Mopar Masters Guild Magazine May -June 2017 Edition

Leaders in the sale of quality Mopar Parts.

May - June 2017

Also In This Issue From the Desk of MMG President Susan McDaniel .................. 2-3 Alfa Crossover Critical to Turnaround ............................................ 4-5 Matt Hagan Grabs “Wally” at New England Nationals ........................... 6 Stay on My Bumper .................................. 7 The View from My Office! .................. 8-9

Make Your Plans Now! Service and Parts Managers FCA 20 Group Fall 2017 August 21 & 22 Details - Pages 2-3

MMG Supporting Vendors .............10-11 Elite Extra...........................................12-13 Snap-On Business Solutions .................14 Autobody News........................................15 Katzkin Automotive Leather ................16 10 Missions Media ..................................17 CDK Global ........................................18-20 Rousseau Storage.....................................21 OEConnection ....................................22-23 Reynolds & Reynolds........................24-25 KIS Solutions ......................................26-28 AER Sales ............................................29-31

Washington Post, NY Times Talk Automotive Technician Shortage Page 38

Dataset .......................................................32 KPMG Warns OEM’s to Prepare for Lower Parts Sales ....................................33 Career & Tech Ed Faces Cuts in FY18 Budget ......................................34-35 Miss. AG’s Auto Body Guide Defines Proper Repair .....................................36-37 What to look for in a Good CSR .........39 2017 MMG Committees ........................40

The exchange of information by like size dealers in a non-competitive environment.

Mopar Masters Guild

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May - June 2017

From the Desk of MMG President Susan McDaniel

“Reflect, Regroup, Make Plans” Hello Everyone!

I hope you all are having a great year! It is really slipping by fast for me. I can’t believe we are already half way into it!

This is really a good me to reflect on how the year has progressed so far, what we have learned, and what we can do to improve the second half. Reflect. Regroup.

A good way to get a fresh start, gain some new knowledge and reassess the situa on is to take part in our biannual Mopar Masters FCA 20 Group. Our next scheduled session will be in Auburn Hills on Monday August 21st and Tuesday August 22nd.

Service and Parts Managers FCA 20 Group Fall 2017 Dealer Connect – Training Tab – Performance Ins tute Learning Course Number – SPF2G7IL Course Name – Service and Parts Managers 20 Group – Fall 2017 Offering Number – 610072 Moderator – Mark Beaton Facility – Marrio Centerpoint – Pon ac, MI Mee ngs – MON. 8/21/2017 8:30 AM – 4:00 PM Tues. 8/22/17 8:30 AM – 3:00 PM Our team from FCA headquarters will join us on Tuesday a ernoon.

Sign up now! For 2017 Master Level Cer fica on!

You will reveive a room block link for the Marrio shortly.

A ending these groups is not only a way to gain your 2017 Master Level Cer fica on but to increase your Knowledge. Remember, you will be in a room with the top 100 performing Parts Directors in the en re country.

These Directors are having the same “everyday” challenges that you are having. We not only spend me going over the financial composites, we HELP each other understand the different sec ons of the financial statement and how to improve our departments and the way we manage.

Continued on Page 3

Mopar Masters Guild Magazine

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Continued from Page 2 This is not a group that points fingers and ridicules those who are weak in certain areas. We HELP each other and share ideas to improve our overall strength as a group and as individual managers. We also have a “Share an Idea” session that is very beneficial. Share a simple procedure or step that you are doing to make a li le extra money or make your departments run more smoothly. We have all benefi ed so much from these sessions.

Remember…Service Directors are included and encouraged to a end. We have a handful who a end our groups and it is so beneficial and enlightening to have them present. To hear their point of view on things is extremely helpful in our overall outlook. The Parts Directors who have brought their Service Directors to these groups have become closer and more connected, in turn crea ng a stronger team in their dealerships.

We not only gain a tremendous amount of knowledge by a ending these groups but also build great connecons and friendships. The conversa ons that take place during our down me, dinners and cocktail hours have helped so many of us progress in our posi ons and become stronger at everything we do.

The Annual World Famous Car Cruise (The Woodward Dream Cruise) on Woodward Avenue just north of Detroit is Saturday August 19th. This is the world’s most popular Car Cruise and largest one-day automo ve event. Plan on coming in early to join us in the excitement.

Build your knowledge, make some great new friends, and have some fun! Join us for the August FCA 20 Group this year in Auburn Hills!

Your President,

Susan Susan McDaniel susan@billluke.com 602.336.1557

KNOWLEDGE I cannot teach anybody anything. I can only make them think.

- Socrates

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May - June 2017

Alfa crossover critical to Marchionne’s turnaround Alfa Romeo’s global turnaround has been a tough road. A new crossover could help.

Stelvio, the name that Alfa Romeo chose for its first crossover, refers to the Stelvio Pass in the Italian Alps. To reach the spot, 9,000 feet above sea level, a driver must make 48 hairpin turns in the mountains.

Alfa’s drive in search of success has been a similar kind of twis ng ascent.

The automaker’s new crossover will now be cri cal for the struggling Fiat Chrysler Automobiles subsidiary as it pursues its ambi ous global sales target and its first profit in almost two decades in 2018.

Speaking in an April call with analysts, FCA CEO Sergio Marchionne said, “Alfa and Masera together will sell 230,000 units in 2017.”

He forecasts that Masera will sell about 60,000 vehicles, leaving Alfa to sell 170,000 globally this year.

That will be a drama c twist for Alfa Romeo. The premium brand sold just 73,000 vehicles worldwide last year.

IHS Markit is less op mis c than Marchionne. The market research firm forecasts Alfa will sell 120,000 vehicles worldwide this year. The Stelvio, which Alfa is rolling out in Europe, will account for fewer than 25,000 sales globally, according to the forecast.

It will go on sale in the U.S. this summer with a base price of $42,990, including shipping. The vehicle comes with a 2.0-liter direct-injec on intercooled turbo four-cylinder engine that yields 280 hp.

