August 2022 West Edition by Autobody News

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GM’s Cruise Self-Driving Car Crash Injures Multiple People by Steven Loveday, InsideEVs

On June 3, in San Francisco, CA, a Cruise self-driving vehicle that was driving autonomously was involved in an accident with a Toyota Prius, injuring people in both cars. According to Automotive News, the crash occurred only one day after regulators in California gave Cruise a critical permit related to its autonomous driving pursuits. The California Public Utilities Commission ruled Cruise can collect fares from passengers taking rides in the car with no human safety driver behind the wheel.

The permit was the first of its kind in the Golden State.

Advisors

After months of speculation about the future of Service King, a blockbuster merger with Crash Champi-

California Voters to Consider New Tax Hike on Wealthy to Subsidize EVs

The Cruise car turned left in front of the oncoming Prius at the intersection of Geary Boulevard and Spruce Street. Officials from Cruise claim the autonomous vehicle stopped before proceeding with the left turn, and the

The initiative, Proposition 30, would increase taxes on personal income over $2 million by 1.75% for wealthy individuals and married couples. The tax revenue would then be split, with 45% for consumer rebates and incentives for zero-emission vehicles, 35% for charging stations and 20% for wildfire prevention. According to the initiative, at least half of the funding earmarked for rebates and charging stations must be directed to low-income communities and households. Clean Air California, the coali-

See Self-Driving Car, Page 16

See New Tax Hike, Page 16

A Deeper Look at Crash Champions’ Merger with Service King by David Roberts, managing director of Focus

Vol. 40 / Issue 8 / August 2022

ons was announced to Service King managers on July 15. The two consolidators will merge and create a 550+ shop operation with upwards of $2 billion in annualized sales.

See Crash Champions to Merge, Page 19

by Madison Hirneisen, The Center Square

This November, California voters will be asked to approve up to $4.5 billion in new taxes on wealthy residents to fund subsidies for zero-emission vehicle purchases and charging stations.

The World Experienced a Pandemic—and Initial Vehicle Quality Got Sick In the wake of the COVID-19 pandemic, initial vehicle quality notably declined, according to the J.D. Power 2022 U.S. Initial Quality Study, released June 28.

Buick was the highest-ranking brand in J.D. Power’s 2022 U.S. Initial Quality Study and the Buick Encore GX, shown here, ranked the highest in its segment.

The disruptions caused by the pandemic—supply chain issues, record-high vehicle prices and personnel dislocations---contributed to vehicle problems reaching a record high in the 36-year history of this benchmark study. Compared with 2021 results, the industry experienced an 11% increase in problems per 100 vehicles (PP100), which is 18 PP100 worse than last year, resulting in an industry average of 180 PP100. A lower score reflects higher vehicle quality.

General Motors bucked the trend with an improvement in initial quality that landed it in the highest rank position among automotive corporations. Among brands, Buick’s quality improved 17 PP100 year over year, vaulting it to ranking highest overall in 2022 from 12th place in 2021, while Genesis ranked highest among premium brands. Just nine of 33 ranked brands improved in vehicle quality year over year. “Given the many challenges automakers and their dealers had to face in the past year, it’s somewhat surprising that initial quality didn’t fall even more dramatically,” said David Amodeo, director of global automotive at J.D. Power. “In general, initial quality has shown steady improvement throughout the history of this study, so the decline this year is disappointing—yet understandable. Automakers continue to launch vehicles that are more and more technologically complex in an era in which there have been many shortages of critical components to support them.” See Initial Vehicle Quality, Page 22

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CONTENTS Barrett-Jackson Celebrates 4th of July Weekend with Las Vegas Auction Record �� 8 California Senate Advances SEMA-Sponsored ZEV Conversion Bill �� 12 California Voters to Consider New Tax Hike on Wealthy to Subsidize EVs �� 1 CAWA Names New Board of Directors Member �� 12 EVgo Awarded Grants to Build Fast Chargers for CA Multi-Family Housing �� 11 GM’s Cruise Self-Driving Car Crash Injures Multiple People �� 1 Lucid Motors Opens First Retail Location in

AUTOBODY

with Service King �� 1 AkzoNobel Supplying Lincoln Tech �� 42

ltedesco@autobodynews.com

800-699-8251

ASE Education Foundation Establishes Network �� 10 CAA Says a New Kind of Insurer Steering is Impacting the Industry �� 31 CIECAST Explores What’s Driving EV Adoption and How Collision Repairers Need to Prepare �� 4 Cox Automotive Introduces Service Advisor �� 14 Driven Brands Announces Board Member �� 27 Elephant Insurance Implements CCC �� 22 GM Has 95,000 Incomplete Vehicles Just Sitting �� 30

INDEX OF ADVERTISERS

REGIONAL

Call or Email Now for Rates:

Publisher & Editor: Jeremy Hayhurst General Manager: Barbara Davies Contributing Writers: John Yoswick, Janet Chaney, Toby Chess, Ed Attanasio, Stacey Phillips Advertising Sales: Joe Momber, Norman Morano, (800) 699-8251 Office Manager: Louise Tedesco Digital Marketing Manager: Bryan Malinski Art Director: Rodolfo Garcia Graphic Designer: Vicki Sitarz Senior Editor: Abby Andrews Accounting Manager: Heather Priddy Permissions Editor: 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. ©2022 Adamantine Media LLC.

asTech/Driven by Repairify �� 8

Industrial Finishes and Systems �� 48

Audi Wholesale Parts Dealers �� 35

Kearny Mesa Subaru-Hyundai �� 23

Auto Data Labels �� 7

Kia Downtown Los Angeles �� 32

Autobody News P.O. Box 1516 Carlsbad, CA 92018 (800) 699-8251 (760) 603-3229 Fax www.autobodynews.com editor@autobodynews.com

Pacific Northwest in Seattle �� 18

High School Students Introduced to Collision

AutoNation Honda Costa Mesa �� 28

Kia Motors Wholesale Parts Dealers �� 40-41

PG&E Begins Installing EV Chargers at Schools �� 6

Repair at Contra Costa College’s Summer

AutoNation Infiniti Tustin �� 26

Kia of Carson �� 36

Tesla Ex-Employee Rejects $15M Award in

Camp �� 43

Axalta Coating Systems �� 11

Kia of Irvine �� 18

I-CAR Offers EV Skills Course �� 44

BMW Wholesale Parts Dealers �� 44

Malco Products, SBC �� 19

Life Coach Uses Different Approaches to

Car Pros Kia �� 22

Mazda Wholesale Parts Dealers �� 42

Space in Fremont Factory to Fulfill Musk’s

Help Auto Body Shop Techs, Owners,

Car Pros Kia Renton �� 26

Mercedes-Benz Wholesale Parts Dealers �� 42

Return-to-Office Mandate �� 10

Managers �� 38

Certified Automotive Parts Association �� 16

Michael Hohl Motor Company �� 14

Chase Chevrolet �� 6

MINI Wholesale Parts Dealers �� 44

Citrus Kia-Ford �� 6

MOPAR Wholesale Parts Dealers �� 29

Classifieds �� 46

Niello Audi �� 30

Colortone Automotive Paints �� 27

Nissan/Infiniti Wholesale Parts Dealers �� 37

Corwin Buick-GMC �� 8

Porsche Wholesale Parts Dealers �� 38

Courtesy Chevrolet San Diego �� 21

PPG �� 9

Equalizer Auto Glass Tools �� 20

Roseville Kia �� 14

Fairview Ford-Lincoln-Mercury �� 12

Sandberg Volvo Cars �� 22

FH Dailey Chevrolet �� 34

Santa Monica Audi �� 27

Into a $1,000+ Monthly Payment in June �� 46

Fix Auto USA �� 15

SATA Dan-Am Company �� 2

Yoswick - DataTouch Offering New Service

Ford Wholesale Parts Dealers �� 31

Sorbothane Soft-Blow Mallet �� 12

to Help Collision Repair Shops Manage

Repairify Acquires ATG �� 6

Future Nissan of Roseville �� 30

Spanesi Americas �� 5

Access to its Data �� 35

Teslas Get Updated Seat Belt Functions

Galpin Motors �� 33

Subaru Wholesale Parts Dealers �� 39

Garden Grove Kia �� 18

The Bay Area Automotive Group �� 17

Glenn E. Thomas Dodge-Chrysler-Jeep �� 10

Volkswagen Pasadena �� 34

GM Wholesale Parts Dealers �� 45

Volkswagen Wholesale Parts Dealers �� 43

Honda-Acura Wholesale Parts Dealers ��24-25

Volvo Wholesale Parts Dealers �� 44

Hyundai Wholesale Parts Dealers �� 38

Wrenchers �� 13

Racial Abuse Lawsuit �� 18 Tesla Reportedly Does Not Have Enough

Vegas Crypto Scam Artist Collected 39 Teslas at Expense of Others �� 14

MSO Acquisitions Slowed Considerably in First Half of 2022 �� 20 Nissan Frontier and Titan Owners Warned

COLUMNISTS Anderson - Collision Repair Shops Play Vital Role in Helping Reduce Vehicle-Related Deaths �� 26 Yoswick - 3 Collision Repair Business Leaders Find Ways to Develop Positive Company Culture �� 28

Yoswick - What Your Auto Body Shop Needs to Know to Be Ready to Repair Evs �� 42

to Use Parking Brakes �� 34 Nissan Pathfinder Hood Latch Recall Follows Investigation �� 47 Non-Tesla Supercharger Pilot Launch Expected Late 2022: White House �� 47 Record Share of New-Car Shoppers Jumped

in New Update �� 47 The World Experienced a Pandemic—and Initial Vehicle Quality Got Sick �� 1

NATIONAL A Deeper Look at Crash Champions’ Merger

Why Online Customer Reviews Are More Important than Ever �� 36

autobodynews.com / AUGUST 2022 AUTOBODY NEWS 3

CIECAST Explores What’s Driving EV Adoption and How Collision Repairers Need to Prepare by Abby Andrews

CIECA hosted its latest CIECAST webinar on June 23, “Charged for Success: Understanding EV Trends and Their Impact.” Ryan Mandell, director of claims performance for Mitchell International, spoke about the trends in electric vehicle adoption and what is driving them, how EVs should be handled differently in a repair facility than their gas-powered counterparts, and what needs to be done to facilitate better, safer repairs. “This is a critical topic for collision repair and the industry as a whole,” Mandell said. Mandell said the last couple of years have been tough on new vehicles sales overall, due to parts shortages and supply chain issues—except for EV sales, which have been a bright spot. Gross volumes of EV sales grew 5% at the same time total vehicle sales decreased 15%, Mandell said. Bloomberg recently projected worldwide EV sales to grow from 6.6 million in 2021 to 21 million in 2025. “People are very bullish on EVs,” he said. Mandell said charging infrastructure is growing but has a long way to go. DC Fast Chargers—which will be key to making long-distance traveling feasible, as they can charge a battery to 80% in about a half hour—increased in the U.S. by 24% in 2021. Batteries are also improving to increase range and decrease “range anxiety” among drivers, Mandell said. The battery is 35% to 50% of the total cost to build an EV, so as mining for components becomes more efficient, it will drive down what consumers have to pay for an EV. However, the recent increasing prices for many of the metals that go into batteries, including nickel, lithium and cobalt, will offset some of those mining efficiency gains, Mandell said. “I think it will be closer to the end of the decade before we see price parity between EVs and ICE

vehicles,” Mandell said. As more EVs are sold, EVs will constitute a greater share of repairable claims coming into shops. They still make up less than 1% of claims, Mandell said, but that will continue to grow at an increasing rate. Repairers need to be ready, he said.

termarket tool can scan them. EVs also use a lot more lightweight materials, like aluminum and carbon fiber, for major component sheet metal parts to offset the heavy batteries, Mandell said. Those materials will respond differently in an accident, which will create the need for a new process to decide what can be repaired or has

“An EV is not just an electrified variant of an ICE,” Mandell said. “It really is completely different, and needs to be treated as such.” EVs have nearly double the number of semiconductors of an ICE vehicle, and a greater reliance on high-voltage batteries, which add to the complexity of repairs. “There are extra components (on an EV) and the systems are more interconnected,” Mandell said. Based on model year 2015 vehicles and newer only, the average ICE vehicle has 8.7 fault codes per scan, while an EV averages 13.8. Estimate lines also increase— the average ICE vehicle’s estimate has 35.5 lines, while the average EV’s has 47.7. “It shows how interconnected the systems are,” Mandell said. “EVs rely on more semiconductors, more digital systems, more advanced electronics to do the same tasks as mechanical systems in ICE vehicles.” A front impact on an EV has a far greater likelihood of affecting other systems throughout the vehicle, he said. Mandell noted the scan data he presented excludes Teslas, as no af-

to be replaced, and will need new tools. EVs also have significantly longer cycle times, Mandell said— on average, keys-to-keys for a drivable claim takes 8.4 days, compared to 6.9 days for an ICE vehicle. Mandell said there are new precautions that must be taken to avoid damaging the battery and keep everyone safe during the repair. “There are precautions that need to take place even before a basic teardown,” he said. Also, the battery has to be removed before going to the paint booth, due to the heat involved, which adds two

4 AUGUST 2022 AUTOBODY NEWS / autobodynews.com

hours to the process. Mandell said it will be important to set appropriate expectations for the vehicle owner from the start. “This is likely most owners’ first experience repairing an EV,” he said. “You will have to help them understand why the repair process is so different from an ICE. Have a very honest discussion at the beginning about additional steps that need to be taken to repair it safely. I think that really sets up the overall outcome to be a positive one.” Mandell said he thinks estimates for EVs need to evolve, rather than just using the same template as for an ICE vehicle. “We need to make sure it’s built in a way to facilitate a safe and proper repair, and is efficient as well,” Mandell said. He suggested adding EV-specific categories that address the completely different chassis, and adding “EV” as a separate vehicle type, as it’s not only important to note if the vehicle is a truck, van or car. He also suggested creating new EV specific templates and qualifiers, like battery capacity. “EVs overall are becoming more widespread,” Mandell said. “There are 84 EV models in the U.S. now; there were 14 just five years ago. We are going to see the tech improve as well. Rising fuel prices will also be a tailwind for EV adoption.” Watch the full CIECAST on cieca. com.

