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PROTECTING CONSUMERS AND THE COLLISION INDUSTRY
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2 March 2019
New England Automotive Report
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March 2019 • Volume 17, No. 3
CONTENTS
DEPARTMENTS
COVER STORY
VICE PRESIDENT’S MESSAGE By Kevin Gallerani
28 | Putting the Consumer First:
8 | Mandatory Viewing
AASP/MA Pushes for Safe OEM Repairs By Joel Gausten
EXECUTIVE DIRECTOR’S MESSAGE By Evangelos “Lucky” Papageorg
10 | Be the Master of Your Own Destiny
LOCAL NEWS 18 | Shop/Vendor Disputes Tackled at January ADALB Meeting
NATIONAL NEWS By Alana Bonillo 22 | The Best Education on the East Coast: Collision P.R.E.P. Returns to NORTHEAST®
LEGAL PERSPECTIVE By James Castleman, Esq. 34 | Are There DRPs in Massachusetts?
OEM CERTIFICATION PROFILE 40 | AMi/FCA
VAP MEMBER SPOTLIGHT By Alana Bonillo 42 | Don Kennett, Inc.
ALSO THIS ISSUE 11 | WHERE’S LUCKY? 43 | AASP/MA SPONSORS 44 | AASP/MA MEMBERSHIP APPLICATION
ADVERTISERS’ INDEX Accudraft Paint Booths ................................OBC Akzo Nobel......................................................7 Audi Group ..................................................45 Axalta Coating Systems ....................................4 BASF ............................................................20 Best Chevrolet/Best CDJR ..............................IFC BMW Group ..........................................................14 BMW/Mini of Warwick ..................................27 Colonial Auto Group ........................................6 Empire Auto Parts ..........................................15 Enterprise ....................................................26 First Chrysler-Dodge-Jeep-Ram......................26 First Ford ......................................................26
First Hyundai ................................................26 Ford Group....................................................37 Honda Group ................................................17 Hyundai Group ..............................................38 Imperial Ford ................................................37 Ira Subaru......................................................13 Ira Toyota of Danvers ......................................12 Kelly Automotive Group ................................IBC Kia Group ....................................................38 Linder’s, Inc. ................................................46 Long Automotive Group ..................................9 Mazda Group ................................................19 McGovern Chrysler Jeep Dodge Ram ................11 Mopar Group ................................................25 Nissan Group ................................................32
PPG................................................................3 Reliable Automotive Equipment ......................33 Sarat Ford Lincoln..........................................30 Sentry Group ................................................39 Sherwin Williams ..........................................35 Spanesi ........................................................38 Subaru Group ................................................41 Tasca Group ..................................................29 Toyota Group ................................................31 Volvo Group ..................................................21 VW Group ....................................................16 Wellesley Toyota/Scion ..................................24 Wheel Collision Center ..................................46 ZB Negotations ..............................................18
New England Automotive Report March 2019 5
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COLONIAL SOUTH CHRYSLER JEEP DODGE-RAM 42 State Road (Rte. 6) Dartmouth, MA. 02747 Phone Number: 508-984-1900 FAX Number: 508-996-5801
COLONIAL CADILLAC 201 Cambridge Road Woburn, MA. 01801 Phone Number: 781-935-7009 FAX Number: 781-933-7728
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COLONIAL VOLKSWAGEN COLONIAL SOUTH CHEVROLET 89 Turnpike Road (Rte. 9) 361 State Road (Rte. 6) Westborough, MA. 01581 Dartmouth, MA. 02747 Phone Number: 888-322-6570 Phone Number: 508-996-6266 FAX Number: 508-616-0445 FAX Number: 508-979-1219 COLONIAL VOLKSWAGEN OF MEDFORD 162 Mystic Avenue Medford, MA. 02155 Phone Number: 781-475-5200 FAX Number: 781-391-3506
WELLESLEY VOLKSWAGEN 231 Linden Street Wellesley, MA. 02482 Phone Number: 800-228-8344 FAX Number: 781-237-6024 Contact: Dan Bettencourt / Wholesale Parts Manager
COLONIAL CHEVROLET 171 Great Road Acton, MA. 01720 Phone Number: 800-787-2787 FAX Number: 978-263-8587
COLONIAL WEST CHEVROLET 314 John Fitch Highway Fitchburg, MA. 01420 Phone Number: 978-345-5532 FAX Number: 978-345-1152
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Visit us at NORTHEAST® Booth 141 New England Automotive Report March 2019 7
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VICE PRESIDENT’S MESSAGE
Mandatory Viewing
KEVIN GALLERANI
If you’ve read recent issues of New England Automotive Report, you are aware of several critical matters currently unfolding at the Auto Damage Appraiser Licensing Board (ADALB). Last month, this magazine reported on the massive member response we received to our Call to Action in regard to certain vendors shutting out shops from purchasing products from them – and how damaging this can be when these vendors are included on an insurer estimate. Rest assured that the association has plans to continue pursuing this issue and representing the needs and concerns of shops in our state. If you have experienced this issue directly and could help us gather examples of this practice, we’d greatly appreciate your input. Speaking of the ADALB, some of our members might still be unaware that the newly revised AASP/MA website (aaspma.org) features complete videos of every ADALB meeting. This allows you to keep up with what’s going on at the Board level at your leisure. If you haven’t attended an ADALB meeting in person or by viewing the videos, I highly recommend that you do so. They can be illuminating – and sometimes frustrating. The video gallery on the website is for Members Only,
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so please consider joining AASP/MA to gain access to this content. Obviously, nothing that AASP/MA does – from the videos to our ongoing chapter meetings and work at the State House – is possible without your direct involvement and support. It’s been great seeing more and more people turn up at our regional events lately, and the flood of calls we received to our Call to Action is encouraging. I hope you all keep up this level of activity with us, and the entire AASP/MA Board of Directors is always available to you if we can assist in making your business more profitable and less stressful. PROTECTING CONSUMERS AND THE COLLISION INDUSTRY
MASSACHUSETTS
AASP/MA VICE PRESIDENT KEVIN GALLERANI is vice president of Cape Auto Collision Center in Plymouth, MA. He can be reached at (508) 747-0316 or kevin@capeautobody.com
G
L
A
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D
AU M TIVE AUT T TI TIV STAFF
AASP/MA EXECUTIVE COMMITTEE
