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The Automotive Service Association of Arizona (ASAAZ) was founded in 1963 to help automotive shop owners statewide through resources, training, legislation and representation, networking, communication efforts and more. The ASA of Arizona is affiliated with the Bedford-Texas-based national ASA, which is the largest not-for-profit trade association of its kind serving automotive service professionals.

Today, the Automotive Service Association of Arizona serves both the mechanical and collision-repair segments of the industry. As a state affiliate of Automotive Service Association, the Phoenix-based nonprofit includes 286 members, including 70 collision shops. As it represents the state industry as a whole, the organization has two divisions: mechanical and collision.

The ASAAZ comprises seven chapters: Mohave, Phoenix, Prescott, Tucson, Verde Valley, Yuma and the Grand Canyon Chapter, which represents members statewide that are not part of another chapter. Each elects a board member, who serves for two years, without term limits; currently, the collision division does not have a member on the board. These individual chapters hold meetings, offer local speakers and information exchange and participate in the ASA-sponsored NACE and the annual ASAAZ conference, held this year, July 9–11, at the Prescott Resort & Conference Center.

The group began as the Arizona Auto Body Association, founded June 4, 1976, by Clarence “Bud” Klinefelter, David Keilholtz and Marv Rather.

Last month Toby Chess wrote an article in Autobody News (see Dec. 09 issue) that was about two repairs on completed by two different shops on Mercedes Benz vehicles that were not only repaired in a substandard way but safe to say in an un-safe manner. I want to add to what Toby had to say because this is not the exception but the norm.

With our economic downturn, shops and consumers are struggling. One (shops) to make a buck, and the other (consumers) to save a buck. There has been a giant step backwards in accountability from both shops and insurers that guarantees that a safe vehicle is put back on the road. The consumer is becoming the victim because they are deceived into thinking that a guarantee is the same as a safe repair.

I believe that we reap what we sow, so to think we will get away from accountability just because we haven’t been caught is wrong. To hide something from the customer will only come back to bite you in the end. Selling the job back to the customer should never be anything more than explaining to them what you have done and reassuring them that they can count on you because you care about them. It should never get to the point of talking them into accepting a repair that you know is substandard.

Some things never change. It seems that every couple of months the insurance industry picks an aspect of the collision repair process and tries to change, alter, or ‘massage’ it. This is an obvious attempt to control costs and it is a challenge to the shops, continually justifying our repair methods and procedures. From a business perspective this is perfectly understandable and, depending on the issue, it may even lead to improvements for both parties.

It is easy for me to tell when the focus shifts to a new process. Within a couple of days I receive phone calls from several clients requesting my point of view on the new topic. The latest one that came up is an interesting question and as is often the case, there is no cut and dried answer to any part of it.

A shop in my area recently experienced an attack by a competitor. One of the competitor’s reps was trying to get one of the shop’s dealership “authorized collision repair” status. At the same time they tried to hire away one of his best technicians, and some nasty “black P.R.” was employed to hurt his reputation with local insurance agents. He tried to fight back. An old military maxim says, “the best defense is a good offense,” but this shop owner felt he lacked the personnel and resources to really mount a good offense against this larger, multi-shop competitor.

By the time this shop owner realized he was under attack, it was almost too late to do anything about it. He should have been maintaining a competition conscious posture in his area. A business can’t afford to operate as though they exist in a vacuum. It can be fatal to ignore the activities of one’s competitors. An on-going marketing strategy should be in place to evaluate competitor’s strengths and weaknesses and to capitalize on any perceived “hole” in their approach to getting new business.

