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Wednesday, 30 November 2005 17:00

Shop owners complain to state senate panel

In spite of the fact that California passed SB 551, a statute that was designed to stop steering in the state, several autobody shop owners showed up to testify about their continuing problems with steering at the Senate Banking, Finance and Insurance Committee Oversight hearing on November 23. 

Wednesday, 30 November 2005 17:00

BAR performance review finds room to improve

The Administrative and Enforcement Monitor of the Bureau of Automotive Repair (BAR) has presented a draft of its first report on the performance of the BAR to the Department of Consumer Affairs and the California legislature. 

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.

Saturday, 31 December 2005 17:00

Right to Repair Act gains momentum in Congress

Congressional support for The Motor Vehicle Owners' Right to Repair Act, H.R. 2048, has reached 77 co-sponsors. 

Tuesday, 31 January 2006 17:00

AQMD tightens up VOC standards

The South Coast Air Quality Manage-ment District (AQMD), the Southland's air quality agency, has adopted stricter standards to significantly reduce smog-forming emissions from coatings used in nearly 1,800 auto body shops in the region. The standards will take effect in 2008. 

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. 

State Farm is rolling out a new DRP program. The program calls for State Farm to get as good a rate as a shop charges any other insurance partner and asks for preferential treatment for State Farm insureds. 

The U.S. International Trade Commission (ITC) has voted to institute an investigation of certain automotive parts designed to be used for the Ford F-150 pickup truck. 

Tuesday, 31 January 2006 17:00

Chip Foose to speak at CAA quarterly meeting

Award winning auto designer Chip Foose will be the featured luncheon speaker at the California Autobody Association (CAA) 1st quarter meeting on February 18, 2006, at the Disneyland Hotel in Anaheim. Foose is also the creator and host of the popular television series Overhaulin, airing on theTLC Network. In a relatively short career, Foose has created a legacy of designs and accomplishments beyond his years.

California Insurance Commissioner John Garamendi announced a $1 million fine against Farmers Insurance Group on January 23 following settlement negotiations over how the company handled consumer claims. According to a spokesman for Garamendi, the claims involved both homeowners and automobile policies. 

Concerns about proposed new state and federal controls on the sale and use of automotive refinish paint products have kept environmental issues among the key topics being addressed by the Collision Industry Conference (CIC) in 2006. 

Activity has been heating up around proposed Assembly Bill 303, known in the industry as the "Concierge" bill because it is backed by Progressive Insurance. Progressive has a repair program known as "Concierge" because of its drop off and delivery services. 

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. 

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: 

Last month State Farm, the nation's largest auto insurer, announced that it was beginning the rollout of a new program for its preferred body shops. The contract for that new program was sent to body shops in the test markets of California, Illinois and Michigan. Predictably, the response was mixed, but the "vibe" was definitely negative. Shop owners who admitted that they depend upon State Farm business for a large percentage of their volume either said nothing or said they were taking a wait and see attitude. 

Hurricane losses and loss adjustment expenses totaling $6.3 billion (after reinsurance) contributed to a reduction in State Farm's 2005 net income. The company is reporting an after-tax net income from all sources of $3.24 billion, down 39 percent from the $5.31 billion in net income for 2004. 

Twenty-five influential members of the automotive recycling industry have been honored by Locator UpFront, a bi-monthly publication by the John Holmes Publishing Company of Whiting, Iowa. 

California State Senator Jackie Speier (D-San Francisco) has introduced SB 1492, groundbreaking legislation that would make the Bureau of Automotive Repair (BAR) responsible for conducting an annual survey of body shop labor rates for the purpose of establishing prevailing rates in different parts of the state. 

Battle lines are being drawn in California over Assembly Bill 1852, a measure that would have the effect of legally sanctioning certified aftermarket crash parts by declaring that, once certified, they are of like kind and quality to OEM. Such sanctioning would presumably cut off consumers from taking legal action against their insurers for mandating the use of aftermarket parts in collision repairs. 

Tuesday, 28 February 2006 17:00

CAA warns that insurers to cap storage charges

The California Autobody Association (CAA) will be holding its own Legislative Day this year on March 29 at the Capitol in Sacramento. All body shops are invited to attend a short update session and participate in scheduled meetings with their legislators. Further information will be available at www.calautobody.com

Insurance Commissioner John Garamendi has issued a Cease and Desist (C&D) Order on The Global Healings Society of Puyallup, Washington, following an investigation by the California Department of Insurance (CDI) Investigation Division. The Order demands The Global Healings Society to cease and desist transacting any and all insurance business in California. 

For the second year in a row, the White House budget request eliminates the federal investment in career and technical education authorized by the Carl D. Perkins Vocational and Technical Education Act. The Association for Career and Technical Education (ACTE) and the National Association of State Directors of Career Technical Education Consortium (NASDCTEc) expressed disappointment with President Bush's budget request and will work with the Congress and administration to seek restoration of Perkins funds during the appropriations process. 