PUBLISHER
CREATIVE DIRECTOR
Thomas Greco - thomas@grecopublishing.com
Lea Velocci - lea@grecopublishing.com
SALES DIRECTOR
EDITORIAL/CREATIVE COORDINATOR
Alicia Figurelli - alicia@grecopublishing.com
Alana Bonillo - alana@grecopublishing.com
EDITORIAL DIRECTOR
PRODUCTION
Joel Gausten - joel@grecopublishing.com
Donna Greco - donna@grecopublishing.com Christopher Rizzi - chris@grecopublishing.com
PUBLISHED BY: Thomas Greco Publishing, Inc. 244 Chestnut Street, Suite 202, Nutley, NJ 07110 Corporate: (973) 667-6922 / FAX: (973) 235-1963 www.grecopublishing.com
CELEBRATING 30 YEARS New England Automotive Report is published monthly by TGP, Inc., 244 Chestnut Street, Suite 202 Nutley, NJ 07110. Distributed free to qualified recipients; $48 to all others. Additional copies of New England Automotive Report are available at $5 per copy. Reproduction of any portions of this publication is specifically prohibited without written permission of the publisher. The opinions and ideas appearing in this magazine are not necessarily representations of TGP Inc. or of AASP/MA. Copyright © 2019 by Thomas Greco Publishing, Inc. Images courtesy of www.istockphoto.com
PROTECTING CONSUMERS AND THE COLLISION INDUSTRY
WWW.AASPMA.ORG MASSACHUSETTS
8 March 2019
New England Automotive Report
TREASURER Matthew Ciaschini LEGISLATIVE CHAIR Peter Langone IMMEDIATE PAST PRESIDENT Paul Hendricks
PRESIDENT Molly Brodeur VICE PRESIDENT Kevin Gallerani SECRETARY Gary Cloutier
AASP/MA STATEWIDE DIRECTORS COLLISION DIRECTOR Rob DelGallo
AT-LARGE DIRECTOR Adam Ioakim
AASP/MA DIRECTORS Frank Patterson Mike Penacho Dana Snowdale Bill Spellane
Ray Belsito Alex Falzone Joshua Fuller Kevin Kyes
AASP/MA ADMINISTRATIVE OFFICE Evangelos “Lucky” Papageorg: AASP/MA Executive Director
Alana Bonillo: AASP/MA Administrative Assistant P.O. Box 212 Marlborough, MA 01752 617-574-0741
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Email: tschube@longauto.com New England Automotive Report March 2019 9
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EXECUTIVE DIRECTOR’S MESSAGE
EVANGELOS “LUCKY” PAPAGEORG
Be the Master of Your Own Destiny When I have a little downtime (which isn’t too often), I enjoy reading – not trade publications or the Massachusetts regulations and CMRs (which I do regularly) or the many emails I receive on a daily basis. I like to read for pleasure and wash away some of the stress of the day, week or month. Recently, I had the chance to re-read a book I enjoyed a few years ago. It is a story of the struggles of everyday life and the tough ones that must be overcome regularly if one is going to survive – and, more importantly, thrive. In addition, the story is told from a very interesting point of view, which I will explain later. There are many touching and thought-provoking events and quotes in the story. As I read, I drew correlations between the issues and situations that arose in the story and the many issues we face as collision repairers. One such quote is as follows: “… Such a simple concept, yet so true: that which we manifest is before us; we are the creators of our own destiny. Be it through intention or ignorance, our successes and our failures have been brought on by none other than ourselves…” Please read through the quote a few times so it sticks in your mind a bit. I will attempt to draw the lines that will connect the dots. More than anything, I believe we have the ability to control our destiny as well as the way we live our lives and conduct ourselves in business. We are able to learn from our experiences and adapt to the many changes that are thrown at us. The ability to learn and adapt is nowhere more evident than in the collision repair industry. Many years ago (nearly 30, in fact), I used to say, “The collision repair industry is in a state of evolution, not revolution.” I was referring to the fact that more and more bodyman-owned shops were evolving into businessman-owned facilities. Shop owners realized that if they were going to survive the changes to their business practices brought on by the “direct payment plan” versus the “work completed form,” they had to dramatically change how they approached their existing and potential customers. Some repair facilities chose to align themselves with insurers and rely on having work pushed to them via the referral shop lists, which insurers were allowed to develop under the Auto Insurance Reform Act of 1988. The Act also mandated “cost containment” on the part of insurers.
Without passing judgment on anyone who chose to align themselves as “referral shop” participants, it was a devastating blow to our industry. The “cost containment” restrictions led to a rollback in the hourly reimbursement rate. It also pitted “brother against brother,” creating a nonunified industry that has fought amongst itself rather than unify against its oppressor: Insurers that have and continue to hide behind the “cost containment” mandates for all their decision-making. For many referral shop owners, having customers sent to their shops by the insurer sounded good – even great. It was a “guaranteed” flow of work, but at what cost to themselves and the industry? To stay on the “workflow train,” concessions were piled on concessions by insurers. Then, those concessions became “prevailing” practices forced onto the independent shops as well. You know the word tracks: “We don’t pay for that” and the famous, “We have a list full of shops that can repair this vehicle based on our estimate.” As the earlier quote from the book stated, “…Such a simple concept, yet so true…” We have failed to learn and have allowed history to repeat itself. “Preferred/program” shops (the DRP “duck”), have become the newest control mechanism here in Massachusetts because insurers had to find another way to control the facilities trying to maintain their independence. Not having the “cost containment” excuse to fall back on, the insurers had to find a way to cause even more division among collision repairers. Who can blame a repairer for choosing a way to push more vehicles through their shop by reducing cycle time delays (like waiting for insurance appraisers to see the vehicle)? “Write your estimate the way we tell you, and we won’t hassle you. You can even pick your own A/M parts supplier, overriding the one we may have specified.” This is a fact, as is the following insurer steering technique: “Yes, you can pick any repair shop you want, Mr. or Mrs. Insured. However, if you don’t take your vehicle to one of our ‘preferred/program’ shops, we may not get to see it for a couple of weeks. Your rental may run out before the repairs are completed. Our preferred shop will get you in and out in no time.” The average customer has no idea that this is a blatant misrepresentation of the regulations. All insurers MUST see a damaged vehicle within five business days of the claim being called in. The regulations do not state the vehicle has to be at a “preferred/program” shop in order to meet that requirement. continued on page 13
10 March 2019
New England Automotive Report
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AASP/MA Executive Director Lucky Papageorg is on the move! Read below for his stops this month.
