Who would have ever believed that we would be watching the Government battle the financial disaster brought upon the world by a small number of amoral people with limitless greed, self absorption, and a boundless appetite for profit. The fate of our country unfolds while we battle on the homefront to keep life as we know it for ourselves and our families. It seems to me it is the time for us to all act like Americans and fight for what is right in our Homeland. If we don’t, who will?
With Executive Director Dan Risley’s departure from SCRS, one might assume that the organization is foundering. Nothing could be further from the truth! Under the chairmanship of Gary Wano, Jr., G.W. and Son Auto Body Shop, Oklahoma City, progress on critical industry issues is already being made.
Black Mountain Body Shop sits in the foothills of its namesake Black Mountain in Cave Creek, Arizona. In 1982 when this shop opened for business in a one-room building, the gold mines of Black Mountain had been closed for less than a decade.
Caliber Collision Centers may have been founded in 1997, but the concept and beginnings of Caliber started years before. Al Estorga, Jack Falluca, Randy Stabler, Dave March, Stepan Altounian and Eric Bickett were major players in the collision industry, involved in associations and active participants in the Collision Industry Conference, with two being CIC past Chairmen.
As they attended industry events and gazed into the crystal ball of the collision repair industry future, they saw a better way to do business. As a group, their talent and dedication covered all points of the industry. They would consolidate their efforts. They chose the name Caliber to represent high quality and professionalism with the logo representing the high quality refinish jobs that were to become a Caliber mainstay. The original founders of Caliber Collision may never have been able to predict the outcome of their dream.
"To love what you do and feel that it matters - how could anything be more fun!"
An Arizona group has announced plans to support legislation in that state to stop insurance companies from acquiring body shops.
On Friday, September 2, Doug Reed, Jr. locked the doors on his Chalmette, Louisiana business, Custom Body Shop, for what he could not have known would be the last time. Reed packed up his family and some personal belongings to evacuate New Orleans.
The best of times and the worst of times. It depends on who you talk to. History repeats itself and it continues to repeat itself in the collision repair business. In fact, the only thing that collision repairers can be assured of - is change. There is no crystal ball to see the future. The collision repair shops that will prevail into the future will have to be the best at what they do.
Organizers of the International Autobody Congress and Exposition (NACE) say that even just weeks before the 26th annual event in November they were concerned that, given the economy, attendance could be down as much as 20% from last year.
Owning a collision repair business shouldn’t just be a way to provide yourself with a job. It also should be an investment—with the “dividends” of a paycheck or other benefits as you go, but with the real pay-off at the end: When you “cash out” by selling the business, whether that’s to a family member, an industry consolidator, a trusted employee or other investor.
CCC Information Services continued to come under a barrage of criticism at the most recent Collision Industry Conference (CIC) for a change the company has made its Pathways estimating system.
In the last 12 months, approximately 21,500 collision repair technicians—about one in every 9 currently working in shops—left the trade. That doesn’t mean they left to go to work for another shop; that means they are no longer turning wrenches.
About 100 women representing collision repair shops, insurance companies and industry vendors gathered in Dallas, Texas, in mid-March for a 2-day Women’s Industry Network (WIN) conference that included presentations on topics ranging from conflict management to networking, employee recruiting and process improvement.
Having spent decades as a technician, claims adjuster, shop owner, I-CAR volunteer, jobber, industry trainer and consultant, Hank Nunn has a unique perspective on changes in shop management and measurement.
If there’s anything positive about an economic downturn like the country is experiencing right now, it could be that for the business owner, it certainly focuses the mind. Extraneous (even if valuable) activities often get set aside as such core fundamentals as getting work to the door take precedent.
With the election and economy first and foremost on many people’s minds this fall and winter, it’s almost hard to remember how many other topics and news items the industry talked about this past year: Changes in some insurer’s repair policies. Changes in some shops’ relationships with insurers. Changes in the leadership of some associations. Changes in gas prices and consumer driving patterns. Changes brought about by laws and lawsuits.
Here is an annual review of the past year’s news as viewed through a collection of some of the most memorable, important, interesting or enlightening quotes heard around the industry during 2008.
“We have heard how complex we have made it to do business with I-CAR. We have to go after that with a vengeance.”
– I-CAR CEO John Edelen, speaking at the organization’s annual meeting in July, about the training organization’s internal restructuring following several significant financial losses.
“I believe this isn’t going to be popular, but my opinion is that it is our business and I don’t think we should be dictated to as to how we should operate.”
