NORTHEAST NEWS (90)
New York, New Jersey, Pennsylvania, and Delaware
Autobody News Northeast print edition is mailed to 8,000+ body shops monthly
NJ Shop Questions State Farm’s Denial of Cost Accounting Based Paint Allowances
Written by staffIn a letter to State Farm CEO Edward Rust Jr., Don Harvey, of International Collision Service in Englewood, NJ, questions why State Farm does not acknowledge cost accounting programs and practices in setting paint allowance rates. Harvey has previously contacted senior State Farm management to no avail. His letter follows:
Feb 15, 2012
State Farm Insurance Co.
Mr. Edward B. Rust Jr.
One State Farm Plaza
Bloomington, IL 61710
Dear Mr. Rust,
Please take a moment to look at an issue regarding customer satisfaction and a “Good Neighbor” responsible commitment to proper repairs.
Paint material has been an issue often questioned and not properly acknowledged.
Several years ago the Department [of Banking and] Insurance Commissioner Steven M. Goldman issued a Bulletin #07-20 (copy enclosed for your review CLICK HERE encouraging insurers to utilize paint cost accounting software programs and manuals. Just after the issuance of this bulletin, State Farm (Northern NJ) changed their paint calculation from a multiplier of $23.00 per paint hour to $28.00 per paint hour. That was November 2007. Since that time, as we all know, all oil-derived product prices have dramatically increased, however State Farm has not acknowledged (NJ office: Mr. Charlie Holmes) any legitimate paint cost programs or software, holding [instead] to their antiquated $28.00 per hour calculation with no deviation.
Automotive paints used on today’s advanced vehicles require many different tints to achieve the look and appearance duplicating the original finish. Therefore all pricing cannot be properly and FAIRLY determined by one multiplier, this is why the paint cost accounting software programs are so important: FAIRLY compensating the repairer for materials used on the specific vehicle (color) being repaired.
Mr. Holmes has repeatedly stated that State Farm holds true to their survey studies. What is interesting about that is twofold:
1) State Farm (northern NJ) hasn’t sent anyone out to survey the shops in many, many years, leaving it to the shops to call State Farm and get an authorization # before being able to even get to the survey.
2) I find it interesting that if State Farm only uses their survey to change rates and materials, why after a short time and no apparent survey, did the multiplier change in late 2007 after the Bulletin issued by the State of New Jersey, from $23.00 per hour to the current rate of $28.00 per hour?
Most insurance companies are acknowledging the cost accounting software programs plus a mark-up as the programs use an average COST to the repair from the suppliers.
In closing I hope that you will review this letter and change the way State Farm, NJ, is conducting business and [have] The Good Neighbor do the right thing, properly and fairly returning vehicles to pre-accident condition.
Respectfully,
Don W. Harvey
International Collision Service
Englewood, NJ, 07631
(Copy of Mitchell Refinishing Calculator Notes enclosed for your review CLICK HERE)
If you have any relevant information submit it to Don Harvey at
This e-mail address is being protected from spambots. You need JavaScript enabled to view it
, or write:
Don W. Harvey
international collision service
328 South Van Brunt St.
Englewood, NJ 07631
Phone: 201.567.2124
Fax: 201.567.6644
New York State Auto Collision Technicians Association (NYSACTA) Releases Statement Regarding Aftermarket Parts Usage
Written by StaffThe New York State Auto Collision Technicians Association, (NYSACTA) announced February 2 it is alerting its members and the general public to the potential safety risks with the use of aftermarket crash parts, and is calling on all insurers in NY who specify the use of un-tested, unqualified, NON-OEM compliant crash parts to take corrective action immediately.
NYSACTA President, Mike Orso said, “I would think safety would be the most important element of any collision repair. Some insurers by their actions are putting their claimant or insured’s family in a vehicle that the [insurer] specified a repair with untested, at risk parts to save money. No one should be re-engineering a car after a wreck as it puts the consumer in damage as well as all highway users at risk. It creates un-due legal liability on the repair shop.” Orso went on to say, “the rules are: Repair or Replace the vehicle after a crash. Meaning; return the vehicle to pre-loss condition. One issue here is that; there is no recall system in place to warn consumers that their vehicle may be unsafe to drive or that their families safety is in unknown, unpredictable peril should a repaired car be involved in a another crash. Consumers should call their repair shop or check their collision invoice to identify what parts that may have been installed that are aftermarket. NY State Law requires shops to note the status of parts used in the repair, i.e. New, OEM, Used, Aftermarket, Reconditioned or Repaired.”