10 Cheapest Cars to Insure    3
Affinia Asks for NHTSA for Brake Rotor Standard    12
AkzoNobel Car Refinishes in Deal with GM Europe    34
AkzoNobel’s Acoat Selected Benevolence Program    7
Allstate Alleges Texas Tow Truck Fraud    1
Amaradio - Accepting Unsafe Collision Repairs    25
APU Solutions Partners with Mitchell and Audatex     27
ASA Announces 2010 Meeting    20
ASA Agreement with Airbag Solutions    27
ASA Decides to Go it Alone at 2010 ASRW    1
Ask Dale Delmege   35
Assessment: Collision Repair Industry in California    26
Auto Body Panels Selects MAM    20
Auto Experts Question After-Market Parts’ ‘Equality’    24
Auto Loan Delinquency Rising Except in CA    7
Automotive Technicians Purchase Based on Brand    19
BASF Visits with Auto Officials    34
Caliber Collision Acquires Three Collision Centers     15
ChemSpec USA Helps High Schoolers     27
Chicago Pneumatic Donates $23K in Tools     11
Chrysler Talks Arbitration With Rejected Stores    3
Chrysler to Build Fiat ‘FIRE’ Engine in Michigan    20
CIC Committtees Report Taking On Big Jobs    10

10 Cheapest Cars to Insure    16
Affinia Asks for NHTSA for Federal Aftermarket Brake Rotor Standard    50
AkzoNobel Car Refinishes in Deal with GM Europe    53
AkzoNobel’s Acoat Selected Benevolence Program    45
Amaradio - Unsafe Collision Repairs    49
APU Solutions Partners with Mitchell and Audatex    45
ASA Announces 2010 Meeting    27
ASA in Benefit Agreement with Airbag Solutions    33
ASA Decides to Go it Alone at 2010 ASRW    1
Ask Dale (Delmege)    14
The Collision Repair Industry by CRA    51
Auto Body Panels Selects MAM    27
Questioning After-Market Parts’ ‘Equality’ to OEM    50
Auto Loan Delinquency Rising Except in CA    48
Automotive Technicians Make Purchase Decisions Based on Brand    26
AZ Program Gets Federal $    10
BASF Visits with Auto Officials    53
Bellingham, WA, Shop Files Ch. 7    22
Brown - Auto Body World Lean-ing Toward the Present    37
CAA on Non-Compliant Labor Rate Surveys    22
CAA VP Joins Cancer Board    22
Caliber Collision Acquires Three Xpress Collision Centers in Houston     36
Charges Filed Against CA Gang Member for Auto Arson & Fraud.    10
ChemSpec USA Helps 16 High Schoolers    33
Chicago Pneumatic Donates $23K in Tools    11
Chrysler Talks Arbitration With Rejected Stores    25
Chrysler to Build Fiat ‘FIRE’ Engine in Michigan    27
CIC Committtees Report Taking On Big Jobs    46
Congressional Support Reaches 51 for R2R    46
Consumers Say: Oil Changes Reduce Repairs    26
Customer Satisfaction Higher in Auto Claims than Homeowners   40

Automotive News has reported that Chrysler Group’s Mopar parts brand has opened an online store to sell parts and accessories electronically. Dealers, though, will ship the parts to customers and get paid for handling the sales.

Toyota's recall troubles continue to grow, with the total number of vehicles affected by two recalls involving gas pedals growing to at least 5.3 million.

Collision Week has reported that efforts by Autobody News columnist Toby Chess have led to GEICO issuing an order to inform  its staff of the companywide policy change this week citing the recent industry dialog surrounding the quality of aftermarket bumper reinforcements.

The National Automobile Dealers Association (NADA) issued the following statement today on the Toyota recall:

"Toyota is doing the right thing. The safety of the customer is of paramount concern. Toyota has a reputation for resolving problems quickly. We certainly hope that's the case in this situation as well.

Honda planned on selling 200,000 Insight hybrids worldwide in its first year on the market, but that prospect has dimmed, Honda's executive vice president Koichi Kondo told media sources. The problem with the car is that it's too small for American customers, particularly in the backseat, Kondo explained. U.S. customers instead prefer Toyota's revamped hybrid Prius. The Prius beat Insight sales seven-to-one in the U.S. during the final quarter of 2009.

 

CLICK for SW Contents Feb 2010 PDF format

Louisiana remains the third most expensive homeowners insurance market in the nation behind Florida and Texas, according to newly released data from the National Association of Insurance Commissioners.

