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Official Publication of the Washington Metropolitan Auto Body Association (WMABA)
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www.grecopublishing.com
Louisiana Attorney General Attacks State Farm - page 38
www.wmaba.com
October 2014Volume 8, No. 10$5.95
ALSO THIS ISSUEWhat Went Wrong: A Case Study Picking a Quality Vendor Time to Get Busy
3October 2014
4 October 2014
©thinkstockphoto.com/Wavebreakmedia Ltd
Photo courtesy of Lange Technical Services
©thinkstockphoto.com/Darko Novakovic
DEPARTMENTS6 Calendar of Events
10 Editor’s MessageJOEL GAUSTEN
12 President’s MessageDON BEAVER
18 WMABA MemberSpotlight
20 Legal Perspective
42 Vendor CornerJOSEPH J. KENNY II
44 Executive Director’sMessageJORDAN HENDLER
46 Advertisers Index
34
CONTENTS October 2014
26Installing a quarter panel on a 2010 BMW 328xiseems like an easy job, right? Maybe not.BY LARRY MONTANEZ III, CDA & JEFF LANGE, PE
TECHNICAL FEATUREWHAT WENT WRONG: A CASE STUDY
5October 2014
COVER STORYRUMOR AND REALITY: REVEALING THE TRUTHS OF ALUMINUM REPAIR
14LOCAL NEWS
GEICO SUPPORTS MD SKILLSUSA WINNER The insurer steps in to fund a student’s dream come true.
CAT-NORTH WELCOMES NEWAUTOMOTIVE REFINISH INSTRUCTOR A familiar face begins a new journey.
15
CONTENTS October 2014
With aluminum all the rage in the industry, WMABA sets out to give members real information.
30SCRS and other industry reps question the methodologies used to determine lengths of rental coverage in today’s industry. BY JOEL GAUSTEN
NATIONAL FEATURETHE RENTAL DELAY DILEMMA: IS THEINDUSTRY LIVING IN THE REAL WORLD?
38As WMABA dealerships start paying for PartsTrader, a high-profile lawsuit goes after the nation’s largest auto insurer. BY JOEL GAUSTEN
WMABA FEATURELAWSUITS & LOST FAITH:STATE FARM FACES A BITTER INDUSTRY
ALUMINUM EXTERIOR PANEL REPAIR & REPLACEMENTState Farm, Silver Spring, MD
November 6, 2014DOCUMENTATION & DIGITAL PHOTOGRAPHYAutomotive Collision Technologies, Randallstown, MDCORROSION PROTECTIONCoxton's Gold Team Collision Center, Yorktown, VA
November 11, 2014FULL-FRAME PARTIAL REPLACEMENTManheim (Harrisonburg) Auto Auction, Harrisonburg, VA FULL-FRAME PARTIAL REPLACEMENTCanby Motors Collision Repair, Aberdeen, MD
November 13, 2014HAZARDOUS MATERIALS, PERSONAL SAFETY & REFINISHSAFETYKunkel's, Baltimore, MDWHEEL ALIGNMENT AND DIAGNOSTIC ANGLESCoxton's Gold Team Collision Center, Yorktown, VAHAZARDOUS MATERIALS, PERSONAL SAFETY & REFINISHSAFETYBeamon & Johnson Automotive Paints, Virginia Beach, VA OVERVIEW OF CYCLE TIME IMPROVEMENTSFOR THE COLLISION REPAIR PROCESSFrederick Co. Career & Tech, Frederick, MD
November 17, 2014MECHANICAL SYSTEMS ANALYSISVirginia Farm Bureau, Richmond, VA
www.i-car.com or(800) 422-7872 for info
November 18, 2014SECTIONING OF STEEL UNITIZED STRUCTURESBeamon & Johnson Automotive Paints, Virginia Beach, VA
November 19, 2014COLOR THEORY, MIXING TONERS & TINTINGRefinish Solutions, Springfield, VA
November 20, 2014ADHESIVE BONDINGCoxton's Gold Team Collision Center, Yorktown, VA STRUCTURAL STRAIGHTENING STEELBeamon & Johnson Automotive Paints, Virginia Beach, VA
November 25, 2014RECYCLED PARTS FOR COLLISION REPAIRManheim (Harrisonburg) Auto Auction, Harrisonburg, VA
CALENDAR OFEVENTS
October 2, 2014FULL-FRAME PARTIAL REPLACEMENTR N R Auto Body, Hagerstown, MD
October 6, 2014ELECTRIC & ELECTRIC HYBRID VEHICLESVirginia Farm Bureau, Richmond, VA
October 9, 2014RACK & PINION & PARALLELOGRAM STEERING SYSTEMSFrederick Co. Career & Tech, Frederick, MD
October 14, 2014INSPECTING REPAIRS FOR QUALITY CONTROLManheim (Harrisonburg) Auto Auction, Harrisonburg, VA
October 16, 2014SUSPENSION SYSTEMSBeamon & Johnson Automotive Paints, Virginia Beach, VAALUMINUM EXTERIOR PANEL REPAIR & REPLACEMENTFrederick Co. Career & Tech, Frederick, MD
October 23, 2014HAZARDOUS MATERIALS, PERSONAL SAFETY & REFINISHSAFETYFrederick Co. Career & Tech, Frederick, MD
October 28, 2014STATIONARY GLASSManheim (Harrisonburg) Auto Auction, Harrisonburg, VARACK & PINION & PARALLELOGRAM STEERING SYSTEMSBeamon & Johnson Automotive Paints, Virginia Beach, VA
October 30, 2014ALUMINUM-INTENSIVE VEHICLE REPAIRSBeamon & Johnson Automotive Paints, Virginia Beach, VA
November 3, 2014DAMAGE ANALYSIS OF ADVANCED AUTOMOTIVE SYSTEMSVirginia Farm Bureau, Richmond, VAFULL-FRAME PARTIAL REPLACEMENTState Farm, Roanoke, VA
November 4, 2014REPLACEMENT OF STEEL UNITIZED STRUCTURESBeamon & Johnson Automotive Paints, Virginia Beach, VA
6 October 2014
Industry training opportunitiesand don't-miss events.
