Hammer & Dolly October 2014 by Thomas Greco Publishing, Inc.

Louisiana Attorney General Attacks State Farm - page 38

October 2014 Volume 8, No. 10 $5.95 www.wmaba.com

ALSO THIS ISSUE www.grecopublishing.com

What Went Wrong: A Case Study

Picking a Quality Vendor

Time to Get Busy

October 2014

CONTENTS October 2014

COVER STORY 34 RUMOR AND REALITY: REVEALING THE TRUTHS OF ALUMINUM REPAIR

With aluminum all the rage in the industry, WMABA sets out to give members real information.

LOCAL NEWS 14 GEICO SUPPORTS MD SKILLSUSA WINNER

The insurer steps in to fund a student’s dream come true.

CAT-NORTH WELCOMES NEW AUTOMOTIVE REFINISH INSTRUCTOR

A familiar face begins a new journey.

DEPARTMENTS 6

TECHNICAL FEATURE 26 WHAT WENT WRONG: A CASE STUDY

Installing a quarter panel on a 2010 BMW 328xi seems like an easy job, right? Maybe not. BY LARRY MONTANEZ III, CDA & JEFF LANGE, PE

Editor’s Message JOEL GAUSTEN

President’s Message DON BEAVER

WMABA Member Spotlight

NATIONAL FEATURE 30 THE RENTAL DELAY DILEMMA: IS THE

INDUSTRY LIVING IN THE REAL WORLD?

SCRS and other industry reps question the methodologies used to determine lengths of rental coverage in today’s industry. BY JOEL GAUSTEN

WMABA FEATURE 38 LAWSUITS & LOST FAITH:

Calendar of Events

Legal Perspective Vendor Corner JOSEPH J. KENNY II

Executive Director’s Message JORDAN HENDLER Advertisers Index

©thinkstockphoto.com/Wavebreakmedia Ltd Photo courtesy of Lange Technical Services ©thinkstockphoto.com/Darko Novakovic

STATE FARM FACES A BITTER INDUSTRY

As WMABA dealerships start paying for PartsTrader, a high-profile lawsuit goes after the nation’s largest auto insurer. BY JOEL GAUSTEN October 2014

Industry training opportunities and don't-miss events.

CALENDAR OF

EVENTS October 2, 2014

FULL-FRAME PARTIAL REPLACEMENT R N R Auto Body, Hagerstown, MD

October 6, 2014

ELECTRIC & ELECTRIC HYBRID VEHICLES Virginia Farm Bureau, Richmond, VA

October 9, 2014

November 4-7, 2014 SEMA 2014, Las Vegas Con vention Center, Las Vegas, NV For more information, visit www.semashow.com/scrs November 4, 2014 SCRS RDE Welcome Rec eption, Las Vegas Conven tion Center, Las Vegas, NV For more infor mation, visit www.semash ow.com/scrs November 5, 2014 SCRS OEM Collision Rep air Technology Summit, Las Vegas Convention Center, Las Vegas, NV For more infor mation, visit www.semasho w.com/scrs November 6, 2014 Collision Industry Confere nce Westgate Las Vegas Res ort & Casino, Las Vegas, NV For more information, visit www.ciclink.com SCRS RDE Sky Villa Afte r-party, Westgate Las Veg as Resort & Casino, Las For more information, visit Vegas, NV www.scrs.com/sema

RACK & PINION & PARALLELOGRAM STEERING SYSTEMS Frederick Co. Career & Tech, Frederick, MD

October 14, 2014

INSPECTING REPAIRS FOR QUALITY CONTROL Manheim (Harrisonburg) Auto Auction, Harrisonburg, VA

October 16, 2014

SUSPENSION SYSTEMS Beamon & Johnson Automotive Paints, Virginia Beach, VA ALUMINUM EXTERIOR PANEL REPAIR & REPLACEMENT Frederick Co. Career & Tech, Frederick, MD

October 23, 2014

HAZARDOUS MATERIALS, PERSONAL SAFETY & REFINISH SAFETY Frederick Co. Career & Tech, Frederick, MD

October 28, 2014

STATIONARY GLASS Manheim (Harrisonburg) Auto Auction, Harrisonburg, VA RACK & PINION & PARALLELOGRAM STEERING SYSTEMS Beamon & Johnson Automotive Paints, Virginia Beach, VA

October 30, 2014

ALUMINUM-INTENSIVE VEHICLE REPAIRS Beamon & Johnson Automotive Paints, Virginia Beach, VA

November 3, 2014

DAMAGE ANALYSIS OF ADVANCED AUTOMOTIVE SYSTEMS Virginia Farm Bureau, Richmond, VA FULL-FRAME PARTIAL REPLACEMENT State Farm, Roanoke, VA

November 4, 2014

REPLACEMENT OF STEEL UNITIZED STRUCTURES Beamon & Johnson Automotive Paints, Virginia Beach, VA

ALUMINUM EXTERIOR PANEL REPAIR & REPLACEMENT State Farm, Silver Spring, MD

November 6, 2014

DOCUMENTATION & DIGITAL PHOTOGRAPHY Automotive Collision Technologies, Randallstown, MD CORROSION PROTECTION Coxton's Gold Team Collision Center, Yorktown, VA

November 11, 2014

FULL-FRAME PARTIAL REPLACEMENT Manheim (Harrisonburg) Auto Auction, Harrisonburg, VA FULL-FRAME PARTIAL REPLACEMENT Canby Motors Collision Repair, Aberdeen, MD

November 13, 2014

HAZARDOUS MATERIALS, PERSONAL SAFETY & REFINISH SAFETY Kunkel's, Baltimore, MD WHEEL ALIGNMENT AND DIAGNOSTIC ANGLES Coxton's Gold Team Collision Center, Yorktown, VA HAZARDOUS MATERIALS, PERSONAL SAFETY & REFINISH SAFETY Beamon & Johnson Automotive Paints, Virginia Beach, VA OVERVIEW OF CYCLE TIME IMPROVEMENTS FOR THE COLLISION REPAIR PROCESS Frederick Co. Career & Tech, Frederick, MD

November 17, 2014

MECHANICAL SYSTEMS ANALYSIS Virginia Farm Bureau, Richmond, VA

November 18, 2014

SECTIONING OF STEEL UNITIZED STRUCTURES Beamon & Johnson Automotive Paints, Virginia Beach, VA

November 19, 2014

COLOR THEORY, MIXING TONERS & TINTING Refinish Solutions, Springfield, VA

November 20, 2014

ADHESIVE BONDING Coxton's Gold Team Collision Center, Yorktown, VA STRUCTURAL STRAIGHTENING STEEL Beamon & Johnson Automotive Paints, Virginia Beach, VA

November 25, 2014

RECYCLED PARTS FOR COLLISION REPAIR Manheim (Harrisonburg) Auto Auction, Harrisonburg, VA

www.i-car.com or (800) 422-7872 for info

Greco Publishing Announces Hiring of Managing Editor Jacquelyn Bauman

Thomas Greco, President of Thomas Greco Publishing Inc., publishers of New Jersey Automotive, New England Automotive Report, Hammer & Dolly, AASP-MN News and Wisconsin Automotive News, has announced the hiring of Jacquelyn Bauman as the company’s new Managing Editor. Bauman will be taking over for Alicia Figurelli, who was promoted to Vice President/Director of Sales of the company this past August.