AASP/NJ’s First NORTHEAST™ Exhibitor Boot Camp A Success
Written by StaffIn preparation for the AASP/NJ's 35th annual NORTHEAST Automotive Services show, the Alliance of Automotive Service Providers of New Jersey (AASP/NJ) held their first-ever NORTHEAST exhibitor boot camp on January 12. The AASP/NJ hoped that this would help exhibitors be more successful at this year's show. The three-hour seminar was held by Susan Friedmann, the "Trade Show Coach." Friedmann is an author and expert in training exhibitors on how to improve and get the most out of their trade show experiences.
“We really didn’t know what to expect when we first found Susan,” said AASP/NJ President Jeff McDowell. “Her qualifications were outstanding so we didn’t doubt what she would bring to the table. We just weren’t sure how our exhibitors would respond.”
The AASP/NJ took surveys following the seminar; the outcome of these surveys encouraged them to continue to hold the bootcamp annually.
“Boot Camp was very informative,” one attendee replied. “It had lots of good information and addressed a lot of mistakes that everyone takes for granted.” Another added, “It covered all aspects of booth presentation at the show. Very comprehensive and well paced. I would recommend this boot camp to colleagues if they want to benefit their company as part of any trade show.”
NORTHEAST™ 2012 takes place March 9, 10 and 11, 2012 at the Meadowlands Exposition Center of Secaucus, NJ. For more information on the show and AASP/NJ, please visit www.aaspnjnortheast.com.
N.J. Dept of Banking and Insurance Commissioner Considine Leaves Post
Written by StaffBanking and Insurance Department Commissioner Tom Considine left his post effective Feb. 10, New Jersey Gov. Chris Christie announced on January 30.
Considine plans to return to work in the private sector, according to Insurance Journal. He will become the new chief operating officer of MagnaCare in March, after leaving the NJ Banking and Insurance Department. MagnaCare is a health plan management company. At a news conference in Trenton, NJ, Gov. Christie also nominated Ken Kobylowski to succeed Commissioner Considine. Kobylowski has served as chief of staff to Considine since 2010, and acting director of banking since last October.
Considine served as a vice president with MetLife legal affairs for 17 years prior to serving as NJ commissioner. Considine also previously served as a litigation associate at Connell, Foley and Geiser, a New Jersey law firm.
Dealers’ success this year seems to be spurring economic recovery along, at least in the Empire State. According to the Greater New York Automobile Dealers Association, franchised dealers in the New York metro area sold 403,000 new and used cars.
And as a result, their businesses injected $24.9 billion into the economy, while also providing nearly 56,000 Americans with jobs. Not a surprising number, when the study also showed that the average dealership employs 79 people.
These very same dealers also generated $1.71 billion in tax revenue to state and local governments last year
Commenting on these numbers, Mark Schienberg, president of GNYADA, said, “Our area’s auto dealers are an enormously important part of the local and state economy because of the revenue they generate and the jobs they produce.
“Directly and indirectly, greater New York’s franchised auto dealers provide nearly 56,000 jobs to area residents and are a key part of the region’s economic growth and development,” he added.
Moreover, the average dealership paid more than $4.1 million in payroll expenses. Besides providing jobs and selling cars, dealerships also pump money into the economy through advertising.
“An average dealer employs 79 people of which more than a third are in high paying jobs in the service department. Dealers also purchase more advertising than any other sector, providing a lifeline to many local broadcast, print and online media companies. Last year, area dealership advertising totaled $385 million,” said Schienberg.
The local economy also received another $253.6 million during the New York International Automobile Show. And nearly $24 million of this pot was formed by city-wide special events and public relations activities by OEMs, the organization noted.
“It {the report} includes a review of direct and indirect employment, personal income, tax collections generated by area automobile dealers and a review of dealership financial statistics and operations,” they continued.
Headquartered in Whitestone, N.Y., the GNYADA represents nearly 600 franchised automobile dealerships in the metro area of New York.
New 10,000-sq-ft Hovis Tech Training Center Opens in Mercer, PA
Written by StaffFederated member Hovis Auto & Truck Supply has opened its new Hovis Technical Training Center located at 1000 Champion Drive, Mercer, PA.
