fbpx

Advancing a cause that is steadily gaining momentum, the Alliance of Automotive Service Providers (AASP) - a national association representing the collision repair industry - has endorsed the petition spearheaded by the Society of Collision Repair Specialists (SCRS) to support two-way communication between like estimating systems. 

Monday, 28 February 2005 17:00

Looking back at 2004: year in quotes

While no particular issue or news event seemed to dominate the industry's attention this past year - other than perhaps the slow-down in work shops felt in many parts of the country - it hasn't been a quiet one for collision repairers. Here is the annual year-in-review wrap-up, a collection of some of the most memorable, important, interesting or enlightening quotes heard around the industry during 2004. 

With profit margins generally razor-thin at best these days, the last thing shops can afford to do is lose money in a scam. That's why a number of shop owners recently have come forward to share their stories of losing - or almost losing - some of their hard-earned money - as a caution against others doing the same. 

Eric Reid wants to do his part to reduce the shortage of collision repair technicians he's always hearing and reading about. But Reid, the collision repair instructor at Northwest-Shoals Commun-ity College in Muscle Shoals, Alabama, is getting discouraged watching his top students move on to other fields because of low starting wages at body shops. 

Hank Tarter jokes that if you're going to have a heart attack, the place to be is Keizer, Oregon, a community of 35,000 residents just north of Oregon's capitol city of Salem. 

As Texas autobody shop owners continue to await a decision on Allstate vs. Abbott - the insurer's challenge to H.B. 1131 prohibiting insurer-owned collision repair facilities - two other states have introduced legislation attempting to ban tied-repair facilities. Although there are no Sterling Autobody shops or Caliber Collision Centers in Indiana and Missouri, those states are making a pre-emptive strike against insurer encroachment upon the independent body shops. 

The last two in a five-year series of settlements with various insurance companies to give refunds to Texas policyholders who paid more out-of-pocket on claims for auto repairs than their policies required were completed by Texas Attorney General Greg Abbott. 

Attorneys General across the country signed settlements ensuring refunds totaling $40 million to consumers who unknowingly purchased vehicles that were previously damaged and deemed total losses by State Farm Mutual Automobile Insurance Co. 

The Nevada Collision Industry Association (NCIA) wrapped up its first full year in a whirlwind of success. The handful of members who established the NCIA in October of 2003 has grown to 46, with the prospect of continuing to increase membership in 2005. 

Monday, 28 February 2005 17:00

Farmers seeks damages for alleged fraud

Farmers Insurance Exchange has begun serving civil summons and complaints upon a nationwide auto glass company and its president, accusing them of taking part in a scheme designed to defraud Farmers and its policyholders. The civil complaint, which is similar to prior successful lawsuits against body shops who submitted false insurance claims, seeks not only damages for the fraud committed, but seeks injunctive relief, where the courts are asked to order a halt to these deceptive practices. 

America's car owners are having increasing trouble getting their cars repaired, according to a recent CBS television "Consumer News Alert." CBS News anchorman John Roberts says car dealers' service departments are gaining ground, and that could cost consumers time and money. The news segment aired January 21 on the "CBS Evening News with Dan Rather."

California authorities arrested ten auto body shop owners and employees in February, charging them with various felony counts of insurance fraud following "Operation Scorpion" - a joint investigation by the California Department of Insurance Fraud Division (CDI) and the San Mateo County District Attorney's office. 

After a year-long investigation, seven Allpro Paint and Body shops in the San Diego area were shut down in November after their registrations were revoked by the California Bureau of Automotive Repair (BAR). 

A widespread and significant drop in ADP refinish labor times discovered in recent weeks will be corrected in ADP's November CD update release, which the company says has been sent to ADP customers. 

Some shop owners say the use of aluminum in vehicles today is similar to the shifts in the industry caused by the rise of the unibody structure in the 1980s. 

Thursday, 31 March 2005 17:00

Senate supports Perkins Act

In a strong show of support for career and technical education, the Senate voted 99-0 to approve Senate Bill 250, the Carl D. Perkins Career and Technical Education Improvement Act of 2005. 

A committee of Oregon lawmakers last month said they like the concept of consumers being made aware of direct repair agreements between collision repair shops and insurers, but the details of how to accomplish that still needs some work. 

A bill introduced in the California legislature in February would establish a legal presumption that "certified" non-OEM crash parts are legally of "like kind and quality" to OEM parts. Assembly Bill 1163 (AB 1163) would also invalidate the current law that prohibits an insurer from requiring the use of non-OEM parts unless the vehicle owner is told of and approves the use of such parts on his car, replacing it with the requirement that the following statement appear on the estimate: "This estimate has been prepared based on the use of crash parts supplied by the manufacturer of your vehicle or certified aftermarket crash parts supplied by an independent manufacturer." 