October 2014

A 2013 graduate of Farleigh Dickinson University, Bauman will oversee editorial in all Greco Publishing publications and will also actively participate in the management of the NORTHEAST® Automotive Services Trade Show. “We are extremely excited to have Jacquelyn become a part of the TGP staff,” Greco says. “Her background and skills are a perfect fit for our company. We have a great team in place and are looking forward to

continuing our role as one of the country’s top automotive repair publishers and trade show management companies.” Jacquelyn Bauman can be contacted at: Ph: 973-667-6922 F: 973-235-1963 E: Jacquelyn@grecopublishing.com H&D

October 2014

Joel Gausten

EDITOR’S

(973) 600-9288 tgpjoel@verizon.net

MESSAGE WHAT A SHAME

“Who would have thought I'd need a law degree to fix cars?” That's what a shop owner recently said to me during a friendly chat about the industry. He was commenting on the variety of legal actions against insurers on behalf of shops and consumers. From independent repairers using the Assignment of Proceeds for short-pay reimbursement, to shops joining forces to pursue a RICO suit against the nation's top insurers, the industry has never seen such a whirlwind of activity on the legal front. Naturally, I get enthusiastic calls every day from collision repairers who believe that the tide is about to finally turn in their favor. At the same time, I receive calls from other industry stakeholders who express regret that things have come to a head in this manner. No matter where you stand in the tug of war between shops and insurers, you simply can't argue with the fact that this relationship is at an all-time low. Since I'm a member of the industry press, my constant focus on this news has kept my schedule nice and full. But as a consumer, I'm frustrated and disappointed beyond measure when I see this constant battling between collision repairers and insurance carriers play out in every issue of this magazine. When you strip away the emotions involved in settling a claim these days, the fact remains that the auto body and insurance

industries need each other. A typical body shop customer doesn't have thousands of dollars ready at a moment's notice when he or she gets into an accident. Additionally, I'm fairly certain that your average insurer spokesperson can't roll up his or her sleeves and work on a quarter panel. When consumers buy auto insurance, they expect to be covered for their loss up to the limits of their policies – and that usually means they want their damaged vehicles returned to them in “pre-accident condition.” When vehicle owners bring their cars to body shops, they expect them to be repaired safely, professionally and in a way that won't negatively affect their dealer warranty. It all seems so simple, doesn't it? Of course, nothing involving money is ever black and white, and that's why I interview as many lawyers as I do collision technicians these days. It's a shame that common sense is often the first thing thrown out the window in an ever-growing number of shop/insurer transactions. The repairer/insurer relationship should be about mutual respect and a shared concern for the vehicle owner's comfort, well-being and peace of mind. Shops should never feel pressured to produce unsafe repairs in the name of cost containment, insurers should never be made to pay for work that wasn't performed and consumers should never feel forced to use a particular body shop. Period. If you want to play games, do it in an industry that doesn't affect the safety of families (especially babies and young children) on the road. The stakes are too high for this kind of insanity to continue. H&D

2014 WMABA OFFICERS PRESIDENT

VICE PRESIDENT

TREASURER SECRETARY

IMMEDIATE PAST PRESIDENT

Don Beaver Dbeaver@antwerpenauto.com 443-539-4200 ext. 17061 Torchy Chandler torchy.chandler@gmail.com 410-309-2242 Mark Schaech Jr. mark@marksbodyshop.com 410-358-5155 John Krauss jkrauss@craftsmanautobody.com 703-534-1818 Barry Dorn bdorn@dornsbodyandpaint.com 804-746-3928

BOARD OF DIRECTORS

Rodney Bolton (rbolton@aacps.org) 410-969-3100 ext. 250 Mark Boudreau (crashdaddy@aol.com) 703-671-2402

Kevin Burt (kevinburt@walkermillcollision.com) 301-336-1140 Bobby Wright (bobby@burkevillebodyshop.com) 434-767-4128

ADMINISTRATION

EXECUTIVE DIRECTOR Jordan Hendler (jordanhendler@wmaba.com) 804-789-9649 WMABA CORPORATE OFFICE P.O. Box 3157 • Mechanicsville, VA 23116

October 2014

STAFF

PUBLISHER DIRECTOR OF SALES EDITOR MANAGING EDITOR ART DIRECTOR OFFICE MANAGER

Thomas Greco thomas@grecopublishing.com

Alicia Figurelli alicia@grecopublishing.com

Joel Gausten tgpjoel@verizon.net

Jacquelyn Bauman jacquelyn@grecopublishing.com

Lea Velocci lea@grecopublishing.com

Sofia Cabrera tgp4@verizon.net

PUBLISHED BY TGP, Inc. 244 Chestnut St., Suite 202 Nutley, NJ 07110 973-667-6922 FAX 973-235-1963 Reproduction of any portions of this publication is specifically prohibited without written permission from the publisher. The opinions and ideas appearing in this magazine are not necessarily representations of TGP Inc. or of the Washington Metropolitan Auto Body Association (WMABA). Copyright © 2014 Thomas Greco Publishing, Inc.

October 2014

PRESIDENT’S

MESSAGE

Don Beaver

(443) 539-4200 ext. 17061 Dbeaver@antwerpenauto.com

TIME TO GET BUSY

Although I often find myself struggling for a subject or topic to write about for this monthly message, this is one of those occasions when so much needs to be said. By the time this issue goes to press, the kids will be back in school and shops will begin planning their busy season. At the same time, young drivers are heading off to schools and deer are heading into rut. Before you know it, we’ll also be dealing with accidents related to shorter daylight hours (which lead us into those “S” days – snow!). Mid-term elections are just around the corner, and the Legislature will soon be back in session. In addition to all of that, WMABA’s annual Labor Rate Survey is now available. On a daily basis, we have different insurance companies in and out of our shops, paying artificially deflated labor and material rates – or refusing to pay for required procedures without a single iota of proven basis and cost. This is where our Labor Rate Survey can and will help. Go to the WMABA website, www.wmaba.com, and fill it out. It literally takes five minutes, is entirely anonymous and can only help prove the point that there is a restriction in fair trade that borders on price fixing. These are the things that help us help you. Insurance companies supposedly pay a prevailing rate, but there has to be some sort of basis to properly establish that rate that is unbiased. I don’t know about you, but there is only one insurance company that has ever surveyed my shops for this; in many ways, it helped to keep rates suppressed. Fill out the Survey using your door rate, which is what you charge (or need to charge) to a walk-in

October 2014

customer – not the rate you may have agreed to from a third party such as an insurance company. The next hot topic for us to consider is upcoming legislation. I’ve said it before and I’ll say it again: The only way things will change and shops will once again control their own destinies is through legislation. This method is expensive and tiring. What we do have with WMABA is the tenacity to fight these outside influences. What we most need is money. I hate, hate, hate this part of being President. It is never an easy thing to ask for money, but if we want things to change, this is the ONLY way. To open doors, we have and need to continue to pay for lobbyists. There is a lot involved in getting an audience with a lawmaker. Sometimes, it comes in the form of a lunch or dinner; sometimes, it’s a fundraiser. All of this comes at a price. We are a small fish in a big pond; we will swim with the big fish, but it will take your contribution. In the next couple of months, you will see how and where this money will go, and how you can help. Stay tuned…there’s more to come. H&D

October 2014

LOCAL

NEWS GEICO SUPPORTS MD SKILLSUSA WINNER As its scores of volunteers and competitors know, SkillsUSA is a tremendous opportunity for promising auto refinishing and collision repair students to showcase their skills on the state, national and even international level. Thanks to GEICO, this year’s Maryland SkillsUSA Automotive Refinishing Technology winner, Frank Meckel (Harford Technical High School, Bel Air), was given the chance to compete at the National Leadership and Skills Conference last June in Kansas City, MO. In an effort to award Meckel for his exceptional performance at the state competition, GEICO covered all of his travel and lodging

Michael Smith, manager of the auto damage training center for GEICO, congratulates Maryland student Frank Meckel on his win at SkillsUSA.

expenses during his week-long trip to Missouri. This generous donation was in line with GEICO’s ongoing commitment to SkillsUSA and the students who compete in the annual event. “I find it personally rewarding to go and watch these high school students go into the industry and have such dedication,” offers Tim Hession, director of auto damage training for GEICO. “Knowing that we have to have all parties involved in automotive repair, I think SkillsUSA is a very worthy cause.” Meckel, who placed 13th at the national event, comes from a long line of automotive enthusiasts. His mother, Beth, is an industry mainstay and a past recipient of an AkzoNobel Most Influential Women in the Collision Repair Industry Award, while his brother, Eddie, works as a professional mechanic. Additionally, his father, Ed, restores classic cars in his spare time. Not surprisingly, Meckel always knew that he would work in the automotive profession. “I love cars – anything with a motor!” he says. Of course, he had an amazing time in Kansas City. “It was the best thing I’ve ever done!” he shares. “I had the most fun ever; it was great!” Currently, Meckel works at Enterprise Upholstering in Bel Air and hopes to go to technical college and pursue a full-time career as a painter. Considering his early success in the field, what is the best advice this recent high school graduate would offer students just now starting out in automotive programs? “Come into it with an open mind,” he says. “Don’t think you know everything; honestly, you probably won’t. Just be ready to learn.” For more information on SkillsUSA, visit www.skillsusa.org. H&D

Save the Dates for NORTHEAST 2015! Top-Notch Educational Opportunities Over 150 industry-leading exhibitors Fun for the Whole Family, And More!