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For the month of March, Lucky will be spending the second week in the Midstate region region and will host a chapter meeting on March 13. (Location TBD.)
4 2
In the third week, he’ll be visiting the Western region and will host a chapter meeting on March 20. (Location TBD.)
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During the fourth week, he will be in the Boston/Northeast region and will host a chapter meeting on March 27. (Location TBD.)
March 11 - April 5
2019 Keep an eye out for future meeting dates and locations!
He will be spending the first week of April visiting shops in the Southeast region and will host a chapter meeting on April 3. (Location TBD.)
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MASSACHUSETTS
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12 March 2019
New England Automotive Report
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EXECUTIVE DIRECTOR’S MESSAGE continued from page 10 An important fact that seems to have been missed by many referral shops is that they too have work steered away from them just as often as the independent facilities. Insurers who have “preferred/program” shop relationships “steer” to those businesses first. Even referral repair shops are an afterthought, leaving them in no better position than an independent shop! This begs the question: Why would you want to stay in a referral relationship? The quote from the book goes on to say, “…we are the creators of our own destiny. Be it through intention or ignorance, our successes and our failures have been brought on by none other than ourselves…” Sadly, truer words have never been spoken when discussing the collision repair industry. I do not pass judgment on the business decision made by any shop owner to stay independent or to enter into a relationship with an insurer. Every business owner has their own set of circumstances that led to their decision. That being said, those decisions are not carved in stone. There is nothing to stop previous decisions from being changed
through education and understanding. Sooner or later, this realization hits home: The “preferred/program” shops are subsidizing insurers for the privilege to work on vehicles they would have had in their shop regardless! They are also realizing that insurers are forcing the shops in these “relationships” to have to choose between making proper manufacturer-recommended/required repairs to restore the vehicle to a “crashworthy” condition at the shop’s own expense. If the shop decides to roll the “liability dice,” it could end up just like John Eagle Collision on the wrong end of a $40-plus million liability lawsuit. AASP/MA, the Society of Collision Repair Specialists (SCRS), I-CAR and other collision-related entities are here to help with the process of righting the ship in our industry. We are here to make sure that what is important in the collision/insurer relationship is not the money-saving intent of the insurer but the safe and ethical repair of a vehicle that could ultimately save lives. That IS NOT being overly dramatic; it is a statement of fact. We are the first line of defense for the
vehicle owner – our customer. We in the collision repair industry can and must control our own destiny. That means taking back control by developing the relationships that matter: The ones we have developed with our customers. By the way, I have not forgotten about the explanation of the point of view from which the story is told. Please read the conclusion of this message in Damage Report, our association newsletter. The next issue will be published digitally for the first time, and it will be available on the AASP/MA website through our “Members Only” portal. Contact us if you are not a member and wish to have access to ALL the valuable information within the portal. BECOME THE MASTER OF YOUR OWN DESTINY! The sooner you do, the better off YOU and the entire industry will be. PROTECTING CONSUMERS AND THE COLLISION INDUSTRY
MASSACHUSETTS
AASP/MA EXECUTIVE DIRECTOR EVANGELOS “LUCKY” PAPAGEORG can be reached at (617) 574-0741 or lucky@aaspma.org
New England Automotive Report March 2019 13
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BMW of Stratham 71 Portsmouth Avenue Stratham, NH 03885 PH: 603-772-0000 FAX: 603-772-9436 bmwofstratham.com
Tulley BMW of Nashua 147 Daniel Webster Hwy Nashua NH 03060 PH: 603-888-5050 FAX: 603-888-8427 tulleybmw.com
New Country BMW 1 Weston Park Ave. Hartford, CT 06120 PH: 860-240-7881 FAX: 860-240-7873 newcountrybmw.com
BMW of Warwick 1515 Bald Hill Rd. Warwick, RI 02886 PH: 401-821-1510 FAX: 401-823-0530 bmwofwarwick.com
BMW of Sudbury Wholesale Parts 68 Old County Road Sudbury, MA 01776 PH: 800-338-3198 FAX: 508-881-7578 bmwofsudbury.com
14 March 2019
New England Automotive Report
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16 March 2019
New England Automotive Report
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It Takes Genuine Honda Collision Repair Parts To Achieve a Genuine Honda Fit. Honda collision repair parts are engineered and manufactured to Honda standards. In the collision-repair business, time is money, and you can’t waste time on parts that almost fit properly. Use Genuine Honda replacement parts. Your reputation depends on it. For Genuine Honda parts, contact these Authorized Honda dealers.
Bernardi Honda 960 Worcester Road Natick, MA 01760 Parts Direct: 800-247-3033 FAX: 508-651-1220 www.bernardihonda.com
Lia Honda of Northampton 293 King Street Northampton, MA 01060 Toll Free: 800-369-7889 Direct: 1-413-586-6043 FAX: 1-413-585-0502 www.liahondanorthampton.com
Honda North 382 Newbury Street Danvers, MA 01923 Toll Free: 800-882-9797 FAX: 978-774-9483 e-mail: eadams@iclautos.com www.hondanorth.com
Kelly Honda 540 Lynnway Rt. 1A Lynn, MA 01905 Parts Direct: 800-779-7466 FAX: 781-595-2898 e-mail: mpsomosjr@kellyauto.com
Honda of Enfield 20 Palomba Drive Enfield, CT 06082 Toll Free: 800-222-6632 FAX: 860-253-5419 www.liahondaofenfield.com
Schaller Honda 1 Veterans Drive New Britain, CT 06051 Toll Free: 800-382-4525 Direct: 860-826-2080 FAX: 860-826-2083 e-mail: jkiniry@schallerauto.com www.schallerauto.com
Lundgren Honda of Auburn 525 Washington Street Auburn, MA 01501 Toll Free: 800-777-2044 FAX: 508-721-0872 e-mail:pmccarthy@lhonda.com www.lhonda.com
New England Automotive Report March 2019 17
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[LOCAL] NEWS
Shop/Vendor Disputes Tackled at January ADALB Meeting
ADALB member William Johnson with new member Samantha Tracy The January 23 meeting of the Auto Damage Appraiser Licensing Board (ADALB) at the Division of Insurance in Boston included a heated discussion on matters important to shop/vendor relations in Massachusetts.
