Nebraska Industry Happenings
We want to thank Woodhouse Dealerships for bringing Texas Attorney Todd Tracy to Omaha March 22nd.
Tracy is the attorney that won the $42M lawsuit in Texas from a shop that did improper repairs.
Tracy’s message is clear.
Cars have to be repaired properly and be paid to do that.
The Nebraska Auto Body Association invites you to join our efforts to:
- Educate
- Inform
- and Represent the Nebraska Collision Industry.
Evolution of the Collision Repair Industry
by NABA President Dave Yard
The collision industry has seen more changes in the last two to three years than it has seen in the previous 15 to 20 years.
These changes brought on by the need for lighter more efficient vehicles and even more so brought on by the consumers demand for amenities and safer vehicles.
With the onslaught of changes, the collision industry has reacted in many ways.
Some shops found these changes to be too overwhelming. Our industry’s average age consist largely of older generations rather than younger. Therefore, faced with the cost of new equipment and continuing education, they have closed or have begun transitioning towards retirement.
Many shop owners and technicians have buried their head in the sand.
I have heard “I’ve been fixing cars for x amount of years, I know how to fix them.” That is an incredibly scary thing to hear considering vehicles today require precise and unique repair procedures. Many of these procedures are put in place because of the extremely critical timing of saftey systems. Milliseconds
can be the difference between someone walking again and sustaining injuries that cause life long issues. We are dealing with more than cars, we are making life and death decisions every day.
Car makers can and will have identified design flaws. The makers can issue procedural changes at 2PM on a Tuesday, from that point forward if you fail to follow that procedure you are endangering your customers, your friends, your family, and anyone else who drive the cars you repair. It is no longer acceptable to bury your head in the sand.
All is not lost though. Many shops have embraced these changes and they are rising to the challenge
Todd Tracy (the attorney for the well known Honda Fit lawsuit) who is becoming an advocate for vehicle Saftey has challenged the industry to adopt a universal mission statement that reads: “As vehicle saftey professionals, we have a legal and moral obligation to make sure our customers make it home safely because our vehicle repairs were performed properly, responsibly and ethically.”
Many shops are striving to meet the challenge. They are educating themselves and their employees from the front door to the back. They are not just meeting minimum industry requirements. They are going above and beyond. They are buying the equipment required to repair vehicles properly, they are researching each and every repair, and writing repair plans-not just estimates.
Some of the required types of equipment is scanning equipment. Educated repairers are well aware of the presence of computer technology. I’ll never forget Mike Anderson stating that a Ford Focus has more lines of logic then a 787 Dreamliner.
Manufacturers have many requirements for acceptable diagnostic equipment. Most manufacturers have specific ways of diagnosing and programming. Each requiring unique equipment and procedures.
Unfortunately a few, Hyundai for example does not offer collision repair procedures. They have saftey devices installed in their vehicles to keep people safe that timing within a millisecond can be the difference between life and death. Yet they do not feel the need to offer procedures to help us repair their vehicles so our mutual customer will make it home safe after their vehicle has been repaired.
As important as these requirements are the industry is struggling with this process.
Calibrations are required. Calibrations tell your saftey system if there is an adult or a child in the passenger seat. They can tell the car how close you are to another car or maybe even if a child is behind the car when you back up or if they run out in front of you. They tell you if there is a car in your blind spot, and they can apply the self braking system when needed. But only when repaired properly. Drivers become dependent and sometimes complacent on this equipment.
Many times not even the dealerships that sell these vehicles have the equipment or know how to properly repair these vehicles. The days of buying a scanning device from your local tool truck to diagnose all vehicles are gone, at least for now.
Manufacturers are requiring specific welding equipment. Pulse welders that that heat very quickly to reduce heat transfer. Silicon bronze welders not only used to control heat transfer, but the amount of heat used; compression welders to recreate factory spot welds; and aluminum welders and aluminum rivet tools that can cost around $10,000 to purchase. All of this is required by manufacturers. All of these contribute to the timing of the saftey equipment where the milliseconds are so important.