March 20, 21, 22 14

October 2014

www.aaspnjnortheast.com

Information and updates from WMABA and beyond.

CAT-NORTH WELCOMES NEW AUTOMOTIVE REFINISH INSTRUCTOR When Auto Refinishing students at the Center of Applied Technology-North (Severn, MD) started their school year last month, they were greeted by new instructor Amanda Bolton. Already known in Maryland education circles for her work as chairperson for the MD SkillsUSA Competition, Amanda took over the position at CAT-North from her father Rodney, who recently stepped down after a 25-year run. Amanda’s arrival at CAT-North follows an impressive career that has included time with VeriFacts, Gerber, Heritage Mile One, the Collision Center of Cockeysville and two different stints with O’Donnell Honda Collision Center. She is thrilled to have an opportunity to work with students on a daily basis. “I always had an interest in teaching students, especially with my involvement with SkillsUSA over the years,” she says. “I think that just having the experience of being up in front of students that age has made me a lot more comfortable in interacting with them. A lot of them have already started to open up; some of the kids have even seen me at the school in prior years.” In her new role, Amanda will be teaching approximately 30 students from grades 9 through 12. Due to her new commitment at the school, she plans to pass along the MD SkillsUSA chairperson position to her mother, Teresa (ASE), for 2015. Amanda hopes to help her new students develop a genuine passion for the automotive trade. “I just want to have an impact on these kids and help them out,” she says. “It’s the whole reason why I wanted to take this position.” Still very active in education, Rodney will now serve Anne Arundel County as an internship coach, helping students out of Meade

Rodney Bolton hands the keys to the CAT-North Auto Refinishing classroom over to his daughter Amanda, who took over the position last month.

High School (Fort Meade) and Southern High School (Harwood) develop career paths in a variety of professions, including work with the National Security Agency (NSA). Looking back at his 25 years with CAT-North, he feels that his greatest success was establishing strong bonds with repairers, vendors and other industry representatives in the area. “The way that program developed was

not just because of me, but because of the professionals who are out in the industry, who run body shops and need people,” he says. “They were the ones who participated in my program as a PAC [Program Advisory Committee] member. The thing that I learned is you have to work directly with the industry to make the program what it is and to continue. No instructor can do it alone.” H&D

October 2014

Contact these Ford or Lincoln Mercury dealers for all your parts needs:

BOB BELL FORD 7125 RITCHIE HWY, GLEN BURNIE, MD 20161 Phone: 410-689-3038 Fax: 410-766-1275 www.bobbell.com

PLAZA FORD 1701 BEL AIR RD, BEL AIR, MD 21014 Phone: 410-879-3367 Fax: 410-877-7248 www.plazaford.com

SHEEHY FORD 5000 AUTH RD, MARLOW HEIGHTS, MD 20746 Phone: 301-899-6300 Fax: 301-702-3650 www.sheehyford.com

WALDORF FORD 2440 CRAIN HWY, WALDORF, MD 20601 Phone: 301-843-3028 Fax: 301-843-0334 e-mail: parts@waldorfford.com www.waldorfford.com

APPLE FORD 8800 STANFORD BLVD, COLUMBIA, MD 21045 Phone: 800-492-7999 Fax: 410-312-0928 www.appleford.com

HAGERSTOWN FORD 1714 MASSEY BLVD,HAGERSTOWN, MD 21740 Phone: 800-200-0276 Fax: 301-733-0603 www.hagerstownford.com

ACADEMY FORD 13401 BALTIMORE AVE, LAUREL, MD 20707 Phone: 301-419-2700 Fax: 301-419-0222 mrobinson@academyfordsales.com www.academyford.com

KOONS FORD OF ANNAPOLIS 2540 RIVA ROAD ANNAPOLIS, MD 21401 Phone: 410-266-3083 Fax: 410-224-4239 www.koonsford.com

TED BRITT FORD 11165 FAIRFAX BLVD, FAIRFAX, VA 22030 Phone: 703-673-2420 Fax: 703-870-7982 www.tedbrittparts.com

October 2014

WMABA MEMBER

SPOTLIGHT DECADES OF DEDICATION: Family Ties Help Nyquist, Inc. Thrive

Any business that can survive in the automotive industry for six decades must be doing something truly special. One of the WMABA region’s most well-respected paint suppliers, Nyquist, Inc. has served collision repair customers in the Baltimore-Washington Metropolitan region since 1955. Originally founded by George and Anna Marie Nyquist, the company has flourished under the guidance of second-generation owner George Jr. since 1978. After working at the company through most of high school and college, George Jr. briefly pursued a career as a public schoolteacher before the lure of owning his own business brought him back into the fold. “I had a competitive spirit and wanted to grow,” he recalls. “I can’t say I woke up every day because I loved paint; I woke up every day because I liked being in business. There are two things you’ve got to do to be successful: You’ve got to have that drive and desire, and you’ve got to work.” And work George Jr. did. It wasn’t uncommon for him to put in 80-hour weeks through most of the ‘80s to solidify the Nyquist name throughout the region. Not surprisingly, the commitment paid off.

The latest from WMABA members and supporters.

In May of 1981, Nyquist opened a second location in Glen Burnie. The following year, the company was selected to be the seventh distributor of the Sikkens brand of automotive finishes. In 1988, George Jr. opened a third location in Capitol Heights, which was merged into the Glen Burnie location and moved to Millersville in 1989. Subsequent locations include Salisbury, Westminster and Hampton, VA. With all of these purchases and acquisitions, Nyquist, Inc. now has more than 60 employees, and services the needs of body shops and related businesses in Maryland, Delaware, Pennsylvania, Virginia and North Carolina. Naturally, George Jr.’s success in the field wasn’t based on working in the business alone. Like many successful industry entrepreneurs, he understood the importance of reaching out beyond his four walls and getting involved in WMABA. “In the mid to late ’80s, things started changing and it became a bigger world,” he says. “If we were going to be a part of that world, we had to do some things in other markets. WMABA was the biggest of its kind and a very well-run organization, so we decided to join, go to meetings and see what it was about.”

Top: George Nyquist, Jr. has carried on the family tradition since 1978. Bottom: 91-year-old Anna Marie is still a regular presence at the longrunning family business.

The Nyquist Management team (left to right): Jim Romeo (operations manager for all stores - 42 years with Nyquist), Jim Turpin (vice president and sales director - 28 years with Nyquist), Eileen May (comptroller and human resource manager - 26 years with Nyquist) and Mike Hasiuk (inventory and fleet manager - 18 years with Nyquist).