The Board continued their focus on addressing concerns expressed by shops that certain vendors are refusing to sell parts to them despite those vendors being listed on the insurance estimate. Representatives from area body shops, MAPFRE Insurance, Liberty Mutual and Empire Auto Parts were among those who offered feedback to the Board on the issue. The meeting was very contentious, with several questionable comments made by the vendor and two insurance companies that the blackballing was based on the shops’ creditworthiness. The January 23 meeting was the first to feature new ADALB member Samantha Tracy (Arbella), who replaces outgoing member Joseph Coyne, Jr. (Home & Auto Appraisal Bureau). Readers are urged to view the complete video of this meeting, which is available in the Members Only section of aaspma.org.
New England Automotive Report
March 13, 2019 Steel Unitized Structures Technologies & Repair Enterprise Rent-A-Car (Burlington) March 14, 2019 Plastic & Composite Repair Bay Path Regional Vocational Technical High School (Charlton) March 27, 2019 Adhesive Bonding Enterprise Rent-A-Car (Burlington) March 28, 2019 Steel Unitized Structures Technologies & Repair Bay Path Regional Vocational Technical High School (Charlton)
PROTECTING CONSUMERS AND THE COLLISION INDUSTRY
MASSACHUSETTS
Visit us at NORTHEAST® Booth 721 18 March 2019
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New England Automotive Report March 2019 19
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Rely on Volvo Genuine parts to get the right fit, at the right price, right now. Please contact the following dealers for your Volvo parts needs:
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New England Automotive Report March 2019 21
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[NATIONAL] NEWS by Alana Bonillo
The Best Education on the East Coast: Collision P.R.E.P. Returns to
It’s an experience no collision repairer can afford to miss – and it’s all happening within driving distance at the NORTHEAST Automotive Services Show this month. The NORTHEAST show weekend will take place March 15 to March 17 at the Meadowlands Exposition Center in Secaucus, NJ and once again promises to deliver top-name vendors and the best education to be found on the East Coast. For the second year in a row, the Washington Metropolitan Auto Body Association (WMABA) has partnered with NORTHEAST’s host association, the Alliance of Automotive Service Providers of New Jersey (AASP/NJ), to offer the Collision Professional Repairer Education Program (Collision P.R.E.P.). “WMABA is excited to team up again with AASP/NJ to host Collision P.R.E.P. for the Eastern US as the only opportunity to participate in nationallevel learning from the industry’s leading experts on this side of the country,” says WMABA Executive Director Jordan Hendler. All classes will be conveniently located at the Holiday Inn Harmon Meadow, just a few steps away from the Exposition Center. Friday’s slate begins with a digital marketing course at 3pm entitled “Expand Your Customer Base – Reach More Online Collision Repair Customers” with presenter Brent Betts (AP Media). Attendees won’t want to miss a debut presentation by the one and only Mike Anderson (Collision Advice) – “Scanning Best Practices” – at 7pm. On March 16 at 10am, Anderson will once again take the podium to present the popular seminar “Write It Right, with Life Nuggets to Live By,” where he will discuss the documentation needed for conducting business in today’s world of properly repaired vehicles. Attendees must mark their calendars for the headlining presentation on March 16 featuring K. Michael Bradshaw of K&M Collision of Hickory, NC. “Repairer to Repairer: Realities of Structural Repair & 22 March 2019
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Tooling” will see Bradshaw review techniques, processes and considerations for repairers when it comes to structural repair methods and equipment. In the wake of the eye-opening John Eagle multimillion-dollar verdict, now is the time for auto repair professionals to make sure they understand the liability involved in collision repair and learn how to protect themselves. Mark Olson of VECO Experts intends to give attendees that ammunition via his presentation, “Building the Bulletproof File: Documentation for Repair and Reducing Liabilities,” on March 16 at 3pm. “NORTHEAST is the perfect venue for this discussion, as there is a good mix of technicians, owners and stakeholders in attendance and they will all have the information,” he says. Repairers looking to get more familiar with or improve the way their shop addresses vehicles with advanced driver assistance systems (ADAS) will not want to miss “Getting It Right for Successful ADAS Diagnostics.” As presenter Chuck Olsen of AirPro diagnostics explains, “ADAS repair procedures and calibration requirements must be followed to a ‘T.’ If you make a mistake during the repair – such as overlooking proper installation and alignment of parts or an incorrect thrust angle from alignment – you won’t be successful in ADAS functionality. The same is true when it comes to following OEM service information and knowing what must be done – and when. There are excellent repairers out there, but if you are not very careful, you can really run into serious problems.” Leaders from top car manufactures will assemble for a special OEM Repair Panel, “The Changing Landscape in Certified Repair & Understanding the OEM Repair Procedures,” on March 16 at 12pm. Panelist Mark Allen, collision and equipment manager for Audi of America, Inc., hopes attendees will walk away
OFESSION PR EPAIRER AL R
ED
U C AT I O N PROGRA M
with the same critical message that many OEMs have been sharing for the past several years. “It is time to change your business to come into this new millennium and be ready to repair cars from our brands – as well as like-constructed vehicles from other manufacturers.” Allen’s advice to repair professionals is to take a good look at their operations, understand who their consumer is and identify what vehicles they are driving. “Don’t aspire to fix every car anymore; aspire to take care of your customer. Look at what trends are out there in your market. Is that customer going to change or stay the same? Start looking at these sorts of things as you develop your business.” John Shoemaker, BASF Automotive Refinish business development manager, will present “Damage Assessment Documentation: Key Steps for Maximum Reimbursement” on March 17 at 10am. Through this discussion, he plans to show repairers ways to document a repair so that everyone from the estimator to the painter and parts person understands what needs to be done. Shoemaker says, “It is important that a damage appraiser answers the questions before they are asked.” Attendees will also walk away with the knowledge of how valuable a photo can be in validating a repair and related labor hours. Shoemaker recommends attendees come to the presentation with a copy of an estimate they have written. As he has discovered from past discussions, it’s a great practice.