Register for ASE Summer Certification The National Institute for Automotive Service Excellence (ASE) summer registration period is now open. More than 50 ASE certification tests covering nearly every aspect of the motor vehicle service and repair industry are available for ASE certification. Those automotive service professionals registering by Sept. 30 will have 90 days to schedule an appointment to take the selected ASE tests, whether registering on the first day of the registration period

or the last. ASE testing is available throughout the year and is conducted days, nights and weekends at nearly 450 secured, proctored test centers. To register, visit ASE.com, click on register and sign in. Once logged in, users can next click on “orders” and then “store,” where they can find the tests they want to take, add those tests to the cart, check out and complete registration. Source: ASE

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Repairify Acquires ATG

PG&E Begins Installing EV Chargers at Schools

Repairify , Inc., a portfolio company of Kinderhook Industries, LLC, on July 6 announced the acquisition of Automotive Training Group (ATG), a leading technical training company known for its unmatched curriculum and experienced instructors. With live and virtual classes offered in all 50 states and internationally, ATG is dedicated to automotive professionals by offering highly technical training backed by quality instructional materials and experienced educators. Founded in 2004, ATG has found success in the market by presenting its technical courses in an understandable and interesting manner that challenges even the most experienced technicians. Curriculum is developed with a diagnostic approach, combining OEM support information with real-world technician experience using actual case studies where possible. Source: Repairify, Inc.

Pacific Gas and Electric Company (PG&E) announced June 30 it broke ground on the first of up to 130 new electric vehicle (EV) charging ports at 22 schools in its service area. The first installation is at Eastside College Preparatory School in East Palo Alto, CA. Overall, PG&E’s EV Charge Schools pilot program aims to help fill charging gaps at these locations and support California’s clean transportation and decarbonization goals. Through the EV Charge Schools pilot, PG&E will install level 2 charging stations at school facilities and educational institutions for staff, parents and students to charge their EVs, with access varying by location. PG&E will help fund the costs of purchasing and installing the EV charging equipment and networking fees at these schools as well as ongoing maintenance and operations. With up to 40% of the new chargers located in disadvantaged communities, the pilot will help to bring EV charging options to customers who might not have had

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them before. PG&E also will develop EV and sustainability curriculum for all schools in its service area along with teacher training options. The kindergarten through grade 12 curriculum will allow teachers to connect classroom learning to real-world infrastructure and help expand awareness of clean energy transportation. “By increasing charging access at schools, we strive to make electric vehicles a viable option for more Californians. Expanding the use of clean transportation and reducing vehicle emissions is good for our state, our customers and the environment,” said PG&E’s Aaron August, vice president of business development and customer engagement. Clean transportation efforts are a central pillar of PG&E’s Climate Strategy Report, which outlines the company’s plans to reach net zero greenhouse gas emissions by 2040, five years ahead of the state’s target, and to start actively removing more greenhouse gases from the environment than it emits by 2050. To help reach these goals, PG&E

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plans to be the industry’s global model by preparing its grid to fuel at least 3 million EVs by 2030—leading to a cumulative reduction of 58 million metric tons of carbon emissions. These recent commitments build upon PG&E’s history of leadership in the area of clean transportation. More than 420,000 EVs have been sold in PG&E’s service area, representing one in six EVs in the country. Increasing EV adoption can play a critical role in supporting California’s goals to reduce emissions as transportation is the single largest source of greenhouse-gas emissions in the state, contributing nearly 40%. Passenger vehicles alone account for nearly 29% of the state’s total emissions. By 2035, 100% of California sales of new passenger cars and trucks will have zero tailpipe-emissions. The electricity fueling EVs in California comes from one of the cleanest energy mixes in the country. PG&E estimates 93% of its customers’ electricity in 2021 came from greenhouse gas-free resources. Source: PG&E

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Barrett-Jackson Celebrates 4th of July Weekend with Las Vegas Auction Record Barrett-Jackson delivered the ultimate automotive lifestyle experience during this year’s Las Vegas Auction, June 30-July 2 in the West Hall of the Las Vegas Convention Center. Fittingly, American muscle cars led the way over the Fourth of July holiday weekend, including a 1970 Plymouth HEMI Superbird that sold for a world auction record $1.65 million. In total, 663 vehicles sold with no reserve for more than $48.2 million, while 279 pieces of automobilia brought in more than $869,000, bringing the total auction sales to more than $49.1 million, a Barrett-Jackson Las Vegas Auction record, with a 100% sell-through rate and more than 40 world record auction sales achieved. “Our Las Vegas Auction provided guests an amazing, unparalleled experience over the Independence Day holiday weekend,” said Craig Jackson, chairman and CEO of Barrett-Jackson. “We set the stage with our world-class opening night party at Zouk Nightclub followed by our ‘supercar therapy’ event with the Driven Project that put kids battling

serious illnesses into supercars on Thursday morning. We then filled the next three days with exciting auction moments, including the sale of 2023 Cadillac Escalade-V First Retail Production VIN 001, which raised $525,000 for charity. The Las Vegas Auction also demonstrated the demand for blue chip HEMI cars that brought in strong hammer prices.” The top 10 non-charity vehicles sold during Barrett-Jackson’s 2022 Las Vegas Auction included: 1. 1970 Plymouth HEMI Superbird—$1,650,000 2. 1963 Chevrolet Corvette 327/360 Z06 Split-Window Coupe—$566,500 3. 1958 Chevrolet Corvette Custom Topless Roadster—$550,000 4. 1971 Plymouth HEMI ’Cuda— $550,000 5. 1970 Plymouth HEMI ’Cuda— $517,000 6. 1941 Cadillac Series 62 Custom Convertible—$385,000 7. 1970 Dodge HEMI Challenger RT/SE—$379,500 8. Jason “Captain America” Britton’s 2009 Mercedes-Benz SL65 AMG

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Black Series—$335,500 9. 1958 Chevrolet Corvette Custom Topless Roadster—$330,000 10. 1967 Ford Mustang Eleanor Tribute Edition—$330,000 “The depth, breadth and quality of our docket, especially muscle cars, hot rods and Resto-Mods, was among the best we’ve ever offered in Las Vegas,” said Steve Davis, president of Barrett-Jackson. “American HEMI muscle appropriately led the charge this holiday weekend. Classic trucks and SUVs, especially Chevrolet C10 trucks and Ford Broncos, also continue to be popular. The collector car hobby is enjoying a banner year and I look forward to riding the momentum into our Houston Auction this October.” During this year’s Las Vegas Auction, Barrett-Jackson raised $650,000 for charity from the sale of two vehicles, led by the 2023 Cadillac Escalade-V First Production VIN 001, which raised $525,000 benefitting the Pensole Lewis College of Business and Design. Barrett-Jackson VIP Dan Snyder placed the winning $500,000 bid and fellow VIP

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Michelle Mauzy generously donated another $25,000 to the cause. The 2022 Jeep Wrangler Unlimited Rubicon 392 crossed the block with 100% of the $125,000 hammer price benefiting Ronald McDonald House Charities of Detroit. To date, Barrett-Jackson has helped raise more than $148 million for charitable organizations. Barrett-Jackson’s Las Vegas Auction sold 279 automobilia pieces at no reserve for $869,100, including buyer’s premium. The top three automobilia pieces that sold during the Las Vegas auction include:

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autobodynews.com / AUGUST 2022 AUTOBODY NEWS 9

ASE Education Foundation Establishes Network

Tesla Reportedly Does Not Have Enough Space in Fremont Factory to Fulfill Musk’s Return-to-Office Mandate

Serving as liaisons between students, schools and ASE Foundation industry partners, ASE field managers are integral to the success of the initiatives established by the ASE Education Foundation. ASE Education Foundation field managers assist and coach schools to achieve and maintain ASE accreditation, collaborate with local employers to engage with schools, help develop advisory committees and assist in the placement of students in entry-level positions in the transportation industry. In addition, the field managers foster local employer partner engagement by connecting employers directly with schools and students. They promote the benefits of professional and entry-level ASE certification, advise on instructor development opportunities, and enable and cultivate relationships among foundation supporters and accredited programs, administrators and instructors. Source: ASE Education Foundation

by Joey Klender, Teslarati

Tesla is reportedly struggling with enough office space to fulfill CEO Elon Musk’s return-to-office mandates at the Fremont Factory in California. A new report said Tesla employees are complaining about slow WiFi, a lack of parking and not enough desk space to accommodate the factory’s 22,000 employees. A report from The Information, which uses quotes from several Tesla employees who work at Fremont, said the factory is not large enough to fit all of the company’s employees after Musk decided earlier in June all employees would work 40 hours in a company office. Musk said in a series of emails that executives would be required to return to the office for 40 hours per week, then clarified that all employees would be required to work in an office setting, not a remote one. Now that the company’s layoffs are taking effect and employees are returning to Tesla-owned offices, workers are starting to convey con-

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cerns over a lack of space, which has been a concern for the automaker as it has expanded production and demand. Fremont is not Tesla’s largest factory; in fact, it’s not very close. It is only 5.3 million square feet, and recent tours from analysts at Morgan Stanley even brought forward thoughts Tesla may have a space problem at the factory. While analyst Adam Jonas said production lines and manufacturing space is limited, it also sounded like office space is a bit of a problem. The report said workers struggled to find desk space at Tesla’s offices in the Fremont complex, WiFi was too weak to use or do anything productive and some employees were told by managers to come in fewer than five days a week due to space restrictions. Jonas said in his note, which came out in March, that Fremont “was never designed to produce 450K units (at its peak produced ~300K units before Tesla took it over from Toyota) which was immediately apparent at the tour.” Of

course, as production increases, so does Tesla’s employee headcount, which stood just a few hundred employees short of 100,000 at the end of 2021. It appears Tesla is now a size of such magnitude that expansion should be its only real plan for Fremont. Space is becoming such an issue in both production and office space, it may be time for Musk and Tesla to go forward with plans of expanding its first automotive plant. “Actually, we still operate our California factory, which is the largest auto plant in North America, at full capacity and are considering expanding it significantly,” Musk said on Twitter earlier this year. “It has built 2/3 of all electric vehicles in North America, twice as much as all other carmakers combined.”

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EVgo Awarded Grants to Build Fast Chargers for CA Multi-Family Housing EVgo Inc. on June 22 announced it was selected for proposed awards for two new California Energy Commission (CEC) Reliable, Equitable and Accessible Charging for ulti-family Housing (REACH) grants totaling $3.6 million. These funds will be used to deploy new high-powered direct current fast chargers (DCFC) near multi-family housing (MFH) units. In addition, local community residents will be eligible for discounted EVgo rates as part of the project. “EVgo is thrilled to work with the California Energy Commission to keep making it easier for more drivers to go electric with wider access to convenient, reliable and affordable EV charging solutions,” said Cathy Zoi, CEO at EVgo. “There are more than 6 million Californians like me who live in apartment buildings, and fast charging nearby is key for us to drive EVs. By partnering with the state on these grants, we can go even further to pair infrastructure for everyone with incentives for nearby residents of underserved and impacted communities—ensuring equitable access to these resources for all.”

