per gallon in the ﬁnal week of April when oil prices

were at their lowest. In the subsequent weeks, the price has recovered and stabilized at around $2.11 per gallon on average, nationwide. At the same time last year, the price was $2.68 per gallon when WTI crude was at $60 per barrel.

Although gas prices don’t follow crude oil futures exactly, they give a relative indication for the future. With oil prices tightening up, it’s a fair assumption that fuel prices will follow suit, assuming oil continues to lose value. How It Affects the Economy A Congressional Budget Oﬃce report highlighted the shift to smaller, more fuel-eﬃcient passenger cars when oil prices and fuel prices were near or above $3 per gallon in periods from 2005 to 2008.

Especially when oil prices hold a trend for an extended period, consumer sentiment follows suit. When gas prices are high, people drive less and purchase more conservative models. And conversely, when fuel prices are low, consumers tend to drive more, buy more vehicles, and purchase larger, less fuel-eﬃcient models. The problem with the current economic climate is that consumers are driving less while fuel prices are down because of the coronavirus. That poses an unusual challenge for auto retail. The Effect on Auto Retail Normally, a higher volume of vehicle sales would be the result of suppressed oil prices and subsequently low fuel prices. But as the virus numbers spike in many states, consumer sentiment is reversing. The Deloitte State of the Consumer Tracker from July 13 indicates American sentiment has shifted to an increasingly anxious view; 42% now say they’re delaying large purchases. Buying intent for vehicles is down 10%.

While consumer buying intent is down, it is a minor amount right now. Dealers may have to work harder to close deals and provide exceptional service whether in-person or through online sales. But the timing is also right for automakers to once again spur on sales with aggressive incentives. As factories have resumed assembly, inventory levels are slowly recovering. Customers who may intend to keep their vehicles longer in light of the pandemic will need to perform routine maintenance and repairs to keep them functional and in good condition. It may be a time to focus on boosting revenue through the ﬁxed operations departments while holding the line on new and used car sales. It’s an unusual position in the U.S.: low fuel prices with low consumer sentiment. However challenging, dealers always prove their resiliency during tough economic times, and this will be another example. We thank CBT Automotive Network for reprint permission.

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Update: 59 Looted Hellcats Recovered, Story Takes Tragic and Bizarre Turn by Amie Williams, Motorious

A Dodge dealership in San Leandro, CA, became one of the biggest targets during a night of violent riots and intense looting on June 1, following the recent death of George Floyd, after his neck was pinned by the knee of Minneapolis police oﬃcer Derek Chauvin during an arrest. It turns out a total of 74 high-performance vehicles were stolen and driven right oﬀ the lot, mainly expensive and powerful Dodge Challenger SRT Hellcats. Many of these cars were caught on video roasting rubber and recklessly driving around before leaving the scene. Fifty-nine of those cars have since been recovered. Five arrests were made. The monetary value of the cars stolen equaled $2.7 million. After ransacking the Nike outlet store across the street, the large crowd of looters started making their way in the direction of the Dodge dealership. Once the Dodge dealership owner, Carlos Hidalgo, saw them coming, he and his employees tried to secure the building

as best as they could before ﬁnding a safer place away from the chaos. As soon as the looters—or shall we call them criminals—made their way over to the dealer, they began smashing out the showroom windows, where they were able to make it inside to the the lock box that held the keys to all cars on the lot. After that, it didn’t take long for the looters to locate their vehicles of choice including Dodge Challenger SRT Hellcats, Chargers, Challengers, Trackhawks and more. As mentioned above, before they hightailed it out of sight, they were seen doing burnouts and recklessly driving the stolen vehicles and damaging them heavily. The phrase “drive it like you stole it” deﬁnitely proved true in this scenario. Hidalgo assessed the vehicles that have now been recovered, plenty in rough shape. Although the cars had tracking devices in the frames, with the amount of vehicles stolen that were constantly on the move, and with police still busy with the riots, it was hard to get the cars recovered quickly.

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In a bizarre turn of events, the California Highway Patrol made an attempt to perform a traﬃc stop on one of the stolen Hellcats after it was found to be driving recklessly with a license plate that did not match the car. The driver of the stolen Hellcat, Erik Salgado, then attempted to ram the CHP cop cars with the high-performance muscle car. Unfortunately, the situation did not end well for Salgado and his pregnant girlfriend, Brianna, who was riding passenger. Sadly, Salgado and the unborn child did not make it out of the situation. Brianna was listed as stable. Our hearts are saddened by the situation all around. To protest is one thing, but to turn said protest into senseless violent rage along with looting and the destruction of property by hard-working businesses, etc., is another thing. There have been deaths that occurred during the rioting that didn’t have to happen, some being innocent bystanders.

a state watch list. “We bent the curve in the state of California once,” Newsom said. “We will bend the curve again. Mark my words. We will crush this pandemic. We will annihilate it. We will get past this. But we are going to have to be tougher.” Newsom said the Occupational Safety and Health Administration (OSHA) and the Alcohol Beverage Control (ABC) will also play a role in the state’s enforcement of health rules. “There are ﬁnancial conditions, there’s regulatory oversight, there’s code oversight, all of those things are part of our overall eﬀorts,” Newsom said. “OSHA is now very active in this space. Alcohol Beverage Control is very active in this space and just moments ago, we’ll be making a more formal and detailed announcement on enforcement tomorrow.” We thank the Mercury News for reprint permission.

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Face Masks Now Mandatory While Outdoors in Oregon by Tim Gruver, The Center Square

Anyone in Oregon going outdoors has to wear a face mask if they cannot maintain a 6-foot distance from others, Gov. Kate Brown announced July 13. Brown also extended the state’s current face mask mandate requiring all customers and employers to wear face masks when doing business. On July 11, the Oregon Health Authority (OHA) reported a one-day record number of 409 COVID-19 cases. The agency’s transition to a new reporting system for several hours on July 9 partially accounted for the number, according to OHA. This report marks the ﬁfth time in July that Oregon’s daily case count report exceeded 300 cases statewide. Brown also banned all indoor group gatherings with more than 10 people. Businesses such as restaurants and bars are allowed to serve larger numbers inside. Children over the age of 2 and under the age of 12 are exempt from the order. Violators can potentially face a maximum penalty of 30 days in jail and a $1,250 ﬁne under Brown’s executive order. Enforcing the order will largely be

up to business owners and employees, Brown said. However, Brown said that businesses which fail to enforce mask-wearing in outdoor lines or dining spaces could be dealt “serious consequences” like citations, fines and closure. Such measures are contingent on rising COVID-19 case numbers, according to the governor. “I’m not going to set up the party police,” Brown said. “The proof here will be in the numbers.” While Brown expressed hope that the state would not shut down indoor service in bars and restaurants like in California, she said that “nothing is off the table.” Employees and customers who find restaurants violating these rules can file a complaint with Oregon’s Occupational Safety and Health division. The outdoor face mask mandate took effect July 15. Three more died of COVID-19 on July 12, raising the state’s death toll to 237, OHA reported. On July 13, the Oregon Health Authority reported 280 new confirmed and presumptive cases of COVID-19, bringing the state total to 12,438. We thank The Center Square for reprint permission.

Arrest Made of Suspect in CA Auto Shop Owner During the investigation, ofThe Costa Mesa Police Department (CMPD) in California has arrested ficers learned Francisco Javier a former auto repair employee on Castaneda, 31, transient, was an suspicion of murder, after an owner employee at the location and was of the auto repair shop was found seen leaving the business after a loud bang was heard. dead in his office. Shortly thereafter, At approximately Castaneda was reported to 3:22 p.m. June 8,, CMPD CMPD as a suspicious unreceived a call from a known man, with a matchwoman at a business loing description, walking cated in the 1900 block in in the area of Victoria of Harbor Boulevard. Street and Harbor BouleThe caller was a customvard. Castaneda was quicker who contacted the police after she discovered Francisco Javier ly located and arrested. He was booked in the the business owner un- Castaneda has been responsive and slumped charged with murder Costa Mesa jail on one count of murder and was over in his office. Police officers and detectives subsequently transported to the immediately responded to the scene. Orange County jail with no bail. On June 9, CMPD detectives The owner of the business, Garbis Yaghlagian, 60, of Huntington located the firearm believed to be Beach, was found in his office de- used in this crime. Source: Nixle ceased with a gunshot wound.

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CA Dials Back

Tech Industry Could Help Nevada Rebound From Pandemic Restrictions by Kimberly James, The Center Square

sectors in 19 counties across the state must close indoor operations “due risk of spread.” They include: Restaurants, Wineries and tasting rooms, Movie theaters, Family entertainment centers (for examples: bowling alleys, miniature golf, batting cages and arcades), Zoos and museums, Cardrooms Bars are ordered to completely close, even if they are operating outside. The closures will remain in place for “at least three weeks,” Newsom said. “The bottom line is the spread of this virus continues at a rate that is particularly concerning,” he said. The 19 counties singled out for being on the “county monitoring list” for three consecutive days include: Contra Costa, Fresno Newsom said the population from these counties represents more than 70% of the state’s overall popu-

With more workers shifting to telecommuting and working from home during the coronavirus pandemic, technology companies are taking advantage. Trustiﬁ, a small email security ﬁrm, is welcoming more business

breathe new life into the state. “Such an industry would go a long way toward broadening Nevada’s economic landscape, which would not only create more opportunity for workers but would strengthen our economy during times of economic downturn,” Michael Schaus, communications director at Nevada

“Nevada seems like a natural place for entrepreneurs and tech companies to relocate if they are looking to flee Silicon Valley,” — Michael Schaus as companies ﬁnd the connection between workers’ home Wi-Fi and their own networks creates a security issue. Larger software support ﬁrms, like Rimini Street, are seeing growth in business as more companies rely on their services to help keep daily operations going. As Nevada’s economy stalled with the loss of tourism and gaming revenue when casinos and other businesses were shut down, technology sector businesses could help

Policy Research Institute, told The Center Square. As Trustiﬁ and Rimini Street have found, Nevada has a business-friendly environment, according to VegasInc. “Nevada seems like a natural place for entrepreneurs and tech companies to relocate if they are looking to ﬂee Silicon Valley,” Schaus said. “From a regulatory and tax perspective, Nevada is a far more attractive environment than California—es-

pecially for the tech industry, which thrives when regulatory structures encourage entrepreneurship, innovation and growth.” Hospitality is a resilient industry and history has shown that as soon as people feel safe to travel again, the dollars will begin to ﬂow back in. Investment in the tech industry oﬀers Nevada an opportunity, opening to the possibilities of a revenue source that only grows as society becomes more dependent on convenience and technological advancement. “The more encouraging we can make the business environment in this state, the more we will begin welcoming new industries, growing industries and a more diverse range of businesses and workers,” Schaus said. “The goal, from a policy perspective, shouldn’t be to ‘dethrone’ hospitality and mining as the state’s most robust economic sectors—it should be to advance the freedom necessary for other industries to join them on that list.” We thank The Center Square for reprint permission.

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Uber, Lyft Drivers Considered Employees Under CA’s New Gig Worker Law work companies would be considered employees, at least for now. In the past, the ride-share companies have stated their drivers were properly classified as independent contractors, and

by Hannah Smith, PropertyCasualty360

The California Public Utilities Commission (CPUC) has decided drivers working for ride-hailing services such as Uber Technologies Inc. and Lyft Inc. will be considered employees as is depicted under California’s new gig worker law. The decision comes after a state law became effective that makes it more difficult for companies to classify workers as contractors as opposed to employees. Having workers designated as contractors exempt an employer from paying overtime, health care and workers’ compensation, but can also go against the essence of the “gig economy” business model of technology platforms such as Uber and Lyft that rely on more inexpensive contract workers. The CPUC, which regulates ride-hailing companies across the state, said it has to enforce state law, and in order to do that, drivers for transportation net-

In May, the State of California filed its own suit against Lyft and Uber, arguing workers for the companies were improperly classified in violation of the new law. Credit: Daniel Dror/Shutterstock

have indicated the majority of drivers would not want to be considered employees, appreciating the flexibility of on-demand employment. The shift would also prevent the ride-share companies from effectively providing re-

liable and affordable services, and would threaten access to the essential work that Californians have begun to rely on. In November, Lyft and Uber worked in conjunction with DoorDash on a $90 million ballot initiative that would exempt them from the law but would require the companies to provide mileage-based subsidies, health care stipends and occupational accident insurance to the drivers, while allowing the drivers to maintain their flexibility as contractors. Labor unions have criticized this proposal, arguing that it creates an underclass of workers who lack fundamental protections such as sick pay and unemployment insurance. In May, the State of California filed its own suit against Lyft and Uber, arguing that workers for the companies were improperly classified in violation of the new law. We thank PropertyCasualty360 for reprint permission.