– Michael Lloyd of California Casualty, when asked if an insurer’s decisions about which shops are selected or removed from its DRP in any market should be made by a “board of independent individuals that cannot have a close enough relationship with a shop to gain any …gratuity.”
“They’re not opening their arms and saying welcome to the fold. It still takes some effort.”
– Bruce Halcro, a shop owner in Helena, Montana, and president of the Montana Collision Repair Specialists, saying insurers are, if only reluctantly, abiding by a 3-year-old law that the association backed which requires any shop meeting the requirements of a direct repair program to be allowed to participate.
“We’re going to see the current model for quite a while. Entrepreneurs owning one, two, three, six or eight shops will continue to dominate this business. Multi-state, 100-shop networks? Hard to do.”
– Brian Sullivan, editor of the weekly “Auto Insurance Report,” saying he no longer believes as he did a decade ago that the collision repair industry
– Crystal Abele, assistant manager of Collision Repair Specialists in El Cajon, California, speaking about State Farm’s required use of an electronic parts ordering program for its Select Service shops in some markets.
“I see this an inevitable part of progress. And I do believe at some point it will work. (And) when it comes to the extra time it takes to deal with aftermarket parts, and the reduced quality of repairs with aftermarket parts, a little bit of extra time dealing with an (OEM) parts system so that State Farm can get their discount is something I’m willing to put up with.”
– Brian Orr, second-generation owner of Jack Orr’s Autobody in La Mesa, California, also speaking about the State Farm parts ordering program.
“We believe now is the time to address this issue for the long run. We are encouraging other states to pursue this type of legislation.”
– Bob Redding, national lobbyist for the Automotive Service Association (ASA), following the U.S. Supreme Court’s decision in February not to hear Allstate’s appeal of a Texas law banning insurers from owning collision repair shops.
“We believe this bill represents a substantial threat to the way in which we currently do business.”
– from an unsigned letter that California-based Mercury Insurance sent last March to shops in that state, urging them to contact state lawmakers to oppose an anti-steering bill that was eventually amended to only require the formation of a task force to look into issues arising from possible changes to existing California anti-steering laws.
“The consumer may be under the impression that he or she has no real choice. We want to make clear: Your car, your choice.”
– Connecticut Attorney General Richard Blumenthal, voicing support for a proposed anti-steering regulation in that state.
“It’s outrageous that legislation is necessary to protect consumers from their own insurance companies, but that is exactly the problem that this bill addresses.”
– California Sen. Carole Migden of San Francisco on proposed legislation in that state that, had it not lost by one vote, would have prohibited insurers from requiring the use of non-OEM parts on vehicles three years old or newer.
“(Although) we strongly believe that reducing refinish times on a more widespread basis is an acceptable practice and reflects operations that allow the shop to restore the vehicle to its pre-loss condition, the decision to limit the use of partial refinish was made in large part to improve our working relationships with shops, and thereby improve the customer’s experience.”
– Chris Andreoli, corporate physical damage process manager for Progressive, announcing last May the insurer’s revised stance on partial paint / full clear.
“We are committed to strengthening Allstate’s relationship with the collision repair industry. Bringing strong leaders such as Dan into our organization will allow us to accomplish that goal much faster.”
– Bill Daly, Allstate auto claim assistant vice president, in announcing that former SCRS executive director Dan Risley had accepted a position with the insurer.
“In other words, you choose to pay, so end of game. The judge felt she had absolutely no decision but to dismiss the case.”
– New York shop owner Greg Coccaro explaining that the dismissal of Progressive fraud lawsuit against his shop was based in part on Progressive’s failure to indicate on its payment to the shop that it was “paying in protest, with all rights reserved,” on the $34,000 repair job that led to the lawsuit.
“As a result of this review, we have determined that this repair method is less feasible on newer model vehicles which incorporate special or alternative metals.”
– Mike Poulard, State Farm estimatics section manager, in a June letter to Illinois shop owner Pam Pierson saying the insurer will no longer include a full rear-body sectioning procedures (or “clips”) on State Farm-prepared estimates.
“Furthermore, only when a collision repair facility is confident that a full-body section is the appropriate repair, has the proper training and equipment to facilitate a quality repair, and has the approval of the customer or claimant for such repair, will the adjuster authorize it.”
– from an Allstate announcement in September saying that, like State Farm, it will no longer specify full-body sectioning (or “clips”) on its estimates.
“They will promise you the world in order to persuade you to go to one of their direct repair or network shops. Don’t be steered wrong.”