Even the repair facilities themselves are changing as well. With clean rooms to prevent electrolysis, specific environment for calibrations, areas for diagnostics, and blueprinting or repair planning.
Everything so far has been based on technical industry challenges, but technical challenges are not the only challenges we are facing.
I don’t know the percentages across the entire industry of the amounts customers versus insurance companies have paid for repairs, but I do know the ratio in my shop because of the higher deductibles I have seen on the rise. Sometimes even as high as 20%. I would speculate that, that may reverse and begin to lower again as the prices of some newer vehicles are sometimes over 100,000 dollars.
My point is that a third party is making decisions on what they will and will not pay for. These decisions rarely if ever are made by someone with the training and/or experience like the experience of the repair person/facility. Not only that, but manufacturers’ required repair procedures are often disregarded for the sole purposes of cutting cost.
I had an adjuster tell me that they don’t pay for cavity wax. I provided them with the manufacturers procedures outlying cavity wax as a required procedure, provided receipts, and billed fairly within industry standards.
I was told nobody else had asked for that. I then asked him if his company did not want us to do that procedure and he said that they did not. I asked him if because cavity wax is required and he refuses to pay for it should we do it for free? He did not know.
This may seem trivial, but beyond the fact that this is an important step to preserve our customers vehicle from corrosion. If corrosion starts and weakens the structure it is almost inevitable that it will change the timing for the saftey restraint system and once again our customer is put at risk. Mark Olson, an expert in vehicle forensics, says that cavity wax is the first thing they look for. The answer to the question I asked the adjuster, without a doubt, is yes, we must follow procedures so yes we must apply cavity wax.
Getting paid for applying cavity wax is just one simple, basic, example of many required procedures, we in the collision repair industry struggle to get paid for. But there are many more battles we face.
We are constantly pressured to repair structural components that per OEM recommendations clearly need to be replaced.
We are told to use parts that don’t meet OEM standards. The list goes on and on.
Insurance companies often refuse to pay our rates. Mechanics, truck repair, tractor repair all have higher rates. I did a google search and even several bicycle repair shops rates are higher than insurance companies are willing to pay for collision repair. I really doubt bicycle repairs require anywhere near the facility, training, or equipment or are as critical to the saftey of the customer as collision repair. *Sorry to bicycle repairers, no disrespect intended.*
We should all have the same goals when it comes to repairing vehicles. OEM’s, Insurance companies and collision repair shops alike. Remember Todd Tracy’s mission statement from before: “As vehicle saftey professionals, we have a legal and moral obligation to make sure our customers make it home safely because our vehicle repairs were performed properly, responsibly and ethically.”
I believe strongly in free market, but shops, insurance companies, and manufacturers that do not do the best to ensure the saftey of our customers are doing the industry a disservice.
Repairing a vehicle back to pre-accident condition is hard work. It takes a lot of dedication and frankly as hard as we try it is not always an attainable goal.
The insurance companies have to let the experts do there jobs. Good repair facilities already do the research, make the repair plan, and create the documentation. They must stop trying to dictate repairs that they have not done the due diligence to ensure a proper repair.
Manufacturers must provide us with procedures. With today’s technology we simply cannot do our job without them. They must stop producing vehicles with methods that can not be duplicated in the repair world.
Repairers must repair vehicles per manufacturers procedures to the best of their ability. This means if you only have equipment and or training to repair 10 year old vehicles then you should probably only repair 10 year old vehicles. The repairers that have invested into training and newer equipment should be allowed to charge accordingly. This could apply to specialty markets as well.
I understand there are many different shops with different abilities that all serve a purpose. I do not want to discount anyone’s ability. That is not my intention.
These shops that have invested in specific equipment and training should be allowed to charge accordingly. They should not be subjected to the same rate as a different repairer in their garage without the training or equipment.
I would surmise that the consumer given the choice, knowing what service they were receiving, would pay the additional cost involved for a proper repair verses a subpar repair. I also believe the liable insurance company should be expected to do the same.
When an industry imposes unfair limits on a repairer the consumer loses, when the manufacturers fail to provide repair information needed the consumer loses, and when equipped and educated shops are not fairly compensated the consumer looses.