Caliber Acquires Hanley Brothers Auto Specialists Locations
Caliber Collision Centers announced Oct. 28 that it has acquired four Hanley Brothers Auto Specialists locations in the greater Houston market. Caliber’s four shop acquisition represents more than 100,000 square feet of collision repair facilities at 1517 Silber Road, Houston, TX, 6409 Richmond Ave, Houston, TX, 5015 Addicks Satsuma, Houston, TX and 25636 Aldine Westfield, Spring, TX.
“Caliber’s acquisition of Hanley Brothers Auto Specialists locations expands our penetration and operational synergies in the Houston market,” said Steve Grimshaw, Caliber Collision Centers’ Chief Executive Officer. “Over the course of our discussions with Ken Hanley and his team, it became very apparent that their culture is a perfect fit with Caliber’s customer centric approach toward restoring our customers to the rhythm of their lives.”
“We are proud that Hanley Brothers is now a part of the nation’s leading collision repair provider,” said Ken Hanley, CEO of Hanley Brothers Auto Specialists. “This partnership will allow the company to continue expanding across the Houston market, while providing Hanley Brothers’ customers with the same high standards of quality repair and personal service they’ve come to expect. And our partnership with Caliber provides Hanley Brothers’ staff and their families’ new career opportunities and a secure future in the collision repair industry.”
“Our Hanley Brothers Auto Specialists acquisition increases the total number of Caliber Houston locations to 12 and total locations to 148 as we continue to execute on our mission of becoming the collision repair provider of choice in every community we serve,” added Mark Sanders, Chief Operating Officer for Caliber Collision Centers.
The Indiana Auto Body Association (IABA) has organized a petition to stop insurer-mandated parts procurement programs and is urging collision repairers to sign it.
The petition can be read and signed HERE.
In an email blast sent Oct. 24, 2013, the IABA wrote:
To make change happen requires action, but it often begins by the smallest of actions.
History has shown that changes begin not by the war to end all wars but by the individual battles that define the injustice and dedication to the need for that change by those willing to accept the challenge.
Today, the industry is faced with one of its greatest challenges that many feel is so important that it will require all the efforts of our trade associations and their members, as well as everyone else within our industry.
The industry news is filled with State Farm’s PartsTrader commentaries, but even though in itself it is a fundamental infringement upon our industry, the issue is also greater than just this one program.
This issue is about programs that insurers are now mandating that change our well-established business relationships, place vehicle owners in jeopardy and interfere with the free market system.
It is also about the aggressive pressure property casualty companies are placing on repairers for their monetary gain, placing the vehicle owners at risk and tortiously interfering with collision repairers’ business.
Take the time to sign our petition to the state and federal attorneys general, legislators and the Federal Trade Commission. We will utilize this show of support to do whatever it takes to take back control of our industry.
The IABA then asks repairers to click a button that reads, "Stop Extortion," to go to the petition.
To contact the IABA go to http://www.iaba.info
The Society of Collision Repair Specialists (SCRS) has included several tracks in its Repairer Driven Education (RDE) series at the SEMA Show that will address the consolidation trend in the industry.
"SCRS is continually looking at ways that we can help collision repair business owners succeed in the marketplace, and we realize that what defines success varies for the wide array of repairers operating in today's shifting landscape," said SCRS Chairman Ron Reichen. "We suspect that the private equity entering our industry is going to continue to fund acquisitions, and that means independent collision businesses are likely to be interested in one of two models for success: they will either position themselves to compete against consolidation or position the business to sell for the highest value."
To address the latter, SCRS has put together several sessions, including a panel of well-known industry veterans who made headlines of their own during the sale of their previous businesses. The panel, "If I Knew Then What I Know Now – Lessons Learned Selling My Body Shop," will be held from 3 to 5 p.m. on Thursday, Nov. 7. Panelists will discuss things they learned in the process that can help attendees interested in proceeding down a similar path best prepare themselves. Subject matter experts include:
• Aaron Clark, former owner of Collision Solutions, sold to ABRA Auto Body & Glass
• Pat O'Neill, former owner of 911 Collision Centers, sold to Caliber Collision Centers
• Dan Bailey, former owner of A&B CARSTAR, sold to CARSTAR Franchise Systems
• Mike Anderson, former owner of Wagonwork Collision Centers, sold to Pohanka Collision Centers
"There is a great deal of combined knowledge among these experts, who will be offering first-hand insight into how to navigate the process of valuing and selling your business," said SCRS Executive Director Aaron Schulenburg. "That said, it is very important to point out that we have a great deal of optimism that independent collision repair owners can thrive in today's marketplace as well, and have also defined specific programs that address solutions for them."