October 2014

Nearly 30 years after first becoming a member, George Jr. continues to derive tremendous value from his relationships with his peers in the association. “You have to do everything you can to get your face out there, whether it’s an industry meeting, a clinic or anything you can do to get in front of people,” he explains. “That includes taking personal time on Saturdays and Sundays to do things with people in your business. You have to devote a lot of time to what you’re going to do [in this industry].” Of course, much has changed in the 36 years since George Jr. first took over the family company. For one thing, the eventual over-saturation of the paint market led to Sikkens and other manufacturers giving jobbers like Nyquist, Inc. exclusive territories, thus allowing George Jr.’s company to grow in exciting ways. In addition to these advancements, the industry’s move to waterborne paint in recent times has had a considerable effect on how paint suppliers conduct business. In George Jr.’s mind, the move from solvent to water is a welcomed change. “It is a better product,” he says, “The color match is better, and it disperses pigment better. A gallon of solvent weighs seven pounds; a gallon of water-based paint weighs 8.2 pounds. Water is more dense than solvent; you can put larger and more substantial pigment in a water-based binder than you can in a solvent-based binder. It’s also cleaner when it goes on the car. In Virginia, we probably sell 85 to 90 percent water, and it’s not the law. It’s just what people are using because it’s better.” With nearly 60 years of success already behind them, Nyquist, Inc. still thrives on the values established in 1955 by a husbandand-wife team with a dream. In fact, 91-yearold Anna Marie is still a regular guest at the Baltimore location, which still has her name on the door. After spending nearly his entire professional life in the family business, George Jr. feels that the greatest tool for success is the ability to be prepared for anything that comes your way. “The biggest problem that people have, in any business, is resistance to change,” he says. “If you’re going to think that anything is going to be the way it used to be, it’ll never happen. If you focus on that, you’ll be eternally angry every day you come to work. Every business has its challenges; it’s work. But this is still a good business.” More information on Nyquist, Inc. is available at www.nyquist-inc.com. H&D October 2014

LEGAL

PERSPECTIVE IMMIGRATION AND SMALL BUSINESS: ARE YOU IN COMPLIANCE?

Whatâ&#x20AC;&#x2122;s happening at the State House, in your industry and everywhere in between.

BY WHITNEY CLEAVER SMITH, Attorney, The Law Offices of Alexander & Cleaver

As the federal government considers immigration reform, it is important to remember that states have their own immigration laws in place. Specifically important to employers, E-Verify is an online system run by the federal government and used by employers to verify that a worker is eligible to work in the US. The system has a central federal database of valid Social Security numbers and names of individuals associated with each. Congress is considering whether or not to make all employers across the nation use E-Verify. Currently, the requirement for an employer to use E-Verify varies from state to state: Maryland and D.C.- Neither region requires employers to use E-Verify to confirm the legal employment status of employees.

Virginia - Effective December 2013, public contractors with more than an average of 50 employees working in the state for the previous 12 months must register and participate in the E-Verify program if performing work for certain state agencies.

October 2014

Other states (including North Carolina) require all (or almost all) employers to use E-Verify. If you have any questions about whether your current business is in compliance with state and federal immigration laws, please contact me at Alexander & Cleaver, (301) 292-3300. H&D Whitney Cleaver Smithâ&#x20AC;&#x2122;s practice of law focuses on personal injury, primarily representing clients in court. She continues to build on her impressive track record of achieving court awards for clients in excess of previously offered insurance settlements. She also works with clients on social media issues. For more information, please contact Whitney Cleaver Smith at wsmith@alexander-cleaver.com or (301) 292-3300 to construct or review social media policies.

October 2014

TECHNICAL

©thinkstockphoto.com/monkeybusinessimages

FEATURE WHAT WENT WRONG: A CASE STUDY

The installation of a quarter panel on a 2010 BMW 328xi seems like an easy job, right? Maybe not. In this month’s article, we will look at a case study of a vehicle repair that went very wrong. On or about February 8, 2013, a BMW was taken to a local dealership due to a persistent problem with the battery/charging system. The certified BMW technician discovered excess sitting water in the battery tray area, in the right rear quarter panel area. Additionally, the inspection revealed previous repairs to the right rear area of the vehicle. On or about February 12, 2013, the BMW was sent to Mid Island Collision in Rockville Centre, NY (an Approved BMW Collision Repair Center) to repair the leak. During the disassembly, the BMWapproved technician assigned the repair noticed multiple areas of corrosion to the right rear quarter panel and adjacent components. On or about February 13, 2013, Robert Jesberger, owner of Mid Island Collision, asked us to examine the vehicle with the vehicle owner present. Jesberger explained to us that the vehicle was repaired at a Direct Repair facility for a particular insurance company to repair damage resulting from a collision event that occurred on or about March 19, 2012. The name of the repair facility was not provided to us, but a redacted copy of the insurance company’s final estimate was supplied and listed the replacement of the rear bumper assembly, right tail lamp assembly, deck lid, rear body panel, fuel pocket and right rear quarter panel. No final invoice from the repair facility was provided. ANALYSIS: Examination of the vehicle revealed the following:

Photos courtesy of Lange Technical Services

Deck lid: The lid was visually misaligned. The left and right hinges to the deck lid showed evidence of a 4mm-to-5mm shift to the right, as evident by the original position marks now exposed. Excessive corrosion was present on all four trunk lid hinge mounting bolts, with multiple tool impact markings.

Battery: Approximately one half-inch of water accumulated in the battery tray/right rear quarter extension panel area. Excessive corrosion was observed on the battery hold down and bolt. The lower portion of the battery case was stained, while rust-colored residue was present. Severe corrosion build-up was evident from the battery to the luggage compartment positive (+) connection cables (main and auxiliary). This corrosion was sufficient to create excessive resistance at the connection. This resistance, in time, would have caused electrical malfunctions and presented a potential fire hazard. October 2014

Nuts and bolts, tips and tricks from our resident industry experts.

BY LARRY MONTANEZ III, CDA & JEFF LANGE, PE

Right bumper mounting bracket (plastic): Nutserts were installed in the two lower mounting areas on the right rear quarter extension panel, and two bolts were installed. BMW utilized coarse-threaded studs resistance welded onto the panel and attached the bracket with plastic nylon nuts. BMW does service the studs and has a part number. The application of butyl tape to the nutserts, in an attempt to prevent water intrusion, was also noted.

Fuel pocket: The pocket assembly was loose and the fuel door lock assembly lower clip was fractured and glued. Removal of the fuel pocket requires replacement, due to the four corner clips that must be damaged to remove it. Rear body panel: Squeeze-type resistance spot welds were observed on the mating flanges. The OEM replacement procedure requires rivet bonding.

Upper inner roof rail reinforcement: A vertical cut with multiple indications of jagged tool-type impact markings were observed to the reinforcement. This type of damage is consistent with contact with a reciprocating-type saw, carbide blade or similar tool while attempting to cut though the outer panel without utilizing the proper precautions, such as installing metal protective tabs to prevent this type of incident from occurring. Right rear quarter panel: Multiple exposed Metal Active Gas (MAG) plug welds with indications of burn-through on the inner quarter panel brace mating flanges were observed. Indications of bare metal areas with corrosion and tool-type impact markings to the rear area of the outer wheelwell housing were observed. Also noted was excessive corrosion to the outer wheelwell wheel lip mating flange, and multiple incomplete MAG plug welds, suggesting lack of penetration from the inner quarter panel brace to inner wheelhouse panel. Multiple indications of incomplete weld fusion of the squeeze-type resistance spot welds (STRSW) were observed on the quarter panel to inner wheelhouse panel at the door opening mating flange and backlit mating flange areas. The inner flange area showed evidence of burned paint material, supporting that the flange was not properly prepared prior to welding. Additionally, no evidence of any corrosion protection and/or rust-proofing compound applications was observed to the enclosed areas and flanges. After removal of the right rear quarter panel, we inspected the sectioning joints in the sail panel and rocker panel areas. This revealed multiple indications of burn-through, with welding wire sticking through to the backside of the joint. The right side rear quarter panel to rear door gap was at or near 7mm. Conversely, the left side rear quarter panel to rear door gap was at or near 5mm. STRSW samples from the quarter panel and rear body panel mating flanges failed visual inspection and destructive peel testing. Intentional separation of the panels at the mating flanges revealed little to no metal tear out. Analysis indicates that bolt-on panels were adjusted to their maximum in attempts to have panels align to adjacent panels. This shows evidence to suggest the structure of the

Right wheel house to 1/4 extension: MAG plug welds present, requires rivet-bond procedure.