Tuesday, 28 February 2006 17:00

Proponents now say AB 303 is moving forward

The Lazarus bill - AB 303 - appears to be making a miraculous recovery. Last month, the legislation was declared to be on life support, alive in committee as a technicality for "emergency purposes" only. Despite new statements to the contrary, there is still no written documentation regarding the renewed status of the legislation. 

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. 

    The meeting between the California Autobody Association (CAA) and Insurance Commissioner Steve Poizner was the focus of Legislative Day at the Capitol on March 27. The four main points that the CAA executive committee covered with the Commissioner and his department were discussed. The points included consumer choice and steering, capping of paint and material costs, auto body labor rates and surveys, and enforcement of laws and regulations.

Results are in for LKQ Corporation's (Nasdaq: LKQX) fourth quarter and year ended December 31, 2005, with revenue of $143.9 million for the quarter and $547.4 million for the year. Net income was $8.3 million for the quarter and $30.9 million for the year, representing growth over 2004 of approximately 64% and 50%, respectively. 

The U.S. District Court, Northern District of Texas, has issued a long-awaited opinion on the Texas insurer-owned shop law. HB 1131 put a halt to insurer-owned shops in the state of Texas. Texas state Senator John Carona along with a strong grassroots effort on the part of collision repairers across the state assured the passage of the bill in June 2003.  

Yohannes "John" Mesfine feels like he has been through hell and back - compliments of the California Department of Insurance (DOI) and the San Mateo County DA's office. Mesfine, owner of Mesfine Auto Body & Paint in Redwood City, California, was arrested in February 2005 and charged with insurance fraud in a sting operation run by the Department of Insurance. 

The second shoe has finally dropped in the saga of AB 303 - legislation that would allow insurance programs like Progressive's "Concierge" to "step into the shoes of the insured." Amendments have been issued by the proponents of the bill to address the complaints made during the Senate Banking, Finance and Insurance Committee hearing last year. 

California State Senator Jackie Speier (D-San Francisco) introduced last month SB 1492, groundbreaking legislation that would make the Bureau of Automotive Repair (BAR) responsible for conducting an annual survey of body shop labor rates for the purpose of establishing prevailing rates in different parts of the state. 

The U.S. Supreme Court denied the petition of Michael E. Avery, et al in their suit against State Farm Mutual Automobile Insurance Co. After almost 10 years of dueling between Avery, et al and State Farm, the U.S. Supreme Court put an end to the national aftermarket parts class action lawsuit March 6. 

The Occupational Safety and Health Administration (OSHA) has issued new standards to the existing standards that limit workplace exposure to hexavalent chromium. It has been determined by OSHA that the current level of hexavalent chromium that workers are exposed to puts workers at a significant health risk. 

For anyone in this industry who started out hustling sales - whether that means collision repair jobs, cans of paint or tools and equipment - pulling back from a focus on growth in gross sales can be a challenge. Increasing the top line, after all, is often a key ingredient in increasing the bottom line. More sales equals more profit, right? 

The hail storm that struck Central Texas on April 21 is expected to exceed $100 million in insured losses. Baseball-size hail pounded the city of San Marcos smashing vehicles at car dealerships and shopping malls. 

Representatives from the vehicle manufacturers, steelmakers, vehicle dismantlers, vehicle shredders, environmental community, states and the U.S. Environmental Protection Agency (EPA) have reached agreement on a statement of principles detailing the elements of a national program for recovering mercury switches from scrap cars and light trucks before they are shredded for recycling. The parties are now working to complete a formal agreement. 

Allstate has filed a Notice of Appeal with reference to the recent decision in Allstate Insurance Company, et al. v. Greg Abbott, et al. issued by the U.S. District Court for the Northern District of Texas, Dallas Division. The court held that specific provisions preventing insurer-owned shops from doing business in the state of Texas were constitutional. 

"State Farm does not think it is reasonable to pay more for repairs than our competitors," stated George Avery, State Farm Claim Consultant, speaking to over 200 attendees at April's Collision Industry Conference in Portland, Oregon. Avery offered a 30-minute high-level overview of the changes the industry can expect from State Farm.  

3i Group Plc and funds advised by Euroventures Management AB, incl. Sjätte AP-fonden, have entered into an agreement to sell all of the shares in Alignment Systems AB, parent of Car-O-Liner and Josam subsidiaries, to FSN Capital Limited Partnership II. 

California collision repair industry professionals took matters into their own hands to impede the progress of AB 1852, the CAPA-sponsored non-OEM parts bill. Members of the California Auto Association (CAA) and several individual shop owners met in Sacramento with legislators to discuss the various legislative issues facing the auto body industry. 

Sunday, 30 April 2006 17:00

New BAR signage requirement

The California Bureau of Automotive Repair (BAR) recently amended its signage regulation, altering the required design to include the BAR website address. Automotive Repair Dealers (ARDs) must comply with the new design requirement by June 30, 2006. 