Alfa’s struggle is well-documented. It is amid its fourth revival plan since Marchionne joined the company in June 2004. The 5 billion euro ($5.62 billion) turnaround plan presented in 2014 targeted sales of 400,000 vehicles in 2018 and predicted Alfa volume would rise to 500,000 soon therea er without providing a me frame.

Marchionne revised that plan in January 2016, moving the 400,000-vehicle sales goal to 2020.

Through the first three months of this year, Alfa has increased European sales 35 percent to 21,512 vehicles, JATO’s numbers show. If Alfa tops 100,000 sales this year, it will be the first me it has done that since 2012.

The last me it sold more than 200,000 vehicles was in 2001.

Alfa Romeo declined to comment for this report.

Good ming One plus for the Stelvio is that it is arriving at the right me. Demand con nues to rise for compact premium crossovers.

The segment already includes popular compe tors such as the BMW X3, Jaguar F-Pace and Mercedes-Benz GLC. Last year, U.S. sales in the segment increased 32 percent to about 360,000, Automo ve News Data Center figures show.

Continued on Page 5

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Continued from Page 4 The Stelvio will also be counted on to help improve Alfa’s profit margins.

FCA CFO Richard Palmer confirmed that Alfa is on course to reach breakeven in the fourth quarter of this year, and Marchionne added that the automaker will become profitable again star ng in 2018.

Massimo Vecchio, an analyst at Mediobanca in Milan, es mates that FCA has so far invested about half of the 5 billion euros earmarked for Alfa. So far, just two of eight planned new models have been launched: the Stelvio and its pla orm sibling, the Giulia midsize sedan, which has not kept pace with expecta ons.

Marchionne predicted annual global sales of 75,000 to 100,000 Giulias, but since its May 2016 market launch through April 2017, Alfa sold 18,908 Giulias in Europe, according to JATO Dynamics.

One challenge for Giulia is that it is not offered as a wagon in Europe, a body style that produces a significant por on of the sales of its compe tors there, such as the BMW 3 series and Audi A4. In the U.S., Alfa sold 1,600 Giulias in the first four months of the year, company figures show.

The Giulia now faces addi onal headwinds as worldwide demand so ens for sedans in general.

Pressure The Giulia’s slow start puts added pressure on the Stelvio to help Alfa reach its sales and profit goals.

“In the third quarter, we might be able to get a first hint of how the Stelvio has been received in its key markets,” says Gabriele Gambarova, an analyst at Banca Akros in Milan, Italy. “The U.S. market could absorb 20,000 units this year between the Giulia and Stelvio.”

Alfa’s return to profitability could be further helped by the introduc on of two other planned crossovers — one compact and one large.

The compact crossover is likely to be built at FCA’s factory in Pomigliano, in southern Italy, where the automaker produces the Fiat Panda minicar. Alfa’s large crossover is expected to be built in either Cassino, sharing its pla orm with the Giulia and Stelvio, or in the Mirafiori plant in Turin as a sibling of the Masera Levante.

But neither of these two crossovers is expected to debut sooner than 2019.

Source: www.Automo ve News.com

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May - June 2017

Matt grabs Wally at New England Nationals Ma Hagan collected his third win of the 2017 season when he outlasted Courtney Force to win the NHRA New England Na onals.

It was Hagan’s first win in Epping and the 25th of his career. That breaks a e with teammate Jack Beckman for ninth on the all- me Funny Car wins list. Hagan saved his best race-day run for last, powering to a 3.897 to defeat Courtney Force, who slowed to a 3.92 a er running low e.t. of elimina ons in the semifinals.

The best ending was when two- me Funny Car world champion Ma Hagan and the Mopar Express Lane 2017 Dodge Charger R/T team led by Dickie Venables stopped a losing streak to John Force in the opening round.

Hagan then went on to win the New England tle by bea ng Force’s daughter, Courtney Force, in the final round of elimina ons at Epping, N.H., for his third event tle of the season. J. Force had beaten Hagan in their last four mee ngs.

Hagan powered to the 25th victory of his career and third of the season with a 3.897 pass at 332.59 in his Mopar Express Lane Dodge Charger Funny Car to defeat C. Force who ran a 3.927 at 332.34.

“I knew we had a great racecar today and the condi ons were great so we knew we would be be er than our qualifying mes,” Hagan said. “Everything went the way it should have today, and things seemed to fall in place for us.”

“Obviously, you have to race the racetrack, but you race the racer as well. People say they don’t think about who is beside you. But I think that’s crap. Everybody does. Their cadence and tendencies and what they’re going to do and different things like that.”

Hagan’s team stumbled on both qualifying runs Friday but rallied on Saturday to qualify fourth.

“We didn’t go down the racetrack (Friday) and you’re thinking, ‘oh man, what do we do?’ But Dickie was like, ‘man we’re be er than that.’ So, he reeled it back in and made two really nice laps on Saturday and built a lot of confidence coming into Sunday.”

Source: www.Ma haganracing.com

Mopar Masters Guild Magazine

Leaders in the Sale of Quality Mopar Parts

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‘STAY ON MY BUMPER’ ‘The most death-defying experience’ of Tim Kuniskis’ life Before he got his driver’s license, Tim Kuniskis raced bicycles and motorcycles.

“But as soon as I could get my license, I drag-raced,” the head of passenger cars for Fiat Chrysler Automobiles in North America told Automo ve News in 2014.

Since Kuniskis took over Dodge in 2013, he has led an all-out effort to bolster the brand’s performance image. He made Hellcat Challengers and Chargers more plen ful, made the Viper more affordable and introduced street drag racing to the annual Woodward Dream Cruise in Detroit with Roadkill Nights. And last month at the New York auto show, Kuniskis revealed a factory-built drag racer — the 840-hp Dodge Demon — aimed at those who share his love of going fast.