Film thickness measurement of new deck lid, 3.6mils. Slightly thin coating.

vehicle is misaligned and/or the replacement quarter panel and rear body were installed in the incorrect position. The replacement rear body panel and right rear quarter panel were installed utilizing MAG welds and STRSW, although BMW of North America specifically requires panels to be installed with rivets and structural adhesives (rivet bonding). Multiple areas were observed with missing and/or improperly applied seam sealer. The repairs performed on the BMW from the incident of March 19, 2012 show evidence to support a direct relationship to the water intrusion to the battery tray/quarter extension panel. Paint film thickness readings varied on the panels and were inconsistent. On new panels, readings ranged from 2.4mils to 3.2mils, suggesting not enough material application. On repaired panels, readings ranged from 4.2 mils to 8.8mils, suggesting too much material application.

CONCLUSION After our examination, Jesberger called the insurance company to come and inspect the vehicle. After inspecting it and reviewing our report as well as BMW repair procedures, the insurer decided to pay for the re-repairs. The original estimate was written for $6,859.59; the re-repair final repair invoice was $22,595.80. We were later told the shop had paid restitution to the insurance company for the incorrect repairs. This is a prime example of two important things: First, a lack of knowledge and training can lead to disastrous outcomes; second, at least the repairs were performed at the insurance company’s DRP facility, so the guarantee was there for proper repairs (to the vehicle owner’s benefit in this case). If this repair was performed at a non-DRP facility, it could have taken a couple of years to settle instead of a couple of weeks. It is

Clockwise from top left: Left side tail lamp pocket panel to left rear quarter panel, OEM Original; Bolt installed with butyl on right bumper side mounting bracket instead of a resistance welded stud; Bolt installed with butyl on right bumper side mounting bracket instead of a resistance welded stud; Fuel pocket with missing clips; Left side quarter panel to quarter extension panel, OEM untouched; Right tail lamp to quarter panel flange, seam open.

unfortunate that in this technically advanced day and age, we still have an epidemic of poor repairs and finger pointing at the insurance company, when in reality the problem is the repair facility’s lack of training, education and desire to change. Many times, their ego blocks the path to growth and success. We hope this article has helped the industry to better understand what could go wrong with a repair, and the ramifications of those incorrect repairs. Feel free to contact us if you have any questions. H&D

Larry Montanez III, CDA is co-owner of P&L Consultants with Peter Pratti, Jr. P&L Consultants works with collision repair shops on estimating, production and proper repair procedures. P&L conducts repair workshops on MIG & resistance welding, measuring for estimating and advanced estimating skills. P&L also conducts investigations for insurers and repair shops for improper repairs, collision repairability and estimating issues. P&L can be reached by contacting Larry at (718) 891-4018 (office), (917) 860–3588 (cell), (718) 646–2733 (fax) or via email at larrygoju@aol.com. The P&L website is www.PnLEstimology.com.

Jeff Lange, PE is president of Lange Technical Services, Ltd. of Deer Park, NY (www.LangeTech.net). Jeff is a Licensed New York State Professional Engineer who specializes in investigating vehicle and component failures. Lange Technical Services, Ltd. is an investigative engineering firm performing forensic vehicle examinations and analysis for accident reconstruction, products liability and insurance issues. Jeff can be reached at (631) 667-6128 or by email at Jeff.Lange@LangeTech.net.

Executive Director’s Thoughts

Understanding a repair-gone-wrong situation only helps everyone, including that person, to grow. Learn from the mistakes of others to prevent putting yourself in this same precarious position. Educate, train and equip, or know your limits and send that repair elsewhere. - Jordan Hendler

October 2014

SCRS and others try to make sense of controversial rental times.

NATIONAL

FEATURE

THE RENTAL DELAY DILEMMA: Is the Industry

Living in the Real World?

When an insurer tells a policyholder that a repair will take two days, it is understandable when this customer gets frustrated – and ready to dole out poor CSI scores – when that job takes 10 days to complete. Every job that ends up in this situation represents a failure to balance insurer expectations with realistic auto body industry data on lengths of repair. As these problems persist, shops and insurers inevitably lose out on customer retention while overburdening the process every step of the way. Thankfully, repair industry representatives are working hard to draw greater attention to what has clearly become one of the biggest obstacles in the shop/insurer relationship. To gain greater insight into the widening gap between insurer expectations and realities on the shop floor, the Society of Collision Repair Specialists (SCRS) gathered statistics produced by CCC Information Services, Inc. and Mitchell International relative to average hours per claim, and information published by Enterprise Rent-A-Car and provided by the Hertz Corporation reflecting the average length of rental. The association focused on data produced for jobs during the fourth quarter of 2013. According to an SCRS press release on this

October 2014

project issued in May*, “While cross-referencing each data set against the others produced a variety of results, no combination of data supported an expectation even reaching [three hours] per day. Results were factored by dividing average hours per claim by average length of rental.” The association came up with some fascinating figures: When comparing the average hours-per-estimate data provided by CCC against Enterprise’s average length of rental, a 30-hour job could be expected, on average, to take an estimated 15 days to repair. When was the last time an insurer told one of your customers upfront that they’d be in a rental car for anywhere close to these numbers? “What’s interesting is that there’s a really big disparity between the way insurers choose to calculate that [rental] number, but there’s not that big of a disparity between the calculation of the actual average rental length,” offers SCRS Executive Director Aaron Schulenburg. “If you look at the

BY JOEL GAUSTEN

average length of rental in comparison to the average hours per claim, the numbers are relatively close. What we found is none of them exceeded three hours per day on average, but there is an unexplainable gap between what happens in reality, and what insurers are expecting. Some are using four hours a day; others are using five and six. I think the reason why you’re seeing such variance is potentially the purpose [behind what is expected]. If insurers are utilizing that figure to drive performance rather than to identify actual length of repair, that would cause those numbers to vary. Obviously, insurers that are trying to drive better performance than their competitors are going to give a more difficult number to attain.” In Schulenburg’s mind, a possible solution to the problem would be to base the upfront rental period on actual industry data on vehicle repairs rather than on the desire for shops to constantly outperform their peers. “Obviously, every shop explains to the consumer that there’s always unseen damage and unexpected things that could vary the length of repair,” he says. “But if we can use better industry data to define what that length of repair is anticipated to look like on average, then let’s communicate that to the customer and set that expectation upfront. If it’s likely going to be 15 days, let’s tell them it’s going to be 15 days instead of telling them it’s going to five and changing it twice.” When discussing insurer demands in the repair process, it is not uncommon for some stakeholders to use the default argument that DRP shops can either work within an insurer’s parameters or cover the financial burdens for the rental vehicle if the repair goes beyond a certain period of time. But is it