In November 2021, the CEC released a grant solicitation and application package, “Reliable, Equitable, and Accessible Charging for multi-family Housing (REACH),” as part of its Clean Transportation Program. The solicitation was an offer to demonstrate replicable and scalable business and technology models for large-scale deployment of EV charging infrastructure capable of maximizing access and EV travel for multi-family housing (MFH) residents, from DCFC nearby those residents to level 2 (L2) chargers in and around the residential buildings themselves. The solicitation defined MFH as residential properties with multiple dwelling units, but excluded single-family dwellings (detached), duplexes, triplexes, townhomes and mobile homes. Projects under the REACH grant must include charger installations that will benefit and be used by MFH residents within disadvantaged communities, low-income communities or a combination of both. “Forth is excited to partner with EVgo in providing outreach and ed-

ucation to communities in California to help increase awareness and understanding of the benefits and availability of electric transportation solutions in their neighborhoods,” said Jeff Allen, executive director of Forth. “Equitable and convenient access to charging infrastructure is a key element of expanding widespread adoption of electric transportation and is a central tenet of our work.” As part of EVgo’s commitment to Electric for All, EVgo integrates the EPA’s EJ Screening Tool—an environmental justice mapping and screening tool based on nationally consistent data—to identify potential site locations that can increase infrastructure access for low-income individuals, people of color and underserved communities, as these communities tend to have the fewest charging options while experiencing

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greater impacts of pollution. Public charging options, and fast charging in particular, can help mitigate this disconnect while fueling the transition to electric by servicing more densely populated areas. In 2021, EVgo achieved its goal to increase such access to charging each quarter and reached a PM2.5 EJScreen demographic score of 51% for its chargers—meaning a majority are within a 10-minute drive of areas with high particulate matter (PM2.5) levels in the air. Today, the company is developing new benchmarking strategies to improve equity and access to its solutions. For more information around the locations of fast charger’s within EVgo’s charging network, visit www.evgo.com. Source: EVgo

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CAWA Names New Board of Directors Member Brian Cruickshank of Schwartz Advisors has been appointed to CAWA’s Board of Directors. “I am excited to announce that Brian Cruickshank with Schwartz Advisors is joining the CAWA Board of Directors,” said Michael Rukov, chair of the Board of Directors. “I have personally known Brian for many years and his industry accolades are nothing but impressive. I am excited to add such an amazing industry leader to our board, which adds even more validity to the importance of CAWA. Brian withstood my participation in Leadership 2.0, Leadership 3.0 in China and motor vehicle executive MBA at Northwood—and there is nothing he cannot help us achieve.” Cruickshank currently works as a Schwartz Advisors associate. He is an experienced industry visionary whose 27-year aftermarket career has been focused on strategy, marketing and communications. He is often seen at industry events or at the podium, where he is routinely asked to speak on aftermarket topics. Cruickshank is the former editor in chief of several national

aftermarket publications at Babcox Media, including Underhood Service, Counterman and AftermarketNews. He served as executive director of the University of the Aftermarket at Northwood University from 2008-2022. He is a member of the AWDA Board of Governors and the recipient of numerous industry awards, including the AWDA Pursuit of Excellence, Mort Schwartz Excellence in Education Award, AIA Young Executive of the Year and the Northwood University Automotive Aftermarket Management Education Award. Cruickshank’s undergraduate degree from The Ohio State University was followed nearly two decades later by the completion of an automotive aftermarket executive MBA from Northwood University’s DeVos Graduate School of Management. Prior to his higher education experience, Cruickshank proudly served in the U.S. Marine Corps. Source: CAWA

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California Senate Advances SEMA-Sponsored ZEV Conversion Bill by SEMA Washington, D.C., Staff

The California Senate Environmental Quality Committee unanimously passed bipartisan SEMA-sponsored legislation, AB 2350, that would incentivize consumers to convert gasoline- and diesel-powered motor vehicles into zero-emissions vehicles (ZEV). If enacted, AB 2350 would provide eligible motorists who

convert their vehicle with a $2,000 rebate. The bill previously passed the Assembly and currently awaits consideration in the Senate Transportation Committee. In recent years, California has implemented various programs, in-

cluding the Clean Vehicle Rebate Program and the Clean Cars for All Program, to promote the purchase of new zero-emission vehicles (ZEVs). However, none of the programs currently offer benefits for vehicles that started their life with an internal-combustion engine and can be converted to a ZEV via an aftermarket motor package. AB 2350 helps preserve California’s rich car culture while creating new ways to make ZEV ownership more accessible. SEMA encourages its members and enthusiasts in California to contact their lawmakers in support of AB 2350. For further details, contact Christian Robinson at stateleg@sema. org. Source: SEMA

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Cox Automotive Introduces Service Advisor Kelley Blue Book, a Cox Automotive company, on June 29 announced Service Advisor, now available for car owners nationwide. Service Advisor is designed to help car owners identify local auto repair shops and find fair prices for services rendered. Referencing data stemming from millions of services performed, Service Advisor answers key ownership questions like what services are needed, when to have them performed and, most importantly, how much it should cost based on similar repairs in the area. With inflation on the rise and both new and used vehicle inventory still constrained, the cost of keeping their current rides on the road is a major concern for most motorists. Additionally, according to the Cox Automotive Monthly Repair Order Revenue Index, the cost of repairs is on the rise. Average revenue generated per repair order rose for the sixth consecutive month after levelling off in November 2021. Source: Cox Automotive Inc.

Vegas Crypto Scam Artist Collected 39 Teslas at Expense of Others by Steven Loveday, InsideEVs

A Las Vegas, NV, man was charged for running a major crypto scam for several years. He reportedly acquired $45 million, 39 new Tesla vehicles and many other items in the process.

According to a report published by Teslarati, the crypto scam artist scammed more than 10,000 people over four years, beginning in June 2018. He told investors via email that a small investment of less than $100,000 would eventually bring $2 trillion, though it was all fabricated to rip off people. On June 29, the crypto scam-

mer, Neil Suresh Chandran, was indicted by a federal grand jury. He had encouraged people to send him money to invest. In order to convince them they should send the funds, he explained one of his five businesses was in the process of being acquired by rich investors, which would generate massive returns. He claimed to own businesses related to cryptocurrency and virtual reality. Both Elon Musk, CEO of Tesla, and Jeff Bezos, executive chairman and founder of Amazon, are indirectly mentioned in the official documents surrounding the case. However, to be very clear, it’s noted neither billionaire played any part in the scam. Chandran made apparent claims about Musk, who is referred to as the “founder and CEO of an electric car company” and “Billionaire 2” in the documents. The indictment refers to Bezos as “Billionaire 1” and the “founder and executive chairman of a large online retailing company.”

When Chandran was arrested in Los Angeles, CA, it was learned he had five homes spread between California and Nevada, stolen money, an expensive Swiss diamond watch, a Ferrari, a Rolls-Royce, a boat, three RVs, two pickup trucks, several other vehicles and 39 Tesla EVs. The Teslas included three Model X, four Model S, 15 Model 3 and 16 Model Y. The indictment points to money laundering, though it doesn’t seem clear precisely how the whole scam unfolded. The documents do, however, say Chandran and some others may have received money from investors, which was then used illegally. The scam artist is accused of multiple counts of wire fraud and the use of stolen or illegally obtained property. He could be sentenced to up to 20 years in prison for each offense.

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New Tax Hike tion of organizations sponsoring the ballot initiative, estimates the measure will impact 0.1% of Californians—around 35,000 residents— who are high-earners and generate $100 billion over 20 years. The measure will appear on the November ballot alongside several other initiatives that qualified by the June 30 deadline, Secretary of State Shirley Weber announced. If voters approve, the legislative analyst and director of finance estimate Prop 30 would increase state tax revenue between $3 billion to $4.5 billion annually. With four months left until election day, the initiative is already sparking debate between proponents who say it will reduce harmful greenhouse gas emissions by speeding up the state’s transition to electric vehicles and opponents who decry increasing the state’s nation-leading income tax rates. Prop 30 has broad support from

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Self-Driving Car self-driving car was actually sitting still when the Prius hit it. Cruise said the driver of the Toyota was speeding. Moreover, the company’s report claimed the Prius was in a lane that required a right turn, though the human driver proceeded straight through the intersection. A spokesperson for the San Francisco Police Department couldn’t confirm or deny Cruise’s interpretation of the story since an incident report was either unavailable or not completed. Clearly, there is much more information needed in order to sort out exactly what happened in the crash. Carnegie Mellon University professor and autonomous-vehicle safety expert Phil Koopman noted the specific behavior of both the human driver and the self-driving car will need to be taken into account. “Many people have a word for a driver who cuts in front of them and then stops in the road, and it’s not a polite or charitable word,” Koopman said. “There are a lot of unknowns

various organizations and associations, including the American Lung Association, the Coalition for Clean Air, CalFire and the State Building and Construction Trades Council of California. They say it will address two primary sources of air pollution and climate change plaguing California—transportation emissions and wildfires—by expanding electric vehicle infrastructure, funding wildfire prevention and making it possible for more individuals and organizations to purchase electric vehicles with rebates. “California wants to lead the nation on climate change, and this initiative fits into that category,” Veda Banerjee, communications director for the California Environmental Voters, told The Center Square. It’s facing opposition from associations like the California Chamber of Commerce and the Howard Jarvis Taxpayers Association, who are skeptical of raising taxes as the state swims in record revenues. California has the highest income tax rate in the U.S. at 13.3% and the nation’s highest sales tax rate. With here. We don’t know if the Prius driver intended to turn right, but then swerved to try and avoid the crash with the stationary vehicle, for example. There are just a lot of unknowns.” Cruise said the car was in autonomous mode when the crash occurred. However, it didn’t clarify if the person or people in the car were safety drivers, employees, passengers or a combination. We do know people in the car were not likely charged for the ride since the paid service hadn’t yet started prior to the crash. Regardless of who’s to blame for the incident, multiple people were injured, and someone is responsible. This just goes to show that even once it seems self-driving cars may be ready for our roadways in some capacity, incidents are almost certain to occur. It will likely be a long and painstaking process to analyze the interaction between human drivers and robot cars to minimize incidents and determine fault. Just weeks after the crash, a fleet of Cruise vehicles drove to the same intersection and blocked traffic for hours. Cruise apologized for the incident and called it a “technical issue.”

16 AUGUST 2022 AUTOBODY NEWS / autobodynews.com

a historic $97 billion surplus for the fiscal year, Jon Coupal, the president of the Howard Jarvis Taxpayers Association, posed the question— do we even need a new tax?” “California is just a tax machine cranking out vast amounts of revenue,” Coupal told The Center Square. “If the objectives of this initiative, the spending priorities reflected in this initiative are that important, they should be paid for by the General Fund.” Coupal also warned that increasing taxes on the state’s highest earners could lead to more residents leaving the state for places like Florida or Texas, where the top marginal rate is zero. Supporters of the measure argue that the initiative will combat the impacts greenhouse gasses and wildfires have on the health of millions of California residents. According to the American Lung Association, six of the top 10 most polluted cities in America are in California, with Los Angeles ranking as the No. 1 most polluted city in the nation. Air pollution

can cause several respiratory issues, like asthma attacks and shortness of breath, and can lead to heart attack, strokes and premature death, according to the American Lung Association. Clean Air California estimates 38 million out of 39 million Californians will be impacted by ozone and particle pollution in 2021. Almost all Californians live in areas that violate national air quality health standards, Bill Magavern, the policy director for the Coalition for Clean Air, told The Center Square. “All Californians are having our health damaged by air pollution and climate change, and this ballot measure is our best opportunity to, as voters, do something about the huge challenges of air pollution and climate change and allow us to take great leaps in cleaning up transportation and stopping wildfires,” Magavern said.

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Lucid Motors Opens First Retail Location in Pacific Northwest in Seattle Lucid Group, Inc., on June 24 announced the official opening of its first retail location in the Pacific Northwest at University Village in Seattle, WA. This Lucid Studio opening marks 28 Studio and service center locations open in North America. Lucid Studio University Village will be open to the public starting June 25. “The response to Lucid in Washington state has been tremendous, which reflects the region’s unique embrace of both innovation and the environment,” said Zak Edson, Lucid’s vice president of sales and service. “We have a growing number of Lucid Air owners in the market, and the new Lucid Studio in University Village will provide the perfect opportunity for EV enthusiasts to engage with and learn about the groundbreaking Lucid Air.” Lucid Studio University Village will join the Lucid service center at 3412 Airport Way S., Seattle, providing comprehensive support for Lucid owners in the

area.

Every Lucid Studio offers a digitally oriented luxury experience tailored to each customer’s preferences, whether they visit in-person, make inquiries entirely online or combine the two. Lucid Studios allow customers to experience the brand and obtain information about its products in locations that underscore the company’s unique design aesthetic. Visitors who explore a Lucid Studio get a vision of how the company draws inspiration from the beauty, innovation and diversity of its home state of California. In addition, Lucid Studios augment the physical experience of seeing and touching a Lucid Air with an elevated digital experience. Using a 4K VR configurator, Lucid’s Virtual Reality Experience combines the physical and virtual worlds to showcase seamless personalization of everything from interior finishes and materials to exterior color. Source: Lucid Group, Inc.

Tesla Ex-Employee Rejects $15M Award in Racial Abuse Lawsuit by Maria Merano, Teslarati

Former Tesla elevator operator Owen Diaz rejected a $15 million award in his lawsuit claiming racial abuse from his coworkers at the Fremont Factory in California.

On June 7, U.S. District Judge William Orrick in San Francisco said Diaz had two weeks to accept the $15 million payout. Orrick had reduced the award in April, from nearly $137 million. Lawyers representing Diaz turned down Orrick’s award in a brief filing submitted to a San Francisco federal court. As per Reuters, Diaz’s lawyers claimed the award was unjust and would not deter future misconduct by Tesla.

After stating Diaz had two weeks to accept the award, Orrick noted the former Tesla worker had no controlling question of law to justify an immediate appeal of the reduced payout. He further explained permitting an immediate appeal “would further delay [the] resolution of a case that is already five years old.” Diaz sued Tesla in 2017. His lawyers disagreed with Orrick, arguing a question of law regarding damages for emotional distress justified an immediate appeal. By rejecting the $15 million award, Diaz’s lawyers opened the door for a new trial. “In rejecting the court’s excessive reduction by asking for a new trial, Mr. Diaz is again asking a jury of his peers to evaluate what Tesla did to him and to provide just compensation for the torrent of racist slurs that was directed at him,” said the lawyers of the former Fremont Factory employee.

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Crash Champions to Merge While still smaller than Gerber and far behind Caliber, this new entity will be competing coast to coast with its two larger national competitors, as well as six smaller super-regional MSOs. For much of the last six months, Crash’s investment bank was circulating an extensive investment memorandum, seeking a new private equity sponsor. During the same period, the investors in Service King were looking for a resolution to its deteriorating financial performance. Clearlake Capital acquired a control position in the Service King bonds. This position allowed them to negotiate a debt conversion to new equity and an extension of other debt obligations. In addition, Clearlake injected a reported $200 million in cash. Crash was looking for capital to continue its rapid growth. Clearlake was looking for a partner to help manage a billion dollar investment in collision repair. The resulting

merger is a combination of a deep pocketed capital sponsor, extensive management team, geographic penetration and scale that now rivals its two biggest competitors. Crash Champions has gained a major influx of assets and probably some cash as well. We don’t know exactly what the combined balance sheet will look like, but total debt to capital will be much more reasonable for the combined companies. We would expect Crash’s acquisition program would be more subdued for a period as it integrates the Service King shops. However, given the success of their program in the last three years, there is probably a substantial pipeline of commitments that will be completed. And the deep pockets of Clearlake will likely allow Crash to contemplate many, as well as larger, transactions. Among the benefits of the merger are a huge increase in revenues and scale, complementary footprints, improved negotiating power with insurance companies, improved purchasing and spreading overhead.