The 10,000 square-foot hands-on training facility is equipped with the most advanced tools and equipment and is dedicated to instructing professional service technicians about time-saving and problem-solving techniques. The center offers a fully equipped body shop with mixing rooms, prep deck and oversized paint booth, a 14-foot overhead door for heavy duty truck access as well as four-post and two-post lifts, a wirelessalignment machine, tire changer, balancer and diagnostic labs.
“The Hovis Technical Training Center is committed to educating automotive, paint and heavy duty truck technicians in a state-of-the-art facility, close to home, reducing shop downtime and travel expenses,” says Curt Hovis, vice president of Hovis Auto & Truck Supply. “We recognize the critical need to provide technicians with comprehensive instruction, technical materials and educational programs, and we understand they don’t want to travel across the country to get it. That is why we are bringing leaders in the industry to western Pennsylvania.”
High School Automotive Repair Program in Wayne, NJ, Wins $10,000 in Equipment and Cash With Video
Written by StaffThe inter-high school automotive repair course for Wayne Hills and Wayne Valley High Schools in Wayne, NJ, won $10,000 in cash and supplies in the Why My High School Auto Shop Needs a Make-Over national contest at the end of January.
Students in the course created, edited and entered a video for the contest. Students from both high schools are enrolled in the course, the only one of its kind in the district where students from one school travel to another to attend class.
The video received 2,483 votes on Facebook, good for second place and only 118 votes more than the third-place winner.
The first-place school received 3,320 votes. More than 100 videos from schools across the country were submitted. Eight were named finalists.
The Universal Technical Institute Foundation (UTI), a non-profit organization dedicated to raising funds to support technical education in the transportation industry, sponsored the contest.
The schools' program will receive $5,000 worth of products from Snap-On, a manufactured of automotive repair tools and equipment, vouches for tires from Bridgestone and Firestone, and cash as their second-place winnings.
Superior Court of New Jersey Rules in Favor of Allstate New Jersey in Agency Franchise Lawsuits
Written by StaffThe Allstate Corporation announced January 6 that the Superior Court of New Jersey has entered judgment in favor of Allstate New Jersey Insurance Company, a wholly owned subsidiary of Allstate Insurance Company, and dismissed all claims in the franchise lawsuits filed against Allstate New Jersey.
Last year, three exclusive agents filed lawsuits seeking to prevent the termination of their agency agreements for failing to meet certain business objectives. They alleged they had franchise relationships with Allstate New Jersey and were protected under the New Jersey Franchise Practices Act. The plaintiffs' application to stop their termination was denied.
The court determined that the agents were not franchisees and have no protections under the New Jersey Franchise Practices Act. The court noted in its decision that the "insurance industry has never been found by any court in New Jersey, or elsewhere, to be home to an insurance company franchisor, or agent franchisee."
Allstate has maintained that exclusive agents are independent contractor agents and not franchisees. The court decision affirms the company's position.
Please visit www.allstate.com or call 1-800 Allstate® for more information.
Pennsylvania Congressman Proposes Repeal of $7,500 Electric Vehicle Rebate
Written by StaffCongressman Mike Kelly (R-PA) introduced into the House of Representatives on December 30 a bill aiming to do away with the $7,500 tax credit for electric vehicle car buyers, titled HR3768.
Kelly, who owns a Chevy Car Dealership in Butler, Penn., has served in the House representing the 3rd District of Pennsylvania since 2010.
The bill, formally titled: "To amend the Internal Revenue Code of 1986 to repeal the credit for plug-in electric drive vehicles", would amend the IRS code section related to the electric car purchase tax credit, to terminate the tax credit.
The $7,500 tax credit came into being in the Emergency Economic Stabilization Act of 2008 (EESA), whose main purpose was the bailout of the financial industry following the meltdown of Sept 2008. The credit was put in place by former President George W. Bush, and continued by President Barack Obama.
Kelly's personal experience as a dealership owner is suspected to have fueled his introduction of this bill. Kelly's dealership, which was founded by his father, was almost axed during the GM bankruptcy. When the Obama Administration Auto Task Force announced plans to shut down more than 1,900 dealerships, including Kelly's own dealership, his response was to fight the decision to close his dealership, in which he was successful.