CA Dials Back lation. Additional July 4 Closures In addition to the closures listed above, Newsom also announced July 1 several closures that affect parking at many beach areas of the state for the holiday weekend. This affects state beach parking lots in the Bay Area and Southern California. In counties that order the closures of local beaches, the state will also close state beaches. To date, that includes Los Angeles and Ventura counties. State parks remain open, but with “measures in place to reduce visitation and limit overcrowding.” Fireworks Displays The governor stopped short of canceling all fireworks shows in the state, but he suggested counties with mandatory closures should consider doing so. See CA Dials Back, Page 20

WA Gov. Extends Halt on Reopening, Warns More County Restrictions on Table by Tim Gruver, The Center Square

None of Washington’s 39 counties may progress to a further phase of reopening before July 28 under new orders from Gov. Jay Inslee. The governor made the announcement July 14 that plans to reopen would be put on hold. “The situation we are in is unsustainable,” Inslee said. “We will have to reduce the rise that is occurring now in case counts, in the positivity rate, in hospitalizations. We have to ﬁnd a way to somehow break that chain of disaster.” Inslee suggested that if cases continue to rise in the state, new restrictions could be placed on counties and counties could be demoted to earlier phases of reopening.

On July 2, Inslee extended the state’s face mask order to all businesses and halted any further reopenings. “There is a significant chance that we would have to take some of these measures,” Inslee said July 14. The governor did not offer any further details on what such measures could look like. There have been five days so far this month that the state exceeded 600 reported COVID-19 cases, according to the Washington Department of Health. As of July 13, the state’s total confirmed COVID-19 case count stands at 42,304 and the death toll at 1,404.

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Petersen Automotive Museum Set to Reopen Soon by Steven Symes, Motorious

During the coronavirus shutdowns, we gearheads have seen races, shows and other events canceled right and left. Even car museums shuttered their doors. Thankfully, many of these ďŹ ne facilities from around the world have been sharing online videos and

Credit: Petersen Automotive Museum

more to keep us entertained and informed while weâ&#x20AC;&#x2122;ve been cooped up as well. Now things are loosening up and weâ&#x20AC;&#x2122;re seeing more of these facilities reopening, including Petersen Automotive Museum. Thatâ&#x20AC;&#x2122;s right, starting June 19, the

car museum, located in Los Angeles, will open its doors to the public for the ďŹ rst time in months. As you probably already suspect, this reopening will come with social distancing and other measures designed to slow the spread of COVID-19. According to an oďŹ&#x192;cial press release from the museum, staďŹ&#x20AC; will be adhering to health and safety guidelines issued by the Centers for Disease Control and Prevention, the State of California and the County of Los Angeles. Everyone in the museum, staďŹ&#x20AC; and visitors, will be required to wear a face mask at all times. Social distancing will be enforced, with navigation paths around the exhibits marked, something you might have already seen in stores and other places. The staďŹ&#x20AC; will be cleaning the facilities more often. Hand sanitizing stations, which we assume are hand sanitizer dispensers, will be located on each ďŹ&#x201A;oor. Special exhibits which were on display before the shutdown ha-

venâ&#x20AC;&#x2122;t been removed, so if you were planning on going and couldnâ&#x20AC;&#x2122;t, you donâ&#x20AC;&#x2122;t have to miss out. These include â&#x20AC;&#x153;Reclaimed Rust: The James HetďŹ eld Collection,â&#x20AC;? â&#x20AC;&#x153;Hollywood Dream Machines: Vehicles of Science Fiction and Fantasyâ&#x20AC;? and â&#x20AC;&#x153;Building an Electric Futureâ&#x20AC;? presented by Volkswagen. Thereâ&#x20AC;&#x2122;s some bad news: the understandably popular Forza racing simulators will be closed until further notice. Same thing goes for the Discovery Center, an area thatâ&#x20AC;&#x2122;s great for teaching kids. While thatâ&#x20AC;&#x2122;s disappointing, itâ&#x20AC;&#x2122;s understandable why those areas wonâ&#x20AC;&#x2122;t be accessible. Another change is the schedule for the Petersen Automotive Museum. Until further notice, it will be open from 10 a.m. to 5 p.m. Wednesdays through Sundays. You can buy tickets ahead of time on the museumâ&#x20AC;&#x2122;s website, which we strongly suggest since a lot of people no doubt are chomping at the bit to visit. We thank Motorious for reprint permission.

CA Dials Back He stressed that Californians should not gather with people they donâ&#x20AC;&#x2122;t live with and avoid any crowds. â&#x20AC;&#x153;We have made it clear... that [these counties] should consider canceling their ďŹ reworks shows and activities,â&#x20AC;? he said. Much as he did a day prior, Newsom emphasized guidance to not host July 4 parties or celebrations with people you donâ&#x20AC;&#x2122;t live with. â&#x20AC;&#x153;One of the areas where weâ&#x20AC;&#x2122;re seeing an increase of transmission... is on family gatherings,â&#x20AC;? he said. â&#x20AC;&#x153;I think patriotism, at least in a COVID-19 environment, can be celebrated a little diďŹ&#x20AC;erently.â&#x20AC;? He suggested the likelihood that if people gather with friends and neighbors â&#x20AC;&#x153;after a drink or two and eating someâ&#x20AC;? people will inevitably start to take their masks oďŹ&#x20AC; and not socially distance. â&#x20AC;&#x153;I hope youâ&#x20AC;&#x2122;ll reconsider those gatherings with people you do not live and are not in your immediate See CA Dials Back, Page 37

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7/21/2020 7:25:52 PM

9 Companies, 8 States Involved in U.S. DOT Automated Driving Systems Initiative by Auto Remarketing staff

Progress toward making automated driving systems better and safer took another step forward on June 15. The U.S. Department of Transportation announced nine companies and eight states have signed on as the ﬁrst participants in a new agency initiative to improve the safety and testing transparency of automated driving systems. The participating companies involved in what’s called the Automated Vehicle Transparency and Engagement for Safe Testing (AV TEST) Initiative include Beep, Cruise, Fiat Chrysler Automobiles, Local Motors, Navya, Nuro, Toyota, Uber and Waymo. “We are pleased to participate in the AV TEST Initiative and applaud the USDOT and NHTSA on an initiative meant to create the needed transparency for safe deployment and operation of autonomous technology across the country,” Beep CEO Joe Moye said in a news release. “Beep has been engaged with NHTSA as part of their AV test program where we, as an autonomous service suppli-

er, share regular information on how these shuttles operate and respond in various, live scenarios interacting with pedestrians, bicyclists and mixed traﬃc. “This initiative will allow us and others in the AV industry to advance our collective learnings with the goal of improving public visibility and awareness of our results while building meaningful relationships among other participants and stakeholders to enhance safety for everyone,” Moye added. The states joining the project are California, Florida, Maryland, Michigan, Ohio, Pennsylvania, Texas and Utah. “Through this initiative, the deparment is creating a formal platform for federal, state and local government to coordinate and share information in a standard way,” U.S. Transportation Secretary Elaine Chao said in a news release. Oﬃcials explained the AV TEST Initiative will include a series of public events across the country to improve transparency and safety in the development and testing of automated driving systems.

Participants can share information about their activities, which the DOT said will help increase the public’s awareness of testing, centralize the department’s role in promoting safety and innovation, and build stronger relationships among federal, state and local governments and stakeholders. Additionally, the agency mentioned this voluntary initiative will provide an online, public-facing platform for sharing automated driving systems testing activities and other safety-related information with the public. Oﬃcials noted online mapping tools may show testing locations at the local, state and national levels, as well as testing activity data, which may include dates, frequency, vehicle counts and routes. “Automated driving system technologies hold the promise to help prevent fatal crashes, save lives and reduce the severity of the crashes that do occur,” said James Owens, deputy administrator of the National Highway Traﬃc Safety Administration. “Under the leadership of Secretary Chao, NHTSA is committed to

facilitating the safe testing, development and eventual deployment of advanced vehicle safety technologies through enhanced transparency and information sharing with all our state and local partners,” Owens said. The agency indicated the AV TEST Initiative will be open to all stakeholders involved in the safe development and testing of automated driving system vehicles. At the state and local levels, participants may include departments of motor vehicles, departments of transportation, highway safety oﬃces and city governments. At the automotive industry level, participants may include developers, manufacturers, suppliers, operators and testers. Oﬃcials emphasized this initiative aligns with the department’s leadership on automated driving system vehicles, including AV 4.0: Ensuring American Leadership in Automated Vehicle Technologies. We thank Auto Remarketing for reprint permission.

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22 AUGUST 2020 AUTOBODY NEWS / autobodynews.com

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Tesla Model 3 Rear Bumper Flies Off After Driving Through a Puddle by Gustavo Henrique Ruffo, Inside EVs

When we wrote about Tesla Model 3 units losing their rear bumpers back in 2018, we hoped the company would investigate “the issue to understand what caused it,” as it promised. See the video at https:// insideevs.com/news/433643/videotesla-model-3-rear-bumpers-fly-off/ When Tesla used to talk to the press, it also said it would contact its “customers to resolve this and ensure they are satisfied.” That implies the issue would no longer happen, but it did. Logan Derouanna even had Tesla’s help to film everything, as you can see. What the video shows is his 2019 Tesla Model 3 Standard Range Plus―bought in March 2019 and with only 14,000 miles on the clock―spontaneously lose its bumper after hitting a puddle. At least it did not see water coming out of the A-pillar. “I was driving in the rain with my girlfriend and her father, decelerating about to make a right turn

(going into the turn lane) when all of a sudden we heard a big noise,” Derouanna said. “I thought we got rear-ended. I pulled into the nearest parking lot and went outside, and the whole back of my car was off.” You can see Derouanna was at the same speed as the cars that come from behind when the accident happens. “I was in shock. I took pictures and watched the video right away,” Derouanna said. “Then I called the Tesla Roadside Assistance and walked over to where it happened. I watched dozens of cars drive over the same spot with no issues.” But Roadside Assistance never arrived. “I waited for them for over an hour, so I decided to call. They told me they were sending me a quote for how much it would cost,” Derouanna said. “I asked if they could cover it, and I kept getting transferred and transferred and transferred… One person told me it was an act of God.” By blaming the Almighty for

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the bumper that wanted to be a SpaceX rocket, Tesla Service said the warranty did not cover that damage, quite a disappointment for a Tesla shareholder and longtime fan of the brand. “I love my car and had no issues up until Friday,” Derouanna said. “I really love this company, and I’m even a long-term stockholder.” Luckily, we learned before publishing this article the company changed its mind about “acts of God” and performed a miracle: it recognized the issue was its fault― with a little persuasion. “My dad had to email the manager with our lawyer, and the manager just called my dad and said it’s a known issue, and they are covering it all for me and bringing a tow to my house,” Derouanna said. “They’re ordering new parts for it and fixing it.” Looking at the pictures Derouanna sent us, we see no damages to the attachment points underneath the bumper that should hold it in place. If the car had its respective

bolts in place, these recessed niches would be split apart. The Model 3 owner will check them to confirm if they are intact as the pictures seem to show. That information is relevant because there are frequent reports of missing bolts in Tesla vehicles. If that was the case in Derouanna’s Tesla, it could explain this and other situations that keep on happening despite Tesla’s promises of sorting this out. There are similar reports at TMC Forum. Another post there claims the issue is a design flaw that makes the rear bumper hold more water than it can cope with. If you have had this problem with your Model 3, please let us know more about it. In case you have a different explanation for that, you are welcome to share it with us. Remember, Derouanna’s story had a happy ending that should be the rule for everyone that had to face the same situation. We thank Inside EVs for reprint permission.