The challenges will be integration, technician retention and merging management teams. Crash Champions has been building out across the country in multiple attractive markets---Southern and Northern California, Florida, Colorado, Chicago, Wisconsin, Washington, D.C., and Philadelphia. Service King had an enviable footprint across the West, Southwest, Texas and Chicago. The two firms overlapped in some markets where neither was dominant. The combined numbers in these markets are considerably more scalable and efficient. In other markets, each had considerable scale without duplicating the other’s positions. With the merger, Crash enters 12 new states and several of the fastest growing metropolitan areas around the country. Texas is the grand prize, with 96 locations in a state where Caliber dominates and Gerber is a weak third player. The original Service King locations owned by Eddie Lennox are the core operations in the best performing region for Ser-

vice King. Crash already has a very strong position in Northern California with the acquisition of Mike’s Auto Body. With the addition of Service King’s South Bay and Sacramento shops, it is a strong No. 2 to Caliber. The combination of Crash’s 30 shops in Southern California with 25 of Service King gives them a stronger footprint in the nation’s largest market. However, even the combination of these two still leaves them a very distant second to Caliber. While 37 total shops is modest, the coverage across the Washington, D.C., and Philadelphia region is highly credible. Combined operations in Florida with 47 shops improves their penetration in that market. Source: Focus Advisors

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MSO Acquisitions Slowed Considerably in First Half of 2022 by David Roberts and Madeleine Roberts, Focus Advisors

The first six months of 2022 have been an unusually slow period for acquisitions by most of the consolidators. Aside from catching their collective breaths after a frenetic wave of closings at the end of last year, there isn’t a single explanation for the slow down but general industry conditions experienced by every operator have put more of a focus on current production rather than future growth. Extreme parts shortages resulting in significantly longer cycle times, an even more severe shortage of qualified technicians to do the work, and the increasing imbalance between insurance reimbursement rates and operator costs, have left every organization scrambling, improvising and struggling to meet current demand. Consolidators COVID has not slowed Caliber down. With more than 130 acquisitions and 72 brownfield and greenfield openings in the same period, Caliber grew more than 200 locations in the first six months of 2022. The company continues to shift its expansion focus to greenfield and brownfield openings. Of their total expansion efforts during 2022, we expect more than half will be acquisitions. Gerber (Boyd Services Group) slowed its pace fairly dramatically in the first half, with fewer than 14 new locations, compared with a whopping 48 in the first half of 2021. Combined with disappointing financial performance that impacted the share price of Boyd Services Group, Gerber has moved more cautiously in 2022. Service King—The recap by Clearlake Capital Service King opened two greenfield locations—one in the Chicago area and the other in San Antonio—but otherwise made no new acquisitions. The continuing saga of Service King’s financial problems has finally been brought to an end—or at least an intermediate conclusion. Under the terms of a deal announced in June, Service King will receive $200 million in new capital and reduce its

debt by over $500 million while extending its remaining existing funded debt maturities until June 2027. When the deal is completed, the full equity and debt positions of the parties will be more visible, but the new control entity is clearly Clearlake. Hold the presses—Crash Champions is merging with Service King. The deal is scheduled to close at the beginning of August with Clearlake Capital Group as the investor. Service King’s 336 locations will combine with 225 Crash Champions locations. Their combined footprint of shops will establish strong market shares in Texas, the Pacific Northwest, Florida, Washington, D.C., Philadelphia and Chicago, forming the third largest U.S. consolidator. We will publish a separate and extensive report with more details and analysis of the transaction.

CollisionRight. Since its founding under the leadership of CEO Rich Harrison, the company has been on an acquisition tear. In the first half of 2022, they acquired Select Collision Group, which operates four shops in Pennsylvania. CollisionRight now operates at least 62 shops in states in the Northeast and the Midwest.

Area, along with one in the Los Angeles Basin. G&C Auto Body, the largest independent MSO based in Northern California, acquired four new locations in the first half of 2022 and now operates a total of 26 locations with announced plans for three additional openings over the third quarter.

New Players VIVE Collision, formed by former H&V Collision CEO Vartan Jerian and former private equity investors Scott Leffler and Phil Taub, has been acquiring in the Northeast U.S. with two significant transactions in 2021: Crown Collision, a three-shop MSO in Rhode Island, and POC Collision Repair Centers, a four-shop MSO in Maine. So far, VIVE has acquired four shops in 2022 and expects to end the year with north of 20 total shops.

Biggest transactions Crash Champions has continued its breakneck pace of acquisitions with the recently announced acquisition of Mike’s Auto Body, one of the largest remaining independent MSOs in the U.S. With 17 locations in SF Bay Area, Mike’s Auto Body is a key platform for Crash’s continuing penetration of the California market. This acquisition followed more than 30 transactions by Crash in the first six months of the year. As of June 30, Crash appeared to be operating more than 203 shops. In another notable transaction early in 2022, Mahnke Auto Body with its eight locations in Colorado joined Kaizen Collision, which now operates 15 locations in that state. CEO Sam Mahnke has been announced as the regional operating executive. Kaizen continues its rapid expansion with a technician-centric approach to operations. Its total shop count at June’s end was 51 shops.

California growth vehicles Having beefed up its executive team and examined multiple targets, Chilton Carstar now operates 15 total locations in the San Francisco Bay

Under the Radar Three new private equity-backed groups are in the process of acquiring their first platforms. They will be disclosed after closing their acquisitions. We expect more new entrants to come into the industry during the remainder of the year as the appetite for resilient, cash-flowing businesses increases. Why are Private Equity firms so interested in the collision repair industry? While there are multiple reasons why large pools of institutional capital are attracted to the collision repair industry, the overriding reason is sustainable cash flow. In good times and

Classic Collision Classic continued its steady growth with an additional 16 shops in the first half including Pro Quality Collision in Florida and Crystal Lake Automotive, each with two shops. CollisionRight In late 2020, the Dallas-based private equity group CenterOak formed

20 AUGUST 2022 AUTOBODY NEWS / autobodynews.com

See MSO Acquisitions, Page 23

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Continued from Cover

Initial Vehicle Quality The U.S. Initial Quality Study, now in its 36th year, is based this year on responses from 84,165 purchasers and lessees of new 2022 model-year vehicles who were surveyed early in the ownership period. The study is based on a 223-question battery organized into nine vehicle categories: infotainment; features, controls and displays; exterior; driving assistance; interior; powertrain; seats; driving experience; and climate. The study is designed to provide manufacturers with information to facilitate the identification of problems and to drive product improvement. The study was fielded from February through May. “Supply chain disruption, especially the shortage of microchips, has caused automakers to seek alternative solutions to get new vehicles into purchasers’ and lessees’ hands,” Amodeo said. “In some cases, new vehicles are being shipped without some features installed. Communication with them about the changes in feature availability, as well as when such features will be re-

Elephant Insurance Implements CCC CCC Intelligent Solutions announced Elephant Insurance will extend its use of CCC technology to include its AI-powered, digital claims solutions. Specifically, Elephant will leverage CCC’s technology to help digitize and further transform total loss resolution, advancing the insurer’s ability to deliver straight-through processing across the claims experience. Total losses have been increasing in recent years, driven by a confluence of factors including surging new and used vehicle prices, growing complexity of the cars themselves and supply chain disruptions driving up the cost of replacement parts. With CCC, insurers can proactively engage policyholders following a probable total loss and guide them in capturing important information. Leveraging photos of vehicle damage, AI and the CCC Cloud, insurers can more quickly make decisions and digitize connections and information sharing with participating auto lenders to achieve faster resolution. Source: CCC

instated, is critical to their satisfaction.” Following are key findings of the 2022 study: • Deterioration goes beyond launch vehicles: Both all-new and continuing models increase in problems this year, though all-new models worsen the most (23 PP100). The initial quality gap between all-new and continuing models widens this year to 25 PP100 from 20 PP100 in 2021. The 2022 study finds four times as many new models performing worse than their segment averages compared with those that perform better than their segment averages. • Mass market vehicles experience fewer problems than premium vehicles: Mass market brands average 175 PP100, which is 21 PP100 fewer than for premium brands (196 PP100). Premium brand buyers typically purchase more technology in their vehicles, and the added complexity of that tech increases the likelihood of problems. Given the challenging task of launching new vehicles in the current environment, mass market carryover vehicles are most likely to achieve high-ranking initial quality.

“Owners of premium-brand vehicles experience more problems than mass market vehicle owners, continuing a trend that started in 2016,” Amodeo said. “But some brands, notably Genesis and Lexus, have largely been able to avoid that issue.” • Infotainment systems remain the most problematic area: The infotainment category continues to be the most problematic, with an average of 45.0 PP100---which is 19.5 PP100 more problems than the next-highest category. Six of the top 10 problem areas in the study are infotainment-related, including: Android Auto/Apple CarPlay connectivity (5.8 PP100); built-in voice recognition (4.0 PP100); difficulties with touchscreens/display screens (3.5 PP100); built-in Bluetooth systems (3.4 PP100); not enough power plugs/ USB ports (2.9 PP100); and inconsistent audio volume (2.7 PP100). • Battery-electric vehicles (BEVs) and plug-in hybrid vehicles (PHEVs) more problematic: Owners of BEVs and PHEVs cite more problems with their vehicles than do owners of vehicles with internal combustion engines (ICE). ICE vehicles average 175

PP100, PHEVs average 239 PP100 and BEVs---excluding Tesla models---average 240 PP100. (Tesla models average 226 PP100 and are shown separate from the BEV average because the predominance of Tesla vehicles could obscure the performance of the legacy automakers that have recently introduced BEVs.) • Driving assistance issues grow: Problems with advanced driving assistance systems (ADAS) declined in 2021 but have increased in 2022. The most problematic ADAS system is lane departure warning/lane-keeping assistance with 4.1 PP100. • Tesla Motors officially included for the first time: Tesla Motors is included in the industry calculation for the first time, with a score of 226 PP100. However, because Tesla Motors does not allow J.D. Power access to owner information in the states where that permission is required by law, Tesla vehicles remain ineligible for awards. Highest-Ranking Brands and Models Buick is the highest-ranking brand in overall initial quality with a score of 139 PP100. Dodge (143 PP100) ranks second and Chevrolet (147 PP100) ranks third.

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Among premium brands, Genesis (156 PP100) ranks highest, and ranks fourth overall. Lexus (157 PP100) ranks second and Cadillac (163 PP100) ranks third. The parent corporation receiving the most model-level awards is General Motors Company (nine awards), followed by BMW AG (five); Hyundai Motor Group (three); Ford Motor Company (two); and Toyota Motor Corporation (two). Among brands, Chevrolet received the most segment awards (six), followed by BMW (four). General Motors models that rank highest in their respective segments are Buick Encore GX, Cadillac Escalade, Cadillac XT6, Chevrolet Corvette, Chevrolet Equinox, Chevrolet Malibu, Chevrolet Silverado, Chevrolet Silverado HD and Chevrolet Tahoe. The Chevrolet Corvette is the highest-ranking model overall with 101 PP100. BMW AG models that rank highest in their respective segments are BMW 2 Series, BMW 7 Series, BMW X1 and BMW X3. Hyundai Motor Group models that rank highest in their respective segments are Genesis G80, Hyundai

Accent and Kia Forte. Toyota Motor Corporation models that rank highest in their respective segments are Lexus IS and Toyota 4Runner. Ford Motor Company models that rank highest in their respective segments are Ford Ranger and Lincoln Nautilus. Plant Quality Awards General Motors Company’s plant in San Luis-Potosi, Mexico, which produces the Chevrolet Equinox and the GMC Terrain, received the Platinum Plant Quality Award. Plant quality awards are based solely on defects and malfunctions and exclude design-related problems. Toyota Motor Corporation’s Takaoka 1 (Japan) plant, which produces the Toyota Corolla, and Nissan Motor Co. Ltd.’s Tochigi 1 (Japan) plant, which produces the Infiniti Q50 and Q60, received the Gold Plant Quality Award for Asia/Pacific, in a tie. BMW AG’s Regensburg (Germany) plant, which produces the BMW X1 and X2, received the Gold Plant Quality Award for Europe and Africa. Source: J.D. Power

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Continued from Page 20

MSO Acquisitions bad times, businesses with historically positive cash flows are attractive to large pools of capital whose primary objective is more predictable returns and lower risk. The Ubers, Airbnbs and other tech darlings whose shares have plummeted over the last three months don’t generate cash; they burn cash— billions of dollars of cash. Investors in these kinds of companies are not seeking stability. They are seeking hypergrowth and for much of the last decade the focus on top line revenue growth and market share gains among the tech darlings has propelled these stocks to extraordinary values. In markets where the wind is at one’s back, these kinds of investments do extraordinarily well. But when the wind shifts as it has over the last three months and the economy slows, there is more focus on companies with more stable cashflows. Whether or not we are current-

ly in a recession, expectations for dramatic high growth opportunities in technology or crypto finance or other sexy investment opportunities have diminished. This puts relatively more focus on cash-generating and defensive industries like collision repair. Institutions with large pools of uninvested cash continually search for the right balance between risk and reward. How much risk should I take for how much reward? During the past five years, with T-bills at very low rates, many value investors have been willing to accept relatively modest returns from more stable cash flow generating businesses. Collision repairers have decades of stable cash flow, albeit with gradually increasing investment requirements and declining numbers of participants. So with such strong demand from consolidators old and new, now is a good time for collision repairers to find sponsors to help capitalize their future growth or consider exiting while the demand for acquisitions continues to be robust. Source: Focus Advisors

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autobodynews.com / AUGUST 2022 AUTOBODY NEWS 25

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.