Dallas News is reporting that the recession cut deeply into local new car and truck sales last year, which fell a dramatic 29.9 percent – one of the steepest declines in decades. All four major counties in the Dallas-Fort Worth area reported drops of at least 25 percent in new vehicle sales from 2008 levels, according to The Freeman Metroplex Recap of new vehicle sales, released Jan 20.

The International Carwash Association™ offers the industry’s most comprehensive education program at Car Care World Expo™ 2010, taking place May 12- 14, at the Las Vegas Convention Center in Las Vegas, Nevada. All sessions presented are designed to meet the specific needs of car wash professionals occupying various roles in the industry.

Education sessions at Car Care World Expo 2010 are presented by recognized industry leaders and specialized business experts and deliver the most relevant, timely topics for car wash owner and operators, site managers and distributors. Select sessions are also available that focus on macro-level topics such as social media for today’s car wash professional. Car Care World Expo 2010 education is divided into tracks, making it more convenient for attendees to select the sessions that best meet their needs corresponding with their particular job role.

 

I-CAR's two newest programs are now available. Collision Repair for General Motors Vehicles and Damage Analysis of Advanced Automotive Systems feature some of the most up-to-date information on vehicle technology and vehicle-specific repairs.

During a recent CIC Technical Presentation, SCRS Board member and well known I-CAR instructor Toby Chess (see ABN column here) demonstrated differences between a number of aftermarket structural parts and their OEM counterparts.  The presentation was witnessed by the CIC body, including a number of aftermarket part industry representatives, illustrated the importance of structural part certification in the aftermarket.  

In November 2009 and January 2010, SCRS National Director and Education Committee member, Toby Chess, performed presentations outlining comparative studies he had conducted between randomly selected OEM and Aftermarket Structural Replacement parts. The parts reviewed included items such as Front and Rear Bumper Reinforcement Beams, Radiator Core Supports, Bumper Brackets and Bumper Energy Absorbers.

The non-OEM parts industry faced criticism from a number of directions at the Collision Industry Conference (CIC) held in Palm Springs, CA, in mid-January.
As he did at the previous CIC, industry trainer Toby Chess brought a selection of non-OEM parts to the meeting to show some significant differences between them and the OEM parts they were designed to replace. Most of the difference, he pointed out, were subtle, and were less often about the physical shape of the part than in their composition. (See Chess’ Hey Toby! column in this issue.)

CLICK for Western Feb 2010 Contents

Whittier attorney John David Munoz, 42, was arrested this morning at this residence on felony auto insurance fraud charges for allegedly fabricating facts surrounding the destruction of his vehicle.

In California Second Appellate District, a shop owner’s claims of unfair business practices on the part of two major insurance companies in their labor rate surveys, have been denied on appeal, upholding an earlier court decision.

The Automotive Service Association of Arizona (ASAAZ) was founded in 1963 to help automotive shop owners statewide through resources, training, legislation and representation, networking, communication efforts and more. The ASA of Arizona is affiliated with the Bedford-Texas-based national ASA, which is the largest not-for-profit trade association of its kind serving automotive service professionals.

With the help of a Phoenix TV station’s consumer crew, a Phoenix photographer, Mark Lane, has obtained a reduction on a $1,300 shop storage bill  accrued while the at-fault driver’s insurer, Infinity, waited to resolve the claim with the insured. The crash occured when the insured driver ran a red light. “Out of the corner of my eye, I saw a car in the number three lane blow right through the light,” Lane said.

California Attorney General “Jerry” Brown Jr. announced on Jan. 25 a $1.8 million settlement preventing Maurice Irving Glad, owner of 22 Midas auto shops throughout California, from owning or operating an auto repair shop in the state, after the franchisee “deceptively lured” customers with cheap brake specials and then charged hundreds of dollars for unnecessary repairs.

Arizona representatives Rep. Nancy McLain (R) and Rep. Laurin Hendrix, have introduced legislation in the state’s house that would amend the state’s laws to add a section specifically addressing auto glass businesses in an attempt to crack down on auto glass repair fraud on behalf of insurers.