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FRIDAY, MARCH 15 SHOW HOURS 5pm - 10pm 3pm
Expand Your Customer Base – Reach More Online Collision Repair Customers Brent Betts, AP Media 5pm
Business Data, Knowing Your Unknowns Craig Seelinger, Vision+Program Manager, BASF 7pm
*NEW COURSE* Scanning Best Practices Mike Anderson, Collision Advice
SATURDAY, MARCH 16 SHOW HOURS 10am - 5pm 10am
OEM Repair Methods & Advanced Technologies Dave Gruskos, Reliable Automotive Equipment 10am
Automotive Industry Disruption: Will Your Business be a Winner? Frank Terlep, asTech 10am
Write it Right, with Life Nuggets to Live By Mike Anderson, Collision Advice 12:30pm
OEM Repair Panel: The Changing Landscape in Certified Repair & Understanding the OEM Repair Procedures Panelists: Aaron Clark (Assured Performance), Leigh Guarnieri (Honda), Mark Allen (Audi), Ken Park (Volvo) and TBA (Subaru) 3pm
Building the Bulletproof File: Documentation for Repair & Reducing Liabilities Mark Olson, VECO Experts 3pm
The Estimate Toolbox: Using FREE Resources to Complete an Accurate Vehicle Damage Repair Plan Danny Gredinberg, Database Enhancement Gateway 3pm
Safety System Alignment: A New Focus on Body Shop Profitability Paul Stern, LiftNow Automotive Equipment 5pm
Repairer to Repairer: Realities of Structural Repair & Tooling K. Michael Bradshaw, K&M Collision
SUNDAY, MARCH 17 SHOW HOURS 10am - 3pm 10am
Scanning & Calibration – Getting It Right for Successful ADAS Diagnostics Chuck Olsen, AirPro Diagnostics 10am
Damage Assessment Documentation: Key Steps for Maximum Reimbursement John Shoemaker, business development manager, BASF 10am
Expand Your Customer Base – Reach More Online Collision Repair Customers Brent Betts, AP Media 12:30pm
Embracing the Post-Repair Inspection 12:30pm
Not-Included Operations – Commonly Missed Items in Estimating Danny Gredinberg, Database Enhancement Gateway 12:30pm
You Schedule How? Charlie Whitaker, AkzoNobel New England Automotive Report March 2019 23
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[NATIONAL] NEWS When not in classes, NORTHEAST showgoers are encouraged to make time to hit the floor at the Meadowlands Exposition Center and visit the extensive list of industry-leading companies from around the country exhibiting this year. Longtime NORTHEAST exhibitor AkzoNobel is one of many companies returning for another round on the show floor. “We look forward to making industry connections and learning what is new and relevant in our industry,” shares Bill Karpovich, district sales leader - northeast. “Not all of us can get to large national shows, so a regional show such as this provides a lot of industry knowledge.” “It is the best regional show there is,” says Ted Dinnella, president of Collision Equipment Consulting, Inc., an equipment distributor with a heavy East Coast customer base. A veteran supporter and participant, Dinnella believes NORTHEAST is the greatest option for them over any national event because it puts them in direct contact with existing customers and potential new clients. “The show continues to grow year after year, with more people
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participating, more vendors and therefore more variety in its offerings,” says Kevin Lombard of Lombard Equipment, LLC, who will be returning to NORTHEAST as part of the Pro Spot International booth. “More shops are coming from farther and farther away. Most people on the East Coast don’t want to make the trek out west and prefer the NORTHEAST show.” Headquartered in Massachusetts, Lombard Equipment been a participant at NORTHEAST since the 1990s. With a strong East Coast customer base, Lombard sees the show as a great opportunity for the company to get in front of shops and provide them with education on the proper OEM procedures needed to fix vehicles. Don’t miss your chance to explore some of the best of the best in the industry. AASP/NJ has secured special show rates at a number of area hotels to ensure attendees will have access to the right accommodations to suit their needs. Be sure to visit aaspnjnorth east.com to learn more and to register online for free to attend NORTHEAST 2019. PROTECTING CONSUMERS AND THE COLLISION INDUSTRY
MASSACHUSETTS
LET US TURN THEM AROUND! Contact New England Automotive Report Sales Director Alicia Figurelli (973) 667-6922 alicia@grecopublishing.com
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New England Automotive Report March 2019 25
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[COVER] STORY By Joel Gausten
PUTTING THE CONSUMER FIRST: AASP/MA Pushes for Safe OEM Repairs “Protecting consumers and the collision repair industry.” The above words not only represent AASP/MA’s new official motto, but they showcase the association’s elevated focus on being an advocate for Massachusetts drivers and automotive insurance policyholders. At AASP/MA’s most recent Boston/Northeast Chapter meeting (held at Greater Lawrence Technical School in Andover and sponsored by Don Kennett, Inc.), Executive Director Evangelos “Lucky” Papageorg mapped out several ways he and the AASP/MA Board of Directors are working to achieve this goal. In his mind, changing common word tracks will go a long way in establishing building a stronger bridge between repair facilities and vehicle owners. “We’re always trying to get the vehicle back to ‘pre-loss condition,’ and that’s a fallacy. There’s no way any of us can restore a vehicle to pre-loss condition. Even if you never did any repairs to a door but you blend paint onto it and clearcoat the entire panel so it matches the fender you replaced, that vehicle is no longer in pre-loss condition…What I’d like to have people start thinking about is the fact that what you’re really trying to achieve is ‘crashworthiness’ in a future loss. That’s our obligation as repairers.” As covered extensively in last month’s issue of New England Automotive Report, recent activities prompted AASP/MA to issue a Call to Action to members to supply information in regard to their experiences with violations of CMR 211 133.04: When an insurance company specifies the use of used, rebuilt or aftermarket parts, the source and specific part(s) must be indicated on the appraisal. If the repairer uses the source and specified part(s) indicated on the appraisal and these parts are later determined by both parties to be unfit for use in the repair, the insurance company shall be responsible for the costs of restoring the parts to usable condition. If both parties agree that a specified part is unfit and must be replaced, the insurer shall be responsible for replacement costs such as freight and handling unless the repair shop is responsible for the part(s) being unfit or unless the insurer and repairer otherwise agree. As to such costs, nothing in 211 CMR 133.00 shall preclude an insurer from exercising any available rights of recovery against the supplier. Updating meeting attendees of the situation, Papageorg explained that the discussion at the Board level was prompted by a letter submitted by a western Massachusetts shop owner. “The [owner] had attempted to buy a part, and he was told 28 March 2019
New England Automotive Report
he was not in the geographical area of the distributor, so they ordered from a different vendor. They then sent in a supplement for a $20 part price increase. The insurance appraiser said, ‘You didn’t buy it from where I told you to buy it.’” Additionally, some representatives in attendance at the two most recent ADALB meetings indicated they are being “blackballed” by vendors that refuse to sell to them. “Rather than the vendor just not delivering to the specific area, there are shops that, when they call a specific vendor, are continued on page 30
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New England Automotive Report March 2019 29