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Hey Toby! with Toby Chess

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

An Overview of Corrosion Protection Products: Part 1 of 2 Let’s start with a test on corrosion protection.

pany would not pay the extra $3,000 to weld the roof in place as outlined in the Honda repair procedures. 1. T or F: In Honda’s latest bulletin The Seebachans purchased the on corrosion, it states epoxy primer repaired vehicle and were involved in should only be sprayed to put down a front-end collision. The roof gave a light coat of epoxy primer. way and caused the quarter panels withMotors David 2. T or F: General nowMcClune al- to buckle inward, puncturing the gas lows the use of DTM sealers, which tank and causing the vehicle to catch have built-in corrosion protection fire. materials, on bare metal. Last February, at Verifax’s annu3. T or F: General Motors’ black al symposium, the Seebachens’ Honprimer is used on bare metal surfac- da Fit was on display. You can read es that will be bonded. all about it, but when you see the ve4. T or F: Toyota allows limited use hicle in person, it is a life-changing of weld boding on its vehicles. moment. 5. T or F: Toyota has a recommended weld through primer on its webwith John Yoswick site. 6. T or F: Fiat Chrysler does not recommend weld through primer on weld parts. 7. T or F: Honda, like Toyota, recommends a coat of epoxy primer on bare metal before applying body filler. 8. T or F: Honda recommends weld through primer when MIG welding and squeeze-type resistance weldwith Richard Steffen ing. 9. T or F: A new quarter panel has been installed. Painting the backside of the rear body panel is included in the repair adjacent welded panel as Fig� 1 per CCC guide. 10. T or F: Toyota considers adhesive as corrosion barrier. 11. When replacing a factory hood, which of the following items does Toyota say need to be applied? Mark with John Yoswick all that apply: seam sealer, cavity wax and/or chip resistance primer.

video to get a better understanding of what the collision repair and insurance industries and suppliers did to these two individuals for $3,000. It is shameful. It all boils down to the fact OEM procedures were not followed in order to save a few dollars. The insurance company in this case said “it specifically denies that it coerced or forced John Eagle to perform substandard repairs” and “denies that it coerced or enticed any body shop to not follow vehicle manufacturer’s procedures, cut corners, take safety shortcuts or do anything that jeopardizes members of the motoring public.” What this means to the repair industry is you are all by yourself when something goes really wrong. I am going to take a look at one repair process, corrosion protection, and see if you are following OEM

California Autobody Association

Year in Quotes

procedures when restoring a vehicle to its pre-loss condition. Are you using the line item “replace corrosion protection”? Let’s have an understanding up front—“replace corrosion protection” is not a line item, it is a repair process. Depending on the repairs being performed, it might need one or two items to restore corrosion protection, but in the case of quarter panels being replaced, it uses upwards of 11 or 12. I know the insurance companies put that on their estimates, but the legal document is your signed repair order with your customer (and not the insurance company’s) and you need to list each item that goes into the repair of the damaged vehicle. The other legal aspect of using the term “replace corrosion protection” is you could be liable for any and all problems in the future related to corrosion. As with the Seebachens’

Collision Repair Association of CA.

Transition Planning

How many of you watched the interview of Marcia and Matthew Seebachan at CIC (www.repairer drivennews.com/2019/12/05/seethe-cic-interview-with-john-eagleFig� 2 plaintiffs-matthew-and-marciaseebachan/)? The couple sued the body shop If you are not familiar with the and was with Karyn Hendricks awarded $31.5 million. case, John Eagle Collision had a HonThe couple is totally disabled for da Fit come into the facility with hail life, they cannot have children and damage to the roof. The shop made Matthew is in constant pain and has the decision to replace the roof using some brain damage. adhesive, because the insurance comIt is imperative you watch the

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case, you are all alone if you need to defend yourself in a court of law. Going forward, list each item you used in the repair process. If you do not want to list each item, use a line that states “for all corrosion protection products used in the repair, please see attached invoice.” See Fig. 3 for example of an invoice for a quarter panel replacement using the PROS program from Kent Automotive.

Fig� 3

I think we need do a tutorial on the many corrosion protection items

metal system. It is the closet product to factory applied electrodeposition primer. It can be used as a bare metal primer, high build primer and/or a primer surfacer. (Fig. 6)

used in the repair process and what the OEMs state in their repair manuals. Fig. 4. You can see a number of items on the Kent Automotive corrosion protection cart. There are several fine companies that make these products, but I am most familiar with the Kent line. Weld Through Primers These primers are used between mating surfaces. You can use copper-based (with zinc) or zinc-based. (Fig. 5) Let’s see what some of the OEMs state about the use of weld through primers. Toyota wants zinc-rich weld through primers on all mating surface. Honda states you will use weld through primer on all mating surfaces that will be spot welded, but no WTP when MIG plug welding. Fiat Chrysler states it does not want weld through primer used on its vehicles. 2K Direct to Metal Primer This primer is a two-part direct to

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Fig� 6, 2K Direct to Metal Primer

Let’s look at what the OEMs state about epoxy primer. Toyota and Honda want a coat of epoxy primer applied to all bare metal surfaces before body filler, adhesives, urethane primers and seal sealers are put on. Honda says that the EP can be applied with a spray gun, roller, foam brush or a dobber. (Fig. 7) Nissan, Ford, GM, Audi and Mercedes-Benz recommend the use of epoxy primer to all bonding sur-

Fig� 4

See Corrosion Protection, Page 50

Fig� 5, Weld Through Primers

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HOND

CALIF

Dept auto

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ACUR

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D mik

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28 AUGUST 2020 AUTOBODY NEWS / autobodynews.com

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Please contact these dealers for your Honda or Acura Genuine parts needs. HONDA CALIFORNIA

AutoNation Honda Roseville Roseville

800-262-3201 916-783-5628

Dept. Hours: M-F 7:30-6; Sat 8-5:30 autonationhondaparts@hotmail.com

Barber Honda

CALIFORNIA

Honda of Pasadena Pasadena

800-433-0676 626-683-5880

760-770-0828

800-717-3562 559-891-5111

Selma

Cathedral City

Galpin Honda

408-720-0221 408-736-2608

Honda Cars of Corona

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Selma Honda

Larry Hopkins Honda

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Torrance

Honda of the Desert

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800-GO GALPIN 818-778-2005

Scott Robinson Honda

Dept. Hours: M-F 8-6; Sat 8-4

Dept. Hours: M-F 7-6; Sat 7-5 mpartridge@honda111.com

Mission Hills

NEVADA

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Bakersfield

661-396-4235

CALIFORNIA

Dept. Hours: M-F 7-6; Sat 7:30-4:30 hondapartsmgr@selmaautomall.com

Sierra Honda

Sunnyvale

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Metro Honda Montclair

Monrovia

800-322-8540 626-932-5614

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Ocean Honda

888-941-2218 208-947-6060

Honda of Hollywood

831-464-1800

800-557-3652 951-734-9045

Hollywood

800-371-3719 323-466-3205

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510-547-8047

Dept. Hours: M-F 7-8; Sat 7-6

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Pacific Honda San Diego

858-565-9402

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Henderson

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Lithia Honda of Medford Medford

888-471-7445 541-770-3763

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IDAHO

800-446-5697 909-625-8960

Corona

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253-288-1069

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Findlay Honda

Richland

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South Tacoma Honda

702-982-4260

Tacoma

888-497-2410 253-474-7541

San Francisco Honda San Francisco

415-913-5125

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Dept. Hours: M-F 8-5 partsws@sfhonda.com ACURA CALIFORNIA

CALIFORNIA

HAWAII

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888-435-0504 510-431-2560

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Dept. Hours: M-F 8-6; Sat 8-5 mike.ohare@acuraoffremont.com

Acura of Pleasanton Pleasanton

888-985-6342 925-251-7126

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Bakersfield

Dept. Hours: M-F 7:30-5:30 bakersfieldacuraservice@yahoo.com

Marin Acura Corte Madera

800-77-Acura 415-927-5350

Honolulu

Dept. Hours: M-F 8-5; Sat 8-4 Johara@lithia.com Tokuda@lithia.com RayleenGarcia@lithia.com

Lyle Pearson Acura

Metro Acura

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Montclair

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Hinshawâ&#x20AC;&#x2122;s Acura

IDAHO

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800-446-5697 909-625-8960

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with Stacey Phillips

From the Desk of Mike Anderson with Mike Anderson

Mike Anderson is the president and owner of Collision Advice, a consulting company for the auto body/collision repair industry. For nearly 25 years, he was the owner of Wagonwork Collision Center, an OEM-certified, full-service auto body repair facility in Alexandria, VA.

Making the Most of the ‘Parts’ Portion of Your Business Parts consistently make up 40% of total repair order dollars, so it’s well worth it for shop owners to pay careful attention to the role parts play within their business. This month, I wanted to share the first of two columns outlaying some best practices related to parts I think could improve your shop’s operations and bottom line. Best Practice: Make sure you’re accurately tracking your parts profitability. As almost anyone who has attended one of my classes knows, I’m a big proponent of the value of detailed and dead-on accurate accounting practices and profit and loss statements. That’s where good P&L account and sub-account categories are needed. You shouldn’t just track labor income, for example. “Labor” is one account; the sub-accounts include “body

labor,” “paint labor,” “frame labor,” “mechanical labor,” etc. When it comes to your parts account, I believe you need sub-accounts for OEM parts, aftermarket or non-OEM parts—which may also include accessories—and salvage or

and cavity wax. These are not paint materials. They are parts you put on the vehicle. The old adage of “junk in, junk out” applies in terms of entering parts on estimates and in your shop management and accounting systems.

A “Who Pays for What?” survey last year found that 3 in 10 shops bill the insurer for added labor or materials when a non-OEM part turns out to be unsable

recycled parts. Some people break out remanufactured parts. But one often missed sub-account is “stock parts.” Stock parts include things like seam sealer, double-sided tape, weld-through primer

You might list seam sealer as an aftermarket part on your estimate because there’s not a “stock part” option in that system. But when you transfer that estimate into your management and accounting systems, you need to

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make sure the systems are mapped properly to reclassify that item into the proper sub-account. One of the other common accounting mistakes I see centers around parts price-matching, when you choose to use an OEM part in place of an aftermarket part, for example. When that happens, it’s important that whoever inputs your parts invoices understands how to properly change that to an OEM part within your management and accounting systems. If that doesn’t happen, the accounting system will presume you sold an aftermarket part, but the cost for that part goes into the OEM sub-account. That results in an overstatement of your profit on aftermarket parts, and understates your profit on OEM parts. Best Practice: Know your gross profit

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margins on different types of parts. Using your sub-accounts properly will help ensure you have accurate information on your parts profits by type. Most shops I see are making between 20% and 32% gross profit on OEM parts, for example. But keep in mind lots of factors can influence that. Your buying power can result in higher or lower discounts compared to other shops. Your mix of work can play a role; parts profits may be higher or lower depending on whether your repair a lot of domestic vehicles, or a lot of Asian or European import vehicles. Even what part of the country your shop is in can affect discounts and profits. Most shops are making between 30% to 45% gross profit on aftermarket parts. Again, buying power and discounts vary. Given that there aren’t list prices for recycled or salvage parts, most shops are marking up the cost of those parts. Don’t confuse mark-up with gross profit. When a shop marks up a part 20%, it is making a 17% gross profit; when it marks them up 25%, it is making a 20% gross profit.

Most shops find their margins on stock parts are similar to their margins on paint materials. Best Practice: Don’t make parts decisions based solely on gross profit margins. I’m not going to argue here about the merits of using OEM or aftermarket parts. But I will say you should take into consideration factors beyond just gross profit percentages. In some cases, for example, it may take a technician added time to install an aftermarket part. Given the average collision technician generates $100 in gross profits per hour, an added 30 minutes installing a part costs you $50, even aside from any impact on efficiency and cycle time. Can you get remunerated for that added labor? Perhaps. A “Who Pays for What?” survey last year found 29% of shops said they bill the insurer for this labor at the shop’s retail rate, and another 10% said they bill the parts vendor. But 21% said they only billed for this at a discounted labor rate, and another 22% said they most commonly didn’t bill for the labor in such situations.