November 4-7, 2014SEMA 2014, Las Vegas Convention Center, Las Vegas, NVFor more information, visit www.semashow.com/scrs
November 4, 2014SCRS RDE Welcome Reception, Las Vegas Convention Center, Las Vegas, NV For more information, visit www.semashow.com/scrs
November 5, 2014SCRS OEM Collision Repair Technology Summit, Las Vegas Convention Center, Las Vegas, NV For more information, visit www.semashow.com/scrs
November 6, 2014Collision Industry ConferenceWestgate Las Vegas Resort & Casino, Las Vegas, NVFor more information, visit www.ciclink.com
SCRS RDE Sky Villa After-party, Westgate Las Vegas Resort & Casino, Las Vegas, NVFor more information, visit www.scrs.com/sema
Greco Publishing Announces Hiring of Managing Editor Jacquelyn Bauman Thomas Greco, President of Thomas
Greco Publishing Inc., publishers of New JerseyAutomotive, New England Automotive Report,Hammer & Dolly, AASP-MN News and Wiscon-sin Automotive News, has announced the hiringof Jacquelyn Bauman as the company’s newManaging Editor.
Bauman will be taking over for AliciaFigurelli, who was promoted to VicePresident/Director of Sales of the companythis past August.
A 2013 graduate of Farleigh DickinsonUniversity, Bauman will oversee editorial inall Greco Publishing publications and will alsoactively participate in the management of theNORTHEAST® Automotive Services TradeShow.
“We are extremely excited to haveJacquelyn become a part of the TGP staff,”Greco says. “Her background and skills are aperfect fit for our company. We have a greatteam in place and are looking forward to
continuing our role as one of the country’s topautomotive repair publishers and trade showmanagement companies.”
Jacquelyn Bauman can be contacted at:Ph: 973-667-6922 F: 973-235-1963E: [email protected]
H&D
8 October 2014
9October 2014
Rodney Bolton ([email protected]) 410-969-3100 ext. 250Mark Boudreau ([email protected]) 703-671-2402
Kevin Burt ([email protected]) 301-336-1140Bobby Wright ([email protected]) 434-767-4128
ADMINISTRATIONEXECUTIVE DIRECTORJordan Hendler ([email protected]) 804-789-9649WMABA CORPORATE OFFICEP.O. Box 3157 • Mechanicsville, VA 23116
STAFFPUBLISHER Thomas Greco
DIRECTOR OF SALES Alicia [email protected]
EDITOR Joel [email protected]
MANAGING EDITOR Jacquelyn [email protected]
ART DIRECTOR Lea [email protected]
OFFICE MANAGER Sofia [email protected]
PUBLISHED BY TGP, Inc.244 Chestnut St., Suite 202Nutley, NJ 07110973-667-6922 FAX 973-235-1963
Reproduction of any portions of this publication is specifically prohibited without written permission from the publisher. The opinions and ideas appearing in this magazine are not necessarily rep re sen ta tions of TGP Inc. orof the Washington Metropolitan Auto BodyAssociation (WMABA). Copyright © 2014Thomas Greco Publishing, Inc.
