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VOL. 30 ISSUE 10 OCTOBER 2012
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President Obama Takes on Chinese Auto Parts, Alleging Illegal Subsidies, and Gov. Romney Plan President Barack Obama confronted China’s alleged auto parts subsidies on Sept. 17, accusing that country of unfair trade practices that “harm working men and women [in the US].” Beijing has acknowledged strategies to support industries targeted for development, ranging from clean energy to mobile phones to autos. Companies can receive tax breaks and low-cost bank loans, energy and land. Exports accounted for about onesixth of the $300 billion in sales by Chinese auto parts makers last year, according to research firm AlixPartners Asia. The United States was by far the
biggest destination for Chinese auto parts last year, with sales rising 26 percent to $12.9 billion. Exports to the No. 2 region, Western Europe, rose by a similar margin to $7.8 billion, said Alixpartners. “Today, my administration is launching new action against China —this one against illegal subsidies that encourage companies to ship auto parts manufacturing jobs overseas,” Obama said in a campaign speech in Ohio, the heart of auto parts manufacturing in the United States. “Those subsidies directly harm
State Farm Insurance has sent a letter to all of its Select Service shops to offer the latest updates and answers to common questions surrounding the company’s parts procurement pilot through PartsTrader. In the letter, State Farm said it believes customers will benefit from competitive pricing, high quality parts and a strong parts supply chain for auto repairs. The company said the PartsTrader platform will ensure that State Farm can work with repairers to fix more cars rather than total them. “State Farm believes technology is changing the driving experience and customer expectations. While we don’t
know what the future holds, trends suggest changes are ahead for insurers and repairers,” State Farm said. “We understand that the ideal ordering solution for repairers will leverage the benefits of technology to provide the opportunity to locate the highest quality parts, at the most competitive prices, as quickly as possible.” State Farm offered the following information to its Select Service shops in attempt to address “misunderstandings and misgivings” that many people have developed regarding the program: ● Pricing information: State Farm said it cannot see repairer costs or part
See Chinese Auto Parts, Page 19
State Farm Releases PartsTrader Update, Adds Chicago to Test Market
See PartsTrader Update, Page 24
CAA Sends Legislative Alert and Call to Action The California Autobody Association issued this Legislative Alert-Call to Action: The CAA has been opposing insurer-sponsored legislation that would weaken long-standing law that provides for fair and reasonable auto body repair practices. CAA has also opposed legislation that would provide legal presumptions that aftermarket crash parts are equal to OEM crash parts in all instances. Insurer sponsored bills this year include SB 1460 (Yee) and AB 1098 (Hagman). Both failed. However, CAA has learned that insurers are now trying to usurp the democratic process by “gutting and amending” a bill during the final days of the legislative session. “Gut and amend” is a last-minute move which strips a bills original contents and inserts new unrelated language to the original bill, thus by-passing open hearings, negotiations and amendments. We are asking all our CAA members to call their Assembly members and Senators today and tell them to say ‘No’ to last minute “gut and amend” bills which significantly weakens consumer law pertaining to aftermarket crash parts and fair auto body repair practices.
Any such legislation should be properly vetted through the normal process, fairly negotiated with all stakeholders and not rushed in the ‘middle of the night’ with no public or industry input. These types of practices undermine public trust. We suspect this ‘gut and amend’ will drastically change current law regarding aftermarket crash parts. Legislators may be led to believe by insurers that aftermarket crash parts are equivalent to OEM parts in all instances, and that they should be legally considered as such. CAA needs our members to educate their legislators. When you call your legislator, please offer them information to support the facts, as you know them. Here are some ideas for discussion: Although quality of aftermarket crash parts has improved over the last 10 years, they are still inconsistent. Sometimes they fit and perform and sometimes they don’t. Protect your business and stop these types of underhanded legislative practices. Please call your senator and assembly member today. Call both district offices and Sacramento offices. To locate your legislator please goto: http://www.leginfo.ca.gov/yourleg.html.
Carbon Fiber Advances Enable Mid-Volume Production Vehicles from MI Factory by 2013 According to the Oak Ridge National Laboratory, a 10% reduction in vehicle mass increases fuel efficiency by 7% on average, so it’s clear what advantages lighter weight and stronger materials can bring to future vehicles. As the automotive industry absorbs CAFE regulations and consumer desire for fuel efficient cars, the goal of mass reduction has enabled some startling improvements in production time and costs for carbon fiber. Carbon fiber is emerging as a practical and cost-competitive alternative for mid-volume production cars. Previously used only in exclusive lowvolume vehicles like the Corvette ZR1 pictured, Plasan Carbon Composites based in VT and owned by Plasan
Sasa, an Israeli defense contractor, will be producing carbon panels for a midvolume production vehicle as early as January 2013 from its locations in
Western Michigan. This means that by early 2013 body shops could be tasked with carbon fiber repairs. “It will be the first time that carSee Carbon Fiber, Page 58
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