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On the other hand, some could argue the higher profit margin on a less expensive alternative part makes sense if an older vehicle has discontinued parts or is close to being an economic total loss. As you read through some of my other parts best practices, you’ll see other factors—such as the availability of the part, vendor performance and parts ordering efficiency—can play a role in making the best parts decision. Price or discount should not be the only considerations. Best Practice: Consider all the costs associated with ordering of parts. Those of you who have studied and worked to implement “lean principles” within your business know lean is all about eliminating waste. Waste includes the time we spend on things we do for free. I don’t know any shop including a line item on estimates or invoices for “order parts.” That’s work shops do “for free.” So if you’re not getting paid to order parts, would you rather do that two or three or even four times per job—or just once? Making that a reality starts with

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100% disassembly of the vehicle to identify every broken, damaged or one-time-use part needed for that job. (I’ll discuss one-time-use parts more in next month’s column.) I also believe shops need to be using an electronic parts ordering solution. It saves time—no one should be waiting on-hold to place a parts order—and improves parts ordering accuracy. It ensures the parts vendor has the VIN, vehicle production date and other information to help them validate the parts ordered match the vehicle being repaired. Some electronic parts ordering systems automatically do this scrub of the parts order and tell you if a part doesn’t match the VIN. That’s a great feature for shops. Next month’s column will offer more best practices related to parts.

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Continued from Cover

Serve Through Pandemic Roland Chartier. “Then we extended credit from net 30 to net 60 for our large customers. “The only change we made to our delivery service was to give all drivers face masks, gloves and supplies to sanitize their vans. Customers were no longer required to sign for delivered parts. The drivers asked for names and noted them on the route/ delivery sheets. We had some of our larger accounts order large stock orders just in case the supply chain was interrupted,” Chartier continued. “When other dealers cut staff or service to customers, we would have our outside sales people work those areas extra hard calling shops and letting them know we were servicing the area. We were able to pick up a few new shops with this tactic. It was hard work and a little luck.” In March, April and May, was your wholesale mechanical business (primarily mechanical repair parts sold to tune-up shops, brake shops and general repair shops) up or down and by what percent? Once again, all except three dealers noted their wholesale mechanical business was down. The smallest decline was 5% and the largest 80%, with an average decline of 39%. One of the three “up” dealers was, again, Richmond Ford Lincoln. The other two were unavailable for comment. Have you had to furlough any parts department personnel and if so, who? Sixty-six percent of respondents said they had to furlough at least one person in their parts department. Some had to let multiple people go. This included 13% who furloughed road sales people and 31% who furloughed stock clerks. Those hit the hardest were delivery drivers, with a 47% furlough rate, and counter people, with a 53% furlough rate; 38% of respondents dismissed both a driver and a counter person. One parts manager noted they cut hours but kept the same number of drivers. Have you altered your parts delivery service and if so, how? This was fairly evenly divided, with 49% saying yes and 51% say-

ing no. Fortunately, for body shops, none of our respondents said they completely stopped delivering. Seventy-eight percent of those who made a change chose to limit the number of delivery runs made per day. A few chose to limit deliveries only to select accounts, one limited delivery by mileage and one limited delivery by dollar value of the order. One VW dealer in northern California noted, “We were allotted one

extra time? Parts department personnel have been using the time to clean up their physical department, check bin counts to ensure inventory accuracy, painting, erecting new shelves and general reorganizing. Some used the time for training. Some updated account information. And some parts managers said with furloughed employees, there was no free time—those that remained were just as busy as before.

“We took our outside salespeople off the road and had them working the phones five or six hours a day contacting customers to see who was open and who was not and if there was anything we could do to help them out,” — Roland Chartier driver and told to make do.” Several dealers said customers were picking up parts at the dealerships in lieu of a reduced delivery capacity. Some dealers used Uber or a taxi service. How have your customers responded to changes in delivery policies? Overall, respondents noted shops understood the situation and were very accepting that business changes were necessary at the dealer level. One Honda parts manager said that because the shops were operating at reduced capacity, they did not deliver after 2 p.m., and most shops seemed to be OK with that. A parts manager at a California Acura dealer said the shops were just happy the dealership was still open and they were able to pick up parts as needed. How much trouble have you had getting parts from your primary OE brand during the height of the pandemic? Respondents said those OEs with the best fill rate during this time were, in no particular order, Honda, Toyota, Nissan, Hyundai, Kia, Mercedes-Benz and BMW. However, the degree to which other OEs may have had trouble fulfilling dealer orders may or may not have been caused by the pandemic. Civil unrest or other factors outside the control of the OE may have played a factor. Also, parts manager answers may have been influenced by a particular order or two or a particular part or type of part that may have been temporarily unavailable. Assuming your business has been slow, how have you used the

Already, people have started driving again and business have started reopening. In view of the events of the past few months, how do you view the future of your parts dept? ▪ 33% said: “It will return to its pre-virus levels but will take several months. I expect to rehire my furloughed people eventually.” ▪ 27% said: “I plan to retain some of

the changes we made during the pandemic and there will be a ‘new normal.’” ▪ 22% said: “My parts business has changed little over the past few months. I expect to continue on business as usual.” ▪ 18% said: “It will return to its pre-virus levels in a fairly short amount of time. I expect to rehire my furloughed people fairly soon.” One GM dealer in Michigan said, “We are already back to normal. All employees have already returned.” Do you foresee any long-term negative effects from the pandemic and if so, what? Twenty-seven percent of respondents said yes, while 73% said no. Several of those that said yes said it will take a long time for people who have been out of work to recover. A parts manager at a West Coast Mercedes-Bens dealer noted, “I think this will be an ongoing, seasonal issue for a few seasons/years. The collision business will take on the majority of the decline each time.” An unidentified parts manager See Serve Through Pandemic, Page 36

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Taking Action Christy Jones of R Jones Collision 1 in Des Moines, IA, offered a “pay it forward” campaign in which each of the shop’s customers in May and June received a $25 gift certificate to a local restaurant, and could designate a charity to receive a $50 donation from the shop.

getting supplements handled, “to keep cash flow up and make sure all the bills are paid and we still make money.” At Zara’s Collision Center, in Springfield, IL, “We are upholding our commitment to bringing new talent into our industry by hiring fulltime a recent high school graduate who had completed a semester-long internship during the pandemic,” shop owner Brad Zara said. “We have also brought on another recent graduate for a summer internship even though business is down.” Adam Reiter of Golden’s Paint & Body Shop in Hot Springs, AR, said the shop has continued to spend all reimbursement the shop has received for added “COVID-19 cleaning” of vehicles to buy gift cards for local businesses through a chamber of commerce program that also matches the funds to buy groceries for displaced workers. “Five thousand dollars has been raised by our shop,” Reiter said. “The gift cards will be used as prizes for customers and bonuses for employees.” Shifts in marketing Zara and Reiter are also among the shops reporting a variety of changes in their marketing efforts given what’s happening in their area. Reiter said he brought in a film crew to shoot a new television ad after the shop was “deeply cleaned and completely repainted.” “We have been utilizing clever messages on our Facebook page to let people know that we are continuing to safely serve them throughout the pandemic,” Zara said. Todd Doyle of Arrowhead Auto Body in Hermantown, MN, has taken a different approach. “We had changed our radio and TV ads to COVID-related topics, telling customers that we are open and how we are cleaning for their safety,” Doyle said. “But we have changed back all our advertising to our normal ads because I’m personally sick of all the ads talking about COVID.” John Naylor, an estimator and manager at Heritage Collision Center in Sherman, TX, said the shop has stepped up efforts to encourage and thank customers for posting online reviews.

Josh Smith, operations manager at Collision Specialists in Jackson, TN, said although the shop doesn’t like photo-based estimates, it is doing some as a selling tool. One California shop owner said he is contacting more mechanical repair shops to exchange customer referrals. Another said she has made sure all her employees “have business cards and are encouraged to hand them out.” The direct repair coordinator at a two-shop collision repair business in Pennsylvania said he’s getting more involved with several community Facebook pages. “Believe it or not, it helps immensely,” he said. Mask policies vary Among more than 200 shops responding to a survey in June, about 30% were requiring customers to wear masks to enter the shop office. “The door is locked; people have to ring a bell before they come in—with a mask,” Bill McElroyofBillMcElroyAutoBodyinBensalem, PA, said. Many shops said they are leaving it up to the customer to decide. “Whatever they are comfort-

able with. Some do, some don’t,” said Candace Dietzen, owner of The Body Shop of Barrington in Lake Barrington, IL. “We have masks available for customers upon request,” said Tyler Perkins, collision center manager at Ford of Clermont in Florida. “My employees have to wear masks whenever a customer enters,” a Georgia shop owner said. But policies regarding masks appear to be in flux from shop to shop; several shops said they had been requiring customers to wear a mask earlier, but stopped at some point in June. A shop owner in Oregon said he hadn’t been requiring it, but would if state policy called for it—something that went into effect in late June. And the percentage requiring masks for customers is somewhat under-reported because at least 10% of those saying they don’t require a mask also said such a policy isn’t needed because customers aren’t being allowed inside. “No one enters our building. We meet them in the parking lot in full PPE gear,” said Mike Kime of Kime Collision in Standish, MI.

Zara’s Collision Center, in Springfield, IL, is trying to use clever messages in its social media to let people know how the shop is continuing to safely serve them during the pandemic

“We’re offering employees later start times so they can help with family or household needs,” the owner of a Chicago area shop said. “We’re offering them four 10-hour days, if that helps, and with that, we’re actually seeing more customer volume in the evening hours.” Auto Craft Collision Center in Kewaskum, WI, extended through June a 10% discount, up to $250, it began offering customers earlier this spring. Carney Cataldo of Cataldo’s Collision in Dubois, PA, gave all employees a $1,000 bonus. A shop in the Pacific Northwest supplemented its painters’ wages to help ease the downturn in flat-rate hours, and an Arizona shop has given commission employees a guaranteed minimum salary equivalent to four days of work, and isn’t requiring them to work more than four days a week. A working manager at a shop in Iowa is letting the shop’s other technicians do more of the production work while he spends more time in the office

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Tesla Exec Hints at Service Center Expansions to Support Growing Fleet by Joey Klender, Teslarati

Tesla is gearing up to continue the growth and presence of its service center locations in the U.S. and its territories. The increase in service centers could be a way to handle the increase in production and deliveries that Tesla has experienced. A LinkedIn posting from Tesla’s President of Automotive Jerome Guillen indicates the electric automaker is looking for spaces in several U.S. cities, along with a location in the unincorporated U.S. territory of Puerto Rico. Guillen’s post showed California, Georgia, Arizona, Florida and Puerto Rico were all current candidates for new service center locations. “Tesla continues to grow its service presence. Some exciting openings coming up in the coming weeks. Still looking for suitable spaces in Los Gatos/Campbell (CA), South Atlanta, Glendale/NW Phoenix (AZ), Naples (FL), and Puerto Rico. If you know some space immediately available, please

contact me,” Guillen said on his LinkedIn page. It is no secret Tesla has continued to ramp production of the Model Y, and the Model 3 continues to be the company’s top seller. With the growing ﬂeet of vehicles and a steady increase in production after the COVID-19 pandemic, Tesla must begin making service centers more readily available for owners. Not only is the company’s Fremont, CA, facility gearing up for an expansion of Model Y production lines, but the company is getting set to open a new production facility in the central U.S. Austin, TX, and Tulsa, OK, are both vying for the chance to become the home of Tesla’s second U.S.-based vehicle manufacturing plant. Currently, it is unknown which location the company will choose as both cities have their own unique advantages in terms of incentives. It has always been a goal of CEO Elon Musk to begin ramping the presence of service centers across the world. Along with

opening up more physical locations, Tesla has also expanded its mobile service fleet. During the Q4 2019 Earnings Call, Tesla stated its mobile service fleet doubled in 2019 to 743 total vehicles. The electric automaker also tested the possibility of specialized service centers tailored to specific vehicle models. A location in Santa Ana, CA, was designated for Model 3 owners only, while another center in Costa Mesa was only taking appointments for the Model S and Model X. The strategy was used by Tesla to increase the efficiency of repairs and reduce turnaround time. Tesla’s service centers are in more than 32 countries around the world currently, and the company continues to expand its presence in new areas. Much like Tesla’s supercharger locations, the company will continue to expand its service center presence as the number of vehicles on the road continues to grow. We thank Teslarati for reprint permission.