Perhaps none of the programs address these solutions more specifically than Wednesday afternoon's session entitled, "Competing in a Consolidated Marketplace." This session will be led by Tim Ronak of AkzoNobel and will take place from 3 to 5 p.m.
Ronak will discuss the most current consolidation information available as of November 2013 and suggest the path consolidation may take and the impact it might have on the industry at large. He will compare collision consolidation to other industries to identify strategies that were successful within those industries when consolidation reshaped their business model. Participants will have better understanding on how to navigate in this environment and insight into survival strategies for their business.
On Friday from 12:30 to 2:30 p.m., Scott Biggs of the Assured Performance Network will host an in-depth session entitled, "Creating a Parallel Universe: Reinventing the Collision Repair Industry." This discussion will allow industry members to better understand profit, prosperity and business survival in the decades ahead, taking a futuristic look at the industry and the trends that are shaping it right now. Attendees will see alternative versions of the future based upon the plans and agendas of insurers, MSOs and OEMs.
The 2013 RDE series is sponsored by industry organizations such as SEMA, PPG Automotive Refinish, GM Genuine Parts, BASF Refinish, Ford Motor Company, AkzoNobel, Hertz, Axalta Coating Systems, Goliath Carts, PBES (a division of AAIA), LKQ Corp., SATA, Spanesi Americas, Sherwin-Williams and AASP.
The Automotive Aftermarket Products Expo (AAPEX) 2013 Learning Forum will offer several sessions on successful sales and marketing approaches that are evolutionary and revolutionary to help buyers grow their business. AAPEX is set for Tuesday, Nov. 5 through Thursday, Nov. 7, at the Sands Expo Center, Las Vegas, Nev.
AAPEX Learning Forum sessions with a focus on evolutionary techniques will cover turning phone shoppers into buyers, how to build brand strength, tactical team planning and selling to increase a team’s selling success. Revolutionary techniques will focus on marketing and selling to millennial consumers, the latest in sales and marketing technology, mobile marketing and taking advantage of the import parts explosion.
The following marketing, sales and branding sessions will be presented by professional speakers and industry experts:
• Brand Supremacy: Building Brand Strength in the Automotive Aftermarket
• Marketing and Selling to Millennial Consumers
• Import Parts Explosion: Are You Taking Your Share?
• SWAT Team Selling: Leading Your Team to a Competitive Advantage
• Implementing Account Planning to Increase Your Team's Selling Success
• Sales and Marketing Trends: The Latest Technology That Will Increase Your Cash Flow
• The Three Quickest Ways to Grow Your Bottom Line with Mobile Marketing
• Handling the Phone Shopper: Turning Phone Shoppers Into Customers
This year’s Learning Forum will feature nearly 40 free sessions, the highest number ever offered at AAPEX. Sessions will begin on Monday, Nov. 4 – the day before the official start of AAPEX – and continue through Nov. 7. Attendees are encouraged to make their travel plans accordingly.
All sessions are accredited by the University of the Aftermarket toward the Automotive Aftermarket Professional (AAP) and Master Automotive Aftermarket Professional (MAAP) professional designations. Sessions will be held at the Venetian Hotel, on the Venetian/Palazzo Congress Center Level 1, Marco Polo Rooms 701-707. Since the sessions are free-of-charge, seating is first come, first served.
For a list of topics, speakers, session descriptions and a schedule, visit the AAPEX Learning Forum, www.aapexshow.com/education.
SEMA is supporting legislation (S. 344) introduced in the U.S. Senate to ban the sale of gasoline containing 15% ethanol. The bill would overturn actions taken by the U.S. Environmental Protection Agency (EPA) two years ago to permit ethanol levels to rise from 10% (E10) to 15% (E15). The agency is only requiring a gas pump warning label to alert motorists that E15 could potentially cause equipment failure for vehicles older than model-year 2001.