reasonable to expect shops to indemnify another industry when a repair process fails to live up to an arbitrary formula, considering industry data demonstrates that this number is often a fraction of the time truly needed? “I think there’s an underlying issue there that we, as an industry, need to address,” Schulenburg says. Not surprisingly, SCRS’ work on the topic has influenced considerable discussion in other parts of the industry. The length-of-rental debate took center stage during the most recent Collision Industry Conference (CIC), where the Insurer-Repairer Relations Committee hosted Schulenburg and representatives from insurers, body shops, rental companies and CSI firms for a special panel discussion. Curtis Nixon, president of UpdatePromise.com, offered intriguing – and at times downright startling – numbers based on data from approximately 8,000 shops to illustrate just how damaging this dilemma can be to both repairers and insurers. Although Nixon’s research showed that the average customer will tolerate one to two promise date changes throughout the repair process, things beyond that target tend to go downhill quickly. According to Nixon, going beyond three days to deliver a promise date will typically result in diminished consumer confidence, while giving an expectation too early often leads to the same result. And here’s the real kicker: Nixon has experienced situations where shops make up to 14 promise date changes on a single repair. Do you want to guess what that does to the customer experience? “There are so many variables in the repair process,” he said. “When we set an unrealistic expectation by using formulas that are just kind of thrown out there, it does cause a diminished return on your overall customer satisfaction.” Frank LaViola, assistant vice president of collision industry relations for Enterprise RentA-Car, noted that an unexpected extension in rental time impacts all stakeholders. “If an insurer makes a conscious effort with the shop through a DRP arrangement… that they’re going to be picking up any extra days, as long as the customer isn’t aware of that and there’s no heartburn there, I don’t think there’s an issue,” he said. “But I will tell you when the customer gets involved in that debate, discussion or battle…it affects all of our CSI.” With more inter-industry discussions on the length-of-rental issue taking place than ever before, one of the auto body field’s most

frustrating problems could finally see a resolution. The data is out there – it’s just a matter of shops and insurers agreeing to finally remove the blinders and operate in the real world. Neither industry is doing the consumer any favors by perpetuating the system as it stands today. As Schulenburg says, “I feel like we, as an industry, do it because we’ve always done it this way, and it just doesn’t make sense.”

*The full SCRS press release regarding length of rentals is available online at http://archive.constantcontact.com/fs161/11 01307009687/archive/1117246772024.html. H&D

October 2014

Conquest your Mitsubishi parts needs!

Mitsubishi now offers Genuine OEM parts through our new “Opt-OE” parts program at discounted prices. See Mitsubishi’s Ultra-Conquest parts and prices in the Optional OEM Suppliers category of popular collision estimating systems. Ultra-Conquest Collision Parts Program Highlights: • Discounted prices on quality new and unblemished OEM parts • Automated price and part selection in collision estimating systems • High parts availability • Delivery to most major U.S. cities within 24 hours • Available through all participating Northeastern area Mitsubishi dealers • Includes the majority of key collision components for select popular models • We can meet or beat aftermarket prices! To find out more about Ultra-Conquest pricing contact your local Mitsubishi dealer. For Genuine Mitsubishi parts, contact these authorized Mitsubishi Dealers. Jerry’s Mitsubishi

Fitzgerald Mitsubishi

Younger Mitsubishi

1906 East Joppa Road

1930 West Street

1945 Dual Highway

Malloy Mitsubishi 14655 Jefferson Davis Hwy

Baltimore, MD 21234

Annapolis, MD 21401

Hagerstown, MD 21740

Woodbridge, VA 22191

Toll Free: 800-255-0691

Direct: 410-224-4636

Direct: 800-296-1190

Direct: 703-490-8263

Direct: 410-668-2119

Fax: 410-224-4264

Fax: 301-733-5465

Toll Free: 888-533-3400

Fax: 410-513-0236

E-mail: adamsf@fitzmall.com

www.youngermitsubishi.com

Fax: 703-490-3864

www.jerrysmitsubishi.com

hmkparts@aol.com

Buy Genuine Mitsubishi Parts and get the perfect fit at the perfect price. 10% off on all parts orders when you mention this ad.

October 2014

COVER

WMABA takes on one of the industry’s hottest topics.

STORY

Whether you’re a shop owner just now beginning to consider upgrading due to the excitement surrounding the 2015 Ford F-150, a veteran repairer with multiple certifications or simply someone who has followed the trade press in recent times, you know that aluminum has become the hottest topic in the industry. In an effort to help its members set a clear path through the murkiness and confusion surrounding aluminum repairs and procedures, WMABA is in the process of organizing a special event for early December designed to offer real world knowledge and insights from those who know these vehicles best. The association is pleased to announce that noted instructor and longtime Hammer & Dolly technical writer Larry Montanez III, CDA (P&L Consultants) has signed on to present an extensive overview of what repairers and owners really need to know about taking on aluminum at their shops. If you seek answers based on truth and not just a sales pitch, this upcoming meeting is for you. “We chose to cover aluminum because it seems to have Pandora-like characteristics for many shop managers and technicians,” explains WMABA Executive Director Jordan Hendler. “How to work on it properly is just as important as all of the other aspects, such as proper repair estimates, equipment integration, space requirements, OE programs, and staff training. There is a lot of speculation coming our way from shops who are weighing their options. There is a small percentage of repairers who decided early on to get in front of the aluminum and structural aluminum, and certify with OEs. Those repairers have talked to us about wasted money on equipment they didn’t really need, how fast equipment

October 2014

BY JOEL GAUSTEN

can change, how much investment in training their personnel costs, and the lists go on. It is a huge commitment, no matter when the decision to start is made.” As anyone who has read Hammer & Dolly in recent months already knows, Montanez has been actively addressing the aluminum issue by working to dispel many of the common misconceptions and myths surrounding the repair of these vehicles. Not surprisingly, he expects his upcoming WMABA course to shed light on the realities that shops must consider before diving into this kind of work. For one thing, it’s not just about buying a bunch of fancy new equipment; it’s also about getting the correct training to know how to get these vehicles back on the road without putting an unsuspecting driver or passenger at risk. When it comes to training, Montanez cautions that there is a world of difference between the current requirements issued by Ford and what other aluminum vehicle manufacturers expect you to know and perform. “Those who bought equipment and went through a one-day training course are not certified in any way, shape or form according to the German/European companies,” he explains. “The people who are making $80,000 to $300,000 vehicles are saying ‘A,’ while the company that is making a $18,000 to $50,000 vehicle is saying, ‘Z.’ This is how far apart they are.” Depending on the manufacturer, aluminum repair classes for dealer-sponsored shops can cost upwards of $16,000 and take weeks to complete – without even beginning to factor in travel and other employee expenses, including the loss of production.

What kind of shop preparation is needed? How do I schedule for these types of repairs versus traditional steel? What are some of the budgetary items, at minimum, that I should be considering? How do OE programs differ from one to the other? Compare that to Ford’s current one-day course, and it’s clear that there isn’t a one-size-fits-all, streamlined silver bullet when it comes to training aluminum techs. “If you’re an Audi, Porsche, Benz, Aston Martin or Jaguar aluminum repair facility, you’re already overqualified for Ford, due to the stringent requirements from the European OEMs for their aluminum programs,” Montanez says. “Ford has chosen different equipment to make it more cost-effective for shops to become aluminum certified, approved or recognized. The other [aluminum repair] shops follow very strict programs, with very specific equipment purchases and training requirements.” For example, Montanez says that students taking the Audi and Mercedes-Benz tests need to be able to deliver the goods with zero hand-holding. “When you go to those courses, you’re expected to know how to weld already, and weld well,” he warns. “Its a rarity that [the instructors/facilitators] will actually put a mask on and watch you weld. They will give you suggestions and guidelines on how to overcome an issue, but it is not a training course – it is a test. You’re supposed to know how to weld– end of story. And you need every bit of those two weeks to take the test the first time, as it is very difficult and frustrating. You are expected to weld like a machine every time – no errors.” If you want even more insight into how important skill and accuracy are to successful aluminum welding, Montanez offers this test: Write 2 + 2 = 4 six times on a piece of paper. Do all six look exactly the same? Are all the equal signs parallel and the same length? Are all the plus signs perfectly symmetrical? Are all the 4s and 2s identical, but not exactly the same? If they’re not, you’re in trouble, because this is the kind of precision the European manufacturers want. Some manufacturers like Audi require a two-year renewal of your welding certification, while Mercedes-Benz requires re-certification every six months. “It’s perfection or nothing,” he says. In addition to Montanez’s presentation about the myths and realities of aluminum, WMABA plans to present a panel of repairers who are already in the OE programs, fixing aluminum and understand the process it took and how others can do it properly. Clearly, WMABA’s upcoming aluminum event will be a can’t-miss opportunity to get the tools you need to successfully take the leap into the next generation of automotive events. Hendler encourages all attendees to prepare in advance to make the absolute most of what the association’s program will offer. “Bring questions to the meeting - all the questions,” she advises. “What kind of shop preparation is needed? How do I schedule for these types of repairs versus traditional steel? What are some of the budgetary items, at minimum, that I should be considering? How do OE programs differ from one to the other? When shops don’t get the facts, it makes things frustrating. That’s why we’re here to help.” More details about this special WMABA event will be featured in our next issue. Please contact WMABA Executive Director Jordan Hendler at (804) 789-9649 if you have immediate questions. H&D