An L.A. City Council decision to ban new auto-related business from opening in the area and force existing shops to come up to code has stoked debate about what exactly belongs in Cypress Park and adjacent Glassell Park.

CLICK HERE for LA Times Story

We never had DRP relationships and have heard horror stories about them. But some days it seems we need to become a DRP shop just in self-defense. How do you make the decision?

For years DRP vs. non-DRP was supposedly a dividing line between opposed schools of operating thought. But “Should we be a DRP shop?” was always more about owner temperament than a business decision. A political mood isn’t a strategy.
    Today, the useful question is “Is there an available business mix of adjusted claims and DRP relationships which would make my business stronger?”
    Getting the answer is hard work, but indispensable for a seriously competitive repairer. Dozens of operators who traditionally wouldn’t have dreamed of a DRP deal in the 90’s have quietly added one or two very carefully selected ones. They have also politely declined many more than they added, a decision requiring discipline found only in facts. An even larger number who always had many DRP’s have gradually “weeded out” half or more of them, leaving just a few that met their needs. For either of these sets of owners the question “Are you DRP or non-DRP” is unanswerable and meaningless.
    Every market is different, and every insurer. Even with the same insurer’s standardized DRP terms, interpretation and enforcement can vary greatly from region to region, sometimes justifiably, occasionally indefensibly. How many cars can you expect? Don’t bother to ask. They don’t know, and couldn’t guarantee it anyway.
    But it’s essential to ask four questions:
● Exactly what discounts and allowances do you require?
● Exactly what will you or won’t you pay for in the repair? (Go over a closed file)
● What additional paperwork and administrative processes are required?
● How exactly will my performance be measured, rewarded, corrected?

    Never argue with the answers. Just ask and make notes. Read the agreement from beginning to end, and make sure it matches. If it doesn’t you’re entitled to ask why. (Obviously, anyone who can’t or won’t provide specific answers has saved you further work on this “opportunity.”) Now run several recent typical adjusted claim repairs against the DRP profile and look at gross margin dilution. You could be in for a surprise. Remember, all that insurer’s adjusted repairs you’ve been doing will now come under the DRP terms. Also ask yourself if you will have to add indirect labor for the admin requirements.
    In the last analysis you have to believe that the impact on your processes and the margin dilution (above the line and below) produces enough absolute dollars of net additional income from each DRP repair to be clearly worth it.
     When you look at it critically in advance (or afterward in the light of real experience), if it doesn’t make it, it doesn’t make it. But if it looks good, give it your uncompromising support. Unless or until they change the rules arbitrarily (in which case you courteously resign), be the best repairer in their local network. You will get cars from their underperforming alliances.

We have a very skilled and intelligent Production Manager with one fault that drives me nuts. When he occasionally needs to be corrected on some minor issue he simply can’t say “Thanks, I’ll take care of it”.  No mater how routine, he makes it intensely personal, and turns it into an hour-long soap opera.  He loves to debate, and he’s very good at it.
You’ve got yourself a subclinical drama queen, a not-uncommon species these days. Assuming he’s worth keeping, otherwise, the cure called for here is changing the transaction from a conversation to a drive-by. Never correct him while either of you are sitting down, in an office or standing still. A corrective direction is not a chat.
    First, mentally rehearse the point into twenty words or less, e.g. “Dick, please don’t leave the keys in the gate any more”.     Then, while he’s right in the middle of things, get the needle in and out in less than two seconds, keeping your voice level, and keep moving right on out of sight.
    Avoid him for at least an hour, more if you can, and then make the next contact upbeat and on an entirely different subject.  If he still absolutely insists on re-opening the point you must, no matter what, never, never say a single word other than the exact same words you said before, even if you have to say it several times. At some point, he should break the habit. If he can’t, and he isn’t a blood relative, replace him. Your organization can’t afford him.

Here is a true story from my book, HEY LOOK! I FOUND THE LOOSE NUT, that might spark your interest.

A customer called [my auto electric shop] and said he just purchased a car from the police auction, but it had some sort of strange noise coming from the driver’s side electric seat. It seems every time he moved it there was a strange electrical sound. He thought there was something wrong with the seat motor.