How much does Kuniskis love to go fast? In 2014, he described a 12-lap training run in a NASCAR racer. Some stories are best told by those who lived them: “I did the Richard Pe y Driving Experience when it wasn’t open to the public. I just went to the track with the instructors, and they said, ‘Here’s the keys to a NASCAR. Have fun.’ The guy said to me, ‘Here’s the rules: I’m going to drive in front of you, and your job is to hit my bumper. Stay so close that you’re going to hit my bumper. You be on my ass, right?’ “‘You’re sure?’ I asked, and he said, ‘Look, this is like chasing a dolphin. You’re not going to catch me, so you stay on my bumper. If you stay on my bumper, I know that you’re in a safe line, that nothing’s going to happen to you. If you get off my bumper, I don’t know. You could slide, you could take an unsafe line. Stay on my bumper, and you’re safe. As fast as you want to go, I’ll go. If you want to go 75, I’ll go 76. If you want to go 100, I’ll go 101. But you stay on my bumper.’ OK. “So I’m on this guy’s bumper. I’m doing about 140, not superfast for NASCAR, but 140 in a real race car, on a track with turns. I’m right on this guy’s ass. I’m white-knuckled and it smells and it’s loud and it’s rumbling and you’re on his ass and you’re doing 140 and you’re a nanosecond away from death, right?

“And you come into the first turn. If you watch [racing] on TV, it’s no big deal, right? Just this li le turn. But you hit this first turn, and the G-forces, the car doesn’t move, but your body wants to go out of the passenger window. So you’re now fully holding on for dear life trying not to fly out of the car, while this car is turning at 140 mph.

“It was the most death-defying experience of my life. It gave me a whole new respect for NASCAR, because if you watch it on TV it’s like no big deal. “But I got out of the car a er probably 12 laps and I almost fell down because I was physically exhausted. A er 12 freaking laps, and these guys are doing 500 miles. Anyway, I looked over and everybody was laughing. I was like, ‘Are you laughing because I’m red? You guys get in and try it. Trust me, this is hard.’ “‘We’re not laughing because you were red,’ they said. ‘We’re laughing because you couldn’t keep up.’ “‘Couldn’t keep up? What are you talking about? I was on his ass. If he would have let off the gas, I would have hit him and I would have been dead!’ Then they said to come watch the replay, and I was like four car lengths behind. Swear to God, I thought I was [inches] behind and it was ... well, it was very far. To the point where they were laughing their asses off.”

Source: www.automo venews.com

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May - June 2017

The View From My Office Hi everyone! Things have been crazy busy here at Jack Powell Chrysler Dodge Jeep Ram! At work and at play.

Part of my job now is to go out and visit our customers. I am really enjoying this because that is what I liked most about being a driver.

Making that connec on with the customer, providing good customer service, and making sure their needs are met and that they are happy with the service the parts department gives them. From the interac on with the parts advisor, the me it takes to deliver the part, and with the parts driver. Everyone plays such an important role in making this wheel spin. I would give this pep talk all the me to our drivers when they would use the excuse “I’m just a driver” I tell them they are one of the most important pieces to the puzzle, they are the face of Jack Powell. I would like to put out a bulle n to all drivers to put your best foot and face forward. Make good impressions, be happy and enjoy yourselfs. Being a delivery driver can be hard work at mes, but it can also be fun if you make it that way. So all you parts managers out there encourage your drivers by le ng them know that they are important and that they really do make a difference - they will appreciate the kind words and to know that what they do and how they do it makes a difference.

Being Jack Powells Mopar outside sales person is proving to be a good fit for me. I am enjoying reconnec ng with our customers and I feel like I can make a difference. It makes my day when when I go into a business and they recognize me and are happy to see me. Another thing I have been doing in my new role is to a end Grand Openings. And it is one of these that I would like to write about today.

I would like to tell you about Interna onal Auto Cra ers. They have been one of our customers for many years. On March 29, 2017 I attended the Grand Opening for their 4th store in Menifee California. I was fortunate enough to meet the owner, Harry Ryan and he showed me around his impressive 17,500 sq. . facility and shared with me the history of Interna onal Auto Cra ers and his journey to open the new store in Menifee. Walking amongst vendors, customers, visitors, and city officials who turned out for the Grand Opening Mr. Ryan was walking tall and wore a big smile and was full of excitement for this day where he would be cu ng the ribbon announcing the opening of his new facility.

Mopar Masters Guild Magazine

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Leaders in the Sale of Quality Mopar Parts

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Continued from Page 8 A day that was many years in the making.

Harry Ryan and and two partners opened their first store in 1990 in Moreno Valley. Then in 1997 Harry’s brother Harvey joined up with him and they bought out the 2 original partners. In 2001 they opened up their second loca on in Lake Elsinore. In 2013 they opened up their 3rd loca on in Palm Desert. Harry Ryan saw Menifee as an area that was growing fast and was in need for a body shop like Interna onal Auto Cra ers. Once he found a loca on he put in a satellite store for customers to bring their cars to and then they would transfer the car to one of their other facili es. The drawing of the plans and ge ng city officials support and permits took a long 4 years. But in the end it all worked out. IAC sits on 1.37 acres and is freeway close and convenient. They built the building from the ground up and were also required to put in all landscape at a cost of over $100,000. The front office features black and white checkered floor and custom pain ngs of classic cars hang on the walls - all with a story to tell. It is a very fun and welcoming office to walk into. A place full of pride as we walked upstairs to a large mee ng room with fantas c views of the mountains in the distance and a nice big table and chairs all around. A room to have mee ngs and tech training set up with TV and equipment. A good gathering room. Downstairs the shop features 3 paint booths and the top of the line Car O Liner. The newest and most accurate car alignment equipment on the market. A very impressive facility.

The Ryans not only run body shops they are also big supporters in the communi es. They sponsor and donate me and goodies to the school Student of the Month programs put on by local Chamber of Commerce in all 4 communi es where they have a shop. They also support the local school sport teams. Customer service is also important to them. Ge ng a customer’s car fixed to perfec on and taking care of them in the future if any touch up repairs need to be done. They offer a “forever detail” to any customer that has their car repaired at any of their shops. This gives the customer an opportunity to bring their car in twice a year to have a mini wash and detail. During this service the car is looked over to make sure everything is as it should be.

In closing I would like to say I enjoyed mee ng Mr. Ryan and learning about his journey. And the the staff I met during the day were all so nice. It was a fun day with food trucks, vendors, prize drawings, and visi ng with people. All of us at Jack Powell look forward to con nued business with Interna onal Auto Cra ers.