The 2015 Ford F-150: Your Questions Answered

In an effort to provide the WMABA community with the most accurate information possible regarding the 2015 Ford F-150, we assembled some of the industry’s most commonly asked questions and passed them along to Elizabeth Weigandt, dealer communications manager at Ford Motor Company. Weigandt’s responses appear below.

If a repairer has zero past experience with aluminum but wants to take advantage of the opportunity to repair the Ford F-150, how much money should they plan to invest in order to become compliant with the equipment/training specifications and be considered Ford-recognized? Ford estimates it will cost $30,000 to $50,000 for a dealer or body shop to purchase new equipment needed to repair damage to aluminum.

What kind of rivet guns should be used on the 2015 F-150?

Here is a full list of equipment (including the rivet gun) we recommend shops purchase for collision work on the new F-150.

What are the parameters/limits for pulling on the Ford F-150?

The vehicle may require anchoring and pulling operations to correct collision damage. This may be done with the use of the Ford recommended solid cab mounts to allow the pulling of the vehicle’s aluminum intensive unibody along with any frame damage. With the damaged areas pulled back to proper dimensional condition, the affected areas are inspected for cracks, damaged fasteners and any other concerns, then replacement of any damaged components may be done per Ford guidelines and procedures. H&D

October 2014

WMABA

FEATURE LAWSUITS & LOST FAITH: STATE FARM FACES A BITTER INDUSTRY BY JOEL GAUSTEN

October 2014

The nation’s largest auto insurer is in the hot seat.

State Farm has seen better days. If the last three years of automotive media coverage has taught us anything, it is that the nation’s largest automotive insurer is unafraid to court controversy. With dealerships across the country now being made to pay upwards of $199 a month to use the insurer’s mandated PartsTrader part procurement system, the insurer’s seemingly permanent black eye is getting even darker. When you consider that State Farm is also facing a high-profile lawsuit by a well-known Attorney General, it appears that the good neighbors are having a very hard time getting much love in their community. The King vs. the Giant To music lovers in Louisiana, James David “Buddy” Caldwell is one of the most popular operatically-trained Elvis Presley impersonators around. But when he takes off his stage clothes and dons a suit and tie, he stands as perhaps the greatest adversary State Farm has ever seen. Since becoming the state’s Attorney General in 2007, Caldwell has made a career out of hunting internet predators, senior citizen scammers and others who work to harm the public. On August 19, he announced his intentions to go after State Farm. In an official statement issued to media, Attorney General Caldwell alleged that the insurer “has engaged in a pattern of unfair and fraudulent business practices aimed at controlling the auto repair industry and forcing unsafe repairs on vehicles without the knowledge or consent of Louisiana consumers.” Specifically, the suit alleges that State Farm violated Louisiana’s Unfair Trade Practices Act and Monopolies Law by (in the words of the statement) “using scare tactics to steer Louisiana consumers to State Farm’s preferred repair shops and forcing shops to perform vehicle repairs cheaply and quickly, rather than in accordance with consumer safety and vehicle manufacturer performance standards.” The Attorney General has also expressed concern that vehicles repaired by these shops are done using “junkyard” or “foreign knock-off” parts.

Caldwell says the suit aims to change the culture of unsafe business practices led by State Farm in the auto insurance and repair industries. State Farm currently holds the largest share of auto insurance policies in Louisiana. In 2012, State Farm wrote one third of all auto insurance policies in the state totaling over $1 billion in premiums. State Farm quickly issued a characteristically reserved public statement on the suit: “The description in this lawsuit is not in line with State Farm’s mission to serve the needs of its customers, and our long, proud history of achievements in advancing vehicle safety. We are reviewing the lawsuit and will have more to share soon.” While State Farm is gearing up for a battle in her state, Alysia Hanks can’t help but feel that these recent events – especially if the AG wins in court – could have considerable benefits for her industry. As executive director for the Louisiana Collision Industry Association (LaCIA), Hanks has seen many of her industry peers struggle to maintain their standing in the marketplace as more and more competitors – and insurers – beat them to the sale using the cheaper/quicker method. According to her, LaCIA reached out to Assistant Attorney General Randy Ishee after efforts to get the Louisiana Insurance Commissioner on their side ground to a halt. Not surprisingly, the group is supportive of the AG's current headline-grabbing activities. “We’re behind them, and we’re willing to help them in any way that benefits the consumer,” she says. In existence for roughly a year, LaCIA has already attracted considerable attention and support from the industry it aims to serve. As an encouraging sign of things to come, the group’s very first meeting drew well over 200 people. “It seems to be something that a lot of people in the state have wanted,” offers Hanks on the growing association. “They just never knew where to start.” Looking ahead, LaCIA plans to focus considerable time promoting a full-fledged revival of the 1963 Consent Decree. Although that document (as well as AG Caldwell’s actions against State Farm) puts the Direct Repair concept under great scrutiny, Hanks insists that her group exists to serve all members of the Louisiana auto body industry. For example, some LaCIA members swore off DRPs years ago, while others have a dozen DRP contracts and zero complaints.

“[Our members] are not out to do wrong; they’re not out to get rich quick or make a fortune doing this,” she says. “They just want to be able to run their business and get paid for what they do and not have all this stress and fighting.” Above all, Hanks is optimistic that the events that continue to unfold in her state will finally change her long-beleaguered profession for the better. “I hope that shops will be able to run their businesses without the outside influence of insurance companies," she says. "We're fighting these people every single day over the littlest things that they know they are responsible for paying, but they don’t.”

More Parts, Less Trading While the attitude in Louisiana is one of optimism, the current mood among more than a few dealerships in the WMABA market is one of frustrated resignation. Just as Caldwell announced his legal campaign against State Farms, parts dealers closer to home were finally hit with PartsTrader subscription fees after utilizing the system free of charge for the last six months. A PartsTrader user since his customers first recommended him for the program, one Maryland-based parts dealer tells Hammer & Dolly that he will now have to pay $2,400 a year if he wants to continue. Unfortunately, he says that the much-hyped program has only succeeded in decreasing sales while adding to his already-high administrative demands. Additionally, he claims that PartsTrader requires three times the steps that OEConnection needs to fulfill its function. “There’s so much banter back and forth,” he offers. “Number one, we’re getting duplicate orders. Number two, we’re losing orders in the translation. Number three, I don’t have the opportunity to Conquest bumper covers, headlights, fenders and things of that nature. I’m losing sales on those. “Some estimating systems are very accurate and some aren’t, so we have to go in and re-verify all the part numbers, which you don’t have to do on OEConnection,” he continues. “At least on OEConnection, you know which numbers are questionable because they are highlighted that way; you know which ones are absolutely okay. On [PartsTrader], we have to look at the whole order, look at the pricing, fix everything and then send it back to [the shops] to review. They review it, take parts off that they are going to get elsewhere and send it back to us as an order. Then, they see that we