WHAT A SHAME“Who would have thought I'd need a law
degree to fix cars?”That's what a shop owner recently said to
me during a friendly chat about the industry. Hewas commenting on the variety of legal actionsagainst insurers on behalf of shops andconsumers. From independent repairers usingthe Assignment of Proceeds for short-payreimbursement, to shops joining forces topursue a RICO suit against the nation's topinsurers, the industry has never seen such awhirlwind of activity on the legal front. Naturally,I get enthusiastic calls every day from collisionrepairers who believe that the tide is about tofinally turn in their favor. At the same time, Ireceive calls from other industry stakeholderswho express regret that things have come to ahead in this manner. No matter where you standin the tug of war between shops and insurers,you simply can't argue with the fact that thisrelationship is at an all-time low. Since I'm amember of the industry press, my constantfocus on this news has kept my schedule niceand full. But as a consumer, I'm frustrated anddisappointed beyond measure when I see thisconstant battling between collision repairersand insurance carriers play out in every issue ofthis magazine.
When you strip away the emotions in-volved in settling a claim these days, the factremains that the auto body and insurance
Joel Gausten(973) 600-9288
MESSAGEEDITOR’S
10 October 2014
2014 WMABA OFFICERSPRESIDENT Don Beaver
[email protected] 443-539-4200 ext. 17061VICE PRESIDENT Torchy Chandler
[email protected] 410-309-2242TREASURER Mark Schaech Jr.
[email protected] 410-358-5155SECRETARY John Krauss
[email protected] 703-534-1818IMMEDIATE PAST PRESIDENT Barry Dorn
[email protected] 804-746-3928
BOARD OF DIRECTORS
industries need each other. A typical body shop customer doesn't have thousands of dollarsready at a moment's notice when he or she gets into an accident. Additionally, I'm fairly cer-tain that your average insurer spokesperson can't roll up his or her sleeves and work on aquarter panel. When consumers buy auto insurance, they expect to be covered for theirloss up to the limits of their policies – and that usually means they want their damaged vehi-cles returned to them in “pre-accident condition.” When vehicle owners bring their cars tobody shops, they expect them to be repaired safely, professionally and in a way that won'tnegatively affect their dealer warranty. It all seems so simple, doesn't it? Of course, nothinginvolving money is ever black and white, and that's why I interview as many lawyers as I docollision technicians these days. It's a shame that common sense is often the first thingthrown out the window in an ever-growing number of shop/insurer transactions.
The repairer/insurer relationship should be about mutual respect and a shared concernfor the vehicle owner's comfort, well-being and peace of mind. Shops should never feelpressured to produce unsafe repairs in the name of cost containment, insurers shouldnever be made to pay for work that wasn't performed and consumers should never feelforced to use a particular body shop. Period. If you want to play games, do it in an industrythat doesn't affect the safety of families (especially babies and young children) on the road.The stakes are too high for this kind of insanity to continue. H&D
11October 2014
customer – not the rate you may have agreed to from a third party such as an insurance company. The next hot topic for us to consider is upcoming legislation. I’ve said it before and I’ll say it
again: The only way things will change and shops will once again control their own destinies isthrough legislation. This method is expensive and tiring. What we do have with WMABA is thetenacity to fight these outside influences. What we most need is money. I hate, hate, hate this partof being President. It is never an easy thing to ask for money, but if we want things to change, thisis the ONLY way. To open doors, we have and need to continue to pay for lobbyists. There is a lotinvolved in getting an audience with a lawmaker. Sometimes, it comes in the form of a lunch ordinner; sometimes, it’s a fundraiser. All of this comes at a price. We are a small fish in a big pond;we will swim with the big fish, but it will take your contribution. In the next couple of months, youwill see how and where this money will go, and how you can help. Stay tuned…there’s more tocome. H&D
TIME TOGET BUSY
Although I often find myself strug-gling for a subject or topic to write aboutfor this monthly message, this is one ofthose occasions when so much needs tobe said. By the time this issue goes topress, the kids will be back in schooland shops will begin planning their busyseason. At the same time, young driversare heading off to schools and deer areheading into rut. Before you know it,we’ll also be dealing with accidentsrelated to shorter daylight hours (whichlead us into those “S” days – snow!).Mid-term elections are just around thecorner, and the Legislature will soon beback in session. In addition to all of that,WMABA’s annual Labor Rate Survey isnow available.
On a daily basis, we have differentinsurance companies in and out of ourshops, paying artificially deflated laborand material rates – or refusing to payfor required procedures without a singleiota of proven basis and cost. This iswhere our Labor Rate Survey can andwill help. Go to the WMABA website,www.wmaba.com, and fill it out. It liter-ally takes five minutes, is entirely anony-mous and can only help prove the pointthat there is a restriction in fair trade thatborders on price fixing. These are thethings that help us help you. Insurancecompanies supposedly pay a prevailingrate, but there has to be some sort ofbasis to properly establish that rate thatis unbiased. I don’t know about you, butthere is only one insurance companythat has ever surveyed my shops forthis; in many ways, it helped to keeprates suppressed. Fill out the Surveyusing your door rate, which is what youcharge (or need to charge) to a walk-in
MESSAGEPRESIDENT’S Don Beaver
(443) 539-4200 ext. [email protected]
12 October 2014
13October 2014
As its scores of volunteers and competitors know, SkillsUSA is atremendous opportunity for promising auto refinishing and collisionrepair students to showcase their skills on the state, national andeven international level. Thanks to GEICO, this year’s MarylandSkillsUSA Automotive Refinishing Technology winner, Frank Meckel(Harford Technical High School, Bel Air), was given the chance tocompete at the National Leadership and Skills Conference last Junein Kansas City, MO.