Hope all of you have your Best Day Ever! ( I stole that one from Rick Monteiro ) Kat Monteiro - Jack Powell DCJR

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Our Supporting Vendors: Support those who support you.

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May - June 2017

Mopar Masters Guild Magazine

Leaders in the Sale of Quality Mopar Parts

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Our Supporting Vendors: Support those who support you.

The exchange of information by like sized dealers in a non-competitive environment.

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May - June 2017

Technology that helps drive your deliveries, while fueling your profitability.

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How does it work? Elite EXTRA is an automated and integrated traffic control center that creates optimally sequenced routes on an interactive map and then dispatches them to your drivers’ smart phones or tablets.

As a recognized leader in the logistics industry, this award-winning solution will give you visibility of your deliveries and drivers at all times, thereby increasing employee accountability and customer satisfaction.

The result? You and your customers will know when and where your deliveries are at all times!

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Leaders in the Sale of Quality Mopar Parts

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Discover what many of your Mopar Masters Guild colleagues already know – Elite EXTRA can help drive profits for your operation.

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May - June 2017

Provide Peace of Mind for your Customers and Increase Service Retention for your Dealership.

Choose PartProtection’s Lifetime Battery Warranty Program Today!

Now your dealership’s parts and service departments can offer customers a lifetime battery warranty program.

Now Available for all FCA Dealers!

Dealership will replace the customer’s battery, in the case of failure, for no additional charge as long as the customer owns the car Customers are directed back to your dealership for battery replacement, maximizing customer retention The warranty provides two complimentary jump-start services per covered battery for added peace of mind for the customer

How does the program work?

Warranty can be placed on any OEM or Aftermarket battery that you currently sell that comes with at least a 24 month underlying factory replacement warranty For each approved claim the Dealer is reimbursed for the battery cost +10% and $30 for battery replacement labor The PartProtection Lifetime Battery Warranty can be offered on your New & Used Cars as well

For more information please visit: www.sbs.snapon.com/lifetime-battery

Mopar Masters Guild Magazine

Leaders in the Sale of Quality Mopar Parts

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The exchange of information by like sized dealers in a non-competitive environment.

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May - June 2017

Mopar Masters Guild Magazine

Leaders in the Sale of Quality Mopar Parts

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THE FUTURE IS HERE

THESE AREN’T YOUR GRANDPA’S MAGAZINES 05.17

FENDERBENDER.COM / JUNE 2017

PARTS

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Master indy-level customer service

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A SIMPLE

NAME GAME

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FIVE STEPS TO A

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One shop’s successful journey through a complete branding overhaul

THE

SWEET

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How to increase your brand awareness in a consolidating marketplace

COLLISION

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Plateau to Pivot Brooke Pilibosian and her husband, Alan, drastically changed their business’s brand after sales sputtered.

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May - June 2017

75,000,000 MOTORISTS

DON’T HAVE A REPAIR SHOP

THEY TRUST Tom Gill Chevrolet has earned the honor of being Kentucky’s largest Chevy dealer by volume. About 110 employees make this successful operation tick, and you’ll find six of them, each with tablets in hand, ready to greet Service customers in the lane.

There’s great value in meeting a customer in the lane because we begin building trust as soon as the customer pulls up.”

See how Tom Gill Chevrolet builds trust with their customers.

Mark Farney, Parts and Service Director, Tom Gill Chevrolet

Mobile technology is a key part of CDK Service. It allows the vehicle owners to participate in walk-around inspections, so they can see exactly what repairs are needed — and avoid any surprises at checkout.

Headline Source: 2016 AAA Repair Customer Satisfaction Study. © 2017 CDK Global, LLC / CDK Global is a registered trademark of CDK Global, LLC. 17-2577

Mopar Masters Guild Magazine

Visit cdkglobal.com/trust

Leaders in the Sale of Quality Mopar Parts

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KEEP CUSTOMERS IN YOUR

SERVICE DEPARTMENT And Out of Independent Shops.

40%

Dealers lose more than 40 percent of their Service customers after their warranties expire.

1

75%

At the same time, nearly ¾ of U.S. drivers say they don’t trust independent auto repair shops — and 75 million don’t have a repair shop they trust.

2

BUILDING CUSTOMER TRUST STARTS WITH A SUPERIOR EXPERIENCE Make it Easy for Them to Give You Their Business

Make Your Prices Appealing

Design your website so customers can easily find: • Online scheduling • Hours, location and contact information • Help with transportation • Technician certifications

Show price-conscious customers your value online with: • Affordable prices • Coupons • Free estimates

Let Them Know About the Perks Remind customers you have amenities the independents can’t offer: • A comfortable lounge area • Clean restrooms • Free Wi-Fi • Coffee and snacks

Today’s vehicle owners have the incorrect perception that your Service department is more expensive and less convenient than independent shops.

By promoting your competitive advantages, you can change that outlook — and keep your customers!

1

Source: CDK 2017 Global Dealer Survey

2

Source: AAA 2016 Repair Satisfaction Study

©2017 CDK Global LLC | CDK Global is a registered trademark of CDK Global, LLC. 17-2577

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May - June 2017

Create the Perfect Match Every Time.

PERSONALIZE THE F&I EXPERIENCE.

Selling is easier when you know what your customers want.

Introducing CDK MenuVantage Platinum™ powered by Darwin Automotive.

How does it work? More than 80 algorithms analyze your customers’ preferences to create the ideal sales presentation in seconds — right from a tablet.

Ditch the same old sales pitch.

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© 2017 CDK Global, LLC / CDK Global is a registered trademark of CDK Global, LLC. 17-8461

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May - June 2017

It’s the season for this‌.

Mopar Masters Guild Magazine

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which means it’s also the season of this.

Make sure you’re ready to supply your shops with the most comprehensive OE Mechanical parts fulfillment solution on the market today: RepairLinkSM.

Find out more at OEConnection.com The exchange of information by like sized dealers in a non-competitive environment.

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May - June 2017

We’re seeing

$350 in accessories profit per deal.