fill the order once we do. It isn’t like OEConnection, where they send you an order, you fill it and you’re done.” To illustrate this tedium, the parts manager says that he needed approximately 820 communications to process just the first 300 orders that came through on PartsTrader. Considering that PartsTrader appears to increase a supplier’s workload and expense while offering no positive effect on profits and sales, why would a dealer even want to consider having it on a daily basis? Unfortunately, it’s for the exact same reason that Select Service shops owners have it in their facilities. “The vendors are stuck,” offers a longtime WMABA parts manager. “If they want to get rid of PartsTrader, get rid of State Farm. The body shops aren’t going to do that, because it’s their livelihood – just like it’s my livelihood to sell the parts. For some people, this program is 70, 80, 90 percent of their business. They can’t walk away from it.” With PartsTrader’s presence in the WMABA only a few months away from the oneyear mark, dealers find themselves reluctantly accepting State Farm’s mandated parts procurement system. This has done very little to improve the public image of the insurance company that was once considered by many to be the best of its kind. While the legal drama in Louisiana has brought the industry’s ongoing issues with State Farm to the attention of more than just this industry, this offers little solace to parts pros who are struggling to make sense out of paying for something they don’t want or need. “I’m in the business to sell parts, so I’m going to sell parts,” says an area dealer rep. “It costs me $200 more a month and a lot more in labor to sell the same amount I was selling in the first place. In this business, we’ve learned to change and adapt as situation arise, and that’s all we’re doing. It’s just another phase in our life where we have to change and adapt to something that’s being dictated to us.” H&D

Executive Director’s Thoughts

State Farm was once known by many repairers as “the only insurer that doesn’t give me as much of a headache as all the others.” With the company's changes in management tactics, lack of negotiation and parts procurement mandate, what I now hear is, “I need to figure out how to do this without them.” Their loss of industry confidence doesn’t bode well for anyone. - Jordan Hendler

October 2014

A view from the supplier side of the industry.

VENDOR

CORNER BEING SAFE

In Hawaiian, the word “ohana” means “family.” Many similarities exist between our home and work “families.” Many of us actually spend more of our waking moments with our co-workers than we do with our spouses and children. Like our home family, we care deeply about them. The smaller the organization, the more tight-knit we become. We share milestones and setbacks with one another. Being safe and compliant is about protecting your ohana. I have been in safety for over 25 years. While my company works with Fortune 500 companies and government agencies, I really enjoy working with small businesses. Over the years, I have found that the vast majority

of business owners genuinely care about their work family. Likewise, employees care about the organization they belong to and are protective of the company and their fellow workers. The biggest reason small businesses suffer a disproportionate number of injuries, illnesses and fines is not because they don’t care, but because they don’t know. Small companies do not have the luxury of an inhouse person to focus solely on compliance. Over the coming months, I would like to share with the readers of Hammer & Dolly some of the most common OSHA regulations that commonly lead to citations for shop owners. The bedrock of all safety programs is OSHA’s Hazard Communication Standard, a.k.a. the “Right to Know” law. As the name

BY JOSEPH J. KENNY II

implies, it’s about informing employees of hazards (both chemical and physical) they may encounter in the workplace. Recent changes to the law, now called the Globally Harmonized System (GHS), mandate new labeling requirements, a transition from Material Safety Data Sheets (MSDS) to Safety Data Sheets (SDS) and employee training. Labels (e.g., “Flammable,” “Corrosive”) are the primary way in which hazards are communicated. The new GHS labels consist of new pictograms and signal words (e.g., “Danger,” “Warning”) in accordance with UN requirements. Safety Data Sheets, which replace Material Safety Data Sheets, standardize and simplify the safety information provided to end-users (shops) by the manufacturer. By June 1 and December 1, 2015, respectively, manufacturers and distributors must provide the new label on all new products and make Safety Data Sheets available for each hazardous material they sell. By June 1, 2016, all employers must be in full compliance with the regulation. The deadline for training on the new label and SDS format was December 1, 2013. Additionally, all chemicals in the business must have proper labeling with an SDS available for employee review. The purpose of the GHS is to make it easier for employees to access needed safety information in an understandable format. This keeps the whole shop safer. No one wants to see their “family” members come to needless harm. H&D

Joseph J. Kenny II is president of Safety Regulation Strategies, Inc., a nationwide safety and environmental training and consulting firm. He has helped thousands of businesses create safe and compliant workplaces and can be reached at 800-7233734 or at www.SafetyRegulations.com.

October 2014

EXECUTIVE DIRECTOR’S

MESSAGE

Jordan Hendler

(804) 789-9649 jordanhendler@wmaba.com

IT’S ALL-IN OR FOLD TIME

I don’t usually bring up the history I have as a welder. But the advancements of vehicle technologies and OEM certification programs and the need for repairers to either go all-in or fold their hand on certified repairs remind me of my time in welding school. There, instructors talked about the same concepts of making perfect welds every time, having pride in your work, being timely for your customer and working together to accomplish the goals of a project. Many of the discussions about aluminum repair center around the welding portion. Though I know that many of the repair procedures are rivet-bonded, you still must prove that you have the capacity to perform – as Larry Montanez said earlier in this issue – just like a machine. Perfection is the expectation. The OE doesn’t have any tolerance for deviation. Specifics for all aspects, including the training, the welder and the setting, don’t give any room for personal choices or extenuating circumstances. So, why are repairs taking place every day in all areas of the country that are against REQUIREMENTS? Because many repairers think that giving the car on time and deviating from proper procedures for the happiness of the insurer are more important than customer safety and protecting the investment. Please, take offense. Get angry at me. But if it were my car, I would sue your ass off if I found out my car was intentionally fixed improperly. If you haven’t invested the time and money into getting the necessary certification, adopted the OEM requirements with that certification

October 2014

and devoted yourself to delivery of that promise to the customer, then DO NOT FIX THE CAR. You are not allowed, you are not justified and there is no excuse in the world that gives you the right to do so. “Getting away with it” will run its course. Soon, this will hit courtrooms around the country. Just make a decision, stick with it and be proud of it. As a consumer-minded person, I would rather see you protect your customer from yourself. Tell them, “I’m not certified to perform the procedures necessary to fix your vehicle for this type of repair, but I recommend ‘X Repairer’ that you will be very happy with. I hope that you will return to us for your next repair.” You don’t have to jump on the bandwagon. There isn’t anyone who will make you, either. But don’t play me that little violin if you’re going about it the wrong way and get caught. H&D

October 2014

ADVERTISERS’ INDEX Alexander & Cleaver............................20 Alexandria Toyota ................................19 All Foreign Used Auto..........................15 American Honda Motor Co. ................4

Audi Group ..........................................13

Axalta Coating Systems ......................OBC

BMW Group ........................................24-25 BMW of Bel Air ....................................IBC BMW of Fairfax....................................3

BMW of Rockville ................................IBC BMW of Towson ..................................IBC CAPA ..................................................4

Car-part.com........................................46

Chesapeake Automotive Equipment ..50

Empire Auto Parts................................21 Ford Group ..........................................17 Future Cure ........................................31 GM Parts Group ..................................11

Hendrick Honda ..................................23

Honda Group ......................................45 Hyundai Group ....................................22

Koons Ford ..........................................23 Malloy Auto Group ..............................8

Mazda Group ......................................29 MINI Group ..........................................32

MINI of Baltimore County ....................IBC Mitsubishi Group..................................33 Mopar Group ........................................36

Nissan Group ......................................37

NORTHEAST® 2015 ..........................14 O’Donnell Honda ................................19 Packer Norris Parts ............................9

Porsche Group ....................................16

PPG ....................................................IFC ProSpot................................................46

P&L Consultants ..................................28 Russel Toyota ......................................21

Safety Regulations ..............................42 SEMA Show ........................................7

Sherwin-Williams ................................7

Steck Manufacturing............................46 Subaru Group ......................................40

Toyota Group ......................................41 VW Group............................................43

October 2014