An anti-steering bill has been introduced in the Arizona legislature by a last minute tactic know as a "strike everything" amendment. HB 2385, which started its life as a bill concerning eminent domain (the taking of private property by the state) was changed on March 24 to a transportation bill dealing with consumers' rights to select their own repair facilities for auto body repair claims. 

If there was one key message at a recent gathering of auto recyclers from around the country it was that shops and insurers want an easy and reliable way to know exactly what to expect when sourcing used parts. 

U.S. Senator Mike Enzi's (R-Wyo.) Health Insurance Marketplace Moderniza-tion and Affordability Act, S. 1955, failed to advance after being just five votes short of a motion to invoke cloture.

"Despite the attempts by the car companies and their car dealerships to kill "The Motor Vehicle Owners' Right to Repair Act, HR 2048," motoring consumers and the independent auto repair industry won the first round in a 14 to 13 vote in the Subcommittee on Commerce, Trade and Consumer Protection," stated David Parde, president, the Coalition for Auto Repair Equality (CARE). 

The Progressive Group of Insurance Companies, which represents two brands of private passenger auto insurance, Progressive Direct and Drive® Insurance from Progressive, has opened its third Houston-area Concierge Service Center. 

Five of the nation's largest auto insurers began airing an expensive TV advertising campaign in order to mislead Californians, mostly in rural parts of the state, about the effects of Insurance Commissioner John Garamendi's proposed Good Driver pricing reforms, according to the non-profit non-partisan Foundation for Taxpayer and Consumer Rights (FTCR). 

A lot of hard work could go down the drain in Sacramento because the California Senate Appropriations Committee has placed a bill that deals with resolving collision repair disputes between insurance companies and their customers, SB 1492, in the "suspense file." Action on this bill is suspended while the fiscal impact of this and other new legislation is determined. Hearings are currently being held to decide which bills will be released from the suspense file. 

Effective May 17, the Bureau of Automotive Repair (BAR) adopted a new regulation that will add flexibility to the process under which additional repairs may be authorized. The new regulation [Title 16 CCR3353(f)] permits the customer to designate another person to authorize additional parts and labor written estimated price. 

Darrell Amberson, AAM, Lehman's Garage, Bloomington, Minnesota, has been re-elected as Collision Division director of the Automotive Service Association (ASA). As such, Amberson serves on ASA's board of directors and chairs the ASA Collision Division Operations Committee. The position of Collision Division director is a two-year term. Jerry Burns, AAM, Automotive Impressions Inc., Rio Rancho, N.M., has been chosen to serve assistant division director. 

Allstate and Audatex, a Solera Company, (formerly ADP Claims Services Group) have entered an agreement for Audatex to provide mobile estimating tools and valuation services to Allstate. Under the agreement, Audatex will continue to provide Allstate's auto adjusters with PenPro® software and Autosource® valuation services. 

Former NFL quarterback and Hall of Fame member Troy Aikman will be the NACE 2006 keynote speaker. DuPont Performance Coatings is the sponsor of the Aikman ap-pearance on Thursday morning, November 2 at the Mandalay Bay Convention Center. 

Hiring a new employee can be tricky business. One West Coast shop owner found that out recently when within two days he suddenly found himself down three technicians. Before he could even get a 'help wanted' ad place, a man came in looking for work. 

Here's your assignment: Pretend you have 45 seconds to talk about your business in front of a group of people you'd love to have as customers. Could you tell them something that's unique about your business, something that no other shop in your area could or is likely to tell them? 

Friday, 30 June 2006 17:00

Central Texas hailstorms were costly

The hailstorms that pounded central Texas this spring were costly. The final tally for insured losses reached $160 million. The city of San Marcos bore the brunt of the storm. Hundreds of homes and businesses were damaged as well hundreds of new and used cars, some of them totaled. 

Texas Attorney General Greg Abbott has instituted an asset freeze and temporary restraining order against the owner of a Houston auto auction, seeking an accounting for millions of dollars in fees fraudulently assessed against those who participated in auctions to purchase vehicles. 

With the opening of the first Concierge Program service center in California, located in San Diego, Progressive Insurance has created a furor over what type of collision repair activities require registration with the Bureau of Automotive Repair (BAR) and reopened the question of whether an insurer can stand in the shoes of its insured in negotiating and authorizing collision repairs. 

The Senate Judiciary Committee held a hearing recently to discuss "The McCarran-Ferguson Act: Implications of Repealing the Insurers' Antitrust Exemption." According to Senator Arlen Specter, R-Pa., committee chairman, this is the first hearing on McCarran-Ferguson by the full committee since 1989. 

In response to concerns of collision repairers raised at the annual National Industry Issues Forum (NIIF), hosted by the Society of Collision Repair Specialists (SCRS), Mitchell International has issued an open invitation to the collision repair industry to come see how the company develops, verifies, and maintains labor times. In a press release, Mitchell said it looks forward to demonstrating complete transparency to collision repairers, SCRS association leaders and members, along with collision repair industry press and analysts, so all can understand how the company derives and maintains its labor times database.