Experience Accessories AddOnAuto - part of Reynolds Retail Management System… transforming the way consumers experience your dealership.

rr.reyrey.com/addonauto | 888.781.3020 © 2017 The Reynolds and Reynolds Company. All rights reserved. 1068343 /17

Mopar Masters Guild Magazine

Nick Short General Sales Manager Landmark Chrysler Jeep :WYPUNÄ LSK 03

Leaders in the Sale of Quality Mopar Parts

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What’s trending with accessories?

Accessory Market

$39.18 Billion Accessory Buyers

49%

of new vehicle buyers plan to ACCESSORIZE

Most Popular Accessories by Region

24% 57% Spend over $300

Spend over $1,000 Most Profitable Trends

Top Accessorized CDJR Models

1

Ram 1500 Crew Cab

1

Protection Products

2

Jeep Wrangler Unlimited

2

Alarms, Remote Starts, and Recovery

3

Dodge Charger

3

Window Tint

4

4

Step Bars

Chrysler 300

5

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See the complete 2017 Auto Accessories Trend Report. info.reyrey.com/trendreport | 888.781.3020 Copyright Š2017 Reynolds and Reynolds Inc. All Rights Reserved. 5/17

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WWW.KISPRODUCTS.COM OR 817.919.0190

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New for 2017, How to Gain & Retain NEW Business! 2.5

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KPMG continues to predict low frequency, high severity in coming decades, warns OEMs to prepare for lower parts sales Consul ng firm KPMG predicted earlier this month that OEMs should expect advanced driver assistance systems to take a huge bite out of the collision parts which had been a stable source of profit, echoing a similar analysis from 2015 and providing input that auto body shops need to take to heart as well.

“OEMs have already begun to deal with the design and engineering challenges related to autonomous vehicles,” KPMG U.S. automo ve leader Gary Silberg said in a statement. “And while their focus may be on bringing the first self-driving cars to market, OEMs need to contend with the decline in demand for collision parts that these safer, autonomous vehicles are expected to bring by reducing driver error and lowering accident rates.”

KPMG has predicted in a new white paper that vehicles with at least one ADAS system, such as automa c braking, will cons tute 65 percent of the U.S. fleet but 75 percent of all miles traveled by that fleet by 2025. This will begin to slash collision volume and raise severity — but the net effect will s ll be a reduc on in profit, it predicted.

Crash involvement could be down 60 percent by 2030 and more than 80 percent by 2040. As those KPMG es mates don’t include weather-damaged vehicles or totaled vehicles (each about 15 percent of all damage incidents, according to KPMG), collision repairers won’t experience quite as much of a business decline — but s ll enough to be alarming to an owner.

“This is a great source of concern for people in my line of business,” an Alliance of Automo ve Service Providers member who owns two auto body shops and one dealership told KPMG. “I’m already seeing a 10 to 15 percent decline in repair jobs in my own shops among vehicles that come with ADAS. “In 15 to 20 years, this line of work is going to be decimated. … I have already begun developing my exit strategy out of this business.”

KPMG predicted what had been 3.1 crashes per million miles traveled would drop to 0.3 vehicles by 2050. The overall collision repair market (it’s unclear if this refers to non-dealership repairs) would fall from less than $30 billion to less than $5 billion, with OEMs’ share falling from $5.6 billion in 2015 to $1.4 billion by 2040.

Crash parts are less than 3 percent of an OEM’s revenue, but yield 10-20 percent of opera ng profit, according to KPMG. It es mated that those profits would fall 4-9 percent in 2030 and 6-13 percent by 2040.

“OEMs need to implement aggressive plans to right-size collision parts cost structures and iden fy new revenue streams,” KPMG industrial manufacturing head of strategy Tom Mayor said in a statement. “This will keep their shareholders and dealer partners whole, while maximizing showroom floor support for ADAS and autonomy.”

As for body shops and other collision repair stakeholders, KPMG predicts “job loss and unemployment,” and “increasing compe on and downsizing … un l the low performers ul mately are pushed out or absorbed into larger, high-performing players with scale advantage.”

Source: www.RepairerDrivenNews.com

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May - June 2017

Career and Technical Educa on Faces Cuts in President’s FY18 Budget Cuts, if approved by Congress, could impact collision repair training programs at high schools.

Collision repair training programs in high schools would possibly face cuts under the budget proposed by the Trump Administra on this week for Fiscal Year 2018 that begins in October 2017. The Administra on is reques ng $976.9 million to support career and technical educa on (CTE) programs under the Carl D. Perkins Career and Technical Educa on Act (Perkins Act). The request represents a 15 percent reduc on from the $1.12 Billion that was approved by Congress for FY 2017.

The Perkins Act provides federal support in the form of grants for CTE programs in all 50 states and the territories. The Administra on explained that overall budget priori es make the cuts necessary.

“Although a decrease is necessary to align with overall Budget priori es, the request would con nue to provide significant flexible formula grant funds that support State and local efforts to implement high-quality CTE programs, such as programs of study (non-duplica ve CTE courses that progress from the secondary to the postsecondary level and lead to a creden al, cer ficate, or an associate or baccalaureate degree), dual enrollment programs, and career pathways that help students a ain the creden als or cer ficates they need to gain employment in high-skill and high-demand occupa ons,” the Administra on said in the budget proposal to explain the decreased funding. “The Administra on plans to work with Congress to reform and improve this program through the upcoming Perkins Act reauthoriza on.”

The budget request includes a $27.4 million request for CTE Na onal Programs, an increase of $20 million that would support a compe on to promote the development of, “…innova ve CTE programs in science, technology, engineering, and mathema cs (STEM) fields.” The remaining funds would con nue to support State and local implementa on of CTE programs under the Act.

Impact on Collision Repair Training Programs Clark Plucinski, execu ve director of the Collision Repair Educa on Founda on, explained that the proposed budget cuts are a serious concern for the collision industry. Collision repair programs have faced declining funding for many years, resul ng in a significant number of school collision repair program closures. The Founda on has been working to help schools realign their programs to industry needs and provide financial support from the industry to support those programs.