Serve Through Pandemic from an East Coast Toyota dealership said, “We will see a new way of doing business; COD only—no charges.” Finally, an Acura parts manager said the last four months had really “put the icing on the cake.” He noted that paying for such computer programs such as CCC, Parts Trader and OPS Trax have added thousands of dollars per month to their operating costs. That, combined with other wholesale costs and a steep downturn in business, has simply made the wholesale business untenable. But rising wholesale business costs and declining profits for dealers has been an issue for 40 years or more. Fortunately for the collision and mechanical repair shops, auto dealers, being as creative and resilient as they are, always seem to find a way to mitigate these business issues and keep serving the automotive aftermarket repair industry.

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Tesla is Worth More Than Volkswagen, Toyota and Honda Combined by Joey Klender, Teslarati

Tesla officially has a higher valuation than Toyota, Volkswagen and Honda combined thanks to a significant surge in the electric automaker’s stock price over the past week. Last month we compared its value to GM, Ford and FCA. Toyota, Volkswagen and Honda currently sit at the second, third and fourth-most valuable automakers in the world, respectively. However, while the three companies are among the largest car companies in the world, their valuation combined has fallen behind that of Tesla’s, which has gained nearly $400 in value in just one week. On July 6, the company’s stock closed at $1,371.00. At the time of writing, TSLA stock was trading at $1,732.61. Tesla’s market cap currently sits at $324.93 billion, while Toyota ($176.49B), Volkswagen ($80.83B) and Honda ($45.56B) are worth $302.88B combined. TSLA has enjoyed a surge in value this year of more than 220% so far, providing exponen-

tial gains to its investors. This fact is especially impressive considering the company has experienced closures at both of its vehicle production facilities in Fremont, CA, and Shanghai, China, due to the COVID-19 pandemic. The stock’s value has inflated primarily due to Tesla’s technological developments, improvements in battery capabilities, production efficiencies and delivery figures that have managed to outperform Wall Street’s estimations. Tesla’s valuation goes far past its stance as an automaker. The company is involved in sustainable energy generation and storage, and its surge as a company focused on the longevity of the Earth and freeing its citizens from the dependence on deadly fossil fuels. Tesla has been a leader in transitioning the massive worldwide automotive industry to a sustainable, electric-based sector that is both fun and great for the environment. After the Model 3 was released in 2017, Tesla was official-

ly recognized as a mass-market car company that offered premium, sustainable vehicles that most families could afford to purchase. Now that the company has two vehicles that fit the price ranges of most families, Tesla has managed to extend its reach to more than just the wealthy and well off. This scenario was detailed in Elon Musk’s “Master Plan,” and it has all come to fruition. The future also looks bright for TSLA. On a recent episode of CNBC’s Squawk Box, Oppenheimer analyst Colin Rusch stated Tesla is showing evidence of a 50% to 70% upside within the next four to five years. Based on Tesla’s significant advantages in electric transportation thanks to automotive technology and battery developments, Rusch believes the company’s valuation will continue to grow by 2025. Tesla will detail the Q2 2020 results in an Earnings Call on July 22. We thank Teslarati for reprint permission.

CA Dials Back household,” he said. “This is about keeping you safe, about keeping them safe, your friends, family and neighbors.” Newsom also announced a “strike team” of people from seven different agencies being gathered together to enforce the new rules. Some of the agencies include Alcohol Beverage Control, CalOSHA, the Department of Business Oversight, the Department of Consumer Affairs and the California Highway Patrol. “Why have rules, why have regulations, why have laws if you’re not willing to enforce them,” he said. The July 1 announcements came on the heels of 5,898 new COVID-19 cases recorded in the state June 30. The positivity rate has increased to 6% over 14 days—and 6.4% over the last seven days. “That’s a very high increase, it may not seem like much to some, but every decimal point is profoundly impactful,” he said.

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Diving Into the Fascinating World of Fasteners by Ed Attanasio

How many bumper covers, fender liners and plastic shields are currently sitting in the middle of the road in this country? I would guess thousands, and why are they there? Undoubtedly one of the main reasons is that one or more retainers—aka fasteners, bolts, screws, clips and rivets—failed. Why? Due to fatigue, of course, but in many cases it’s because they were incorrectly installed or the wrong ones were used.

CEO Russ Ramsey is launching a website that will enable shops to make a profit on retainers and make it easy to find the correct hardware for each repair

Since 1988, the people at Blue Vista Data Systems (BVDS) in Las Vegas, NV, have created efficient systems to turn lost money into profits when it comes to clips and fasteners. Every auto body shop on the planet has a plethora of retainers with specific applications, and with more than 700 car models out there containing an average of 30 locations requiring them, it’s a big deal. The company recently launched a new website, bluevistadata.com, containing more than 28,000 retainers, broken down by location, OE designation and cost, complete with diagrams and specs for each. With seven programmers working day and night to get the site clicking like a new Tesla, BVDS launched it July 1. The site lists every retainer and its location, and is designed so anyone can use the system without changing their current distributor. For more than three decades, BVDS has been a pioneer in the development of many of the retainer-related inventory and invoicing systems used today. CEO Russ Ramsey explained retainers are small in size and often

forgotten, but their impact on a shop’s profits can be significant. Things like retainers and other smaller items are often not included in estimates. It’s the old Catch-22—f you invest in too many retainers and they never get used, that’s obviously problematic. But if you don’t have the right ones on hand, that can be even worse, possibly cutting into your cycle time. “We have been in this business for a long time and have helped a lot of shops to make money on retainers, by making it easier to find the right ones and invoicing them correctly,” Ramsey said. “Our website has tackled the problems associated with retainers because with this system, all of the information they need is right there, with photos and drawings and an easy way to track them. “It also enables your shop personnel to find out what they might need from the OE dealer prior to the repair.” Annually, the overall number of OE retainers spike because every time an OE gives a vehicle a facelift or re-engineers it, new fasteners hit the market. If you’re not on top of it, you might be lost, especially if you’re working on a 2021 car, for example. That’s why BVDS developed the most complete and comprehensive system out there to keep track some of the smallest, but most important, parts on any automobile. Kurtis Rosenborough is the owner of Certified Auto Body Center in Las Vegas. He has been purchasing retainers from Ramsey and BVDS for at least 20 years, he said, saving him tons of money and time. “I have used their products and their systems for a long time,” he said. “When cars changed big-time back during the mid-1990s with so much plastic all around, the game changed dramatically. We’re spending approximately $2,000 every month on clips and rivets and couldn’t get reimbursed by the insurance companies until we began using their system. “We never got paid and now we do because our invoices are iron clad, listing exactly what we used and how many of them we installed. It also saves our parts manager time, because he finds the vehicle and all of the retainers are listed. Even some

of our insurance adjustors have used Blue Vista to research all of the hardware required on a particular repair.” Rosenborough’s retainers went from being an expense to becoming a profitable small but important part of his business. “There are so many clips, fasteners and other retainers on the newer vehicles, it’s mind numbing,” he said. “Too many shops think that many retainers are ‘one size fits all’ but that’s not the case. They install a Christmas Tree retainer, which is not ideal for many O.E. and does not meet any of their standards. Why would you spend hours and hours doing a great repair on a vehicle and then install the wrong or poor-quality parts?” Body Shop Manager Mike Giovengo at Friendly Ford in Las Vegas has known Ramsey for decades, and praises him as “the Man” when it comes to the world of retainers. His shop ponies up more than $18,000 retainers annually, many of which are rivets for the aluminum F150s. Getting paid for them in

the past required a little dance with his insurance companies, but now Giovengo waltzes right through and gets paid. “When it comes to things like retainers, you won’t get reimbursed unless you ask for them up front,” he said. “A lot of shops don’t keep that in mind, so when they are rushing around to finish the repair, they realize they need a few clips or rivets, for example. They just want to get the car done, so they install the retainers and eat the cost. “The numbers really can add up. We fix roughly 1,200 vehicles every month, so if every car requires $8 to $40 in retainers, that equals between $9,600 to $48,000 annually. So, Russ and BVD have helped us to get them into our repairs more easily with specific and accurate information to document the cost.” For shops who want to subscribe and use the system, the cost is $40 to $55 monthly, and there are a series of short videos to train parts managers, technicians and estimators how to use it.

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with Stacey Phillips

Tips for Busy Body Shops with Stacey Phillips

Stacey Phillips is a freelance writer and editor for the automotive industry. She has 20 years of experience writing for a variety of publications, and is co-author of “The Secrets of America’s Greatest Body Shops.” She can be reached at sphillips.autobodynews@gmail.com.

Industry Veterans Erick and Shelly Bickett Share Insight About Collision Industry When industry veteran Erick Bick- in a body shop owned by a couple ett was growing up, he aspired to be of dealerships in Anaheim, CA, and an airline pilot like his dad. He real- eventually purchased the business, Stacey Phillips ized that a 9-to-5with job wasn’t for him. Auto Center Auto Body Inc. Erick always had an interest in We operated out of a 3,500cars and eventually opened a body square-foot facility behind a used shop with his partner, Shelly Bickett, car lot. Three years later, we built a who had a background in accounting. 30,000-square-foot state-of-the-art location at an auto mall where there were a number of dealers in one location. The business eventually bewith Victoria Antonelli came part of Fix Auto USA and grew to include 165 employees at nine locations, spanning over 200,000 square feet and bringing in more than $30 million in annual gross revenues.

My SEMA

Shop Strategies

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with Ed Attanasio Shelly: I never intended to be in the

body shop business. I went to school for accounting and was working at New York Life Insurance. When we Erick and Shelly Bickett bought into the business, I start That was more than 35 years ago. ed doing the accounting part time. Since then, Erick and Shelly have Eventually, I worked there full time founded a number of organizations in when we purchased the company. with Gary Ledoux the collision repair industry. These in- At the time, most body shop clude Caliber Collision, the Collision managers and owners had grown up Industry Electronic Commerce Asso- in the business and didn’t have financiation (CIECA), Cyncast, Fix Auto cial or accounting experience. Erick USA and the Collision Career Insti- is a great businessman and his finantute (CCI), which supports industry cial expertise helped us a lot and set apprenticeships. us apart from our competitors. with Stacey Phillips Autobody News recently talked to Erick and Shelly about their caHow did you both get started reer highlights as well as advice to How did your involvement in shops on how to be successful in the 20 Groups eventually lead to the forfuture in light of COVID-19 and in- mation of Caliber Collision? dustry changes. Shelly: When we started our first Mike Anderson How did with you both get started business, we became involved in a in the collision repair indus- 20 Group with other like-minded try? individuals. We’ve always found the networking to be very beneficial and Erick: While in college, I took a job it’s a great way to share knowledge driving a tow truck. I eventually and best practices. It also gives you managed the tow company and then the ability to have a bigger footprint transferred to the owner’s body shop. to work with insurance companies. Later, I managed a dealer group. I Otherwise, your body shop is like a also obtained my license to become lone ship on the ocean. an insurance agent. The shop owners would mea Early on, I realized I could be sure themselves against themselves, competitive in the body shop busi- and we soon realized that we needness. Shelly was a big influencer ed to compare ourselves with other in that decision. I was 28 years old shops nationwide. These measurewhen she convinced me to go out ments and numbers are now called on my own. In 1984, we invested Key Performance Indicators (KPIs.)

OE Shop Certification

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Erick: The formation of the 20 Group started with a group of California shops coming together to talk about the challenges of software we were all using. At that meeting, we realized the benefit of having discussions about business development issues and this led to the formation of our 20 Group. The industry was going through a lot of change and having the association of great operators was really important. When you are all by yourself, you’re not exposed to different viewpoints and other ways of doing things. Through the 20 Group process, we learned that the best form of continuous improvement is posting results and comparing them among the group. We were all active nationally at that time and a group of six business owners decided to form Caliber Collision in 1991.

What role have you played in creating technology for the industry?

