NATIONAL NEWS

AASP-MN Shares Updates at National Board Meeting

During the AASP National Board virtual meeting on November 8, state affiliate representatives were joined by other industry experts to discuss a multitude of issues impacting member shops and the automotive and collision repair industries as a whole. Affiliate leaders also provided updates on what’s happening in their specific market areas.

In light of the imminent retirement of AASP-MN Executive Director Judell Anderson, Will Latuff (Latuff Brothers Auto Body, St. Paul) recommended that other affiliates review their succession plans to ensure they’re up-to-date, and he announced that the association has named a replacement: Linden Wicklund.

“We’re also introducing legislation related to the timeliness of insurer communications,” Latuff added. “Basically, we’ll be introducing a bill that will make it an unfair claims practice if insurers ‘fail to review and approve or deny a repair supplement for a vehicle repair within three business days of its submission by a repair shop engaged to repair the insured’s vehicle.’”

Dan Sjolseth (Superior Service Center, Eagan) provided an update on Minnesota Careers in Auto Repair and Service (MNCARS), informing meeting participants that the website attracts over 2,500 unique visits each month, and traffic continues to grow with new visitors in 2021 already 55 percent higher than at this point in 2020.

The MNCARS campaign includes social media activity on Facebook and Instagram, as well as video ads on YouTube, while the website (carcareers.org) offers the MotorMouth toolbox, a comprehensive source of promotional materials and talking points for industry professionals to use when delivering high school and trade school presentations. AASP-MN has recently introduced a new fundraising campaign in an attempt to raise $200,000 to fund MNCARS’ activities over the next three years.

“We’re consistently ranking on the first page in Google results for searches related to car careers in Minnesota, ensuring we’re top of mind for someone looking for auto career options,” Sjolseth said. “We want to help industry members get involved in the local community and start having conversations with customers, community members and students about the career potential in the automotive industry.”

AASP’s National Board also addressed additional business during the meeting, beginning with an update from Pat Kane of United Fire Group (UFG). Although 2020 and 2021 have not been profitable for the insurance industry due to high catastrophe losses and commercial auto claims, Kane assured Board members that “UFG’s commitment to AASP is unwavering. Insuring automotive repair businesses is one of our top priorities, and this is going to be a bigger focus for us moving forward.”

Danny Gredinberg, administrator of the Database Enhancement Gateway (DEG), announced that the DEG has received nearly 18,000 inquiries. “That’s a huge number right there, and it’s a testament to why the DEG is so important to the industry. It demonstrates the kind of impact we can make when it comes to helping the industry.”

“The OEMs have even recognized the DEG as a valuable resource and given us access to their information free of charge because they realize that validating the inquiry with the OEM repair information is the only way we’re going to achieve a positive outcome,” he continued. “At the end of the day, we all just want accurate databases – nothing more, nothing less.”

AASP National Board President Tom Elder proposed that the organization provide a recommendation for Condition Now, a program that attempts to moderate the negative impact CARFAX reports have on customers’ vehicles.

“If a CARFAX report is pulled after an accident, it does not take into consideration whether you wrote an estimate and repaired the vehicle, but now, there’s a way to abate that by inspecting the car and attaching your shop’s report to the CARFAX to show that the vehicle was repaired by a certified collision facility and is now in better condition than that negative CARFAX report indicates.”

With a Condition Now report, Elder acknowledged, “The car will likely be valued at a number somewhere between the diminished and full values, but this is something we didn’t have before. Being able to show who repaired the vehicle and the quality of the workmanship demonstrates what transpired and can help our customers.”

Lastly, Joe Amato, Jr. from the Amato Insurance Agency (a division of World Insurance) shared details on the possibility of expanding their New Jersey Health Insurance plan nationally to make it available to all AASP members. For more information on AASP National, visit autoserviceproviders.com.

Internal Combustion Engine Vehicle Aftermarket Will Grow to 2030 and Beyond

“Internal Combustion Engine (ICE) vehicles will achieve significant U.S. automotive aftermarket product growth to 2030 and beyond, contrary to the widely held expectations that Electric Vehicles (EV) will rapidly eliminate ICE aftermarket product sales,” said Jim Lang, President of Lang Marketing Resources, a leading automotive market intelligence firm headquartered in Fort Wayne, Indiana with over 25 years in the vehicle product industry.

“Peak ICE aftermarket, the year when Internal Combustion Engine vehicles reach their maximum automotive aftermarket product volume, will not arrive until after 2030,” predicted Lang. “This is significant to the more than 400,000 business locations across the

www.langmarketing.com

U.S. that repair vehicles and sell automotive products,” emphasized Lang.

Millions More ICE Vehicles

Despite growing annual EV sales, the number of ICE vehicles on the road will increase between 2021 and 2030.

Regular hybrids and mild hybrids (both have batteries recharged by internal combustion engines) are included as ICE vehicles in this analysis because most mileage of non-plug-in hybrids is ICE powered.

EV Future VIO

While EVs will steadily increase their share of new car and light truck sales in the U.S., their share of vehicles in operation (VIO) will climb at a much slower pace.

Even with aggressive annual sales growth, EVs will account for only approximately seven percent of the total VIO by 2030. Battery electric vehicles (BEVs) will represent an even smaller share.

EV Aftermarket Impact Delayed

Aside from tires and certain accessories, cars and light trucks do not make substantial contributions to aftermarket product volume until they are at least five years old. This will delay the impact of the rising annual sales of new EVs on the ICE aftermarket.

EV Low Average Age

Since the runup in the number of EV vehicles on the road will occur late in the 2020s, EVs in operation during 2030 will have a very low average age, less than three years. BEV average age will be even lower, less than two years.

ICE Vehicle Aftermarket Growth to 2030 and Beyond

With their relatively small VIO and low average age, Electric Vehicles (plug-in hybrid electric vehicles and BEV models) will eliminate less than two percent of ICE aftermarket product sales in 2030, aside from tires and certain accessories. BEVs will eliminate an even smaller portion of ICE aftermarket product volume.

As a result, ICE cars and light trucks will continue to increase their aftermarket product volume through 2030 and beyond.