Reports are that after avoiding shut-down Kelly's own car dealership took extra steps to shun the Chevy Volt, even going to far as to fire an employee who consented to GM's request that they bring in a Volt.
"I can stock a Chevy Cruze, which is about a $17,500 car and turns every 30 to 40 days out of inventory or I can have a Volt, which never turns and creates nothing for me on the lot except interest costs," said Kelly in October. "There is no market for this car."
Kelly echoes the main argument espoused by many anti-EV advocates—-that electric cars are simply toys for rich people. Kelly says that subsidizing the purchases of upper-income individuals is not the correct course of action to take during these difficult financial times. According to Kelly, the $7,500 credit goes to the "few who can actually afford to buy an electric car."
PA Dealership Founder Ronald Ertley Passes Away at 79, Leaving Legacy of Dealership Consolidation and Community Involvement
Written by StaffRon Ertley, founder of Ertley MotorWorld in Wilkes-Barre, PA, and operater of Ertley Dealership in Moosic, PA, passed away January 7 from cancer at 79.
Ertley, founder, owner and CEO of Ertley MotorWorld was remembered as an innovator in the automobile sales business by co-workers and friends at a service held January 12 at St. Stephen's Episcopal Church in Wilkes-Barre, according to the Scranton Times-Tribune.
After graduating from Duke University in North Carolina and receiving an honorable discharge from the Air Force, Ertley returned to eastern Pennsylvania to manage an Oldsmobile dealership with his father. Ertley grew to own the dealership after his father's retirement.
In 1991 Ertley became the first in the area to combine dealerships--founding Ertley MotorWorld in 1991 with the help of his friend and colleague, J. David Power of JD Power and Associates. Ertley MotorWorld was a powerhouse in the eastern Pennsylvania area and was considered the area's first auto mall with 12 dealerships in one location.
"Main thing I remember is his innovation and willingness to try whatever the latest and greatest technology and techniques were to move forward in the automotive industry," Rick Osick, who worked with Mr. Ertley at MotorWorld, told the Scranton Times-Tribune. "He was known as an innovator as far as technology and methods to move a retail business along."
Ertley eventually sold Ertley MotorWorld to investors, and it still exists today, as MotorWorld.
Ertley remained in the auto dealership industry, opening a Chrylser-Jeep-Dodge-Kia dealership in Moosic.
As a member of the board of the JD Power Superdealer Rountable, a director of the Pennsylvania Automobile Association, a commissioner on the state Board of Transportation and the president of several other automobile dealer boards, Ertley was very active in the Pennsylvania automotive industry.
McBride Auto Body in Woodland Park, NJ, Celebrates 75 Years in the Industry
Written by Joe Carioti III/StaffBack in October Autobody News interviewed Joseph Carioti III about his NJ shop, McBride Auto Body, which had suffered flood damage from Hurricane Irene. (See Autobody News November 2011 Edition) The business was able to recover from the flooding and is back on track, but there’s more to the story.
To view a PDF of this article please click HERE.
In 2012 McBride Auto Body will be celebrating its 75th year in the automotive collision repair and refinishing industry. McBride has been owned by one family, the Cariotis, throughout its long history of industry ups and downs, the family’s ups and downs, and just plain life’s ups and downs. They have survived and persevered through it all, watching many body-shops come and go with great sadness. The owners have always fought for the rights of the auto repair shops and for the rights of the insured when it was apparent that the laws were unjust.
Joseph W. Carioti Sr. moved from Calabria, Italy in 1910 as a young boy with his family to come to America to start a new and better life.After arriving in America his family settled in Paterson, NJ, where he attended school but never got past the 8th grade due to the hard times and his family needing his wages to survive. He took on odd jobs in masonry work while the country was in its growth period of building dams and tunnels up north in Wanaque Township, NJ. Then, one day in 1937, for no reason that he could ever articulate, Carioti Sr. purchased his first gas station with a two car garage attached and began the legacy of McBride Auto Body.
McBride began with humble beginings but not shortly afterwards in the early 40’s it was clear to Carioti Sr. that a larger facility was needed so he purchased a larger building two doors down from McBride’s present location. To the new structure he added another 4,000 square-feet and opened up the second location with apartments above in which his family lived, and two additional rental units attached. Carioti Sr. always believed that common sense was a person’s best investment in life, according to Joe Carioti III.