In an effort to award Meckel for his exceptional performance atthe state competition, GEICO covered all of his travel and lodging
expenses during his week-long trip to Missouri. This generous dona-tion was in line with GEICO’s ongoing commitment to SkillsUSA andthe students who compete in the annual event.
“I find it personally rewarding to go and watch these high schoolstudents go into the industry and have such dedication,” offers TimHession, director of auto damage training for GEICO. “Knowing thatwe have to have all parties involved in automotive repair, I thinkSkillsUSA is a very worthy cause.”
Meckel, who placed 13th at the national event, comes from along line of automotive enthusiasts. His mother, Beth, is an industrymainstay and a past recipient of an AkzoNobel Most InfluentialWomen in the Collision Repair Industry Award, while his brother,Eddie, works as a professional mechanic. Additionally, his father, Ed,restores classic cars in his spare time. Not surprisingly, Meckel al-ways knew that he would work in the automotive profession.
“I love cars – anything with a motor!” he says. Of course, he had an amazing time in Kansas City.“It was the best thing I’ve ever done!” he shares. “I had the most
fun ever; it was great!”Currently, Meckel works at Enterprise Upholstering in Bel Air and
hopes to go to technical college and pursue a full-time career as apainter. Considering his early success in the field, what is the best ad-vice this recent high school graduate would offer students just nowstarting out in automotive programs?
“Come into it with an open mind,” he says. “Don’t think you knoweverything; honestly, you probably won’t. Just be ready to learn.”
For more information on SkillsUSA, visit www.skillsusa.org. H&D
GEICO SUPPORTS MD SKILLSUSA WINNER
14 October 2014
Top-Notch Educational Opportunities
Over 150 industry-leading exhibitors
Fun for the Whole Family, And More!
®
Save the Dates forNORTHEAST 2015!
March 20, 21, 22
www.aaspnjnortheast.com
Michael Smith, manager of the auto damage training center for GEICO,congratulates Maryland student Frank Meckel on his win at SkillsUSA.
NEWSLOCAL
When Auto Refinishing students at theCenter of Applied Technology-North (Severn,MD) started their school year last month, theywere greeted by new instructor AmandaBolton. Already known in Maryland educationcircles for her work as chairperson for the MDSkillsUSA Competition, Amanda took over theposition at CAT-North from her father Rodney,who recently stepped down after a 25-year run.
Amanda’s arrival at CAT-North follows animpressive career that has included time withVeriFacts, Gerber, Heritage Mile One, the Colli-sion Center of Cockeysville and two differentstints with O’Donnell Honda Collision Center.She is thrilled to have an opportunity to workwith students on a daily basis.
“I always had an interest in teaching stu-dents, especially with my involvement withSkillsUSA over the years,” she says. “I thinkthat just having the experience of being up infront of students that age has made me a lotmore comfortable in interacting with them. A lotof them have already started to open up; someof the kids have even seen me at the school inprior years.”
In her new role, Amanda will be teachingapproximately 30 students from grades 9through 12. Due to her new commitment atthe school, she plans to pass along the MDSkillsUSA chairperson position to her mother,Teresa (ASE), for 2015. Amanda hopes to helpher new students develop a genuine passionfor the automotive trade.
“I just want to have an impact on thesekids and help them out,” she says. “It’s thewhole reason why I wanted to take this posi-tion.”
Still very active in education, Rodney willnow serve Anne Arundel County as an intern-ship coach, helping students out of Meade
High School (Fort Meade) and Southern HighSchool (Harwood) develop career paths in avariety of professions, including work with theNational Security Agency (NSA). Looking backat his 25 years with CAT-North, he feels thathis greatest success was establishing strongbonds with repairers, vendors and other indus-try representatives in the area.
“The way that program developed was
not just because of me, but because of theprofessionals who are out in the industry, whorun body shops and need people,” he says.“They were the ones who participated in myprogram as a PAC [Program Advisory Commit-tee] member. The thing that I learned is youhave to work directly with the industry to makethe program what it is and to continue. Noinstructor can do it alone.” H&D
Information and updatesfrom WMABA and beyond.
15October 2014
CAT-NORTHWELCOMESNEW AUTOMOTIVEREFINISH INSTRUCTOR
Rodney Bolton hands the keys to the CAT-North Auto Refinishing classroomover to his daughter Amanda, who took over the position last month.