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[COVER] STORY continued from page 28 being told, ‘Sorry,’” Papageorg revealed. “In some cases, the minute the vendor hears that shop’s name, it’s a click. They can’t pay cash for the part, they can’t buy it on credit and they can’t go get it. They’re not being given the part.” Papageorg encouraged AASP/MA members to watch the videos of ADALB meetings available in the Members Only section of aaspma.org. “We need you to get educated and hear what’s going on in there so when we do put out a Call to Action, you respond and you give us the information we need.” AASP/MA’s legislative plan was also discussed. AASP/MA needs to be armed with accurate and up-to-date information if work in the Legislature is to be successful. Papageorg urged members to participate in the free “Who Pays for What?” surveys conducted by Mike Anderson’s Collision Advice (collisionadvice.com) and John Yoswick’s CRASH Network. “There are 1,763 shops in this state. If 100 people send in the survey, Mike is going to send the information back to everybody.” The meeting also included an overview of the current in-shop surveys Papageorg and AASP/MA are currently conducting throughout the state. Questions include (but are not limited to) whether the member shop is a program/referral shop (and, if so, how many insurers they work with). Other
topics included questions about what the major concerns are for shop owners and managers, along with gathering demographics as to the number of employees and their classification with the shop (production versus administrative). Above all, Papageorg stressed that AASP/MA will carry on through 2019 and beyond as a true resource and line AASP/MA Executive of defense for the motoring public. Director Evangelos “Lucky” Papageorg “We want to have people start during a recent thinking of the association as the place Boston/Northeast to go to get consumer-friendly Chapter meeting in consumer-protection information to Andover make allegiances with consumers so when they come to your shop, they’re on your side and not listening to the propaganda.” Information on upcoming AASP/MA chapter meetings and events is available at aaspma.org. PROTECTING CONSUMERS AND THE COLLISION INDUSTRY
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[LEGAL] PERSPECTIVE by James A. Castleman, Esq.
Are There DRPs in Massachusetts? Someone sent me an online job ad posted by Liberty Mutual Insurance for a senior auto repair appraiser. The job was for a supervisory position covering a territory south of Boston. The first line of the job description noted that the person hired would be “responsible for overseeing an assigned portfolio of Direct Repair Shops [DRP] shops [sic] to ensure that work performed is in alignment with Service Level Agreements.” I was shocked to see the ad, since Direct Repair Programs (DRPs) are illegal in Massachusetts. Yes, I know that many insurers now have “program” shops to which they refer work, and I know that the system of program shops mirrors the systems of traditional DRP shops that exist in the rest of the country. But it was my understanding that insurers still recognize that DRPs are taboo in this state, and that insurers deny that their program shops are actually DRPs. Yet, here was Liberty Mutual openly advertising that they were looking for someone to oversee their Direct Repair Shops in southern Massachusetts. What are DRPs? DRPs are programs in which insurers directly refer their insured claimants to specified collision repair shops. These are shops that have a contract with the referring insurer, which governs how the shops are to interact with the insurer’s claimants, how work is to be done, what types of parts will be used and how much the shops will charge. In exchange for a volume of referred work, the DRP shops give incentives to the
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New England Automotive Report
referring insurers, perhaps as to Labor Rate, maximum labor times, storage charges or storage policies, charges for paint and materials, types of parts used, repair parts charges, giving preference to the insurers’ claimants over other repair shop customers or to all of these items. While DRP shops may sometimes save insurers claims dollars, a question arises as to whether they do so at the expense of providing lesser repairs for their referring insurers’ claimants. After all, whose interests are more important to these shops – those of the referring insurer that wants to save claim dollars by minimizing repair costs, or those of the claimant customer who wants a professional and safe repair that truly puts their vehicle back into pre-accident condition? Are Direct Repair Programs Legal in Massachusetts? In response to the problems that arose with then-existing Direct Repair Programs, as part of the statute that established the Auto Damage Appraiser Licensing Board (ADALB), Massachusetts enacted a first-in-the-nation law in 1981 that mandated, “No appraiser or insurer shall request or suggest that repairs be made in a specified repair shop.” This was amplified in regulations issued by the ADALB, which stated, “No staff or independent appraiser, insurer, representative of insurer or employer of an independent appraiser shall refer the claimant to or away from any specific repair shop or require that repairs be made by a specific repair shop or individual.” At the time, the statute and regulation effectively eliminated any type of referral shop system or anything that looked like a Direct Repair Program. No referrals by insurers actually meant no referrals. Over the years, however, there has been gradual erosion of the Massachusetts “no referral” law. Initially, in 1987, a Supreme Judicial Court decision on a suit brought by Allstate Insurance Company allowed that, if asked by a claimant, an insurer could give the claimant a list of at least five repair shops or individuals that the insurer believed did quality work
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[LEGAL] PERSPECTIVE at competitive prices, “as long as the communication makes it clear that the choice of the repair shop or individual belongs to the customer.” Once given an opening, insurers attempted to become creative in how they would communicate a list of preferred referral shops to their insureds, encouraging the claimants to ask about recommended shops and otherwise seeking the ability to make repair shop recommendations. Then, in 1989, the so-called “Direct Payment Law” was enacted, and the manner in which Massachusetts insurers handled auto damage claims changed drastically. Insurers were now allowed to submit “Direct Payment Plans” for approval by the Commissioner of Insurance for implementing the new law. As part of those plans, the law provided that the Commissioner “may require any plan filed… to provide…that the insured will be given a list of at least five registered repair shops, geographically convenient for the insured, from which the insured may at his or her option select a shop, which will without undue delay complete the repair work for the amount of the payment to the insured, plus any applicable deductible, that the insurer will guarantee the quality of the materials and workmanship used in making repairs if the repairs are performed at one of the repair shops so listed.” Regulations were issued by the Commissioner of Insurance for the implementation of such plans. Sure enough, they required all Direct Payment Plans have the referral shop provision. The regulations, however, also mandated that any shop that wanted to be placed on an insurer’s list of “referral repair shops” would have to be placed on the list if they met certain minimum requirements, essentially prohibiting insurers from referring claimants to a short, limited list of preferred shops. Direct Repair