Collision Repair Shops Play Vital Role in Helping Reduce Vehicle-Related Deaths I read a sobering article in The Washington Post recently that I think offers some insights into where vehicle technology is likely headed. The article featured an interview with Jeffrey Michael, who spent three decades at the National Highway Traffic Safety Administration (NHTSA), and is now at the Johns Hopkins Center for Injury Research and Policy. He’s a car guy. The article said when he’s home, he likes to tinker on the 1987 Porsche 911 he bought as a fixer-upper. While he was with NHTSA, he worked on issues related to seat belts, child restraints, drunken driving and emergency medical services.

and cites a gradual reduction in road deaths over 50 years. But in an interview with The Washington Post—days after new NHTSA figures showed fatalities hitting a 16year high—Michael pointed to the nation’s failure and potential fixes.” Make sure you read that again. Roadway fatalities have reached a 16-year high. You have to believe NHTSA and other regulators are going to place an even greater emphasis on vehicle and roadway safety. You have to believe the automakers are going to be pushing forward on getting more and better ADAS and telematics features into vehicles. That’s going to impact the vehicles we have coming into shops. Michael also noted in the interview, “To improve things, we’re going to need to individually make concessions about convenience, about

But the article also said this: “Michael saw the ability of federal programs to influence safety

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driving a little slower, about taking a little more care, about personal responsibility, of using our seat belts, of driving at or below the speed limit, of driving responsibly, certainly driving without impairment, without fatigue, without distraction.”

The “using our seat belts” portion of that quote caught my eye. Our industry has a vital obligation to make sure those seat belts have been inspected after a vehicle has been in an accident. Every automaker has very specific requirements about this. Even when General Motors revamped its post-collision vehicle

inspection requirements, for example, its stance on seat belts did not change. GM wants “every seat belt of every [GM] vehicle inspected every time” a vehicle is in for repairs, “regardless of the [crash] severity level or what’s being done” to the vehicle, said John Eck, collision manager for GM. We’ve been asking about seat belt inspections in our “Who Pays for What?” surveys dating back to 2016. On the surface, the news is good. Back in 2016, close to twothirds of shops said they’d never billed for the labor involved in inspecting seat belts, and among those who had, fewer than one in four said they were paid for that work by the eight largest national insurers “always” or “most of the time.” In the seven years since, the percentage of shops not billing for the work has fallen, and the percent-

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age being paid regularly has grown. But looking at the numbers still keeps me awake at night. As of this year’s survey, there were still 28% of shops—more than one in four— that acknowledged never having billed for seat belt inspections. I have to believe many of those shops aren’t doing this critical work, perhaps because they’re not researching

not otherwise—obligated to do it even if they’re not paid for it, are insurer payment practices contributing to it not being done on every single vehicle? Ladies and gentlemen, it often doesn’t require any more than looking at the vehicle owner’s manual to document the seat belt inspection requirement. In the resources sec-

A “Who Pays for What?” survey this spring found only about 37% of shops are paid regularly when billing for labor required to inspect seat belts as part of repairing a collision damaged vehicle

and following the OEM procedures. And in the seven years we’ve asked, never have more than two in five shops billing for this work said the insurers regularly pay for it. How can the insurance industry deny payment for this needed step? And though shops are morally—if

tion of the “Who Pays” body labor report, we point to an excellent list of links to vehicle owner’s manuals, put together by the Database Enhancement Gateway (DEG). You can take the current “Who Pays for What” survey during July at www.surveymonkey.com/

r/3X7FDBP In some cases, in addition to a visual inspection, the OEM procedure may require the use of a diagnostic scan tool to check the pre-tensioners. On some Honda and Acura vehicles, for example, a deployed pre-tensioner does not trigger a diagnostic trouble code, so other “live data” from the scan must be checked. In these cases, it’s important to know I’ve read of instances where shops have found their aftermarket scan tool didn’t catch blown pre-tensioners an OEM scan did. I encourage you to check the NHTSA website, www.nhtsa.gov, for some sobering statistics about highway deaths, and some tools you can use to help educate your customers. But we also all need to make sure we’re not contributing to the problem, by repairing every vehicle fully and correctly, including the seat belt and other OEM safety inspections.

www.autobodynews.com

Driven Brands Announces Board Member Driven Brands Holdings on July 11 announced the election of Jose Tomás to its Board of Directors, effective that day. Tomás currently serves as the chief administrative officer for TelevisaUnivision, the world’s leading Spanish language content and media company, where he oversees strategic support areas, including human resources; corporate communications; enterprise technology services; facilities/real estate; social impact; diversity, equity and inclusion; and corporate safety, health and security. Previously, he was a principal and managing partner at BrandSparc, a global communications, employment branding and human resources consulting firm. He also led human resources and other strategic functions for General Motors, Anthem, Inc., and Burger King Corporation. With Tomás’ election, the board now consists of nine members, with the majority being independent. Source: Driven Brands

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Industry Insight with John Yoswick

—John Yoswick is a freelance writer based in Portland, Oregon who has been writing about the automotive industry since 1988. He is the editor of the weekly CRASH Network (for a free 4-week trial subscription, visit www.CrashNetwork.com). Contact him by email at jyoswick@SpiritOne.com.

3 Collision Repair Business Leaders Find Ways to Develop Positive Company Culture

Shop Showcase

Three auto body shop owners spoke would be talking about who was goduring the recent Society of Col- ing to the hockey game that Friday lision Repair Specialists’ Repairer night. Honestly, that was one of the with Ed Attanasio Roundtable about their efforts to best team-building things that we’ve build a positive culture within their done, that’s been impactful for our companies. youngest employees to some of our Bruce Halcro of Capital Col- older ones.” lision Center in Helena, MT, said a Ron Reichen, owner of Precichange in pay plans was one step he sion Body & Paint, which is opening took a few yearswith ago. Ed Attanasio its fifth location in Oregon this year, “We were paying flat rate, and it said part of developing his compacreated more divisiveness than any- ny’s culture involves having second-year students from a local community college collision industry training program spend their threemonth co-op at one of his shops. “We try to have them touch with Ed Attanasio each one of the different disciplines within that 90 days,” Reichen said. “So they get to see where their appetite might be. During that 90 days, they’re learning the culture. They’re Montana shop owner Bruce Halcro said learning to come to work on time, to with Attanasio sponsorship of a youth hockeyEd team has been keep their work area clean, to read good for team-building within his shop the OEM repair procedures, to read thing,” Halcro said. “Everyone was and follow the repair plan. They undoing their own thing and saying, derstand they’re part of a team.” ‘That’s not my job.’ So we switched Other entry-level hires often everybody to hourly, working out a start off in a shop’s parts department, pay plan that gotwith them as close asPhillips we with opportunities for a career path Stacey could to the flat rate that they had.” laid out up front. Halcro said he tries to get out “You’re not going to be stuck to each technician’s work area every on the wash rack or with a broom the day to talk with them briefly. rest of your life,” Reichen said. “If “Sometimes it’s about the car they demonstrate a good work eththey’re workingwith on, butStacey most of Phillips the ic, then our master technicians will time it’s about family,” he said. “I say they are interested in taking on think that’s an important connection this person, being a mentor, to grow to have with employees. I think how them, whether their interest is on the you treat employees, showing them refinish or body side or mechanical.” that you value them, really builds a He said getting on a collision culture.” repair training program’s advisory with Stacey Phillips One thing Halcro said has sur- committee is one of the best ways prised him was the impact on his both to find entry-level employees company’s culture he’s seen from its and help with the industry’s overall sponsorship this past year of a youth technician shortage. hockey team. “We also look at the high “So we had our own section, schools with the SkillsUSA proa ‘Capital Collision the gram,” Reichen said. “We find that withsection,’ Staceyat Phillips games,” he said. “We actually hired even though a high school may not a couple of the players to come in a have an auto body or refinishing couple hours a day, twice a week, to program, they may have a mechanclean the shop, empty garbage. By ical program. And with our industry the end of the year, almost our whole changing, with more and more calicrew was going to these hockey brations and ADAS and things like games. By Wednesday, they all that, there’s opportunity there. You

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have to get creative.” He said his company also works with those being released from a state penitentiary. “That involves a certain amount of calculated risk,” Reichen acknowledged. “It’s a lot of work, but we’ve had a pretty good success rate with doing that.” Andy Tylka of the Tag Auto Group in Indiana acknowledged it has been a challenge maintaining his company’s culture while growing the business from six shops to 15 over two and a half years. “But those people decided to sell to me because our culture was very similar to theirs,” Tylka said at the SCRS event. “A single-family-owned culture. Knowing everyone’s name, having those conversations, knowing something about everybody’s life, them knowing your life.” He said rewarding loyalty is ex-

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tremely important. “There might be a shop that needs a technician and they’ll just load [the new hire] full of benefits and pay, while disregarding the loyal employees who have been

Oregon shop owner Ron Reichen said having students work in multiple departments during their first 90 days helps them learn the company culture

there all along,” Tylka said. “I need to do a better job of that as well.” Growing your own new employees is a great way to instill your culture, he said. He spoke at sever-

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al Indiana Auto Body Association chapter meetings last year to share details about his company’s apprenticeship program, including how it’s structured, the check-off lists of what apprentices need to learn and how to find apprentices, not just through auto body job boards but those for construction and plumbing, etc. “Because there are people in those trades who are having a bad day or are looking for another industry,” Tylka said. “What shocked me was through all the chapter meetings, there were only two shops that had a structured apprenticeship program. All the others were deterred from getting apprentices because they just didn’t know what to do with them. “I think that’s what the industry needs is at least some kind of guideline to give a mom-and-pop shop some direction as to apprentices other than just putting a kid with a technician and hoping they learn something,” Tylka said. “I’m hoping as our apprenticeship develops to share that within Indiana, and that will start to have a snowball effect.”

GM Has 95,000 Incomplete Vehicles Just Sitting by Steven Symes, Motorious

A wise man once said it’s best to face the awful truth of your situation than to lie to yourself that everything is just fine. Well, the automotive industry is in a bad place and has been since the pandemic shutdowns. One of the most shocking indicators of where we’re at now is the revelation General Motors is holding onto about 95,000 unfinished vehicles at the end of Q2. Many news outlets are blaming the glut of unfinished cars, trucks and SUVs squarely on the microchip shortage, but they’re missing the big picture. Many raw materials and hence a whole array of components have been in short supply in the automotive industry since early last year. Try ordering enough car parts and you’ll find that fact out real quick. Per a press release from GM, most of the unfinished vehicles it’s sitting on were assembled in June. Consider this: according to a report from The Wall Street Journal, new vehicle sales in the U.S. fell

about 17% for the first six months of 2022. However, demand for cars remains high, so the problem obviously is a constrained supply. With prices soaring in the new and used markets, that’s what we’d expect to result.

Other automakers have suffered all kinds of supply chain problems, ranging from shortages in microchips to constrained availability of glass and aluminum. Toyota, which in December returned to full production capacity, has since seen many manufacturing setbacks, resulting in a 19% drop in sales for Q1 and Q2 of 2022. Worse, Nissan saw a 34%

drop while Hyundai Motor Co. said sales decreased 16%. Everyone is suffering. Another problem is creeping up, one that threatens to make this industry tailspin even worse: rising interest rates. The Wall Street Journal report claims automaker executives believe despite this, sales should level out through at least the end of 2022. Beyond then, well things could get ugly, although automakers seem to think they don’t have that far to fall if a deep recession does strike. Where things could get even more complicated is the projection by Intel’s CEO and others that the chip shortage will last well into 2024. Even once the supply of chips returns to pre-pandemic levels, it will take some time to produce enough new cars to even out the auto market. Plus, shortages of other raw materials or manufactured components could still put the squeeze on production.