16 October 2014
BOB BELL FORD 7125 RITCHIE HWY, GLEN BURNIE, MD 20161Phone: 410-689-3038Fax: 410-766-1275www.bobbell.com
WALDORF FORD2440 CRAIN HWY, WALDORF, MD 20601Phone: 301-843-3028Fax: 301-843-0334e-mail: [email protected]
TED BRITT FORD11165 FAIRFAX BLVD, FAIRFAX, VA 22030Phone: 703-673-2420Fax: 703-870-7982www.tedbrittparts.com
PLAZA FORD1701 BEL AIR RD, BEL AIR, MD 21014Phone: 410-879-3367Fax: 410-877-7248www.plazaford.com
APPLE FORD8800 STANFORD BLVD, COLUMBIA, MD 21045Phone: 800-492-7999Fax: 410-312-0928www.appleford.com
ACADEMY FORD13401 BALTIMORE AVE, LAUREL, MD 20707Phone: 301-419-2700Fax: [email protected]
SHEEHY FORD5000 AUTH RD, MARLOW HEIGHTS, MD 20746Phone: 301-899-6300Fax: 301-702-3650www.sheehyford.com
HAGERSTOWN FORD1714 MASSEY BLVD,HAGERSTOWN, MD 21740Phone: 800-200-0276Fax: 301-733-0603www.hagerstownford.com
KOONS FORD OF ANNAPOLIS2540 RIVA ROADANNAPOLIS, MD 21401Phone: 410-266-3083Fax: 410-224-4239www.koonsford.com
Contact these Ford or Lincoln Mercury dealers for all your parts needs:
© 2014, Ford Motor Company17October 2014
The latest from WMABAmembers and supporters.
SPOTLIGHTWMABA MEMBER
18 October 2014
Any business that can survive in the automo-tive industry for six decades must be doingsomething truly special.
One of the WMABA region’s most well-re-spected paint suppliers, Nyquist, Inc. has servedcollision repair customers in the Baltimore-Wash-ington Metropolitan region since 1955. Originallyfounded by George and Anna Marie Nyquist, thecompany has flourished under the guidance ofsecond-generation owner George Jr. since 1978.After working at the company through most ofhigh school and college, George Jr. briefly pur-sued a career as a public schoolteacher beforethe lure of owning his own business brought himback into the fold.
“I had a competitive spirit and wanted togrow,” he recalls. “I can’t say I woke up everyday because I loved paint; I woke up every daybecause I liked being in business. There are twothings you’ve got to do to be successful: You’vegot to have that drive and desire, and you’ve gotto work.”
And work George Jr. did. It wasn’t uncom-mon for him to put in 80-hour weeks throughmost of the ‘80s to solidify the Nyquist namethroughout the region. Not surprisingly, thecommitment paid off.
In May of 1981, Nyquist opened a secondlocation in Glen Burnie. The following year, thecompany was selected to be the seventh distrib-utor of the Sikkens brand of automotive finishes.In 1988, George Jr. opened a third location inCapitol Heights, which was merged into the GlenBurnie location and moved to Millersville in 1989.Subsequent locations include Salisbury, West-minster and Hampton, VA. With all of these pur-chases and acquisitions, Nyquist, Inc. now hasmore than 60 employees, and services theneeds of body shops and related businesses inMaryland, Delaware, Pennsylvania, Virginia andNorth Carolina.
Naturally, George Jr.’s success in the fieldwasn’t based on working in the business alone.Like many successful industry entrepreneurs, heunderstood the importance of reaching out be-yond his four walls and getting involved inWMABA.
“In the mid to late ’80s, things startedchanging and it became a bigger world,” he says.“If we were going to be a part of that world, wehad to do some things in other markets. WMABAwas the biggest of its kind and a very well-runorganization, so we decided to join, go tomeetings and see what it was about.”
DECADES OFDEDICATION:Family TiesHelp Nyquist,Inc. Thrive
Top: George Nyquist, Jr. has carriedon the family tradition since 1978. Bottom: 91-year-old Anna Marie isstill a regular presence at the long-running family business.
The Nyquist Management team (left to right): Jim Romeo (operations manager for all stores - 42 years with Nyquist), Jim Turpin (vice president and sales director - 28 years with Nyquist), Eileen May (comptroller and human resource
manager - 26 years with Nyquist) and Mike Hasiuk (inventory and fleet manager - 18 years with Nyquist).
19October 2014
Nearly 30 years after first becoming amember, George Jr. continues to derivetremendous value from his relationships withhis peers in the association.
“You have to do everything you can toget your face out there, whether it’s an in-dustry meeting, a clinic or anything you cando to get in front of people,” he explains.“That includes taking personal time on Satur-days and Sundays to do things with peoplein your business. You have to devote a lot oftime to what you’re going to do [in this indus-try].”
Of course, much has changed in the 36years since George Jr. first took over thefamily company. For one thing, the eventualover-saturation of the paint market led toSikkens and other manufacturers giving job-bers like Nyquist, Inc. exclusive territories,thus allowing George Jr.’s company to growin exciting ways. In addition to these ad-vancements, the industry’s move to water-borne paint in recent times has had aconsiderable effect on how paint suppliersconduct business. In George Jr.’s mind, themove from solvent to water is a welcomedchange.