“Over the last several years the Founda on has been focused on establishing the needs of school collision programs, from con nuous educa on for instructors, tools and equipment to necessary to achieve accreditaon by the Na onal Automo ve Technicians Educa on Founda on (NATEF), to consistency in their curriculum using I-CAR’s PDPEE for schools,” explained Pluciniski. “Working with over 500 of the 1100 schools teaching collision repair, last year we developed the Career Readiness Benchmark, ering schools to pinpoint their current status toward achieving the top level, er one status.

Continued on Page 35

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Continued from Page 34 The top ered schools differen ate themselves in that 63 percent of their students find their way into the industry and embrace higher levels of educa on versus the 20 percent that are not involved. Our research tells us that to move 300 schools to er one status to meet the pre-employment training needs of the industry will cost $35 million over five years.” The Founda on recognized the first 121 schools included in the Career Readiness Benchmark program in April.

Plucinski con nued, “Cu ng Perkins Grant dollars is guaranteed to cause hardships for the schools, especially with diminished focus on CTE, the collision programs could be eliminated. Since 2009, the number of high school and college collision repair programs has shrunk from 1454 to 1100 across the U.S. Clearly, this is the me for the industry to take a more ac ve role to partner with the schools, administra on and the state and local legislators to show our support.” “The Founda on, with strong industry support, can be the vehicle to not only influence the states and local schools boards, but to show through our rigor, our ability to not only save, but to improve the current status of their collision repair programs,” said Plucinski. “Over the last two years, using the theme of adop ng a schools, the local I-CAR commi ees have raised millions of dollars to support their local high Schools and college collision repair programs.”

Plucinski is urging the industry to contact their legislators to ask for support of con nued Perkins funding.

“Please take the me to write your local poli cians and help us with your generous dona ons,” concluded Plucinski.

Career and Technical Educator Concern A joint statement from the Associa on for Career and Technical Educa on (ACTE) and Advance CTE raised concerns about the impact of the proposed cuts. According to the statement by LeAnn Wilson, execu ve director of ACTE, and Kimberly Green, execu ve director of Advance CTE, “While the Trump Administra on talks about suppor ng workforce and skills development, this drama c cut is nothing short of an a ack on CTE and the students and employers who benefit from it. At a me when millions of job openings go unfilled every year due to shortages in the skilled, technical workforce, President Trump should double-down on an investment in CTE, not propose dras c cuts.

“This proposed $168 million cut from state grants for CTE significantly reduces states’ abilities to use these resources to improve and expand CTE programs based on their specific needs. It’s incredulous that an Administration that wishes to devolve authority to the states proposes to increase its own funding at the federal level by $20 million; this essentially equates to taking funds out of the pockets of states, colleges and schools to a create a new, untested program run by the Secretary of Education,” the statement continued. “As a businessman who has employed a range of employees – from engineers to computer programmers – the president is well-positioned to appreciate the importance of a skilled workforce that meets the demands of today’s economy. Unfortunately, this budget falls woefully short in its commitment to students, employers, and the next generation American workforce. We urge the President to review the far-reaching impact CTE has on all facets of the economy, and to make investing in CTE a priority.

Source: www.CollisionWeek.com

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Miss. AG’s consumer auto body guide defines proper repair as OEM procedures, roles of shop, insurer A er nearly a year of work, a low-profile but high-powered task force made up of insurers, collision repairers, OEMs, aftermarket parts manufacturers and Mississippi’s attorney general and insurance commissioner has finished and released a “Consumer’s Guide to Insurance and Auto Body Repair.”

“To say this is a monumental day would be an understatement,” the Mississippi Collision Repair Associa on wrote on Facebook Thursday. “Please follow the below link to the document, print copies to keep at your shop to provide to customers. This is a testament to the good that can come when shops, insurance companies, parts makers, and regulators come to the table for the good of consumers.”

The document announced Thursday by Democratic Attorney General Jim Hood is a straightforward, short booklet that clearly explains and defines some aspects of auto body repair which can be muddled during the claims process.

It stresses that customers can pick their own shop but offers considera ons before doing so and ques ons to ask before the repair, and it provides a list of items to inspect upon receiving a repaired vehicle.

It notably declares OEM procedures to be the proper way to fix a car — and advises customers to ask a shop if they’re using them.

Ask the shop about the repair process for your vehicle and how those compare to manufacturer guidelines for those procedures. …

A proper repair is performed pursuant to the original equipment manufacturers’ (“OEM”) repair procedures and using OEM or OEM equivalent parts that have been properly tested pursuant to or meet the manufacturers’ specificaƟons.

It also follows up the “OEM repair procedures = proper repair” defini on by defining the shop and insurer’s roles — roles that both sides seem to forget from me to me.

“It is the duty of your insurance company (or the third party’s insurance company) to pay for a proper repair,” the guide states. “It is the auto body repair shop’s responsibility to make the proper repair.”

Hood’s office on Thursday said the goal of the Mississippi Auto Repair Task Force was to “give consumers some guidance on naviga ng the rela onship between the collision repair and insurance industry” — a diploma c way of pu ng it.

“Our Consumer Protec on Division receives complaints from consumers about disputes between insurance companies and collision repair shops,” Hood said in a statement. “Due to the lighter space age materials used in newer model cars, the repair procedures, machines, and training for collision repair technicians are very technical and expensive. In order to place a vehicle back in its pre-accident condi on, some body shops have to buy expensive machines or tools and have their technicians trained and cer fied on the repair procedures for certain makes of vehicles.

Continued on Page 37

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Continued from Page 36 Some collision repair shops which do not obtain these cer fica ons and tools, may offer to do a repair cheaper. The goal of the insurance companies is to keep repair prices as low as possible. Therein lies the conflict for consumers to navigate. Our goal is to help consumers be aware of issues and understand their rights in the repair process.”

The task force, assembled by Hood in August 2016, “met to find common ground on best prac ces for the future and discuss concerns and desires to be er meet the needs of consumers.”

Clinton Body Shop owner John Mosley praised the consumer guide on Facebook Thursday and called working on the task force a “privilege and pleasure.”