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CAA Says a New Kind of Insurer Steering is Impacting the Industry by Ed Attanasio

The California Autobody Association (CAA) recently held a one-hour Zoom meeting with the California Department of Insurance (CA-DOI), covering a handful of topics of interest to the entire membership. One particular subject that has been a pebble in CAA’s shoe for several years was brought up again during the meeting. You might be thinking that pebble was illegal steering, but you’d only be half right. When we talk about steering in this industry, it’s usually about insurers trying to persuade consumers to take their vehicles to DRP shops, because those shops offer the insurer more attractive labor rates, and in many cases, a promise to use the lowest priced parts available. Instead, this is about “parts steering.” Parts steering is where insurance companies search a multitude of different online vendors scattered across the country to find each part at the lowest price, and then cap

payment on their estimate based on that price. Sound reasonable? Monte Etherton, chairman of the CAA State Legislation Committee and state board member of CAA’s San Diego chapter, has been monitoring this situation for years and doesn’t think it’s reasonable at all. “Here’s an analogy,” he said. “Your 8-year-old car needs some work, so you take it to the dealer and they give you an estimate for $3,500. You tell them you’ll get back to them. Their estimate lists five parts that total $2,000 of the $3,500. Since you want to save some money, you start scouring the internet for those parts. “You find the cheapest parts from five different online stores, and all offer free shipping. Buying those parts instead of the parts from the dealer will save you almost $500. You make a neat list of all the store’s phone numbers and the prices and take it back to the dealer and ask them to buy the parts they need from those places so you can save some

money. What do you think they would do?” Etherton cites “parts steering” as a major problem in the industry. “Some insurance companies will only pay us based on the price of the cheapest parts, so they are literally forcing us to buy certain parts from their vendors or lose money,” he said. “I did one job on a Volkswagen where the insurance company’s estimate had an aftermarket headlight from an out-of-town vendor, because it was cheaper than my local aftermarket supplier,” Etherton said. “I emailed them that they can’t require me to buy a part from a specific supplier, and they replied with this fallacy: ‘We can’t tell you where to purchase your parts, but we don’t owe more because you select a different vendor.’” In 2018, CAA received a written legal opinion from the CA-DOI in response to questions regarding several industry problems, including parts steering. Two paragraphs from the opinion explain how parts steer-

ing is related to customer steering, which is illegal in California: “No insurer may require that an automobile be repaired at a specific automobile repair shop. (Cal. Ins. Code §758.5(a)). If the claimant elects to have the vehicle repaired at the shop of his or her choice, the insurer may not limit or discount the reasonable repair costs based on charges that would have been incurred had the vehicle been repaired by the insurer’s preferred shop. (Cal. Ins. Code §758.5(d)). As a result, by refusing to pay any reasonable price for a replacement part that is higher than the price quoted by the insurer’s preferred parts vendors, the insurer is limiting or discounting the reasonable repair costs based on the charges that would have been incurred had the vehicle been repaired by the insurer’s chosen repair shop thereby preventing customers from using the repair shop of their choice and preventing the policyholder from using any shop other than those shops that purchase their replacement crash parts from the pre-

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ferred parts vendors of the insurer. “Limiting or discounting the reasonable repair costs based on the charges that would have been incurred had the vehicle been repaired by the insurer’s chosen repair shop is a violation of Insurance Code section §758.5(b) (3) and would constitute a violation of the Unfair Insurance Practices Act. Cal. Ins. Code §758.5(f). That is, if an insurer limits or discounts the reasonable repair costs based upon the replacement part prices available from a certain parts vendor, the insurer would effectively prevent a customer from using the automobile repair shop of his or her choice in violation of Insurance Code section 758.5(b) (3). An insurer would, however, be permitted to reasonably adjust a collision repair shop’s written parts price estimate for any part, including new OEM crash parts, if the insurer demonstrates that the price charged by the repair shop for the replacement part is “unreasonable.” 10 CCR §2695.8(f).” This opinion was also a topic of the Zoom meeting. Both the DOI’s deputy commissioner and the Claims Services Bureau chief urged shops experiencing this problem to send a copy of the DOI letter to the insurer with their supplement. Miscategorized Parts There is another facet to this problem. In California, the law requires shops only list parts on their estimate as new, used, reconditioned, rebuilt, an OEM crash part or a nonOEM aftermarket crash part. Insurers are also supposed to follow these regulations when writing estimates, but some do not. “A few months back, we had a 2021 Mercedes in the shop,” Etherton said. “It only had 1,000 miles on it and was hit pretty hard in the right suspension. The customer’s insurer specified 13 used, non-OEM or reconditioned parts from six different vendors located in California, Texas, Michigan and Oregon. The parts’ prices ranged from about $10 to $1,000. “Some of the part descriptions were really questionable, like a reconditioned upper control arm and a reconditioned engine cradle, and a used wheel that was also refurbished. By law, we have to be crystal

clear about parts with our customer, but how can I do that if I don’t even know what they are?” Etherton continued. “And none of these parts had a manufacturer’s warranty, something we would get if we bought them from the dealer. We ended up losing that job because we believed new genuine factory parts belonged on that car, and the customer didn’t want to pay the difference. She did tell me she was changing insurance companies though.” The Difference Between Opt-OEM Parts and Genuine OEM Parts Many parts on insurers’ estimates have been miscategorized with such terms as “alt-OEM”, “opt-OEM” and “surplus-OEM.” In reality, these parts may be over-production, blemished or damaged OEM parts. One thing they all have in common is none of them carry the original car manufacturer’s warranty. Every part sold by every vehicle manufacturer has a manufacturer’s suggested retail price (MSRP), which is the price a shop charges for the part. In contrast, opt-OEM parts do not have an MSRP, only a cost. When a part does not have an MSRP, insurers will allow a “markup,” usually 20%. Etherton thinks he knows how opt-OEM came into existence. “Let’s say a shop buys a bumper from a Chevy dealer that has an MSRP of $200, and the shop gets it for $140 wholesale. The shop will make a $60 profit,” he said. “Let’s also say an opt-OEM vendor—maybe a wrecking yard— has bought 50 of those bumpers on the gray market for $120 each. They offer the bumper to insurers for $150. The insurer marks the part up $30—20%—for the shop. The insurer now gets the $200 bumper for $180, but the shop loses half their profit, the shop’s Chevy dealer loses a sale and the customer loses the Chevy factory warranty because the shop didn’t purchase the part from the dealer. Who wins here?” Another issue is some vendors are mislabeling their parts to gain an advantage with insurers. “Something else we see is when the vendor lists a bumper cover as a used part when it’s actually a new ‘surplus part,” Etherton said. “Many new factory bumpers are raw plas-

32 AUGUST 2022 AUTOBODY NEWS / autobodynews.com

tic, which requires a special prep to make the paint stick. That prep costs about $100. Since a used bumper is already painted and wouldn’t need that treatment, the insurer won’t put the treatment on their estimate. The problem is, the bumper isn’t a used part, and the work still has to be done.” How Shops Choose Which Vendors from Which to Purchase Parts Just like any business, body shops must choose their vendors carefully. Shops need to know a vendor will be in business next month or next year if there’s a problem. They need to deal with experts that will send the correct parts the first time, quickly and at no charge, whether that part is a $2.50 fastener or a $700 aluminum hood. Another problem Etherton brought up is the logistics of adding unnecessary vendors to his shop’s bookkeeping system and staff. “Most online vendors limit what they sell to big-ticket high-volume parts, so they can’t fill a complete order,” he said. “If you buy from one, you either have to pay COD or

have an open account, right? Any body shop worth its salt has charge accounts with their vendors because you can’t afford to write a check for each invoice and have $100,000 tied up before you get paid. “Not being able to use our regular vendors means we have to pay upfront for the parts, either by check or credit card,” he said. “And when I call these vendors to see if they really have the part, I usually spend at least five minutes on hold waiting for people to answer the phone. Probably half the time they either don’t have the part, it’s not what they said it was, or they won’t deliver to our area. “And if you do buy the part and it’s wrong, they already have your money,” Etherton said. “Hopefully they’ll give it back, but you need to pay return shipping and wait. “The other option is to open an account with each of these vendors. Now if you know anything about bookkeeping, we already have like 50 various parts vendors on our list. If we had to add a new vendor to our database for every time an insurance company found a cheaper part, we’d

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probably have 200 more vendors, and who’s going to keep track of that? Two hundred credit applications? Two hundred more monthly statements to reconcile? It’s ridiculous.” Doing the Insurance Adjuster’s Job Another subject discussed during the CAA CA-DOI meeting was how insurers are requiring more and more documentation from shops before they will pay the claim. The documentation is in the form of damage photos, work in process photos, purchase invoice copies and more. “What happens is that we have a customer who wants us to fix their car, so we write an estimate and send it to their insurance company,” Etherton said. “Now some insurance companies review our estimate and pay it to the penny, while others cut the estimate no matter what you send them. And it’s not uncommon for an insurer to start off low at $2,000 and end up paying an actual cost of $8,000. “I think the insurers that cut estimates are just trying to make our job so difficult that we will give up

and accept their lowball offers,” he said. “They want pictures and copies of everything, and as I said before, whatever the lowest part prices they can find on the internet is the most they will pay us for the parts we need to fix the car.” Etherton’s main point is this--other than allowing the insurer to inspect the car at his shop, he has no obligation to them to document anything. The obligation he does have is to the vehicle owner. “The law says if I fix your car, we will have a contract between us, which is my estimate,” he said. “I give you the estimate, and then you authorize the estimate so it becomes a work order. So, I repair your car based on that work order. If I don’t follow that work order while repairing your car, then I have committed fraud and could lose my license. “Even though these insurance companies have the right to inspect the damaged car, they choose not to. It’s easier to deny the claim from a distance than it is in person.” www.autobodynews.com

Nissan Frontier and Titan Owners Warned to Use Parking Brakes by David A. Wood, CarComplaints.com

More than 180,000 Nissan Frontier and Titan trucks are recalled because they could roll away even when the trucks are shifted into PARK. Nissan is warning 2020-2022 Frontier and Titan owners to engage the parking brakes every time they park their trucks. Nissan received a report in June 2021 alleging a 2020 Frontier began to move after the driver shifted into PARK, but the dealer was unable to replicate the problem. Nissan took the transmission and sent it to the supplier, JATCO, but the company found no problems. The automaker thought it was just a random incident until Frontier and Titan warranty claims began arriving. Nissan collected the components but engineers couldn't duplicate the issues, and neither could JATCO. JATCO finally duplicated the problem that was caused by the parking pawls. "Due to dimensional varia-

tion during the manufacturing process, reduced clearance may cause contact between the edge of the parking pawl and the boss on the transmission case, which may result in non-engagement of the parking pawl," Nissan said. Nissan is aware of four allegations of minor injuries.

Nissan is trying to determine how it will repair the Frontier and Titan trucks. Interim Nissan recall letters are expected to be mailed July 20, and second letters will be mailed once dealers are ready to repair the trucks. Nissan Frontier and Titan truck owners may contact Nissan at 800867-7669. Nissan's recall numbers are R22A2 and R22A3.

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DataTouch Offering New Service to Help Collision Repair Shops Manage Access to its Data

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Pete Tagliapietra is sympathetic to buying parts from, and at what price. collision repairers whose customers It also shows what kind of cars the have found accident information shop repairs, and what cars the cuswith Ed Attanasio about their car on a vehicle history tomers in that geographic area buy report. and drive.” But Tagliapietra said that’s only All that, Tagliapietra said, is a small subset of what he sees as a even aside from the customer’s much larger concern of shop esti- personal identification information mate data being obtained, used and on the estimate, which a growing sold by unauthorized withthird Ed parties. Attanasio number of states have mandated “It’s my belief that most shops businesses take adequate steps to are oblivious to how much estimate protect. information is being scraped off their “If I owned a body shop, I computers, giving third parties a wouldn’t want third parties to know wealth of knowledge about how that all of this—how I run my business shop does business,” said Tagliapi- and with whom—and to be able to etra, founder of the newly-launched use it or sell it without my authoriwith Ed Attanasio DataTouch, LLC. “Even just a small zation, and clearly even in ways that set of a shop’s estimates tells some- are not in my best interest,” he said. one whether or not the shop has Tagliapietra said it’s his belief DRPs, and if so, which ones. It tells “the CARFAX issue”—estimates them the labor rates the shop has resulting in entries on a vehicle’s negotiated withwith different Ed insurance Attanasio history report—and all the other companies. It shows who the shop is third-party use of shop information

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are the result of thousands of “data pumps” running on shop computer systems across the industry. “Data pumps have become prolific,” Tagliapietra said earlier this year. “It’s gotten out of hand, from my point of view, because the data has become so valuable. Most shops probably have an unauthorized data pump, or more likely multiple data pumps, that are sucking the repair line information and personally identifiable information off of every estimate they write.” A shop may have authorized the installation of some or all of the data pumps running on its computer system, because they can help automate some shop processes, such as sourcing alternative parts, subletting repairs or materials. In other cases, the shop may not be aware of a third-party vendor installing a data pump, or that a data pump installed

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by a company the shop is no longer doing business with continues to scrape estimate data from the shop’s computers. “But the data pumps themselves are only the first part of the problem,” Tagliapietra said. “The real issue is that shops can’t control what portions of an estimate get scraped by those data pumps. A parts vendor doesn’t need your labor rate information or the customer or insurer name nor even the entire VIN, yet they get all that. A CSI provider doesn’t need anything other than the basic customer contact information, yet they get all the estimate line items and subtotals. A remote scanning company doesn’t need anything other than the complete VIN to identify the specific vehicle and the ADAS functions on that vehicle.