He was coming to me, an auto electric technician, to get it fixed.

“Sure,” I said. “What kind of car is it?”

“It’s a Peugeot,” he answered.

I’m not much on Peugeots, but I told him I could take a quick look at it and see if I could do anything for him.

There is the way “it should be” and then there is “the way it is.” Deal with the way it is and forget the way it should be. “It should be” will never benefit you; you will become bitter and cynical and could become distracted from the problems at hand.
    We have all watched changes in the economy over the last year and we have been forced to readjust our approach to our businesses. We wonder what we can possibly do to return things to the way they were two years ago. We may think things would be different if we had done things differently but the reality is, we have what we have, and looking back only hinders your progress.
    I remember during the last recession and I beat myself up pretty bad about expanding and opening up a second location only to be met with the worst recession of my working life. I thought I had made a poor decision to purchase a building and open a second location only to find myself in a financial crisis. After three years of beating myself up I finally realized that every decision I made was a “good one,” based on the information I had at the time. I quit beating myself up and began to make decisions once again with the information I had at the time; I had to close one shop so I could sustain the other.
    I quit waiting for things to return to the way they used to be and began to deal with the problems at hand, I closed my second location and immediately things began to get better. Emotionally I felt much better because I was doing something that I needed to do but kept putting off. I can compare this to meeting the school yard bully instead of dodging him by taking a different way home. Sometimes it’s better just to meet the bully face to face and take your licks and get it over with. Confronting a difficult decision and getting it over with is much better than dodging the problem and feeling the pressure in knowing that sooner or later a day of reckoning is coming.
    No one has all of the answers and hindsight is always 20/20 so when you make any business decision make it based on the information you have at the time and then get on with it. So many times we know what we must do but fail to do it for a number of reasons, this is not a time for indecision but a time for action. Create a new business plan for 2010 that is well thought out based on what is going on right now, not on what you think or wish was going on. If you need to adjust your payroll don’t put it off, I was so sold on “going lean” that I failed to put my body men back on commission as soon as I should have. When I finally decided to make the change, production immediately got better, and my techs started to produce 25% more work that cost less and we didn’t lose a single tech.
    When we decided to go “lean” we put everyone on a salary so we could create a team atmosphere but as things slowed down I had no way to adjust payroll so I just kept waiting to get busy again instead of doing what needed to be done. These decisions are not easy but they are necessary if you want to remain a profitable company. I’m not heartless, but I didn’t create this economy, nor do I have any control over its recovery, so I must make decisions based on the information available to me today.
    “Fantasy” would be to think that there are no ups or downs in business but the “reality” is that in business there are many ups and downs and how you deal with them and learn from them will define you as a businessman. Fantasy would be to think that in business you get to work less and make more money but we all know the reality of that, we usually work harder and make less and when we finally get to the point that we really do make more money there is always someone there trying to take it from us.
    After the last recession I learned that so many things were out of my control and there is really no one to blame, so with this recession I would like to think I am a little better prepared both emotionally and financially. Did I learn from my mistakes? Sure I did, but I still made a bunch of poor decisions just prior to the recession because I made decisions based on the information I had at the time. I expanded at the worst possible time, I made investments in real estate, I quit over 3 million dollars a year in DRP contracts, so yes I made some bad decisions, but at the time they were the right things to do.
    I don’t know what the future holds but I do know that today things are good and I’m glad to be in business, and if I have learned anything in the last 30 years of business it is to take life one day at a time and to enjoy the good days because they will be few.