“The days of ‘the cheapest price is the price we pay’ has reached an end,” wrote Mosley, who ran unsuccessfully against fellow task force member Insurance Commissioner Mike Chaney out of frustra on with the Insurance Department’s handling of collision repair issues. “When you need collision repairs, do your research and make your shop choice based on reputa on. Don’t stop there; educate yourself to your vehicle’s needs. Find out if the shop is capable of making a proper repair. This guide will help you understand your choices and your op ons.”

“We as an associa on are proud of the end product this over year long study group has produced,” MSCRA Execu ve Director John Morgan Hughes wrote in an email. “I hope this document serves as a testament to the power of shops, insurance companies, parts makers, and regulators all coming to the table for the benefit of consumers. Our members are commi ed to making safe and proper repairs and this document will be a great educa onal tool to let consumers know their rights. We thank A orney General Hood and Commissioner Chaney for their leadership and courage to tackle this issue head on.”

The Property Casualty Insurance Associa on of America refused to support the consumer guide — arguing apparently against the use of OEM repair procedures as the defini on of a proper repair.

“While PCI generally appreciates all efforts to educate consumers on auto body repairs, we are disappointed with the Consumer Guide to Auto Body Repair recently issued by A orney General Hood,” Joe Woods, PCI state government rela ons vice president, said in a statement Thursday. “Principally, PCI is concerned that the Guide may confuse and mislead consumers and body shops because it differs significantly from repair requirements proscribed by Mississippi law and from directives issued by the Mississippi Department of Insurance.

“Moreover, the Guide does not recognize that insurers and consumers share the same goals following an accident — ensuring the consumer’s well-being and the prompt and proper repair of the damaged vehicle. Nor does the Guide note the important role insurers play in protec ng consumers from being taken advantage of when es mates include excessive charges or opera ons that are not necessary to properly repair a vehicle.

“Because of the likelihood of confusion for consumers, PCI cannot sign on to or otherwise support the Guide.”

Source: www.RepairerDrivenNews.com

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May - June 2017

Washington Post, New York Times talk automotive technician shortage Two of the na on’s largest media outlets last month took a look at the skilled automo ve repair worker shortage, a bit of high-profile exposure which might help convince prospec ve students, parents and educators/ counselors to look favorably upon a ermarket careers.

Both pieces offer great food for thought for collision repairers as well as prospec ve technicians and are worth a look.

The New York Times on April 27 opened its coverage of the mechanical service and repair by poin ng out dealership labor rates of $125 an hour — “a rate typical in ci es and at the low end for luxury brands.” It con nues: It’s true that a mechanic wielding wrenches is not paid that hourly rate — the shop’s cash flow must cover sophis cated diagnos c tools and contribute its share toward the dealership’s prime real estate. But top-level technicians in the field can earn $100,000 a year a er achieving master mechanic status and five years of experience, said Robert Paganini, president of the Mahwah, N.J., campus of Lincoln Technical Ins tute.

That ought to catch prospec ve technicians’ a en on.

Besides presen ng the huge demand for jobs, the piece focuses on BMW and FCA’s in-house efforts to nurture technician careers. There’s also an interes ng aside regarding BMW’s program which ought to show the importance of electronic diagnos cs in modern vehicles: While fundamentals like engine and transmission repairs are taught, some 90 percent of the instrucƟon deals with electronic systems. The typical path of a graduate is to start as a maintenance-level technician whose duƟes include Ɵre service, wheel alignments and programming electronic features; aŌer six months to a year, a move to a posiƟon as a line mechanic is typical.

Trades seek women The Washington Post last month focused on how a tech shortage in some of the country’s “manliest industries” leaves those trades trying to hire more women. It notes how the Iron Workers union in April became the first building trades union to offer a maximum of eight months of maternity leave.

It presents some of the difficul es in recrui ng and retaining women, including sexual harassment and doubt in one’s skills from co-workers, but also some of the poten al benefits when women enter the field — such as they’re more careful and not as likely to be high at work as men.

While the word “body shops” does appear in the Post story, the newspaper mostly uses the general term of “automo ve technician” in examining the tech and female technician shortage for the a ermarket.

Data in the story suggests that vaguely defined trade is 91.7 percent male, though the Times also cites a Labor Department sta s c that “female technicians” make up 1.5 percent of the sector. The la er sta s c comes despite OEMs offering more scholarships to female recruiters like the Car Care Council Women’s Board and Automo ve Women’s Alliance Founda on, the Post reports, ci ng Boston Globe coverage.

For the record, the Bureau of Labor Sta s cs in 2015 calculated that 0.6 percent of “auto body repairers” are female. A Collision Repair Educa on Founda on 2013 study found 2 percent of technicians are women.

Source: www.RepairerDrivenNews.com

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What to Look for in a Good CSR Jennifer Bur s thrives when working in a team atmosphere. And she plays a key role at Brown’s Collision Center in Bentonville, Ark. Each day, Bur s establishes the tone of the customer experience at her workplace. “I love what I do—I feel like I make a difference,” says Bur s, who has helped her shop improve its CSI scores each of the last three years to an all- me high of 97 percent.

When FenderBender ini ally interviewed Bur s, in June 2016, (fenderbender.com/compassionatecare), she spoke of the sympathy she extends to customers following their car accidents. Others appear to have taken no ce: Brown’s Collision Center has earned “Best of the Best” in auto repair in consecu ve years from the Northwest Arkansas Democrat-Gaze e, and Bur s is confident that customer service has helped pave the way for such accolades.

“The people that are walking through the door—the customers coming in—that’s my first priority,” says Bur s, whose shop always searches for new ways to appeal to customers, such as recently hos ng a $50 gi card giveaway for customers who leave online reviews.

In her three years working in Bentonville, Bur s has given great thought to the most important elements of her role. A customer service representa ve (CSR), in her observa on, can set a shop apart. In that spirit, FenderBender caught back up with Bur s recently to get her thoughts on what shop operators should look for when hiring CSRs. Find the Most Selfless Perhaps the greatest trait a CSR can possess is a generous personality, Bur s notes. That’s why she goes to great lengths to make customers feel appreciated, even taking steps such as giving customers her personal cell phone number. Later, in the days following a customer’s visit to Brown’s Collision center, Bur s will o en send out thank you cards. Bur s also suggests hiring CSRs who make an effort to learn everyone’s name whom they encounter, and generally have a work history of leaving no stone unturned in their efforts to keep customers happy.