“It is a better product,” he says, “Thecolor match is better, and it disperses pig-ment better. A gallon of solvent weighsseven pounds; a gallon of water-based paintweighs 8.2 pounds. Water is more densethan solvent; you can put larger and moresubstantial pigment in a water-based binderthan you can in a solvent-based binder. It’salso cleaner when it goes on the car. In Vir-ginia, we probably sell 85 to 90 percentwater, and it’s not the law. It’s just what peo-ple are using because it’s better.”
With nearly 60 years of success alreadybehind them, Nyquist, Inc. still thrives on thevalues established in 1955 by a husband-and-wife team with a dream. In fact, 91-year-old Anna Marie is still a regular guest at theBaltimore location, which still has her nameon the door. After spending nearly his entireprofessional life in the family business,George Jr. feels that the greatest tool forsuccess is the ability to be prepared for any-thing that comes your way.
“The biggest problem that people have,in any business, is resistance to change,” hesays. “If you’re going to think that anything isgoing to be the way it used to be, it’ll neverhappen. If you focus on that, you’ll be eter-nally angry every day you come to work.Every business has its challenges; it’s work.But this is still a good business.”
More information on Nyquist, Inc. isavailable at www.nyquist-inc.com. H&D
What’s happening at the State House, inyour industry and everywhere in between.
PERSPECTIVELEGAL
As the federal government considers immigration reform, it isimportant to remember that states have their own immigration lawsin place. Specifically important to employers, E-Verify is an onlinesystem run by the federal government and used by employers to verifythat a worker is eligible to work in the US. The system has a centralfederal database of valid Social Security numbers and names ofindividuals associated with each. Congress is considering whether ornot to make all employers across the nation use E-Verify. Currently,the requirement for an employer to use E-Verify varies from state tostate:
Maryland and D.C.- Neither region requires employers to useE-Verify to confirm the legal employment status of employees.
Virginia - Effective December 2013, public contractors with more thanan average of 50 employees working in the state for the previous 12months must register and participate in the E-Verify program ifperforming work for certain state agencies.
IMMIGRATION ANDSMALL BUSINESS: AREYOU IN COMPLIANCE?
BY WHITNEY CLEAVER SMITH,Attorney, The Law Officesof Alexander & Cleaver
20 October 2014
Other states (including North Carolina)require all (or almost all) employers to useE-Verify. If you have any questions aboutwhether your current business is in compliancewith state and federal immigration laws, pleasecontact me at Alexander & Cleaver, (301)292-3300. H&D
Whitney Cleaver Smith’spractice of law focuses onpersonal injury, primarily representing clients incourt. She continues tobuild on her impressivetrack record of achievingcourt awards for clients in excess of previously offered insurance settlements. She also works with clients on social mediaissues. For more information, please contact Whitney Cleaver Smith [email protected] or (301) 292-3300 to construct or review social media policies.
21October 2014
22 October 2014
23October 2014
24 October 2014
25October 2014
Nuts and bolts, tips and tricksfrom our resident industry experts.
FEATURETECHNICAL
BY LARRY MONTANEZ III, CDA & JEFF LANGE, PE
The installation of a quarter panel on a 2010 BMW 328xi seemslike an easy job, right? Maybe not. In this month’s article, we will lookat a case study of a vehicle repair that went very wrong.
On or about February 8, 2013, a BMW was taken to a local deal-ership due to a persistent problem with the battery/chargingsystem. The certified BMW technician discovered excess sitting waterin the battery tray area, in the right rear quarter panel area. Addition-ally, the inspection revealed previous repairs to the right rear area ofthe vehicle. On or about February 12, 2013, the BMW was sent to MidIsland Collision in Rockville Centre, NY (an Approved BMW CollisionRepair Center) to repair the leak. During the disassembly, the BMW-approved technician assigned the repair noticed multiple areas of cor-rosion to the right rear quarter panel and adjacent components. On orabout February 13, 2013, Robert Jesberger, owner of Mid Island Colli-sion, asked us to examine the vehicle with the vehicle ownerpresent.
Jesberger explained to us that the vehicle was repaired at a Di-rect Repair facility for a particular insurance company to repair dam-age resulting from a collision event that occurred on or about March19, 2012. The name of the repair facility was not provided to us, but aredacted copy of the insurance company’s final estimate was suppliedand listed the replacement of the rear bumper assembly, right taillamp assembly, deck lid, rear body panel, fuel pocket and right rearquarter panel. No final invoice from the repair facility was provided.
ANALYSIS: Examination of the vehicle revealed the following:
Deck lid: The lid was visually misaligned. The left and right hinges tothe deck lid showed evidence of a 4mm-to-5mm shift to the right, asevident by the original position marks now exposed. Excessive corro-sion was present on all four trunk lid hinge mounting bolts, with multi-ple tool impact markings.