“This legislation is necessary to protect auto enthusiasts by preventing damage to older vehicles and high-performance specialty components,” said SEMA Vice President of Government Affairs Steve McDonald. “SEMA applauds Senators Roger Wicker (R-MS) and David Vitter (R-LA) for their efforts to correct by statute a flawed decision by the EPA. Unless enacted into law, E15 may soon appear at a gas station near you.”
Ethanol increases water formation that can then create formic acid and corrode metals, plastics and rubber. Older cars and certain high-performance specialty parts are not constructed with corrosion-resistant materials or able to tolerate the higher temperatures at which E15 may burn. Auto enthusiasts have complained for years about damage caused by E10, which is now in more than 90% of gas sold in the United States E15 would increase that risk by 50%. For classic cars that are infrequently driven, corrosion could eventually damage the engine, fuel line, fuel tank and exhaust systems.
SEMA represents thousands of companies that market products for these vehicles and, through its SEMA Action Network (SAN), millions of enthusiasts who buy and operate these automobiles.
BMW has asked the U.S. Northern California District Court to strike the proposed state class action status of a lawsuit filed against the company by two BMW owners who claim that drainage tubes installed to pull water away from vehicles’ sunroofs do not properly work, leading to water damage.
Plaintiffs’ attorneys claim the class should include California residents who have “owned or leased any BMW X5 series vehicles, X3 series vehicles and 5 series vehicles.”
In response, BMW’s attorneys claim in court documents, “First, the purported class is not ascertainable because it includes many persons who have no claims against BMW North America. … Those putative class members whose cars have never manifested the alleged defect, those whose sunroofs leaked for reasons other than the alleged defect and those whose cars are covered under warranty—and thus eligible for repair at no cost to them—cannot claim they suffered any cognizable injury and therefore lack standing.”
The attorneys also claim, “The class includes many vehicles purchased more than ten years ago, meaning that the transactions at issue are well outside the statutes of limitation of, for example, plaintiffs’ CLRA (three year), UCL (four year) and breach of express warranty (four year). At a minimum, persons whose claims are outside the statutes of limitation should be excluded from any proposed class.”
BMW’s attorneys also point out that it is difficult to identify owners who have “experienced water damage because of the alleged defect, rather than other reasons—including lack of maintenance, accident damage or even leaving the sunroof or trunk open before a rain storm.”
Citing the certified pre-owned BMW warranty, attorneys claim that the automaker “cannot be held liable for ‘failing to company with the warranty’ or ‘refusing to repair’ if putative class members did not comply with their own obligations under the warranty or if the warranty does not provide coverage for the damage claimed. Determining whether such compliance exists will require individualized inquiries precluding class certification as a matter of law.”
BMW’s attorneys conclude by claiming, “Plaintiffs cannot represent the putative class specified in their complaint because the class is simply too board and faces overwhelming individualized inquiries and because plaintiffs cannot satisfy basic typicality requirements. These deficiencies are plain, even at the pleading stage. For the foregoing reasons, the class allegations therein should be stricken.”
Attorneys for plaintiffs’ Monita Sharma and Erica Anderson claim “BMW designed, manufactured, distributed, sold and leased various makes and models of BMW vehicles that contain a serious design defect that significantly impacts both the safety and value of its vehicles. Specifically, numerous models of BMW vehicles manufactured during the class period were designed so that certain vital electrical components known as SDARS, RDC, and PDC modules, are located in the lowest part of the vehicles’ trunk. … Because BMW decided to place these vital electrical components in what is essentially the lowest part of the vehicle (the spare tire well under the trunk), they are especially prone to water damage that can be caused through the normal and ordinary use of the vehicle.
“When this water damage occurs, the vehicles become inoperable and pose a serious safety risk to those who experience this problem. Although these components are highly susceptible to water damage, BMW provides no warnings or advisories to BMW owners about the location of this vital equipment or the importance of keeping the vehicle’s trunk compartment free of liquids,” they continue.
The attorneys point out that drainage tubes are installed to pull water away from the sunroof.
“Unfortunately, these sunroof drains were designed in such a way that they are prone to become clogged with dirt, debris, leaves, and other naturally-occurring materials. When these tubes become clogged, they come loose or leak into the trunks of the vehicles. These leaks, which eventually flood the trunks of the vehicles, cause the vital electronic components contained at the bottom of the vehicles’ trunks to short-shutting off certain components of the automobile necessary for driving and creating a potential safety risk,” the attorneys allege.