Shop owners must remain ever attentive to legislation introduced to control aspects of the collision repair process. Provisions may be added to seemingly innocuous bills that can have devastating effects on how autobody shops do business. And a bill's sponsor can be a clue to the need for added vigilance.  

In the blink of an eye, it was all over but the shouting. With the ink barely dry on a letter of intent from Caliber Collision Centers to purchase 27 shops from the financially troubled M2 Collision Care Centers, the deal was dead. According to Caliber Vice President John Walcher, as the due diligence began, it became apparent that the deal would not be consummated and Caliber pulled out. At press time, unconfirmed reports indicated that Caliber had not purchased a single M2 shop, but was negotiating on the large, still unsold Santa Monica location. 

In a strong show of support for career and technical education, the Senate voted 99-0 to approve Senate Bill 250, the Carl D. Perkins Career and Technical Education Improvement Act of 2005.

Here's your assignment: Pretend you have 45 seconds to talk about your business in front 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? 

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. 

A bill introduced in the California State Senate that was called "extremely bad for the collision repair industry" by the California Autobody Association (CAA) was effectively gutted in the insurance committee before being passed and sent to the full senate. 

With the growing number of insurance company direct repair programs - and with many insurers processing an increasing percentage of their claims through such programs - it's easy to understand why some states are looking to put the brakes on "steering" of work by insurers. 

Calling it "a piece of legislation as 'American as apple pie,' and one that is vital to motoring consumers and the five million plus Americans working in the automotive aftermarket," David Parde, the president of the Coalition for Auto Repair Equality, applauded U.S. Representatives Joe Barton (R-TX) and Edolphus Towns (D-NY) for re-introducing H.R. 2048: The Motor Vehicle Owners' Right to Repair Act in the 109th Congress. 

The carcass of M2 Collision Centers, until last month the second largest collision repair chain in California and one of the largest in the country, has been thoroughly picked over. The assets of 26 M2 shops were sold as of May 31, with only the Van Nuys location's equipment remaining to be sold piecemeal when the dust had settled. 

The California Autobody Association (CAA) met with Insurance Commissioner John Garamendi early in August to discuss the enforcement of SB 551 (Anti-Steering Law) and the labor rate surveys that the Department of Insurance (DOI) have been receiving from insurance companies pursuant to Labor Rate Survey Insurance Code 758(c). 

Although the percentage of dealerships with body shops has declined over the past 30 years, a growing number of automakers are working to help dealership shops gain market share. How successful they will be remains to be seen, but independent shop owners would be foolish to ignore the threat - or possibly the opportunity - these efforts may offer. 

The California legislature has been busy with several pieces of legislation related to the collision repair industry. Activity is taking place on AB 1163, SB 98, and AB 79. 

Tuesday, 31 May 2005 17:00

Californian elected new ASA chairman

ASA held its annual business meeting in April in Fort Worth, Texas. The event provided a forum for several association leadership activities including open meetings of the ASA affiliate assembly and board of directors; a State of the Association address by Ron Pyle, ASA's president and chief staff executive; and the installation of the 2005-06 board of directors. 

Allstate Insurance Company has rolled out a new auto insurance plan - Allstate® Your Choice Auto Insurance, which the company says breaks the mold of products traditionally offered by many insurers by presenting consumers even more choices, innovative features and enhanced rewards for safe drivers. 

Allstate Insurance Company has rolled out a new auto insurance plan - Allstate® Your Choice Auto Insurance, which the company says breaks the mold of products traditionally offered by many insurers by presenting consumers even more choices, innovative features and enhanced rewards for safe drivers. 

Whether you knew it or not, the odds are good that already today you've contributed in some way - positively or negatively - to your company's "culture." 

Nearly one year after Allstate filed suit against the state of Texas to overturn H.B. 1131, the 2003 Texas law that regulates insurer ownership of collision repair businesses, testimony began in Allstate vs. Abbott. The trial began on September 20 in the courtroom of Judge Ed Kinkeade, U.S. District Court, Northern District of Texas Dallas Division. 

Texas Governor Rick Perry has named Mike Geeslin as the state's Insurance Commissioner. The commissioner oversees the Texas Department of Insurance (TDI), which regulates the insurance industry. 

The International Autobody Congress & Exposition (NACE) announced that online registration is live and open at www.NACEexpo.com

The California Air Quality Review Board (CARB) is holding a series of public meetings to elicit feedback on its proposed statewide regulations for auto refinishing. The proposed rules would set a tougher standard for Volatile Organic Compounds (VOCs) than are in place today and would standardize rules throughout the state. 

An article in last month's ABN discussed the value and importance of building a company's culture, a common understanding among all employees about "the way we do things around here." 


The Air Resources Board (ARB) is holding a second set of public workshops in Fresno and Oakland on the development of a Suggested Control Measures (SCM) for automotive refinish coatings. 