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autobodynews.com / AUGUST 2022 AUTOBODY NEWS 35

Why Online Customer Reviews Are More Important than Ever by Ed Attanasio

Every transaction has a value in terms of both human resources and money, and online reviews from customers play a significant role in both for any business. Many auto body shop owners and managers use review sites to connect with customers and get feedback. But many are still skeptical about the authenticity of the reviews posted. Before the online consumer review industry gained momentum roughly 18 years ago when Yelp was founded, people had to rely on recommendations from friends, neighbors and associates. Word-of-mouth worked pretty well, but now we can access hundreds of reviews within minutes, rather than polling the mailman or the checker at your grocery store for the best restaurants, movie theaters or body shops. As a body shop owner or manager, ultimately, all you want is to acquire new customers, retain existing ones and increase revenue. But like many, you’re probably a little overwhelmed by the speed at which technology evolves and how to respond to it. Recently, I saw this powerful quote from the Harvard Business Review: “Many companies need to dramatically shift their marketing strategies to account for the rising power exerted on future customers by the opinions of existing customers.” I had a friend who used to say opinions are like a certain orifice we all possess. It still applies, but now everyone’s opinions seem to count more than ever, especially online. For companies that do an exemplary job and garner high CSI ratings as a result, online review sites are a wonderful thing. On the other hand, what happens if you’re a good company, but you’re not getting a significant number of accolades from the public—or, worse, negative bogus reviews from competitors and disgruntled former employees? Megan Fulkerson, managing partner and strategist at 3P Marketing in Evansville, IN, works with body shops and other small businesses on their online reviews and

how to set them up for success. “While managing reviews can seem daunting, taking care of your customers and providing safe and proper repairs is what we try to do every day,” she said. “Taking things one step further and by having CSRs or estimators ask the customer to

Megan Fulkerson of 3P Marketing said shops that have negative reviews and do not acknowledge them appear to not care. She suggests responding to every review, positive or negative

provide a review is a great way to have current responses added to your list of online reviews.” Online reviews are crucial in the collision industry because people want to be comfortable before they trust a body shop with their vehicles, Fulkerson said. “The collision repair industry is especially important because vehicles are most commonly the second largest asset one possesses in their lifetime. For most, it is critical to the success of their day—ensuring the kids are at school and they make it to work on time,” Fulkerson said. “Because of this heightened importance and cost endured when getting collision repair, many are extra hesitant to entrust their vehicle at a shop that does not have recent and good reviews.” Fulkerson said shops always need to respond to reviews, both positive and negative. “Another important aspect of getting reviews is responding to them,” she said. “The only opportunity we have as a business owner to dispute a review is to leave a response. By remaining cool and calm but potentially shedding some light onto the negative experience mentioned, you can show that you stand by your work and will always make it right. “Businesses that have negative reviews and do not acknowledge

36 AUGUST 2022 AUTOBODY NEWS / autobodynews.com

them appear that they do not care,” she said. “While many aspects of marketing and advertising are evolving, the need for good reviews remained unchanged.” Those shops that embrace online reviews and pursue new marketing techniques such as geofencing, SEO strategies and digital advertising are excelling, Fulkerson said. Here are some more interesting numbers and analysis from ReviewTrackers: Google remains the No. 1 review site of choice. Nearly 64% of consumers say they are likely to check Google reviews, through Google Maps and Search, before visiting a business location—more than any other review site. Yelp ranks second at 45.18%, followed by TripAdvisor and Facebook. Google’s review growth is driven by the volume of zero-click searches, which rose to 65% in 2020. By showing review snippets and star ratings in organic search results without having to send users to a third-party website, Google

has effectively cut in line ahead of other websites in the online reviews space. Eighty-eight percent of all reviews come from only four review sites—Google (73%), Yelp (6%), Facebook (3%) and TripAdvisor (3%). Approximately 75% of new business is influenced by only a handful of business review sites and directories: Google, Facebook, Yelp, TripAdvisor, Apple Maps and Bing Maps. Review interaction is up by 50% from pre-pandemic levels. It’s one of the many signs demonstrating consumers’ heightened sensitivities about where to go or what to purchase in the wake of the pandemic. If your shop is missing the boat when it comes to sites like these, I would suggest to not try to do it yourself. Hire a knowledgeable company that specializes in leveraging these review sites to deliver solid leads and increase your car count.

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autobodynews.com / AUGUST 2022 AUTOBODY NEWS 37

Life Coach Uses Different Approaches to Help Auto Body Shop Techs, Owners, Managers by Ed Attanasio

Claudia Morgillo has multiple titles, including certified professional leadership coach and trainer. She and her husband own six Fix Auto locations in the Ontario, Canada, area, two Novus glass companies and a centralized head office.

As a woman and a leader, what communication and other skills you’ve developed over the years to be a manager in a male-dominated industry?

I have developed a lot of processing modalities, including learning how to communicate, train and motivate the people that I work with while being a female in this industry. I think as a woman, knowing how to communicate with different people in general is a real plus. My dad has been in the industry for almost 50 years and he introduced it to me; I followed him around at a young age and later

worked alongside him in his jobber business. At this point, I’ve been in collision repair for more than 25 years. Thirteen years ago, my husband, Claudio Chiodo, and I purchased our first body shop, and have grown from that point on.

challenges our industry was facing. In the end, it comes down to attaining the right skills to motivate people in general. For instance, how do you create buy-in, build comfort and trust, and all those things? So, I went back to learn how to build and use the tools needed for these essential skills and, most notably, the neuHow do you motivate your roscience behind them. people? Do you take I became a professiondifferent approaches with al coach and a leadership each person? trainer to motivate all these people individually. Every Four main groups person requires a different are impacting our approach, so if you try to industry—Generation Z, treat everyone the same, it ages 7-22 (born between Claudia Morgillo will likely fail. I have de1997 and 2021); Millen- helps body shop pro- veloped tools that are tried, succeed nials, ages 23-38 (born infessionals tested and true. But in the an ever-changing between 1981 and 1996); end, it comes down to peoindustry Generation X, ages 39-54 ples’ motivations and how (born between 1965 and 1980); and they feel appreciated. How do they our Boomers, ages 55-73 (born be- understand caring, because everytween 1946 and 1964). body understands caring differently? I went back to school and Everybody’s going to respond earned a lot of different training and to buy-in in their own way, so how coaching certifications to help and do I create that for them? That’s my support my teams through the real approach—it’s individualized and

that’s why I went back to school to find out about how I can achieve that for all these people. I’ve been doing that for more than five years now full-time within my organization and for external clients as well. I have also been working closely with David Luehr at Elite Body Shop Solutions, as well as different industry leaders, and owners of other shops to help them identify and build their skills and grow into being an MSO or whatever they’d like to do.

What are your three main concerns about the collision repair industry?

Everyone is talking about supply chain issues, hiring and retaining good people, and how to fix today’s sophisticated vehicles. My perspective on this is that it will always come back to people. Years ago, someone shared an equation with me that said, “Process plus people equals profits.” I thought, what does that really mean?

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So, the process part is self-explanatory, right? We’re always constantly looking at process building and tweaking processes, but what are people doing about that? You never get to check the box because it’s all about training, retraining and retaining people in this industry. Where are their mindsets for them? Do they want to be retrained and stay in our industry? So, my concerns will always come back to what we need to do to find, hire and train all of these people and keep them motivated. Because as much as we want to continue moving forward and pursue all of these new advancements being thrown at us, we can’t just tell people they need to move forward. It’s about how do we support these people to do these things? That’s always my main concern— the people part of it. How do we keep them engaged and interested in training that’s changing with the times and still be motivated without getting exhausted? That is my concern for this industry because everything else seems to fall into place if we can do that.

How can you help shop owners and managers to retain their workers with poaching rampant in some areas of the country?

I tell people it all starts with leadership, including self-leadership. So, we are ideally going out into the world and showing other people what we’d like them to see and know about us, which of course, takes a lot of self awareness to be developed. If we can’t lead ourselves, we can’t effectively lead others. So that’s why I help and support shop owners and managers by showing them how to lead themselves appropriately. People want to work for empowered leaders and learn from them. If you’re leading by example, your people will follow you through good times and bad times. The main causes of stress are often due to a lack of skills in those areas. For instance, weak time management skills are often a result of poor self-regulation and awareness. In my opinion, productivity is most often affected by gaps in someone’s communication skills.

Those things get in people’s way, sometimes regarding attitude and knowing how you show up in the world. How do you turn someone’s perspective around when things are getting hard? Because we all get there eventually, but how we choose to go forward can make or break an entire day for some shops. So, it’s about creating that self-awareness and giving them tools they can put in their toolbox so that when they do get in the thick of it, they will be OK to get through successfully.

Q: A:

Why do some shops excel and others struggle?

I think it pretty much goes into that same sentiment, that some shops struggle because of culture and a lack of self-awareness. I feel it always comes back to culture. You can have all the OEM certifications and DRP relationships you like within your business, but if your team doesn’t know your organization’s “why,” they will sometimes struggle to understand “why” they are doing what they are doing

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every day, week, month and year alongside you. That’s trouble if they don’t know why they’re there and the culture isn’t being solidified. They know what they’re there to do and nothing more; that is where you run into gaps. I can see that some shops struggle because they don’t have the shop’s culture on their radar and don’t know what they don’t know. So, they don’t even know what is not working because they don’t even know what to look for. Ideally, we need to ask some basic questions. How do we communicate with each other? How do we want to communicate with each other going forward? Why do “we” choose to repair cars as a career? Do we feel like a team? What does our ideal team look and feel like? These are just some of the possible empowering questions we ask our teams to help support and build better cultures within our organizations.

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not installed by an Authorized Kia Dealer are covered for 12 months from the part only, and any labor charge is the consumer’s responsibility. autobodynews.com / AUGUST 2022 AUTOBODY NEWS 41

Industry Insight with John Yoswick

What Your Auto Body Shop Needs to Know to Be Ready to Repair EVs

Shop Showcase

The Alliance for Automotive In- Many shops in the past have had novation reported in June almost to upgrade the electrical service to 200,000 electric vehicles were sold their building in order to accommowith Ed Attanasio in the first quarter of this year—a date the power needs of some weld4.2% increase over the previous ing equipment. Putting in one or quarter—representing 5.9% of over- more EV charger stations will likely all light-duty vehicle sales. Is your require yet another upgrade. shop gearing up to repair them? “The answer they are mostly Repairers, trainers, automakers getting [when shops inquire about and others participated a recent any necessary electrical upgrades] with Edin Attanasio panel discussion at the Collision In- is: You only have just enough power dustry Conference (CIC) about what coming into the building to run the EVs will mean for auto body shops. things you have there right now,” Here are some of the highlights from said Bob Augustine, co-chair of that discussion. CIC’s Emerging Technology Committee hosting the panel discussion. Consider Your Lifts with Ed Attanasio “The normal two-post lift is not go- Other Possible Changes to Processing to be the future, in my opinion,” es and Facility said Virginia shop owner Barry “It’s a lot of Go-Jaks,” Dorn said Dorn, whose company is certified to of the dollies needed to move EVs repair a number of automaker’s EVs. around the shop once they have His reasoning: Shops a lift been powered down for repairs. “We withwill Ed need Attanasio that can be used when an EV’s main had to reconfigure the drains in the battery pack need to be removed. floor because they get caught up “When you consider the width on that. We had to reconfigure our of the battery you are going to take paint booth because you’re pushing out, at least for the Audi brand, the a dead vehicle. There are literally batteries are the size of a queen-size times we have to have a tow truck mattress and weigh to 2,000 pull an EV into the booth.” withclose Stacey Phillips pounds,” said Mark Allen of Audi Shops also need to know what of America. “So you’re going to EV repairs require powering down need a lift that has at least 67 inch- the vehicle. Even something as es between the posts. Not the arms, seemingly minor as paintless dent the posts. And then a flat floor un- repair (PDR) may require de-enerderneath so youwith can get a lift table gizing the vehicle, Dorn said. Stacey Phillips underneath.” “Depending on the vehicle, there are some areas that are literally right Expect to Need a Power Upgrade beside a fender or right under the hood

Social Media for Shops

SEMA Show Goes On

that are very close to areas you don’t want to be,” Dorn said of PDR. Trying to Save Money Could Cost You Jason Norman of Enterprise RentA-Car said he’s seen instances of people thinking they can reduce the cost of charging cables or adapters by getting one available online at a quarter of the cost of the OEM part. “It’s very tempting, and it turns out they look very similar,” Norman said. “But the reality is this is one of those times when the OEM equipment and procedures are critically important. A lot of those [cheaper] adapters and cables don’t have the embedded technology to do things like measure heat and current. So you end up with significant problems.” The panel shared a photo of the charred remains of electrical con-

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nectors inside a charging system installed some years ago by a California shop. The heat involved in EV charging also can lead to expansion and contraction, which can loosen connections over time. “There is a certain amount of maintenance you’re looking at on these chargers,” said Oregon shop owner Ron Reichen. “You have to go in and retighten things from time to time.” Darrell Amberson said his multi-shop collision repair company in Minnesota repairs a lot of EVs, and it’s not something shops should avoid. “It’s no big deal. We’re still fixing cars,” Amberson said. “But on the other hand, it does require a difference from the start to the finish of the process. And every person in the organization has to have some different understanding, especially in terms of safety.”

