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Monday, 11 June 2018 17:29

Certification, Legislation Related to Non-OEM Parts Get Spotlighted at Convention

Written by
Ray Colas, director of government affairs for LKQ Corporation Ray Colas, director of government affairs for LKQ Corporation

Index

Speakers representing insurers and non-OEM parts manufacturers, distributors and certifiers offered a variety of perspectives from the podium at the recent Automotive Body Parts Association (ABPA) annual convention.

Patrick Burnett, who leads material damage operations for Nationwide Insurance, told non-OEM parts industry representatives at the event that alternative parts played a significant role in the almost 700,000 estimates for the insurer’s auto claims last year.


“I won’t get into exact numbers, but I will tell you almost half of the part dollars that we wrote came from alternative parts,” Burnett said.


He said that as a financial organization, the cost of those parts is important.


“But I’m almost more interested in quality and how quickly you can get that part where it needs to go and how you work with repair facilities and others to facilitate a good, solid repair,” he said. “For crash parts, we look for NSF- or CAPA-certified parts, and NSF-certified distributors to deliver those crash parts. To us that’s very important. It’s important to know the quality of what’s going on our estimates and what may be delivered to those repair facilities as those parts go onto vehicles.”


Burnett was asked about his view of the outlook for body shops. He said driver safety and assistance technology will continue to make repairs more complex.


“It’s going to change who’s able to repair that car, who should be repairing that car,” he said. “It will change the make-up of the repair industry; I’m very confident of that.”


He acknowledged it will be tough for smaller collision repair operations to keep up.


“The larger shops that are committed to the equipment, the training [and] the certification path and that have the money [and] the capital outlay that it takes to make that happen will be well-positioned for the future,” he said. “I think those [that] are not, those who are just saying, ‘I’m just going to … do what I’ve always done,’ at some point the [car population] that they’ll have available to repair is going to shrink.”


Returning to the subject of certification, Bob Frayer of NSF International said his organization is launching certification of non-OEM radiator supports. He also urged the aftermarket parts industry to ensure that non-OEM parts such as bumper covers allow for the proper functioning of proximity sensors and rearview cameras.



“It’s one thing to design a bumper cover that fits the vehicle. It’s another thing to design a bumper cover that allows for the proper installation of the proximity sensor, and making sure that proximity sensor works properly,” Frayer said. “It’s something that NSF is working very hard to make sure happens.”

 

He said 21 parts distributors have earned NSF certification themselves, a program NSF developed, Frayer said, in part to ensure distributors are actually delivering certified parts when shops order certified parts.


“That seems like a very common sense way of running a business, but I can tell you in fact that’s not the way business is always being done,” Frayer said. “Many times, certified parts are ordered and that’s not what’s delivered to the repair shop. I think it was important for us to recognize that, and make sure that what’s ordered is what gets delivered. When a certified part gets ordered and a non-certified part gets delivered, I think that hurts all of us in this room.”


As he did at the ABPA conference a year earlier, Frayer worked to explain the difference between a NSF-certified part and one bearing the “NSF Registered Part” label. As part of the full certification process, Frayer said, NSF conducts audits of the parts’ manufacturing facilities; that doesn’t happen for “NSF Registered” parts. Certification also involves “in-market testing of the products being sold,”---not so with parts that are only registered. With those parts, he said, NSF only validates “that the design is the same as the OEM part and that it worked properly on the vehicle.”


Mirrors are among the parts commonly being “registered” rather than “certified.”


“We’re doing this because for certain part types, this is what the market is asking for,” Frayer said, not indicating whether by “market” he was speaking of parts manufacturers or parts buyers as not interested in the presumably more expensive certification process. “I would love to be able to certify all these products … but at the end of the day, what the market is saying is we don’t have an appetite for certification.”



State and federal legislation related to non-OEM parts was also on the agenda at the ABPA convention. A bill introduced in Iowa, for example, would prohibit insurers from requiring a shop to use a specific parts vendor or procurement process, or from requiring the use of non-OEM crash parts for the repair of a vehicle 5 years old or newer. Ray Colas, director of government affairs for LKQ Corporation, told those at the ABPA convention that the bill was introduced by a lawmaker who represents a district in which an LKQ facility is located. Colas said that previously bringing the state representative in for a facility tour had helped raise his understanding of the issue, something Colas reminded the lawmaker about.


“‘In all honesty,’ he told us, ‘I completely forgot about that,’” Colas said, noting that the lawmaker still has some concerns but said he would “remove the bill from consideration.”

 

Colas had similar assessments of lawmakers sponsoring bills in Illinois that would require the use of OEM repair specifications and procedures when estimating repairs and prohibit the use of non-OEM parts without the customer’s consent in writing.


“They did not realize what they got themselves into,” Colas said. “We had to educate them. It’s always good if we educate these members before somebody else does.”


(In an op-ed piece published in a Rhode Island newspaper in June after the convention, ABPA Executive Director Ed Salamy voiced opposition to proposed legislation in that state that would expand the state’s ban on the use of non-OEM parts to include vehicles up to 48 months old---from the current 30-month ban. Calling the legislation anti-competitive, Salamy warned consumers that, “Put simply, these bills would take away your choice about how to repair your vehicle.”)


Sources say that during a portion of the ABPA convention closed to the media, a former U.S. Senator expressed optimism about the prospects for the “PARTS Act,” proposed federal legislation that would slash the time that automakers can use design patents to prevent other companies from producing replacement crash parts from 14 years to just 30 months.



Mark Pryor, a former Senator from Arkansas who is now a partner with a legal and lobbying firm in Washington, D.C. that is representing the “Quality Parts Coalition,” said that group is pressing for a vote on the bill by a U.S. House committee before the mid-term elections in November.


But the legislation faces some big hurdles to overcome before this Congress ends. Even if passed by the committee, the bill would still need to be scheduled for a vote in the House, and there’s been no action on the Senate version of the legislation. Two of the bills’ four primary sponsors (Republicans Sen. Orrin Hatch of Utah and Rep. Darrell Issa of California) have announced their retirement from Congress this year, and most D.C. observers aren’t predicting a flurry of legislative activity in the final six months of the 115th Congress.


John Yoswick, a freelance writer based in Portland, Oregon, who has been writing about the automotive industry since 1988, is also the editor of the weekly CRASH Network (www.CrashNetwork.com). He can be contacted by email at john@CrashNetwork.com.

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