Erick: It was that learning through the 20 Group that was an incentive to eventually start CynCast in 2000, a technology company serving thousands of collision repair shops that was later sold to Enterprise Rent-A-Car. We built technology predominantly to create transparency around shop performance. In a 20 Group, that’s fairly easy to do because everyone brings in their financials in a common format. Since there wasn’t anything already built for the industry in the late 1990s, we started the Collision Industry Electronic Commerce Association (CIECA), the only industry organization providing standard methods of electronic commerce. Having e-commerce is critically important. The way things are going now with APIs

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(application program interfaces), and how software components and computers interact, it’s all becoming more integrated, leading to efficiencies for the industry. At Cyncast, we built the first Estimate Management Standard (EMS) data pump. EMS was created through CIECA and we used this standard to build the first EMS pump, replicating all information automatically from remote estimating systems. In the 1990s, we created the first Customer Satisfaction Index (CSI) system in the Collision Repair Management System (CRMS) so shops could share data. We also built many web-based claims tools to be used by shops. Shelly: Another concern for shops is the technology in vehicles today. Vehicles may have technical changes from one year to the next. Technicians may think they know how to repair them, but it’s essential they look up and be well-versed in OEM procedures.

What are some of the challenges and growth opportuni-

ties in the industry? Erick: Entrepreneurs are very proud, and at the same time, they are stubborn. In the late ‘80s and early ‘90s, we watched the transition from adjusted claims to DRPs. At that time, there were highly respected industry leaders who dug in their heels, telling other shop owners not to participate in a DRP. We, on the other hand, saw the value and opportunity and leveraged significant growth from these new relationships. Early on, we worked with insurers to help develop their DRP programs. I’m finding that a similar situation is happening right now in regard to OEM certifications. We’ve been talking about OEM certifications within our Fix Auto franchise network, and we strongly feel that shops have to be certified. At the same time, we see people digging their heels in, even at our own shops asking, “What is the ROI?” Shelly and I decided to move ahead with certification, knowing that it would pay off in the future. Some shop owners don’t think it’s important to be certified with all makes and models of vehicles, but what they

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don’t understand is that the first level of change will be filters on First Notice of Loss (FNOL.) As an example, that means if you aren’t certified with Nissan, you aren’t going to be repairing Nissans. Shelly: Vehicle technology is advancing rapidly. First and foremost, we need to repair cars correctly according to OEM procedures and ensure we put people back in a safe vehicle. I hope and pray for and believe that OEMs, insurers and body shops will be completely aligned in the correct repairs of vehicles. We’re starting to see that now with insurers directing work to those shops that have OEM certifications; that’s a great thing.

What are some of the effects of COVID-19 on the collision repair industry? Shelly: I think reacting quickly to COVID-19 and making changes was really important. However, I think we’ll see shops go out of business, whether that’s consolidators deciding to close locations or independents who can’t make it through. Even if

they reacted quickly, we’re going through something very significant. In a very short period of time, some shop owners have lost 50% of their business in weeks. Erick: I think it’s all about how shops respond when coming back to the new market. No doubt, it’s going to be very different than what we experienced before. As a result of the pandemic, we took out the duplication in our business and created efficiencies, but unfortunately, we had to lay off 55% of staff. We learned how to do things differently out of necessity and shame on us if we don’t come back differently and go back to doing things the same way. Smart operators are going to take what they’ve learned from this situation and develop a different structure for their businesses. Those who don’t adjust to the business climate are not going to be competitive.

What do you think the future holds for collision repairers?

Erick: One of the things that our expeSee Erick and Shelly Bickett, Page 51

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ge 51

SEMA Show Goes On with Ed Attanasio

Media and Publicity for Shops

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

with Ed Attanasio

Will COVID-19 Change Your Marketing and Advertising Plans Forever? A friend of mine who owns a body that is even more evident now. shop always swore marketing and We all know by now the COadvertising were a waste of time VID-19 global pandemic is going to withhe’s Stacey and money, but now singingPhillips the change our lives forever, and the way blues. body shops operate as well. It is alrea When things are going well and dy causing body shops to reevaluate the cars are coming through the doors, their thinking about current and future many shop owners never even think advertising and marketing campaigns about marketing and advertising—unStacey Phillips til now. If you’rewith currently doing half your normal volume and walking around in a haze, I could say “I told you so,” but that’s not how I roll. With most shops reporting a 50% drop in business since mid-March, shops that neverwith thought marketing Stacey Phillips was essential are sitting around scared and unprepared. This is why I’ve always said marketing is not a “start and stop” thing. It should always be idling in to accommodate social distancing and the background and tailored based on work-from-home protocols initiated with Phillips to combat COVID-19. car counts and the timeStacey of the year, but to do zero marketing is a mistake How does the future look for

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body shops post-pandemic? Who will survive, thrive or meet their demise in a new world of market adjustments, stronger competition and an ever-increasing demand for marketing that will address and comfort consumers during these uncertain times? Some shops have already redirected their marketing efforts, while others have just eliminated them altogether. They didn’t do it because they’re anti-marketing—to survive as their car counts dropped and they were forced to furlough people. “If it comes down to making my payroll versus maintaining our social media or email marketing, it’s a pretty easy decision,” one shop manager told me recently. Shops that could afford to keep the marketing machine rolling along

began tailoring their advertising to accommodate these indeterminate several months. With fewer people in their vehicles, some shops decided to nix things like radio advertising— both satellite and terrestrial—outdoor advertising—billboards, bus boards and other signage—and some mobile apps that target drivers in their cars. Shops are now heavily pushing things like pickup/drop-off services, free car washes for customers and photo estimates, as well as safety protocols for customers and their employees. One thing that has changed dramatically during stay-in-place orders is companies have realized letting their employees work at home is not a bad thing. In fact, many businesses have found out people working virtually are even more productive. Some large high-tech companies See Advertising Plans, Page 51

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Continued from Cover

Positive Trends hicle auction company reported its mid-month “Used Vehicle Value Index” fell to 125.2 points, a 9.6% decrease from the same period a year ago. The prior record for decline in any month was 5.5% in November 2008. Manheim also pointed out, however, that when its used vehicle value index fell 10.5% over two months in the fall of 2008 at the start of the Great Recession, the horizon looked bleak then as well, yet vehicle values fully recovered seven months later. Sure enough, this year there was a strong—nearly 9%—rebound in May, Manheim reported, bringing pricing to within 1.9% of what it was a year earlier. The index then jumped another 6.6% in the first half of June, erasing much of the spring decline and reaching a level that is actually 4% higher than last June. Admittedly, there are still factors that could lead to a lot of instability in used vehicle pricing in the coming months. Rental car companies continue to send significant numbers of used vehicles to the auctions as they reduce their fleets in response to the drop in travel. Repossessions are also picking up, and while automakers delayed some turn-back dates on leases this spring during the worst of the COVID-19 impact, more of those vehicles also are expected to join the parade of used vehicles hitting the market. Still, the fact that the large decline in the spring didn’t hold should come as welcome news to collision repairers. Traffic levels are getting closer to “normal” Traffic analyst firm INRIX at the end of June halted the weekly reports it was producing on traffic levels around the country given that by its system of measurement—a comparison to weekly traffic in February— personal vehicle traffic on a rolling seven-day national basis was back to 100% as of June 25. As July began, more than 34

states had traffic levels higher than in February, according to INRIX, and only three states had declines exceeding 10%: Hawaii (still down 43%), California (down 12%) and Arizona (down 11%). Forty-two of the 98 metropolitan areas INRIX tracks in the U.S. had traffic at or exceeding February levels.

Demand for gasoline, as measured by how much was being delivered to retail stations around the country, also has rebounded to close to “normal.” Back in April, according to the U.S. Energy Information Administration, gas deliveries had tumbled by 47% compared a year earlier. But by the last two weeks of June, the amount of gasoline being delivered was just 10% below what it was during the same period last year.

parts delays,” a shop in Northern California commented. But at least one in four shops said they could point to something helpful insurers were doing. Those included shops saying they were being paid for the added labor for “COVID-19 cleaning” of vehicles. Shops on Progressive’s direct repair program also said the company has followed through on its pledge in mid-April to share with those shops more than $2 million of the money the company was saving from the drop in claims Progressive and other insurers were experiencing. “Progressive gave us $1,000 to help with the reduction in work,” one Florida shop reported, a dollar figure that was confirmed by more than a half-dozen other Progressive direct repair shops. A shop owner in Hawaii said GEICO had increased shop labor rates, and shops on USAA’s direct repair program in Oregon and Illinois reported the insurer suspended the performance-based bottom line discount the shops are required to give that insurer.

Some shops point to help from insurers A poll of shops in the second half of June asked shops if they have been offered any assistance from Manheim’s used vehicle pricing index in June had rebounded insurance companies to significantly after a record-setting drop this spring, reaching help their business during levels higher than a year ago, which will help prevent more vehicles from being declared total losses the pandemic. A large majority said no. “Just the opposite. Most insurers That’s a fairly sharp recovery, given that in early April, traffic had fallen are auditing more files and becomto nearly half of what it had been ing very nitpicky,” a shop owner in Hawaii said. just six weeks earlier. It should be noted that the IN- “They just want you to cover RIX data paints a little brighter pic- rental even when the pandemic caused ture of traffic around the country than it would if it compared traffic in June to what it was a year earlier. Because traffic tends to rise in the spring and summer, reaching February levels in late June still represents about a 16% decline compared to a year earlier. But 16% off is significantly better than the 47% decline in April. And From helpful direction to assistance with your next order of analysis of traffic camera data in some Genuine Volkswagen Collision Parts, our team is well read on cities and states indicates even more ways to make your job easier. of a full recovery in some markets. Using that measurement, statewide SO. CALIFORNIA WASHINGTON traffic in Florida and Indiana during Galpin Volkswagen University Volkswagen North Hills Seattle the third week of June, for example, 888 840-8416 206-634-8200 was down by just 4% or less comFax: 818-778-2090 Fax: 206-547-1581 www.galpin.com M-F 7am-6pm pared to the same week in 2019, and parts@uvwaudi.com down by less than 10% in Arizona, www.universityvw.com NO. CALIFORNIA Ohio and Michigan. Dirito Bros. Walnut Looking at vehicle counts tracked Creek Volkswagen on state highways in some cities also Walnut Creek points to at least a near return to nor925-934-8459 Fax: 925-934-0786 mal in some cities. Traffic on I-465 in parts@dirito.com Indianapolis in early July, for example, was actually 6% higher this year when measured against the same Contact your local Volkswagen dealer or visit Wholesale.VWServiceandParts.com to place week last year. And traffic camera your Genuine VW Collision Parts order today. data for that week indicates just a 10% decline on state Route 315 in Colum“ Volkswagen” and the Volkswagen logo are registered trademarks of Volkswagen AG. ©2020 Volkswagen of America, Inc. bus, OH, and only a 6% decline on I-85 in Charlotte, NC.

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3M Shows Support of Collision Repair Industry During Pandemic by Stacey Phillips

When reports were first coming from China in early January regarding the coronavirus, Dave Gunderson, vice president of 3M’s Automotive Aftermarket Division (AAD), said the company saw the writing on the wall. Having been through previous pandemics, such as SARs, 3M executives realized the need to take action. “Every day at 3M, we think about improving lives,” said Gunderson. “Those of us working in the automotive aftermarket have been thinking about ways to support collision repairers during the pandemic.” Operating in more than 240 countries, the company manufactures and sells 52,000 different products and has more than 96,000 employees. Autobody News recently talked to Gunderson about the state of the industry during COVID-19 and what 3M has been doing over these past few months to show its support. “We realized that we needed a new operating rhythm and it had to

be simple, yet effective,” said Gunderson. “It came down to three overarching guidelines: people, prioritization and rebound.”

physically do their jobs from home. We also created new rules and training for employees. For anyone who travels and meets with customers, we’re going through How has 3M protected peo- another level of training to ensure emple during the COVID-19 re- ployees know how to properly use a strictions? respirator or face covering. It’s called fit testing. Sometimes, you see peoFirst and foremost, the top ple with a face covering over their priority is to make sure that mouths but not their noses. That’s our teams and customers are staying not effective or the proper way to safe. We have stay informed about the wear a face covering. If you wear a guidelines from the Centers respirator, it’s essential that for Disease Control and Preit fits correctly. If you have vention (CDC) and the World a beard, a respirator will not Health Organization (WHO). fit properly because the air We took action to limcan come around the sides. it any exposure and ensure In our industry, it’s not just our teams have the right important during COVID-19. measures in place. We also Dave Gunderson, If you are working with any vice president of converted all of our support to industrial application, cer3M’s Automotive be handled remotely. Customtain respirators are required. Aftermarket Division We are reinforcing that with er support is key for us, but (AAD) employees. we need to do it in the safest possible way. From a customer standpoint, Since June 4, we started bring- we’re learning how to reengage and ing 3M employees back to the 3M “ask before going.” In the past, 3M Center campus who aren’t able to representatives stopped by multiple

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body shops on their regular routes. That has changed since COVID-19. Now, we call first and ask how the shop owners and managers want to be served. We’re finding that some request training over the phone while others prefer someone to come in person. Rather than showing up and assuming that’s OK, we are asking their preference. Our customers are very appreciative of this.