Battery: Approximately one half-inch of water accumulated in thebattery tray/right rear quarter extension panel area. Excessive corro-sion was observed on the battery hold down and bolt. The lower por-tion of the battery case was stained, while rust-colored residue waspresent. Severe corrosion build-up was evident from the battery to theluggage compartment positive (+) connection cables (main and auxil-iary). This corrosion was sufficient to create excessive resistance atthe connection. This resistance, in time, would have caused electricalmalfunctions and presented a potential fire hazard.
Right bumper mounting bracket (plastic): Nutserts were installedin the two lower mounting areas on the right rear quarter extensionpanel, and two bolts were installed. BMW utilized coarse-threadedstuds resistance welded onto the panel and attached the bracket withplastic nylon nuts. BMW does service the studs and has a part num-ber. The application of butyl tape to the nutserts, in an attempt to pre-vent water intrusion, was also noted.
Fuel pocket: The pocket assembly was loose and the fuel door lockassembly lower clip was fractured and glued. Removal of the fuelpocket requires replacement, due to the four corner clips that must bedamaged to remove it.
Rear body panel: Squeeze-type resistance spot welds were ob-served on the mating flanges. The OEM replacement procedure re-quires rivet bonding.
Upper inner roof rail reinforcement: A vertical cut with multiple in-dications of jagged tool-type impact markings were observed to thereinforcement. This type of damage is consistent with contact with areciprocating-type saw, carbide blade or similar tool while attemptingto cut though the outer panel without utilizing the proper precautions,such as installing metal protective tabs to prevent this type of incidentfrom occurring.
Right rear quarter panel: Multiple exposed Metal Active Gas (MAG)plug welds with indications of burn-through on the inner quarter panelbrace mating flanges were observed. Indications of bare metal areaswith corrosion and tool-type impact markings to the rear area of theouter wheelwell housing were observed. Also noted was excessivecorrosion to the outer wheelwell wheel lip mating flange, and multipleincomplete MAG plug welds, suggesting lack of penetration from theinner quarter panel brace to inner wheelhouse panel. Multiple indica-tions of incomplete weld fusion of the squeeze-type resistance spotwelds (STRSW) were observed on the quarter panel to inner wheel-house panel at the door opening mating flange and backlit matingflange areas. The inner flange area showed evidence of burned paintmaterial, supporting that the flange was not properly prepared prior towelding. Additionally, no evidence of any corrosion protection and/orrust-proofing compound applications was observed to the enclosedareas and flanges.
After removal of the right rear quarter panel, we inspected thesectioning joints in the sail panel and rocker panel areas. This re-vealed multiple indications of burn-through, with welding wire stickingthrough to the backside of the joint. The right side rear quarter panelto rear door gap was at or near 7mm. Conversely, the left side rearquarter panel to rear door gap was at or near 5mm.
STRSW samples from the quarter panel and rear body panelmating flanges failed visual inspection and destructive peel testing.Intentional separation of the panels at the mating flanges revealedlittle to no metal tear out. Analysis indicates that bolt-on panels wereadjusted to their maximum in attempts to have panels align toadjacent panels. This shows evidence to suggest the structure of the
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26 October 2014
vehicle is misaligned and/or the replacement quarter panel and rearbody were installed in the incorrect position.
The replacement rear body panel and right rear quarter panelwere installed utilizing MAG welds and STRSW, although BMW of NorthAmerica specifically requires panels to be installed with rivets and struc-tural adhesives (rivet bonding). Multiple areas were observed with miss-ing and/or improperly applied seam sealer. The repairs performed on theBMW from the incident of March 19, 2012 show evidence to support adirect relationship to the water intrusion to the battery tray/quarter exten-sion panel.
Paint film thickness readings varied on the panels and were incon-sistent. On new panels, readings ranged from 2.4mils to 3.2mils, sug-gesting not enough material application. On repaired panels, readingsranged from 4.2 mils to 8.8mils, suggesting too much material applica-tion.
CONCLUSIONAfter our examination, Jesberger called the insurance company to
come and inspect the vehicle. After inspecting it and reviewing our reportas well as BMW repair procedures, the insurer decided to pay for there-repairs.
The original estimate was written for $6,859.59; the re-repair finalrepair invoice was $22,595.80. We were later told the shop had paidrestitution to the insurance company for the incorrect repairs. This is aprime example of two important things: First, a lack of knowledge andtraining can lead to disastrous outcomes; second, at least the repairswere performed at the insurance company’s DRP facility, so the guaran-tee was there for proper repairs (to the vehicle owner’s benefit in thiscase). If this repair was performed at a non-DRP facility, it could havetaken a couple of years to settle instead of a couple of weeks. It is
unfortunate that in this technically advanced day and age, we still havean epidemic of poor repairs and finger pointing at the insurancecompany, when in reality the problem is the repair facility’s lack oftraining, education and desire to change. Many times, their ego blocksthe path to growth and success.