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AkzoNobelwith Supplying StaceyLincoln PhillipsTech

Lincoln Educational Services Corpo- paint line, derived from AkzoNobel’s ration has entered into an agreement Sikkens refinish brand, the brand that with AkzoNobel Coatings, Inc. Lin- will be used at the Kindig Academy. Lincoln Tech campuses offering coln Tech’s collision repair and refinishing technology programs across collision repair career training will the country will use paints and refin- have the opportunity to receive prodish coatings solely from AkzoNobel, ucts from either Sikkens or Lesonal, with Stacey Phillips as the two organizations strengthen another premium AkzoNobel brand. their partnership following the openAkzoNobel’s proprietary coling of the Kindig Academy at Lin- or-matching software MIXITTM will also be available to Lincoln Tech coln Tech in Denver, CO. AkzoNobel also partners with students. Dave Kindig of Kindig-It Design to produce the custom Modern Classikk Source: AkzoNobel

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42 AUGUST 2022 AUTOBODY NEWS / autobodynews.com

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High School Students Introduced to Collision Repair at Contra Costa College’s Summer Camp by Ed Attanasio

Educators are looking for new and different ways to attract students to their auto tech programs, many of which are struggling as they come out of the pandemic. This year’s summer camp at Contra Costa College (CCC) in San Pablo, CA, is a perfect example of thinking outside the box to get high

Laura Lozano, Contra Costa College professor of collision repair technology and co-chair of the automotive department, with high school students at the schools’ first Auto Tech Summer Camp

school students interested in both collision and mechanical repair as a career. The two-day training session, held in mid-June as part of the school’s collision engineering apprenticeship program, hosted 15 high school students, with many CCC graduates on hand to help out. Representatives from Bay Area companies attended the camp as well, including B & S Hacienda Auto Body from Pleasanton, CA; Mercedes-Benz of Walnut Creek; Barsotti’s Body and Fender from San Rafael, CA; and 3M. The program’s former director, Peter Lock, taught some of the training sessions. Laura Lozano, a professor of collision repair technology and cochair of the automotive department, was delighted to coordinate the CCC summer camp with leading Bay Area companies. “Sharing our knowledge and experience with these high school students is crucial for us,” Lozano said. “It was only two days, but I know we gave them a ton of information,

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which was the goal. Industry support is also really important to us. We have established good relationships with some great body shops and product manufacturers and distributors, and we value their involvement.” Lozano always wants to teach the newest techniques in the colli-

Nick Gale, Contra Costa College automotive services faculty member, was one of the featured instructors at the school’s two-day Auto Tech Summer Camp

sion repair industry through events such as the CCC summer camp. “We want our students to succeed, and knowing the newest technology is a huge part of that,” she said. “If we’re going to build enrollment, we need to show these young people that we are teaching

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them cutting-edge collision repair processes and using the latest tools, equipment and products.” Now Lozano will be looking at 2023 for next year’s summer camp. “On behalf of our CCC students, faculty and staff, we want to express our gratitude for their continuing support,” Lozano said. “We were able to get a total of nine new students to enroll for next year through the camp—five on the collision side and four in the automotive services program.” John Helterbrand, national program director of collision engineering at Ranken Technical College, traveled from St. Louis, MO, for the summer camp to help Lozano and the program. “Laura Lozano is a very outward thinker when it comes to her program and what she did with this summer camp is a great example,” Helterbrand said. “More and more schools need to do this. If we’re going to get more people in the industry, that’s definitely something that we’re going to have to do more of

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autobodynews.com / AUGUST 2022 AUTOBODY NEWS 43

and change the perceptions of how influencers perceive our industry. I was lucky enough to participate in this one with Laura and hope to do more in the future.” Helterbrand loves to teach and watch the students’ eyes light up when they understand the concepts presented, he said. “I helped the students with a welding project, and I can tell you it went over well because it was not just for the collision students, but for the entire automotive program as well,” he said. “Getting young minds and hands into the program was excellent. It was very encouraging when the students showed up the second day too.” As a bonus, every camper received a swag bag, with a T-shirt and some surprise goodies from local vendors. Lozano and her team also tried to simulate a real-life work environment for the high schoolers during the two days. “We gave each one of them a locker and got them into a uniform,” Lozano said. “We want them to see what it will be like to work in a shop and be part of a team.”

I-CAR Offers EV Skills Course As the automotive industry ramps up its commitment to electric and hybrid vehicles, I-CAR continues to expand its leading EV curriculum with a first-ever, five-day EV hands-on skills development course at I-CAR’s new Chicago Technical Center (CTC) in Vernon Hills, IL. The new course, taught by I-CAR’s bench of EV experts, will serve as the capstone to eight prerequisite EV courses for collision repair professionals. EV safety instruction includes learning how to safely disconnect high voltage systems, confirming zero potential, and initializing high voltage systems following repairs and service. To register for this new five-day hands-on course, visit I-CAR.com. Source: I-CAR

AUTOBODY

Continued from Page 35

DataTouch Offering “Too much of a shop’s information is going to too many third parties---often without the shop’s knowledge or consent---and that information has significant value to those companies that can get it.” Tagliapietra founded NuGen IT and sold that company to OEConnection in 2020. He is launching DataTouch this summer as a potential solution for a shop that wants to get a better handle on who has access to its data. For a one-time fee, DataTouch can audit a shop’s computer system to identify what data pumps are operating on it. “They’re often hidden well enough that unless someone knows what they’re looking for, they’re not going to find them,” Tagliapietra said. The shop then has the option to subscribe to the DataTouch monthly service, which enables the shop to administer by trading partner which portions of estimate data go to each third party. A recycler, for

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example, may only receive a parts list and the year, make and model of the vehicle, and the first 11 digits of the VIN. “That’s enough information to run it through a parts exchange and supply the part,” Tagliapietra said. “When a shop picks up a phone and says, ‘I need a left front fender for a 2004 Chevy Tahoe,’ the recycler doesn’t say, ‘Give me the VIN.’ So why when ordering electronically does the shop send them the entire estimate and all of that information?” DataTouch also will assist a shop in deleting data pumps that are obsolete or not approved by the shop. Tagliapietra said he believes DataTouch will put collision repairers back into better control of their estimate and business information, and better able to protect their customers’ privacy as well. “We can help shop eliminate the possibility of trading partners sharing repair information to unauthorized entities, such as vehicle history reporting companies and so much more,” he said.

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Record Share of New-Car Shoppers Jumped Into a $1,000+ Monthly Payment in June Financing a new vehicle purchase is growing more expensive for consumers, according to the car shopping experts at Edmunds.

New data from Edmunds reveals: • The average annual percentage rate (APR) on new financed vehicles in Q2 2022 climbed to 5% for the first time since Q1 2020. • 12.7% of consumers who financed a new vehicle purchase in June committed to a monthly payment of $1,000 or more—the highest level that Edmunds has on record— compared to 7.3% in June 2021, 4.6% in June 2019 and 2.1% in June 2010. • The average amount financed for new vehicles hit a near-record level in the second quarter of 2022, climbing to $40,602—compared to $39,726 in Q1 2022 and $36,215 in Q2 2021. Edmunds analysts note that the first and only other time that the average amount financed for new vehicles surpassed $40,000 was Q4 2021, when

the average APR was just 4.1%. • An influx of luxury shoppers are turning their backs on leasing and choosing to purchase their new vehicles. Edmunds data reveals new-vehicle lease penetration fell to 18.5% in June, down from 30.5% in June 2019.

sumers the new car market is growing increasingly out of reach.” To help guide car shoppers, Edmunds analysts calculated how much additional interest consumers can expect to pay over the course of a $40,000, 72-month car loan.

“A single percentage point increase might not seem like much at first blush, but that adds up to hundreds, if not thousands, of dollars over the course of a 72-month (or longer) loan—a significant cost considering consumers are financing as much as ever,” — Ivan Drury “Low interest rates used to be one of few reprieves for car shoppers amid elevated prices and supply shortages. But the Fed rate hikes this year are making finance incentives far costlier for automakers, and consumers are starting to feel the pinch,” said Jessica Caldwell, Edmunds’ executive director of insights. “Although there appears to be a steady stream of affluent consumers willing to commit to car payments that look more like mortgage payments, for most con-

They note that jumping to a 5% APR from a 4% APR would cost consumers $1,324 more in interest over the course of the loan. Jumping to a 6% APR from a 4% APR would cost $2,672 more. “A single percentage point increase might not seem like much at first blush, but that adds up to hundreds, if not thousands, of dollars over the course of a 72-month (or longer) loan—a significant cost considering consumers are financing as much as

ever,” said Ivan Drury, Edmunds’ senior manager of insights. “Seeking out finance incentives was less necessary during recent years in which finance rates had been low, but shopping around for lower APR offers from dealers or third parties could make a difference in today’s market.” Edmunds analysts also note consumers are opting for loans with longer terms to make monthly payments more palatable. Edmunds data reveals 36.1% of consumers who financed a new car purchase in June opted for a loan term of between 73 and 84 months, compared to 32.8% in June 2021. “Consumers are exploring every possible avenue to make their next vehicle purchase affordable, and longer loan terms are a good example of that, even if that choice poses risks considering vehicle wear and tear and greater negative equity (the amount by which their loan balance exceeds their vehicles’ value) as their vehicle ages,” said Drury. “The best moves shoppers can make are staying as informed as possible and not relying on car financing strategies of old—because buying a car in 2022 is a whole different ball game.” Source: Edmunds

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Nissan Pathfinder Hood Latch Recall Follows Investigation by David A. Wood, CarComplaints.com

A Nissan Pathfinder hood latch recall follows a federal investigation into why the hoods suddenly fly open while driving. The 2013-2016 Nissan Pathfinder hood latch recall involves nearly 360,000 SUVs in the U.S. and Canada. The government opened an investigation into Pathfinder hood latches in December 2021 after receiving 14 reports which said the hoods opened when the latches failed. According to Nissan, the hood can open while driving if the primary hood latch is inadvertently released or the hood is not closed properly with the bell crank lever in the open position. Trying to drive a Pathfinder with the hood blocking the driver's view may be a challenge. “On certain Pathfinder vehicles, dust and dirt contamination may accumulate on and around the bell crank lever pivot joint,” Nissan said. “Over time, the build-up of contamination combined with a

lack of proper inspection and maintenance of the bell crank assembly (as described in the Owner’s Manual) can create mechanical binding that could cause the lever to remain in the open position after it has been disengaged.”

Nissan also said the contamination can scratch the bell crank protective anti-corrosion coating, which allows corrosion of the metal in the pivot joint. Even though the investigation continued for months and Nissan has ordered this recall, the automaker is still trying to figure out how dealerships will repair the

Non-Tesla Supercharger Pilot Launch Expected Late 2022: White House by Maria Merano, Teslarati

The Biden-Harris Administration released a fact sheet suggesting the non-Tesla Supercharger Pilot program will be available in the U.S. later this year.

The White House fact sheet briefly mentioned Tesla’s contributions to expanding EV charging stations in the U.S. It acknowledged Tesla’s investments in Giga New York, which produces Supercharger stalls and Solar Roofs. “Tesla is expanding production capacity of power electronics components that convert alternating current to direct current,

charging cabinets, posts and cables. Later this year, Tesla will begin production of new Supercharger equipment that will enable non-Tesla EV drivers in North America to use Tesla Superchargers,” the fact sheet said. The pilot program would open the Supercharger Network, with more than 35,000 Superchargers worldwide, to non-Tesla vehicles in the U.S. As of this writing, the non-Tesla Supercharger Pilot is available in most of Europe. The Supercharger rates for non-Tesla drivers vary by site but can decrease with the company’s charging membership. Prices for the Supercharger Pilot program are listed in the Tesla app. Tesla also charges idle fees to vehicles, ensuring Supercharger stalls are always immediately available once customers finish charging. Charging fees vary by country. In the U.S., Tesla charges 50 cents per minute when the Supercharger station is 50% full and $1 per minute if the station is 100% occupied.

Pathfinders. Nissan mailed interim recall letters to a selected sample of 40,000 Pathfinder owners beginning June 30. This hood latch recall letter will invite the owner to bring their Pathfinder to a dealer to have technicians inspect the bell crank and hood lock assembly and replace them if needed. But the replacement parts will be the same hood latches and components as originally installed in the Pathfinders. The collected components will be used by Nissan to create a recall remedy. Nissan will then mail interim Pathfinder hood latch recall letters to all other affected owners by Aug. 3. The recall letters will show owners how to properly inspect the bell crank assemblies and hood lock levers for proper operation. If the lever moves freely, the Pathfinder owner can clean the

lever based on the Nissan Pathfinder owner’s manual. The owner can also bring the Pathfinder to a dealer for the cleaning and maintenance. However, if the levers don't move freely, Nissan Pathfinder owners should take their vehicles to dealers to have the bell crank assemblies and hood lock levers inspected. The dealers will clean and lubricate the parts if the levers are working properly. The components will be replaced with new like-for-like hood latch components if the levers and locks aren't working. “When the final remedy plan is available, Nissan will mail final remedy notification letters and include a statement concerning reimbursement for the cost of obtaining a pre-notification remedy for a subject vehicle that was no longer under warranty at the time of a repair,” Nissan said. Owners of 2013-2016 Nissan Pathfinders can call 800-867-7669 and ask about hood latch recall numbers R22A2 and R22A3.

Teslas Get Updated Seat Belt Functions in New Update by William Johnson, Teslarati

As part of a recent over-the-air (OTA) software update, Tesla improved its vehicles’ safety and comfort by introducing improved seat belt and suspension enhancements. The seat belt enhancement is an update that uses the vehicle’s onboard cameras to detect when a crash is imminent to automatically tighten seat belts in the cabin. This feature already existed in a limited capacity, as Tesla’s seat belts would tighten as airbags were deployed. However, this update now allows vehicles to act more proactively to protect their occupants. Tesla already benefits from a low center of gravity, making it hard to tip over; myriad safety features; and, despite what some news outlets would argue, an increased level of safety due to a reduced number of combustible parts. These updates prove there is more that can be done to prevent automotive deaths, and Tesla is implementing changes to address these risks. While the seat belt enhancement applies to all vehicles, the suspension

enhancement only applies to the Model S and Model X with adjustable air suspension. These vehicles will now, also through the use of the onboard cameras, be able to detect rough roads and potholes. Similar to the vehicle’s ability to detect debris on the road, this system uses the suspension to raise the vehicle proactively to protect the body panels and occupants from being jarred when going over rough terrain. Also included in this update is the green light chime and the return of the range at destination feature. The green light chime alerts the driver when the traffic light they are waiting at has turned green, or when the vehicle in front has started to advance. The range at destination feature, while previously available on vehicles, returns to allow drivers to see how much battery they will have left when they reach their destination. These updates mark the first 2022.20 series of updates Tesla is releasing to vehicles and follow a long stream of 2022.16 updates that included everything from autopilot max speed increases to driver profiles to updated visualizations.

autobodynews.com / AUGUST 2022 AUTOBODY NEWS 47

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