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The following dealerships are eager to serve your needs. Call your local Subaru collision parts specialist today! autobodynews.com / AUGUST 2020 AUTOBODY NEWS 47

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In the past, technicians typically went online at night after work. Our goal is to help technicians sharpen their skills and support shop owners while they prepare for an economic rebound. We launched our 3M online platform in 2018. In March, we introduced a webinar series for the industry and we have more than 25 on-demand classes for techs. We also host one-hour “how-to” webinars multiple times per week and post them on YouTube. The sessions focus on a deeper understanding of body shop processes and procedures. I don’t think we’ll ever replace the need for physical training at our

are using their cars, that’s changing. We’re still going to birthday parties, but we have drive-by birthday parties. We’re going to church, but staying in our cars. In the 1950s, people looked forward to going to a drive-in movie or restaurant. Using the car was passion-driven. Today, and especially with the COVID-19 situation, cars are becoming our safe haven. Recent surveys show that people are going to be driving more after the pandemic and avoiding the use of mass transit and shared mobility due to hygiene concerns. When we think about getting into someone else’s car, we’re not sure if it has been sanitized. However, we have comfort in knowing that our cars have been cleaned. Another reason is due to congestion. For many years, there was a big push to use mass transit to reduce consumption. But now the question is becoming: do 3M is directing a majority of respirators produced to health you want to be safe or worry care workers and first responders, followed by critical about causing congestion? national infrastructure All of this is positive for internal centers, but we’ve found the collision repair industry. We need that you can do a lot of training on- to continue watching these trends closely and prepare for the future. line. We also launched an application, I understand that sometimes it “Ask Me Anything,” where techni- feels like it is going to take forevcians can reach out to 3M on the fly er. But if you look back in history, I and have a company representative think the auto aftermarket recovers answer questions in a timely manner. much faster than other sectors. People don’t need to buy anything; they What are some of the most just get back in their cars and begin significant changes you’ve to drive. seen over the last few months? How is 3M supporting the inAs the economy is opendustry as it gets ready to ramp ing back up across the U.S., up again? we’re seeing the return of miles driven faster than we were expectIt is important for us to track ing. People are getting out and startthe market and be ready for ing to drive. I think that’s good news the rebound. We want to make sure and an encouraging sign for our in- that we have the right products available and the support the industry dustry. Depending on the part of coun- needs to service customers. try, miles driven are about 75% to Prior to COVID-19, 3M was 85% of what they were pre-COVID always committed to balanced disand are continuing to increase. The tribution of respirators to our existRV industry is also recovering quite ing industrial, retail and health care customers. well, and sales are up. In this unprecedented crisis, 3M If you think about how people

is directing a substantial majority of the respirators we produce to our heroic and courageous health care workers and first responders, followed by critical national infrastruc-

tailed information on our website showing examples of how to use sanitizer on a vehicle based on information from the CDC. You would think it’s intuitive, but for some of these chemicals to work, they have to saturate or stay wet for a certain amount of time. If we can help assure customers that their cars will come back safe, clean and sanitized, then consumer confidence will help drive additional repairs. We’re a trusted leader in this industry and work 3M’s global headquarters is located in Saint Paul, MN hard to serve the needs of ture during the pandemic. customers. For the automotive af 3M is also going to be launching termarket division, our strategy and two new products for sanitization over vision are to create the future of the next couple of months. They have care and repair with our customers been thoroughly tested to ensure they and industry partners. We’re in the are safe to use on automotive interi- industry for the long-term and want ors. When developing the products, everyone to know that we’re in this we took into account efficiency and together. productivity in the shop because we understand that every minute counts For more information about 3M’s during a repair and want to create the training resources, visit: https:// most value for our market. www.3m.com/3M/en_US/learning Since safety and sanitization is marketplace/automotive-academy/ top of mind right now, we have de- collision-repair/.

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48 AUGUST 2020 AUTOBODY NEWS / autobodynews.com

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autobodynews.com / AUGUST 2020 AUTOBODY NEWS 49

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Continued from Page 26

Corrosion Protection

same rules that are applied to regular self-etching primers pertains to these primers.

Undercoatings (Fig 10) are applied to the underside of a vehicle to provide protection from the various

cluded item) to determine the number of coats of material needed to match existing undercoatings.

Fig� 8a

Fig� 9

Fig� 11

faces prior to the application of adhesives.

Fig� 7

Self-etching primers (Fig. 8a) are used on bare metals. The primer contains phosphoric acid and should not be used where glass adhesives are applied. If the acid is not totally cured or a seal coat is not applied, an adhesion failure will most likely occur. The same scenario applies to body fillers and seam sealers. The next sets of primers are colored self-etching primers (Fig. 8b). These primers are used on interior sheet metals that are different colors than the exterior of the vehicle. The

Fig� 8b

Fig� 10

Cavity wax (Fig 9) is a semi hardening or a hardening material that will “creep” into seams, folds and hems to seal off the parts from moisture and air. This product is applied after the vehicle has been painted because paint will not stick to it. Toyota says in CRIB 1997 it will be applied to the inside of new doors, hinges, quarter panels, rails, front hood hems and rear deck lid hems.

road hazards, such as rocks. It also acts as a sound deadener. You may have to make a test panel (non-in-

SEMA Supports Legislation to Forgive All PPP Loans Less Than $150,000 SEMA joined with dozens of other trade associations in urging the U.S. Congress to pass legislation to forgive all PPP loans that are less than $150,000. The groups sent a letter to leaders of the House and Senate Small Business Committees requesting immediate passage of “The Paycheck Protection Program Small Business Forgiveness Act” (S. 4117). To date, more than 85% of the PPP loans provided to small businesses are less than $150,000. Under the current program, the loan has restrictions on how monies are spent, including a requirement that 60% be spent on payroll cost, and company officials must then spend

many hours completing paperwork to document the spending. The proposed legislation would instead simply require borrowers to submit a one-page forgiveness document. The U.S. Congress is expected to consider another COVID-19 stimulus package later in July. SEMA is urging that the PPP loan forgiveness legislation be enacted at that time, either as a stand-alone bill or as part of the stimulus package. For more information, contact Stuart Gosswein at stuartg@sema.org. We thank SEMA for reprint permission.

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Stone guard or chip guard is applied to areas such as the bottom of door skins, rocker panels and quarter panels prior to refinishing. Honda and Toyota state in the repair manuals the collision repair facility needs to make sure the application will be the same texture as the OEM applied materials. In other words, you will need to make test panels and that is a non-included operation. We will discuss more corrosion protection products next month.

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50 AUGUST 2020 AUTOBODY NEWS / autobodynews.com

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Advertising Plans such as Oracle, Facebook and Apple have asked their employees to work virtually with no immediate plans to change the plan. So, how do body shops get their marketing messages to those people who are in their homes 90% of the day? Industry author, speaker and consultant John Stuef has held literally every position in a body shop. He entered the industry as a painter’s helper and then became a painter, a body man, manager and then owner. For many years, he owned several successful shops, and currently he’s a regional manager for a large MSO. Two things Stuef has been doing since he bought his first shop involve getting out there in the public and hitting the streets for business. “There will obviously be a lot less business out there until this thing is definitively over, which won’t truly happen until we have a vaccine that actually works,” he said. “Advertising isn’t going to get you what you need fast enough, plus it’s too expen-

sive, especially when your marketing budget is temporarily limited.” So, Stuef is suggesting a few things to do that might bring you some faster results. The old adage is advertising is buying exposure while marketing is earning it. “Tapping into proven sources of revenue is the best way to operate during these unprecedented times, especially when time and money are limited,” he said. “Whenever we wanted to create some new business, we went back to what always worked, like visiting dealerships and insurance offices. “There is no silver bullet, but actually getting in front of people and interaction have always been effective for us. You can’t imagine the power of free pens and doughnuts.” Stuef and many other shop owners, managers and marketing people are looking at how COVID-19 will affect consumer buying habits and the collision repair industry. “It’s all about short term decision-making right now and those shops that will be able to pivot quickly will have a distinct advantage,” Stuef

said. “With so many uncertainties out there to deal with in both our professional and personal lives, a shop’s marketing should stress safety, comfort and trust more than ever.” Angel Iraola at Net Business Consulting and Solutions in Oakland, CA, is currently performing marketing triage for a wide range of small businesses during the pandemic. “With the economy taking a major hit, consumer behavior is likely to change dramatically through the end of the year and well into the first quarter of 2021,” he said. “For those with less disposable income, or considering retirement, this economic slump might result in a sharp decline to their spending habits. “Right now, consumers are wisely taking a ‘wait and see’ approach, so body shops should consider their target audience and how their lives will change as a result of the current economic climate. It’s a whole new ballgame and only those who will adapt quickly will survive.”

www.autobodynews.com

Continued from Page 42

Erick and Shelly Bickett riences have resulted in is that we’ve been able to predict what’s going to happen. We are going through more dramatic change, danger and opportunity than ever seen in our industry before. I think the future of the entrepreneurial collision shop is going to be dictated by how repairers respond to the changes coming. Independent collision shops owners add a ton of value and can survive if they work together and take the necessary actions to respond to market needs. At the same time, they need to remain competitive and look for efficiencies while removing duplication and waste in their businesses. If independent shops don’t do these things, they’ll likely become extinct. The full article is available online and includes information from Erick and Shelly about what prompted them to sell ACAB Automotive Group and Fix Auto USA to Driven Brands.

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autobodynews.com / AUGUST 2020 AUTOBODY NEWS 51

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I-CAR® Names Peevy to New Role

2020 SEMA Show Safety Announced

EV Maker Lucid Motors to Open 20 Retail and Service Locations in North America Through 2021

I-CAR®, the Inter-Industry Conference on Auto Collision Repair, announced July 15 the addition of renowned collision repair industry veteran Jeff Peevy to its executive leadership team as vice president of technical products, programs and services. In this new role, which becomes effective at the end of July, Peevy will spearhead the strategic development and growth of all I-CAR curriculum and technical relations efforts while leveraging his 20-plus years of executive management experience in the industry. Most recently, Peevy served as president of the Automotive Management Institute (AMI) since 2015, and as the 2019-20 chairman of the Collision Industry Conference (CIC.) He also shares a long and successful history with I-CAR, where he served as senior director of field operations and led I-CAR’s collision repair segment team before his AMI post. Source: I-CAR

SEMA Showgoers will be required to wear a face mask or a face shield during the 2020 event, as part of a proactive plan to prevent the spreading of germs and provide exhibitors and attendees with a safe environment where they will be able to conduct business. With 1,800 exhibiting companies participating in the upcoming event on Nov. 3-6 in Las Vegas, NV, the annual B2B SEMA Show will include several precautions and preventive safety measures. In addition to adhering to best practices, Show organizers released a video that outlines additional precautions that will be taken to focus on the health and well-being of those at the SEMA Show. The guidelines, which include the following, are posted at www. semashow.com.

by Brad Anderson, CarScoops

WIN Announces Award Winners Women’s Industry Network (WIN) presents the Cornerstone Award to those who’s actions and contributions demonstrate outstanding commitment to WIN’s mission and vision. They also set a high example for others to follow. This year, WIN Chair Cheryl Boswell awarded two board members with the Cornerstone Award, Michelle Sullivan and Jenny Anderson. Sullivan has been a mentor to so many women. During the last year, she worked to redefine sponsor opportunities and benefits. She served on the WIN executive committee in various roles and served in a leadership capacity on many committees, including membership and sponsorship.Anderson, vice chair on the WIN executive committee, served a key role in selecting and implementing a new WIN membership database and website. She too has served in many roles on the executive committee, co-chairs the marketing committee and is involved on the Most Influential Woman (MIW) award committee. Source: WIN

Source: SEMA

Lucid Motors has revealed it will open 20 retail locations and service centers across North America by the end of 2021. The electric vehicle manufacturer will refer to these outlets as Lucid Studios. Facilities set to open first will include a studio at Lucid’s headquarters in Newark, CA, a Los Angeles Studio and Los Angeles Service Center in Beverly Hills at the same site previously leased by McLaren Beverly Hills, a San Jose Studio, Miami Studio, West Palm Beach Studio, New York City Studio, and a DC Metro Studio in Tysons, VA. Lucid will adopt a direct-to-consumer model much like Tesla and offer “a digitally enhanced luxury experience tailored to each customer’s purchase and ownership preferences.” Customers will be able to visit a studio in person, make their inquiries entirely online or any combination of the two. Lucid says it selected locations with relatively small

Amazon Acquires Autonomous Ride-Hailing Group Amazon has signed an agreement to acquire Zoox, a ride-hailing group that developes autonomous technology from the ground up with passengers frontof-mind.