A shop in my area recently experienced an attack by a competitor. One of the competitor’s reps was trying to get one of the shop’s dealership “authorized collision repair” status. At the same time they tried to hire away one of his best technicians, and some nasty “black P.R.” was employed to hurt his reputation with local insurance agents. He tried to fight back. An old military maxim says, “the best defense is a good offense,” but this shop owner felt he lacked the personnel and resources to really mount a good offense against this larger, multi-shop competitor.
    By the time this shop owner realized he was under attack, it was almost too late to do anything about it. He should have been maintaining a competition conscious posture in his area. A business can’t afford to operate as though they exist in a vacuum. It can be fatal to ignore the activities of one’s competitors. An on-going marketing strategy should be in place to evaluate competitor’s strengths and weaknesses and to capitalize on any perceived “hole” in their approach to getting new business.
    Keeping a simple file on each major competitor, enumerating which of the ten major business sources each one focuses on, is a start. For example, the shop owner should have known that his aggressive competitor had lost one authorized dealership position when that dealer went out of business. This should have raised an “alert flag” to strengthen and sweeten his own dealership position, knowing his competitor’s predatory nature.
    Another competitor nearby picked up a major DRP relationship lost by a shop that changed hands. Not keeping track of other shop’s marketing efforts probably cost him any opportunity to compete for that DRP status. In his defense, tracking one’s competitor’s activities can be time-consuming for one competitor, let alone dozens of competitors. The best sources of shop gossip and private information are the vendors, adjusters, jobbers, delivery guys, and various sublet service people. Taking a little time to ask key questions of a few of these people who jump from shop to shop could alert a shop owner to possible opportunities (or consequences).
    While it’s extremely valuable to get a heads up on a pending business threat, it may be even more valuable to spot the hole in one’s competitor’s marketing arsenal. I’ve spoken to many shop owners who avoid commercial vehicle accounts. They say they always have to discount prices and going after that kind of business is too time-consuming. They’d rather have jobs sent to them by dealerships or DRPs. If this is a hole in most of a shop’s competitor’s business mix, it could be an excellent opportunity to fill the need.
    This tendency to sit and have jobs sent to a shop may allow one to get the jump on the competition and seize the direct marketing business falling through those competitor’s holes. Many shops are not willing to expend the time and effort to distribute direct literature or write business-card size estimates on vehicles in parking lots and local streets. This is an easy hole to fill.
    When one’s competitors are enjoying sufficient DRP or dealership business to avoid harder marketing targets, this may also open up an opportunity to go after fleet work. Getting local government fleets, a GSA account, or national fleet services like C.E.I. and Fleet Response can take a lot of time and effort. Governments require endless paperwork and getting the attention of many fleet services can also be very time-consuming, but ultimately very profitable.
    While these more difficult targets are often “holes” in a shop’s competitor’s marketing mix, the juicier finds like DRPs and dealerships may show up as available targets. Creating a list of the DRP relationships at one’s dozen or so main competitors shouldn’t be that difficult. Most shops list their DRP relationships in their literature. Going over those lists should show at a glance that those DRPs are unlikely to add another shop locally. But these days there are dozens of insurance companies with one form of direct repair or another. If there are companies not represented in your area, this may be a hole you should find it relatively easy to fill. Who would have thought your competitors could be so valuable in helping you expand your marketing efforts?

The New Year is well under way and by now most of us have probably forgotten our New Year’s resolutions—that is, if we even bothered to write any. Those of us who did write some probably tapped our mental list of those things about ourselves, our businesses, our relationships and our finances that we would like to improve. It’s also likely that our list of resolutions was incomplete. There were probably many more things that needed improvement that we simply didn’t notice.
    After a while we become so accustomed to that spot or tear on the sofa that we don’t notice it anymore. Perhaps we’ve had that old poster on the wall so long that we haven’t noticed that it’s hopelessly out of date and no longer a complementary decoration for our waiting area. Once we begin looking at some aspects of our shop from someone else’s point of view, we may realize that some additional resolutions to change things for the better should have been on that list.
    Since more than half of our customers these days may be women, that could be a useful point of view to start with. Most of the men I know only occasionally buy new clothes or pay much attention to what other men are wearing. Women, on the other hand, are generally very aware of what other women are wearing and often ask where someone bought that purse or shoes or jacket. They have a keen eye for appearance and for detail. If clothing retail merchants had to depend on men’s shopping habits, few would have survived this recession. Shops with tasteful uniforms for employees will have a definite advantage with the clothing-conscious ladies.