BMW had asked the court earlier to dismiss the lawsuit by Sharma and Anderson.
The court had not issued any decision at press time.
To no one’s surprise, the 2013 NACE exhibition was a downsized event from previous years, but the Las Vegas-venue may have been the most appropriate launching pad for what is expected to be a revitalized NACE event in Detroit next summer.
Attendance has been down for the past three years, with a slight uptick for the 2011 show in Orlando, FL. This year’s event saw another attendance dip, which ASA Executive Director Dan Risley says was expected.
There were significant successes at the 2013 show such as a popular keynote by industry veteran Mike Anderson and the MSO Symposium which has been growing in attendance.
Mike Anderson kicked off the 2013 NACE Expo with a keynote speech entitled “The Future Is Not Set in Stone” at the Opening General Session/Collision Industry Forum.
Anderson’s familiar audience engagement techniques were on display as he employed humor, moving personal annecdotes, and even his Tourette’s syndrome ticks, as models and metaphors for perseverance, unity and action in the industry.
“We get caught up in how much things cost, in Parts Trader, in cycle time, and we forget that what matters is how we fix the car,” Anderson said. “When the industry gets a black eye, it affects every single person [in it].”
“With insurers, they try to come in our industry and do things to us and not with us,” he said, citing his experience living briefly in Hawaii where he was counseled about developing a more collobarative style while teaching.
At the conclusion of his talk Anderson was honored with the 2013 Joe Jackson Industry Champion Award, presented by Axalta Coating Systems, which recognizes collision repairers exhibiting outstanding leadership, charity or humanitarian works.
Getting local shops involved tends to pose the biggest challenge for most collision repair associations, and this is currently the focus for the Tennessee Collision Repairers Association (TCRA). As TCRA strives to increase their membership, Executive Director Tony Nethery shared some insight into the association and their objectives.
TCRA was established in 2006 when three collision repair shop owners met for lunch and the conversation turned to “the struggles of going it alone in the collision industry,” according to Nethery. This casual conversation sparked an idea and a goal, leading to the first TCRA meeting about a month later which was held at a restaurant in Jackson, TN. One of the founders volunteered to serve as chair until a board could be formed and an official charter completed.
Though 50 people attended TCRA’s first meeting, “the crowd dwindled to about half of that when it was made clear that TCRA was being formed to increase knowledge and work together, not to do battle with insurers,” Nethery explains. Still, enough interest was generated to allow TCRA to form a second chapter in Nashville the following year. Currently, the Jackson chapter of TCRA focuses on the western part of the state, while their Nashville chapter services central TN; however, since TN is over 400 miles long, they hope to establish an eastern chapter in the near future.
In July 2013, Michael Bradshaw, VP of Operations at K&M Collision in Hickory, NC, was victorious in his court-ordered arbitration against Nationwide for a short-pay lawsuit filed on behalf of a body shop customer. The underpayments were determined to be reasonable and necessary repair costs, but the problem continues as Bradshaw notes that this issue is quite common with several specific insurers, including Nationwide and GEICO.
Currently, Bradshaw is pursuing six short-pay cases against Nationwide, three against GEICO, and one against All-State. Still, his pursuit of full payment has not impacted these insurers’ practices. Bradshaw notes, “they come out and refuse to pay for the same things they just lost. Their attitude is ‘sue us again,’ and I do.”
On a positive note, Bradshaw says that some other insurers who are aware of his short-pay cases have "chosen to do the right thing and pay the full repair bill because they know they'll get tied up in the same litigation if they don't."
In Bradshaw's July victory against Nationwide, the insurer’s short-pays included: labor rates ($48 Body & Refinish, $80 Mechanical and $65 Frame), procedures (i.e. sand and buff, final detail, road test, color tint and collision access time), invoiced paint & materials, sublet markup, fixture usage and a $250 Damage Analysis fee which included a comprehensive part by part inspection of all components including: exterior panels, inner structure, mechanical components and SRS and seat belt systems. The award also included storage charges at a rate of $50 per day for the total amount of $2,506.98 plus accrued interest until the insurer’s full payment is made.