Aicha Evans, Zoox CEO, and Jesse Levinson, Zoox co-founder and CTO, will continue to lead Zoox as a standalone business as they innovate. “Zoox is working to imagine, invent and design a worldclass autonomous ride-hailing experience,” Jeff Wilke, Amazon’s CEO of worldwide consumer, said in a statement. “Like Amazon, Zoox is passionate about innovation and about its customers, and we’re excited to

help the talented Zoox team to bring their vision to reality in the years ahead.” Zoox started in 2014 with the vision of purpose-built, zero-emissions vehicles designed for autonomous ride-hailing, along with an end-to-end autonomy software stack. Zoox’s ground-up vehicle focuses on the ride-hailing customer, with integrated features designed to provide a revolutionary passenger experience. “This acquisition solidifies Zoox’s impact on the autonomous driving industry,” said Evans. “We have made great strides with our purpose-built approach to safe, autonomous mobility, and our exceptionally talented team working every day to realize that vision. We now have an even greater opportunity to realize a fully autonomous future.” Completion of this transaction is subject to customary closing conditions.

footprints in high-traffic areas. “Just as the Lucid Air is meticulously designed and engineered to be a new benchmark in the luxury electric car segment, we designed Lucid Studios to be engaging, to start conversations and to help educate people about the performance and efficiency benchmarks possible in an electric vehicle,” CEO and CTO of Lucid Motors Peter Rawlinson said. “A Lucid Studio is a place for people to learn about our unique brand while supporting every facet of the customer journey.” The long-awaited Lucid Air will premiere on Sept. 9. We will have to wait until then to get finalized specifications, but understand the Air will be able to cover more than 400 miles (644 km) on a single charge while being able to sprint to 60 mph (96 km/h) in roughly 2.5 seconds and, in all likelihood, hit a top speed of more than 200 mph (322 km/h.) We thank CarScoops for reprint permission.

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52 AUGUST 2020 AUTOBODY NEWS / autobodynews.com

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autobodynews.com / AUGUST 2020 AUTOBODY NEWS 53

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Autobody News Writer Recognized for ‘Solving the Tech Shortage’ Column Congratulations to Stacey Phillips, freelance writer at Autobody News, for receiving an award for her column, “Solving the Tech Shortage.” Phillips received a 2020 APEX Award for Publication Excellence from Communications Concepts in July. “I’m honored to have received this award,” said Phillips. “I am greatly appreciative of all the individuals I interviewed over the past year who have shared ways to hire and retain technicians for the future.” Phillips is a freelance writer for the automotive industry based in Southern California and owns Radiant Writing & Communications. As the prior assistant editor of Autobody News, Phillips has written for the publication since 2014. Her regular columns include “Best Body Shops’ Tips,” “Shop Strategies” and “Solving the Tech Shortage.” In addition, she assists the Collision Industry Electronic Commerce Association (CIECA) with marketing and communications and has co-authored two books, including “The Secrets of America’s

Greatest Body Shops.” Phillips initiated the column in January 2019 after talking to Jeff Smith, a collision repair instructor at the Northeast Arkansas Career and Technical Center, about the overwhelming shortage of technicians. “At the time, collision repair shop owners and managers faced a shared challenge: how and where to find new technicians,” said Phillips. “My intent on starting this column was to come up ways for the industry to share ideas on how to solve this problem.” Since then, Phillips has profiled a variety of individuals and organizations about the ways they are approaching the problem, including the Collision Career Institute (CCI), the Collision Repair Education Foundation (CREF), the Inter-Industry Conference on Auto Collision Repair (I-CAR), the March Taylor Memorial Foundation, in-prison automotive program instructors and technical schoolteachers. Her column can be found online at www.autobodynews.com.

Most Expensive States for Car Insurance in 2020 by Denny Jacob, PropertyCasualty360

In a country as large and diverse as the U.S., each state offers a range of pros and cons across a number of aspects. Whether it’s the cost of being a homeowner, the proximity to nature or their state and local tax rates, there is something for everyone. While it might not be the first factor someone might tout when talking about their state, the cost of car insurance is an important quality for many. An analysis by Insure.com found that the average cost of car insurance in 16 states is more than $100 above the national average, which came in at $1,517 this year. What state an insured lives in is a significant factor when determining the cost of car insurance, but insurers also consider gender, age, the vehicle and credit score. State-specific factors like insurance laws, claim and crime rates, and the number of uninsured drivers can influence the premium as well.

Whether you live in an expensive state or a cheap state, Insure.com says to shop at least three insurers and “always make sure you’re comparing apples to apples when it comes to coverage levels and deductibles.” And when buying a new car, it’s always wise to shop for insurance as you look for the car so the premium won’t tear through your budget. Insure.com commissioned Quadrant Information Services to calculate auto insurance rates from six large carriers (Allstate, Farmers, GEICO, Nationwide, Progressive and State Farm) in 10 ZIP codes per state. It averaged rates in each state for the cheapest-to-insure 2020 model-year versions of America’s 20 best-selling vehicles as of January and ranked each state by that average. With this in mind, explore the slideshow to see Insure.com’s list of the most expensive states for car insurance in 2020. We thank PropertyCasualty360 for reprint permission.

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CAR Coalition Urges Data Control The Consumer Access to Repair (CAR) Coalition recently sent a letter to members of the U.S. House of Representatives’ Committee on Energy and Commerce, speaking out against a previous request on behalf of auto manufacturers opposing consumers’ choice over the use of the data generated by telematics in their vehicles. According to the CAR Coalition, limiting that choice is driving out repair competition, while the consumer cost of auto repair has risen dramatically. The previous request, in a letter to the same committee sent by the Alliance for Automotive Innovation on behalf of auto manufacturers, called for a fiveyear federal preemption of any state action regarding access to telematics data. The CAR Coaltion said such a move which would only strengthen the manufacturers’ developing monopoly of the automotive collision repair chain. Source: CAR Coalition

Tesla Battery Day Gets a Concrete Date by Simon Alvarez, Teslarati

It turns out the long wait for Tesla’s highly-anticipated Battery Day event will be a bit longer, but it will certainly be well worth the wait. In a recent announcement on Twitter, Tesla CEO Elon Musk stated the tentative date for Battery Day will be Sept. 15. But that’s not all, as the event will be held along with the Annual Shareholder Meeting. Musk posted the announcement this weekend, later adding the event will be held in Fremont, CA. Musk noted Battery Day will include a tour of Tesla’s cell production system, among other things. Considering the location of the event, it appears Tesla may be bringing investors to its secret and rumored skunkworks lab located at the company’s Kato Road facility, just a few minutes away from the Fremont plant. Speculations are abounding about what Tesla would reveal in its Battery Day event. The last time Tesla held a similar event was Autonomy Day in April 2019, and that included a deep dive and discussion

of the company’s custom Hardware 3 chip. Everything about HW3, from its design to its performance, was discussed intensively. This same amount of attention to detail is expected for Battery Day.

In classic Elon Musk fashion, Battery Day has experienced some delays, a lot of it due to the coronavirus pandemic. If Musk’s recent Twitter announcement is any indication, this delay is due, at least in part, to the fact the company seems determined to show its shareholders what its battery cell technology is like firsthand. And considering how impressive Tesla’s batteries already are today, it’s pretty exciting to see what the company has in store for the future. Previous reports point to Tesla

discussing its next-generation battery cells at Battery Day. These cells are rumored to be capable of lasting a million miles if used in electric vehicles, and decades if deployed as battery storage devices. If Tesla does discuss cells that match these speculations, then the entire electric vehicle industry—and the shift to sustainability as a whole—will likely change forever. Among the remaining roadblocks for widespread EV adoption are the limitations of the current generations of batteries. Batteries today are capable in their own right, but they are still more expensive compared to a traditional internal combustion engine. Tesla’s rumored million-mile batteries are expected to reach, and perhaps even go beyond, price parity with gas-powered cars. By doing so, Tesla would be able to accelerate the EV transition even more. We thank Teslarati for reprint permission.

Industry Legend Dick Schoonover Dies Dick Schoonover, of Woodbury, Little Lakes-Little League and MN, who grew his family auto body Lake Region Youth Hockey. He was a student of the game shop into a nationally-recognized company while helping to advance and he shared his competitive spirit with all who played for the collision repair indushim. try as a whole, died July 9, In addition to his love 2020. He was 84. for family, Dick loved the Dick graduated from family business. In 1973, Murray High School in he moved Schoonover 1955, where he had played Auto Rebuild to Shorevfootball, basketball and iew. Dick was an innovabaseball, earning a letter in all three sports over four Dick Schoonover tor and was always two steps ahead of the comyears. That was also where petition. He set the bar high for he met the love of his life, Beryl. Dick and Beryl were married customer service and quality and in 1956 and started their family in made sure his employees had the St. Paul, MN. Dick went to work best tools, equipment and training for his dad, Chuck, at the family available. During his leadership, business, Schoonover Auto Re- he grew the company to a nationbuild. Dick took it over in the mid ally recognized repair facility. Dick was involved in the ‘60s after Chuck’s early passing. Dick and Beryl built a home collision repair industry, serving in Shoreview, MN, and raised on many boards and committees their three sons. Dick balanced at the state and national level for small business ownership with ASA, ASC, I-CAR and others. family time. He encouraged the Dick helped develop legislation, boys to be active in sports and rules and procedures granting helped them develop a love of the rights to consumers and leveling game, especially hockey. Over the the playing field with auto insuryears, Dick coached Legion ball, ers.

In his spare time, Dick gave back to the community that meant so much to him. Besides coaching youth sports, he served on the Northwest YMCA board, was a Roseville Rotarian and sponsored many youth teams year after year. He and Beryl enjoyed golfing and were members of Midland Hills and Indian Hills Golf clubs. He was an avid reader and would read anything related to news, politics and business. He also loved cars and shared that love with his sons. Dick was a man of many talents: businessman, entrepreneur, visionary, mentor, coach. Most importantly, he was a loving man who would do anything for his family. His drive for excellence, integrity, hard work and dedication proved anything could be achieved, and any obstacle could be overcome. He often used the phrase “tough mustang” to encourage family members. With Beryl, his wife of 64 years, at his side, Dick passed away at home. In addition to his wife, Dick is survived by sons Jeff (London Savant), Scott and Mike (Gayle); grandchildren Alyssa, Lindsay

(Ben), Courtney, Abby (Drew), Anna and Matthew; great-grandchildren Jaxon, Maddox, Keegan and Josie; sister Jodie Roche (Michael) and nephew Ronan (Rebecca). He was preceded in death by grandson Patrick. The Schoonover family would like to thank the caregivers from St. Therese and CareAparent, who provided comfort, care, companionship and support while Dick was in hospice. A memorial services will be held at a later date. Memorials preferred to Patrick Schoonover Heart Foundation, www.playforpatrick.org, or King of Kings Lutheran Church, Woodbury, www.kingofkingswoodbury. org. Source: Tribute Archive

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