Industry News You Might Have Missed in 2011

So much happens in the collision repair industry that it can be hard to keep up on everything. A few big stories get plenty of attention, but sometimes it’s the lesser-known stories that can have as big an impact on your business.

As a new year kicks off, here’s a wrap up of some of the news stories from this past year that might have flown under your radar amid the day-to-day challenges of running your shop, but that could prove helpful for you to know about.

• 1 The Federal Trade Commission last year issued a consumer bulletin related to the Magnuson-Moss Warranty Act. It states that use of non-OEM parts in itself cannot void a vehicle warranty.

  “Still, if it turns out that the aftermarket part was itself defective or wasn’t installed correctly, and it causes damage to another part that is covered under the warranty, the manufacturer or dealer has the right to deny coverage for that part and charge you for any repairs,” the bulletin states. For a copy of the bulletin, visit: http://tinyurl.com/3zvas3w

• 2 The Society of Collision Repair Specialists (SCRS) last spring released its findings into whether the paint manufacturers consider tinting and blending as necessary procedures that are commonly performed in conjunction with each other.

  “Research of the color code and existing variations provided by the refinish manufacturer, and blending of the color coat are both recommended operations to perform an acceptable match,” SCRS said in a summary of its findings. “If the refinish technician determines that the color variance requires adjustment, it is a consistent recommendation to tint to a blendable match. When tinting is necessary for color adjustment, it is always done in conjunction with blending.”

  SCRS has posted individual responses from each of the five major paint companies in the “Technical Info” section of its website (www.scrs.com).

• 3 J.D. Power and Associates data released last year—based on surveys of more than 11,500 insured drivers who had a claim within the previous 12 months—shows how important to customer satisfaction it is to get repairs done quickly and on time.

  Satisfaction levels for the 75 percent of customers who felt their vehicle was done on time were nearly 200 points higher (883 vs. 709, on a 1,000-point scale) than those who felt their vehicle wasn’t done on time.

  It doesn’t appear to matter what causes the delay: parts, unexpected additional damage, insurer delays or just plain too much work in the shop. In all these cases, customer satisfaction still never exceeded 728 points.

  Setting expectations is particularly important on larger, non-drivable jobs, Jeremy Bowler of J.D. Power and Associates said. Fair or not, customers expect a drivable vehicle to be repaired within a week, and non-drivable vehicles—even the worst “train wrecks”—within two weeks. An extra effort needs to be made to adjust these expectations if they can’t be met, Bowler suggests.

  Speed still offers a shop a chance to set itself apart, according to the data. One-in-four customers with drivable vehicles say they didn’t get them back within a week, and one-third of those with non-drivable vehicles didn’t get them back within two weeks.

• 4 Industry trainer Toby Chess last year was alerting shops to the need to recalibrate the steering angle sensor that is part of the electronic stability control system on an increasing number of new vehicles. Such systems are standard equipment on 85 percent of 2010 new vehicles, and will be required on all new vehicles as of model year 2012. The recalibration is an additional procedure that must be done after the vehicle alignment.

  “It’s an added step, and there’s also no more 2-wheel alignments with these systems. That won’t work,” Chess said.

  He said he is concerned because even though no “trouble light” will be lit on the dash and the vehicle may handle properly under normal driving conditions even if the system is not calibrated, the electronic stability control function may not work properly in a subsequent “emergency maneuver.”

• 5 The Automotive Education & Policy Institute, which last year received a grant from the Alliance of Automotive Service Providers to build a web-based repository of legal decisions finding in favor of collision repairers, has been posting court documents to the “legal cases” section of its website (www.autoepi.org).

  The Institute was founded by Ohio attorney Erica Eversman, who said that the website will give shops and their attorneys easy “access to court precedent and the facts and admissions leading to... decisions that can be used to persuade other courts, customers and insurers that the repairers’ charges are reasonable and necessary for a safe and proper repair.”

• 6 Both Audatex and CCC Information Services last year began offering an automated labor time system for the additional labor needed when replacement bumpers arrive “raw” or unprimed from the factory.

  In the Audatex system, the “prep raw, unprimed bumper cover” labor operation is not automatically added to an estimate but must be selected by the user. A line for the operation will show in the “part edit box” when a bumper Audatex knows to be supplied raw from the manufacturer is selected.

  Although the labor time is pre-populated at 20 percent of the base refinish time for the part (or .3 minimum), the user can override this value.

  Jack Rozint of CCC said that that based on labor studies completed by Motor Information Systems, the pre-populated labor time for the operation in his company’s estimating system is 25 percent of the full refinish time for the part (with a minimum of .1 and a maximum of 1.0).

  The feature is available through the “additional operations” menu both when the bumper is known to arrive unprimed and when the condition of the new bumper is uncertain (when it may arrive unprimed); it will not be seen only when the bumper is known by Motor to always arrive primed.

  If the automaker has informed Motor the bumper may or will arrive unprimed, footnotes in the CCC system will alert the estimator to this, and a headnote (“Add if Required”) will appear to allow the user to add the “prep unprimed bumper” operation if indeed the part is unprimed.

  Both Audatex and CCC said the stumbling block in extending the labor operation option to other types of parts that also may arrive unprimed is that information about the parts isn’t provided to them from the automakers.

• 7 With all the apparent bad news about the nation’s economy, one story many have missed is the relatively good news coming out of the automotive industry. Some economists in recent months, for example, were saying it may be the auto industry that “bails out” the nation from slipping back into a recession.

  Ford, GM and Chrysler have added 90,000 manufacturing jobs, a 14 percent increase, from the low two years ago. Nissan, Volkswagen and other foreign-based automakers are expanding in the U.S., and dealers are making more per-sale than they have in years. The Commerce Department has reported significant gains in orders for autos and auto parts, a number of recent government reports have shown the auto industry was the strongest segment of the manufacturing economy in July.