Programs were still clearly prohibited. Notably, at the same time that the Direct Payment Law was enacted, another statute was added to the laws of Massachusetts, M.G.L., c. 175 § 113T, allowing insurers to adopt “participating repair shop” programs that were to be Direct Repair. Under that statute, an insurer would have to issue a separate endorsement as an option that could be chosen by an insured in exchange for a reduction in premium, wherein the insured would agree to allow the insurer to direct them to a repair shop that had a contract with the insurer where repairs were going to be made. In order for that statute to become effective, however, it required that the Commissioner of Insurance and the Massachusetts House of Representatives take further actions. Those actions were never taken, so the law never became effective. However, the point is that the Massachusetts legislature recognized that Direct Repair Programs were not allowed under existing law, and that it would be necessary to adopt and implement a separate statute to make DRPs legal here. More recently, around 2012, certain insurers decided to try to push the limits on DRP prohibitions in Massachusetts. Some insurers began submitting revised Direct Payment Plans to the Commissioner of Insurance. These plans had provisions that would allow the insurers to operate “program shop” systems in which claimants would be encouraged to go to a limited number of preferred shops. The person who was the Commissioner of Insurance at the time appeared to be more friendly toward insurers trying to implement these types of programs and less friendly toward the governing law. One insurer submitted a plan for approval that blatantly explained how it would have a limited list of Platinum Auto Service (PAS) repair shops to which claimants would be directly
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New England Automotive Report
guided. As explained by the insurer in its submitted plan, an individual PAS shop would be patched into a conference call when a claimant first called in a claim in order to directly schedule a repair date and time. Not only was the insurer proposing a limited list of preferred shops, but it was also proposing to be allowed to direct a claimant to a single chosen shop at the time they called in their claim. This appeared to be a clear-cut violation of the law. Yet, the Commissioner of Insurance, without scheduling or holding a legally required hearing, approved the plan. Other insurers felt emboldened and followed suit. “Program” shops became a reality in Massachusetts; Direct Repair Programs were effectively fully introduced into Massachusetts even if they were not called Direct Repair Programs. So, What’s the Problem? According to statutes and regulations that are unambiguous with regard to the issue, DRPs are unequivocally still illegal in Massachusetts, and insurer “program shops” are, in reality, Direct Repair shops. Despite the fact that many insurers and a former Commissioner of Insurance have ignored the governing laws, the laws have not been repealed and still exist. Direct Payment Plans that allow for what are DRP programs were approved by the then-Commissioner of Insurance, without any hearing and with notification to “other persons affected,” despite the following: Complaints made to the Commissioner at the time The fact that the Commissioner completely ignored the legal mandate to hold hearings on the submitted Direct Payment Plans The fact that the governing regulations require that “[t]he party filing the plan and other persons affected shall be notified of the date of the hearing at least 10 days in advance.” Notwithstanding the current relatively widespread implementation of these “program” plans, in my opinion they are still illegal, and, quite frankly, there does not seem to be any room whatsoever in the governing statutes and regulations for their approval or existence. Yet, they do exist, and do so without objection from the Division of Insurance – the governmental agency charged with protecting the consuminginsured public in Massachusetts and enforcing the laws that govern how insurers interact with their insureds and with Massachusetts collision repair shops. Meanwhile, Liberty Mutual continues to publicly seek a senior auto repair appraiser who will be responsible for overseeing an assigned portfolio of Direct Repair Shops. This just doesn’t seem how the system is supposed to operate – because it clearly and legally isn’t. PROTECTING CONSUMERS AND THE COLLISION INDUSTRY
MASSACHUSETTS
Attorney James Castleman is a managing member of Paster, Rice & Castleman, LLC in Quincy, MA. He can be reached at (617) 472-3424 or at jcastleman@prclawoffice.com.
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[OEM CERTIFICATION] PROFILE:
AMi/FCA
AMi President Jeff Peevy
The FCA Certified Collision Network, the Automotive Management Institute (AMI) and Mike Anderson’s Collision Advice have teamed up to provide relevant network online training to improve the FCA customer experience. These online courses have been developed for individuals involved in administrative, management, estimating and repair planning roles. Based on the topic, online courses will be “highly recommended” or “recommended” by FCA to participate in their Certified Collision Network. New England Automotive Report recently sat down with AMi President Jeff Peevy to learn more about this exciting new partnership and its plans moving forward. New England Automotive Report: What led AMI and FCA to collaborate in this way? What are the biggest goals for both parties moving ahead? Jeff Peevy: My involvement with car manufacturers and training over the years led me to see a shift. Manufacturers were beginning to look at the collision repair industry, build their certification networks and have tool/equipment and technical-training requirements, whether they did it themselves or through I-CAR. They started to take some control and have influence over the collision repair process of their brands. I believed that at some point in that evolution, they would seek customer service, nontechnical soft-skill training as a part of that experience. One of the things we did at AMi was begin to address what I 40 March 2019
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believed was a void. We manage professional designations for the industry, but we also have an open learning management system and platform that allows organizations to address specific learning needs built by a set of criteria in our system. Then, we can use courses that we have – like a series on improving CSI – and build a list of them that are required for their needs. When Chrysler approached us, our system resonated with them, and we pursued this together and worked through this process over the course of seven months or so. To their credit, they realize that in order to truly impact the customer experience, they need to look at customer satisfaction. That would mean an accurate repair, which requires OEM repair procedures. We have “How to Use Tech Authority” for that. FCA sees the importance of cycle time efficiency, and we have courses that would impact that. In the end, the most important thing in the repair is the customer. That translates to passenger safety and customer satisfaction. Those should be the main goals of the car manufacturer, the shop and the industry as a whole. I have to give Mike Anderson a tremendous amount of credit for his role in the vision and development of learning solutions to take the industry to new levels and ultimately protect families. He has been a huge supporter of what AMi is attempting to do. These courses are available to anyone in the industry. You don’t have to be on the FCA Certified Collision Network in order to take advantage of that. FCA really wanted it to be available to anyone and everyone who saw a value in it. NEAR: Since this is a new endeavor, what kind of checks and balances will be in place to ensure that once a student and a facility meet the criteria, they maintain the standing they’ve accomplished? JP: It will be through extensive reporting. We will track the courses that are taken, both individually and tied to a