– wording in an newspaper ad jointly sponsored by a handful of shops in Temple, Texas, many of whom dropped out of State Farm’s “Select Service” program this past summer.
“Progressive and Nationwide definitely got the most hands. He said, ‘Maybe I need to be looking at those companies a little harder.’”
– Georgia shop owner Steve Peek, speaking about an association meeting with Georgia Insurance Commissioner John Oxendine at which Oxendine asked those in attendance to raise their hands to indicate with which of the insurers that he named one-by-one they are having problems.
“If everyone in our industry would utilize these charts…Wow, what a difference we could see.”
– Mike Anderson of Wagonwork Collision Centers in Alexandria, Virginia, and a member of the ASA Collision Division Operations Committee, speaking of the association’s two “not-included operations” charts designed to assist collision repair shops in writing complete estimates.
“This transaction will be a transforming event for the insurance claims and collision repair industries. Our customers are under increasing pressure to achieve new levels of efficiency and customer satisfaction, which requires their service providers to offer new and enhanced products, services and solutions. CCC-Mitchell will be positioned to meet these needs as we bring together our two talented teams to create greater value for our customers and business partners through increased innovation and network connectivity.”
– Githesh Ramamurthy, chairman and CEO of CCC Information Services, in announcing last April its intent to merger with Mitchell International.
“There is no doubt that this merger would reduce competition that benefits auto insurers and autobody shops and ultimately would lead to higher prices and less innovation for consumers.”
– David Wales, acting bureau of competition director for the Federal Trade Commission, announcing in late November that it had filed suit to block the CCC-Mitchell merger.
“While we are disappointed and disagree with the FTC’s position, we intend to vigorously challenge the FTC in court.”
– CCC’s Ramamurthy, responding to the FTC suit.
More insurance companies appear to be gravitating toward the idea of reducing supplements by enabling more complete disassembly of a vehicle prior to completing an initial estimate, according to a Collision Industry Conference (CIC) committee.
Shop owners may want to view technical training as an investment in employee retention. A well-trained employee, after all, is generally a more productive employee. For technicians paid on commission or flat rate, this added productivity should have an immediate impact on their income.
When Doug Kelly stepped to the podium at a Friday afternoon session at NACE this past November, his goal was to help an audience consisting primarily of paint, body and equipment (PBE) jobbers understand how to grow their businesses.
Very few collision repair shops have unionized workforces, but more shop owners find themselves facing union organizing efforts, according to two attorneys who spoke at a recent industry event.
Steve Feltovich recalls some years ago walking into a large shop for which he was going to be doing some consulting work. Feltovich, who conducts estimating and other training as the manager of business consulting services for Sherwin-Williams Automotive Finishes, recalls that the manager of the shop said he needed a few minutes to finish up some projects but told Feltovich to feel free to walk around and check out the shop.
U.S. shop owner Jeff Beavers was at a cross-roads. His 7-year-old company, Car Crafters Collision Repair in Blue Ridge, Georgia, had grown steadily to the point of having annual sales of just over $1 million – but was somehow losing money.
State Farm’s foray into parts procurement. Growing dissatisfaction with direct repair programs. “Underwritten” initial estimates by insurers. These were among the most talked-about topics in the industry this past year. Here’s a quick review of the year through a collection of some of the most memorable, important, interesting or enlightening quotes heard around the industry during 2007.
What do you get when you ask the industry to list what they see as the key issues they’d like to see addressed?
The leaders and participants of the Collision Industry Conference (CIC) conducted just that exercise in recent weeks, and ended up with a list of nearly 600 issues submitted by more than 150 representatives of the collision repair, insurance and related segments of the industry.
If you didn't attend the Collision Industry Conference (CIC) and I-CAR annual meeting, both held in San Jose, California, in August, you may have missed out on some useful news and information shared at the meetings.
State Farm's new 'Select Service' program; a Texas court's upholding of a state law banning insurer-owned shops; the increasing percentage of vehicles being declared total losses; and the ongoing battle over the "right to repair" were among the most talked-about topics in the industry this past year.
If refinish labor times on repaired panels are going to be adjusted from those in the estimating systems - something 96 percent of shops say they have seen insurers do - the printed copy of the estimate should show what the original labor time is.
A committee of the Collision Industry Conference (CIC) is taking a different approach to the long-standing battle between shops and insurers over "featheredge, prime and block" by defining where body work ends and paint work begins.