Volkswagen of America, Inc. will pay $1.1 million to resolve its failure to promptly notify the Environmental Protection Agency (EPA) and to correct a defective oxygen sensor affecting at least 329,000 of their 1999, 2000 and 2001 Golfs, Jettas, and New Beetles, according to federal officials. This is the largest civil penalty to date for this type of violation. 

In an overwhelming 22 to 5 vote, members of the National Conference of Insurance Legislators (NCOIL) Property and Casualty committee agreed to continue their effort to protect consumers from both the "car company parts monopoly" and "poor quality aftermarket parts." After hearing testimony from both sides, the group created a special committee to address the issues necessary to develop a model bill on certified aftermarket crash parts that could be introduced in state legislatures around the country. 

The California Department of Con-sumer Affairs' Bureau of Automotive Repair (BAR) has revoked the automotive repair dealer registration of California Collision Center, 3029 Enterprise Street, after an investigation found multiple violations of California law governing the auto repair industry. 

Mentors@Work is once again searching for the best of the best mentors in the collision repair business. The national mentoring organization seeks nominations from the industry for its annual "Mentor Of The Year" award. This award will be presented to the individual who has shown exceptional skill teaching and training new technician talent for the collision repair industry. 

The California Senate Banking, Finance, and Insurance committee heard testimony in July in Sacramento concerning Assembly Bill 303 (AB 303) - a bill that would allow insurance companies to take over as the customer in the collision repair process. 

Wednesday, 31 August 2005 17:00

Decrease in workers compensation filed rates

Workers' compensation insurers in the state filed rate reductions averaging -14.6 percent for policies incepting on or after July 1, 2005 bringing the cumulative rate reduction to -26.78 percent since reforms were enacted, stated Insurance Commissioner John Garamendi. In addition, the Commissioner called on insurers to pass on savings more quickly, noting that in 2005 the industry only paid 41 cents in claims for each dollar of premium collected. 

 ..and what men can learn from them

Attend any national trade show, conference or association event in the collision industry, and one thing is likely to become apparent: While men may still far outnumber the women, both the number and success level of women involved in the industry is growing rapidly.  

In an anticlimax second only to the Y2K debacle (remember - the hysteria over the new century), the Illinois Supreme Court overturned on a technicality the lower court decision in Avery vs. State Farm, the class-action lawsuit in which jurors found that aftermarket crash parts were not of like kind and quality to OEM parts and awarded over $1 billion against State Farm in October 1999. 

Wednesday, 31 August 2005 17:00

Public hearings set on labor rate survey

The California Department of Insurance (DOI) will hold two hearings regarding the adoption of proposed amendments to regulations interpreting and making specific provisions of Insurance Code Section 758(c). 

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." 

Wednesday, 31 August 2005 17:00

U.S. house passes association health plan bill

The U.S. House of Representatives has passed a bill that would allow business association members to purchase health care plans at lower rates. Association Health Plan (AHP) legislation, H.R. 525, passed by a vote of 263-165. 

Two lawyers and one medical doctor pleaded guilty in connection with an interstate staged auto insurance fraud ring involving more than 55 victims/insurance carriers both in Arizona and California. Over $2.5 million was paid out in fake insurance claims in an organized staged collision ring from 1993-2000. Investigators from the California Department of Insurance's (CDI) Los Angeles Urban Auto Fraud Task Force targeted the ring in 2003 dubbing it "Operation Rent & Wreck" and announced the investigations and arrests of 18 people. 

Attendees at the Collision Industry Conference (CIC) survived the blistering Arizona heat in Scottsdale, Arizona, to see progress being made on many crucial issues. The Estimating Task Force, formed by AASP, ASA and SCRS at NACE in 2004, had plenty to report about getting results from the database providers. 

A number of dealership service departments, independent repair shops and other automotive businesses that have been the victims of thefts in recent months are urging other businesses in the industry to take added steps to protect themselves. 

Friday, 30 September 2005 17:00

Plan ahead to reduce the tax bite

Most people in the United States tend to associate the month of April with taxes. But in reality, there's a lot more you can do right now - prior to the end of 2005 - to reduce your tax burden come next April 15. 

Monday, 31 October 2005 17:00

Part 2 what should be in a personnel file

An article in last month's issue outlined why maintaining personnel files is so critical - and explained some of the items that should not be kept in the files. 

Are you ready for the "personnel file" challenge? How well can you answer these questions: 

Friday, 30 September 2005 17:00

Expanding your business - without DRPs

There's little doubt that much of the growth some collision repair businesses have experienced over the past decade has been fueled by insurer direct repair programs (DRPs). After all, the percentage of insurance-paid work handled through DRPs quadrupled - to more than 30 percent - between 1996 and 2002. Most major insurers are already well over that 30 percent mark - with some at 70 percent or more.