business. As they add courses and the requirements grow, we will continually have that reporting mechanism that says they’ve taken the minimum or beyond the bare minimum, beyond the bare minimum and are staying up to date. In the future, we’ll be able to flag anyone who doesn’t stay up to date with some of the newer courses. This is going to be a very dynamic program that will continue to add courses as there is a need. A ‘one and done’ deal doesn’t work anymore. Anyone who thinks they can train and that will be good forever is really out of touch. There are just so many things changing. NEAR: It’s my understanding that there are some AMi offerings that are new and unique to the FCA program. What can existing or new AMi students expect from this that they haven’t had before? JP: When we were building this package with the FCA Certified Collision Network people, one of the things that came with that were three courses from Mopar that were built by them around their wiTECH 2.0 scanning program. It’s more of the technical series than we would typically do, but it came with the package. They wanted the shops to have an opportunity to better understand the ECUs [engine control units] within their brand’s vehicles. Even if the shop doesn’t use the wiTECH 2.0 programming, there are a lot of things they can learn. “Flight Recordings” is one of the courses. One course that will be out by the time this is published is “How to Partner with Your Local FCA continued on page 46
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For Genuine Subaru Body Parts, contact an Authorized Subaru Dealer. Long Subaru 7 Sutton Rd., Webster, MA 01570 800-982-2298 Fax: 508-879-1212 tschube@longauto.com New England Automotive Report March 2019 41
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[VAP MEMBER] SPOTLIGHT by Alana Bonillo
Don Kennett, Inc.
to conduct all its monthly regional chapter meetings. He finds the relationship to be extremely important towards helping the industry. One of the largest problems body shops have is finding suitable employees. Don Kennett Personable, face-to-face service is what has regularly takes on voc-tech students as interns, helping to made Don Kennett, Inc. the go-to place for autotrain them for a career in this field. He stresses that they motive paint and body supplies throughout parts have had female students come on board, as the of Massachusetts, New Hampshire and Maine automotive world is not as male-dominated as most think. since 1953. He points to AASP/MA President Molly Brodeur as an “We are a family operation, and we take great example of a successful woman in the industry. pride in what we do,” explains Vice President Bob “Molly brings a lot to the association. She’s very good Levy. “We never look at the clock. I attribute our at what she does.” success to taking care of our customers and our Levy hopes more area vendors and jobbers will get customers taking care of us.” involved with the association, as they have a lot of pull with shop owners and can help spread the word and get more people to the local chapter meetings. Levy and President/Owner Dan Takesian have been “I have been doing this for 35 years, and I am working together for more than three decades. Both have passionate about it. It’s fun to go out and do this every day. family members who play principle roles in the operation. It’s not just a job.” Levy’s wife, Lisa, works in the office, while his son, Levy’s own career in the automotive world was born Michael, is one of the company’s account representatives. by working part-time at a body shop while in college. That Takesian’s son, Paul, does the purchasing; his daughter, experience, along with a business Lori, handles accounts management degree and an receivable. appreciation for cars, helped The company started out mold the role he now plays in the with two locations in Lawrence industry. and Lowell. Today, Don He believes that Don Kennett Kennett, Inc. has a team 40 is one of the few remaining people strong among its four original – if not the only – jobber locations in two states. They in New England exclusively have seven account committed to selling wholesale representatives, a full-time paint body and equipment (PBE) technician and a part-time in addition to some commercial technician. Its Manchester, NH items they carry for trucks. store opened 16 years ago; the As for the future, Levy says Wakefield location opened in they have achieved a lot of 2012. growth in the past several years Levy believes strongly in Don Kennett, Inc. is an active participant in and foresees more on the horizon. taking care of Don Kennett’s AASP/MA’s Vendor Affinity Program (VAP). “In this business, if we’re not local customers. Each store growing, we’re going backwards. serves its area within a oneWe attribute our success to our employees and our four hour driving radius. They operate 20 delivery trucks and locations. You can not just stay status quo in this business.” offer delivery twice a day to most of its clients. Addressing another critical topic, he has a clear Training to the Massachusetts auto body community is message to MSOs coming in to the area and buying up another thing Don Kennett is proud to offer. businesses: “We are not for sale.” “I believe in partnering up with our customers in After all these years, Levy says he remains “old school” order to be successful,” Levy says. in dealing directly with existing and potential customers. Giving back and being involved with the automotive Don Kennett still grows its business through cold-calling, community is also important to Don Kennett’s business referrals and going directly to shops’ door. culture. The company is a proud Silver Sponsor of “Even after 35 years, I still enjoy knocking on doors to AASP/MA’s Vendor Affinity Program (VAP) and recently get new business.” sponsored one of the association’s local chapter events at the Greater Lawrence Technical School in Andover. Levy is an advocate for the association’s partnership with vocational technical schools, where AASP/MA plans PROTECTING CONSUMERS AND THE COLLISION INDUSTRY
MASSACHUSETTS
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For more information or to become a sponsor of AASP/MA please call (617) 574-0741 or email admin@aaspma.org.
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PROTECTING CONSUMERS AND THE COLLISION INDUSTRY
MASSACHUSETTS
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New England Automotive Report
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[OEM CERTIFICATION] PROFILE: continued from page 40 Dealership.” There are some things that aren’t immediately known to shops about a dealership’s needs, and a shop might even be in a position to educate the dealership about certified pre-owned cars and the criteria around them. There is a lot of interacting there, and that course should be good for both the shops and FCA dealers. NEAR: Where can people go online to learn more about the structure and requirements of this new program? JP: If you go to amionline.org, there is a pop-up that comes up that presents the FCA program. When you click on the ‘Learn More” button, it takes you to an outline of some of the courses. The next page actually walks you stepby-step through how to register for the program. PROTECTING CONSUMERS AND THE COLLISION INDUSTRY
MASSACHUSETTS
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New England Automotive Report
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