That notation on every paint can in your shop that says, "For Professional Use Only," may soon hold some real meaning according to early indications about rule-making currently underway by the federal Environmental Protection Agency (EPA).
In its second year in its new home, the 2005 International Autobody Congress and Exposition (NACE) offered attendees about 75 classes, the return of the NACE welcome party, a keynote address by former New York City Mayor Rudy Giuliani, and the opportunity to attend two other larger automotive aftermarket trade shows also being held in Las Vegas.
After last year's I-CAR 25th annual meeting, which very much focused on the training organization's successful history, this year's event focused more on the future than on the past 12 months, which one board member termed "its most challenging year ever."
The multi-association task force created to address repairer concerns about how the estimating database companies operate reported on its early progress in April and defended its decision to include insurers in the process.
From "unintentional fraud" to "estimating database abuse" and the added costs created by the lack of standardization among direct repair programs, the Collision Industry Conference (CIC) plans to address a wide range of topics in 2004.
At the last International Autobody Congress and Exposition (NACE) expected to be held anywhere other than Las Vegas, attendees had an opportunity in early December to enjoy a welcome party at Universal CityWalk in Orlando, Florida, participate in 45 educational sessions, hear a keynote address from news commentator Bill O'Reilly, and browse a 176,000-sq.-ft. trade show featuring 488 companies.
The Texas law passed earlier this year that puts a halt on the growth of insurer-owned shops is nine pages long.
The issue of reuse of non-deployed airbags from salvaged vehicles returned to the spotlight at the Collision Industry Conference in Phoenix in April with a panel discussion that included information on a program being developed to certify such airbag modules.
"Working Small and Effective" was the title of a class at the International Autobody Congress and Exposition (NACE) in Dallas, Texas in early December, but it could have been an apt theme for the event. Many wondered whether NACE would "feel the impact" (the actual theme of the show) of the five major paint companies being absent from the trade show floor. Indeed, attendance by both shops and vendors was down. (For details, see "NACE by the numbers".)
Used or "recyclable" parts were the focus of discussion during a number of other presentations at the Collision Industry Conference (CIC) held in mid-March in Nashville, Tennessee.
Throughout the Las Vegas Convention Center the 35,000 attendees at last month's NACE seemed to be talking as much about the event itself as they did about the usual industry announcements, speakers and the "good deals" to be had on the trade show floor.
Sometimes the best way to look forward is to spend a few minutes looking back.
That’s a concept that came to mind recently looking through a file of industry-related notes and articles from 15 years ago. What can the industry today learn from the ideas and topics being discussed then? What has changed – for better or worse – and are there areas in which virtually no progress has been made? And what should we be doing differently now to ensure we’re not just treading water 15 years from now in 2022?
If you think the collision repair industry is changing rapidly, spend a little time talking with the owner of your nearby auto salvage yard:
Consolidation? Independent yards around the country are being gobbled up by larger corporations like LKQ Corporation and Ford Motor Company.
E-commerce and computer technology? Body shops can shop for used parts on-line at several websites, including iSalvage.com, NextPart.com, PlanetSalvage.com, and CarStation.com, and many yards are connected to each other by co-op networks such as United Recyclers Group.
Seemingly conceding that its previous position on estimating system data was untenable, ADP announced in April it was putting on hold its plan to encrypt that data and make it unusable by unlicensed third parties such as Internet claims management companies.
With the sluggish growth or even decline in sales many shops have experienced in recent years, the technician shortage and recruitment of employees have not been the troublesome issue they were for the industry during the late 1990s.
Concerns about the estimating databases, the reversal of the decision in the State Farm non-OEM parts lawsuit, the collapse of another consolidator and an ongoing battle over the "right to repair" were among the most talked-about topics in the collision industry this past year.
There's a simple rule in business that if you want to increase profits, you need to either increase sales and revenue, or decrease costs and expenses.
In the three years since "event data recorders" (often referred to as "black boxes") in vehicles really began to arise as an issue of interest for collision repairers, there has been significant activity related to EDRs on a number of fronts:
Shop owners struggling to remain profitable say they are increasingly focusing on the paint side of the shop, looking for innovative ways to squeeze even more productivity out of paint booths, paint products and paint personnel.
At first glance, it's hard to fathom what Eliyahu Goldratt, a 58-year-old Israel-born physicist, has to offer the collision industry. But more than 20 years after Goldratt authored (along with Jeff Cox) a "business novel" entitled "The Goal," his theory of process improvement is increasingly being discussed within many shop "20 groups" and implemented by a growing number of collision repair businesses.