“Details ma er,” she says.

Seek Posi vity Tenta ve people aren’t ideally suited for a customer service role. Body shops need personable, energe c employees gree ng customers. “You know, nobody wants to be at a collision center,” says Bur s, whose shop boasts an average monthly car count of around 125. “We want it to be a friendly atmosphere, where you have answers to all the ques ons they may have. If I don’t have the answers, I always let them know that I will get the answers for them.”

Seek the Compassionate Customers no ce when a business’s employees are empathe c. That’s why Bur s makes it a point to study customers’ body language once they’ve arrived at the shop, typically a er an accident. If the customer appears overwhelmed, Bur s doesn’t hesitate to console them. She also takes pride in passing out “goodie cups”—featuring key chains, pens, tape measures, and Tootsie Rolls—when customers leave the facility.

“I just know that every day I go in and I’ve got my mind set to help people, and make a difference in their experience,” Bur s says. “When it comes to some of this, it cannot be taught. You have to actually have a love for people.”

Source: www.FenderBender.com

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May - June 2017

2017 20 17 M MG M G Committee Com m i t t eess Officers:

Execu ve Commi ee - All Officers Including:

President - Susan McDaniel - Bill Luke CJD – Phoenix, AZ Vice President - Andy Reed - AutoNa on DCJ – North Richland Hills, TX Treasurer - J.D. Ipsen - Ken Garff West Valley CDJR - W.Valley City, UT Secretary - Ma Jarvis - Bald Hill DCJR - Warwick, RI

Marvin Windham - Benchmark CJD – Birmingham, AL Rick Monteiro - Jack Powell CJD – Escondido, CA Joe McBeth - Dallas DCJ – Dallas, TX Paul Allred - Stateline CJD – Fort Mill, SC Gerry Oakes - Baxter CJD - Omaha, NE Dan Hu on - Tom O’Brien - Greenwood, IN Rick Cutaia - Rick Hendrick DCJR – Charleston, SC

Commi ees: Nada 2017 Planning

Newsle er/Website/Social Media

Casey Brown - Autona on CDJ - Katy, TX

Don Cushing - Mopar Masters Magazine

Finance Commi ee

Vendor Chairmen

J.D. Ipsen - Ken Garff West Valley CDJR - W.Valley City, UT Susan McDaniel - Bill Luke CJD – Phoenix, AZ Rick Cutaia - Rick Hendrick DCJR – Charleston, SC

Paul Allred - Stateline CJD - Fort Mill, SC Mike Opperman - Baxter CJD - Omaha, NE

Vendor Commi ees CDK Global

Reynolds & Reynolds

Andy Reed - Allen Samuels DCJ – North Richland Hills, TX (Chairman) Paul Allred - Stateline CJD – Fort Mill, SC Mike Opperman - Baxter CJD - Omaha, NE Mick Padgeon - Fred Beans Parts - Doylestown, PA Rick Cutaia - Rick Hendrick DCJR – Charleston, SC Rick Monteiro - Jack Powell CJD – Escondido, CA (ALT)

Marvin Windham - Benchmark CJD – Birmingham, AL (Chairman) Susan McDaniel - Bill Luke CJD – Phoenix, AZ Alan Yancey - Hayes CDJ - Alto, GA Ed Lueras - Perkins Mtr. Co. - Colorado Springs, CO Kent Cogswell - Jack Phelan CDJR - Countryside. IL

OEConnec on/Snap On

Dealer Tire

Dan Hu on - Tom O’Brien CJD – Greenwood, IN (Chairman) Paul Allred - Stateline CJD – Fort Mill, SC Steve Hofer - Park CJ – Burnsville, MN Robert Chatwin - Larry Miller Auto - Sandy, UT Marvin Windham - Benchmark CJD – Birmingham, AL

Susan McDaniel - Bill Luke CJD – Phoenix, AZ (Chairwoman) Tom Kellogg - Ziegler Auto Group - Kalamazoo, MI Joe McBeth - Dallas DCJ – Dallas, TX Robert Chatwin - Larry Miller Auto - Sandy, UT Cody Eckhardt - Larry Miller Auto - Sandy, UT Marvin Windham - Benchmark CJD – Birmingham, AL (ALT)

UPS

AER

Paul Allred - Stateline CJD – Fort Mill, SC (Chairman) Marvin Windham - Benchmark CJD – Birmingham, AL Rick Cutaia - Rick Hendrick DCJR – Charleston, SC Ma Jarvis - Bald Hill DCJR - Warwick, RI

Mike Mulkins - Go Chrysler Jeep West - Golden, CO (Chariman) Glen Hojnacki - Milosch’s Palace CJD – Lake Orion, MI Josh Gouldsmith - Gladstone DCJ - Gladstone, MO J.D. Ipsen - Ken Garff West Valley CDJR - W.Valley City, UT Steve Hofer - Park CJ – Burnsville, MN

Katzkin

Elite Extra

Mike Gerber - Rairdon CDJ - Kirkland, WA (Chairman) Louis Osuna - Huffines CJD - Lewisville, TX Dan Delisle - Golling CDJ - Bloomfield Hills, MI Mike Mulkins - Go Chrysler Jeep West - Golden, CO

Rick Monteiro - Jack Powell CJD – Escondido, CA (Chairman) Joe McBeth - Dallas DCJ – Dallas, TX J.D. Ipsen - Ken Garff West Valley CDJR - W.Valley City, UT Larry Morris - Fred Beans Parts - Doylestown, PA

KIS/Alpine Louis Osuna - Huffines CJD - Lewisville, TX (Chairman) Paul Allred - Stateline CJD – Fort Mill, SC Mike Opperman - Baxter CJD - Omaha, NE Casey Brown - Autona on CDJ - Katy, TX

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