We hope this article has helped the industry to better understandwhat could go wrong with a repair, and the ramifications of thoseincorrect repairs. Feel free to contact us if you have any questions.
H&D
Larry Montanez III, CDA is co-owner of P&L Consultants with Peter Pratti, Jr. P&LConsultants works with collision repair shops on estimating, production and properrepair procedures. P&L conducts repair workshops on MIG & resistance welding,measuring for estimating and advanced estimating skills. P&L also conducts investi-gations for insurers and repair shops for improper repairs, collision repairability andestimating issues. P&L can be reached by contacting Larry at (718) 891-4018 (office),(917) 860–3588 (cell), (718) 646–2733 (fax) or via email at [email protected]. TheP&L website is www.PnLEstimology.com.
Jeff Lange, PE is president of Lange Technical Services, Ltd. of Deer Park, NY(www.LangeTech.net). Jeff is a Licensed New York State Professional Engineerwho specializes in investigating vehicle and component failures. Lange TechnicalServices, Ltd. is an investigative engineering firm performing forensic vehicleexaminations and analysis for accident reconstruction, products liability andinsurance issues. Jeff can be reached at (631) 667-6128 or by email [email protected].
27October 2014
Understanding a repair-gone-wrong situation only helps everyone, includ-ing that person, to grow. Learn from the mistakes of others to prevent put-ting yourself in this same precarious position. Educate, train and equip, orknow your limits and send that repair elsewhere. - Jordan Hendler
Executive Director’s Thoughts
Right wheel house to 1/4 extension: MAG plug welds present, requiresrivet-bond procedure.
Film thickness measurement of new deck lid, 3.6mils. Slightly thin coating.
Clockwise from top left: Left side tail lamp pocket panel to left rear quarterpanel, OEM Original; Bolt installed with butyl on right bumper side mountingbracket instead of a resistance welded stud; Bolt installed with butyl on rightbumper side mounting bracket instead of a resistance welded stud; Fuelpocket with missing clips; Left side quarter panel to quarter extension panel,OEM untouched; Right tail lamp to quarter panel flange, seam open.
28 October 2014
29October 2014
When an insurer tells a policyholder thata repair will take two days, it is understand-able when this customer gets frustrated –and ready to dole out poor CSI scores –when that job takes 10 days to complete.Every job that ends up in this situation repre-sents a failure to balance insurer expecta-tions with realistic auto body industry data onlengths of repair. As these problems persist,shops and insurers inevitably lose out oncustomer retention while overburdening theprocess every step of the way. Thankfully, re-pair industry representatives are workinghard to draw greater attention to what hasclearly become one of the biggest obstaclesin the shop/insurer relationship.
To gain greater insight into the wideninggap between insurer expectations and reali-ties on the shop floor, the Society of CollisionRepair Specialists (SCRS) gathered statisticsproduced by CCC Information Services, Inc.and Mitchell International relative to averagehours per claim, and information publishedby Enterprise Rent-A-Car and provided bythe Hertz Corporation reflectingthe average length of rental. Theassociation focused on data pro-duced for jobs during the fourthquarter of 2013. According to anSCRS press release on this
project issued in May*, “While cross-refer-encing each data set against the others pro-duced a variety of results, no combination ofdata supported an expectation even reaching[three hours] per day. Results were factoredby dividing average hours per claim by aver-age length of rental.” The association cameup with some fascinating figures: When com-paring the average hours-per-estimate dataprovided by CCC against Enterprise’s aver-age length of rental, a 30-hour job could beexpected, on average, to take an estimated15 days to repair. When was the last time aninsurer told one of your customers upfrontthat they’d be in a rental car for anywhereclose to these numbers?
“What’s interesting is that there’s a re-ally big disparity between the way insurerschoose to calculate that [rental] number, butthere’s not that big of a disparity between thecalculation of the actual average rentallength,” offers SCRS Executive DirectorAaron Schulenburg. “If you look at the
average length of rental in comparison to theaverage hours per claim, the numbers arerelatively close. What we found is none ofthem exceeded three hours per day on aver-age, but there is an unexplainable gap be-tween what happens in reality, and whatinsurers are expecting. Some are using fourhours a day; others are using five and six. Ithink the reason why you’re seeing such vari-ance is potentially the purpose [behind whatis expected]. If insurers are utilizing that fig-ure to drive performance rather than to iden-tify actual length of repair, that would causethose numbers to vary. Obviously, insurersthat are trying to drive better performancethan their competitors are going to give amore difficult number to attain.”
In Schulenburg’s mind, a possible solu-tion to the problem would be to base the up-front rental period on actual industry data onvehicle repairs rather than on the desire forshops to constantly outperform their peers.
“Obviously, every shop explains to theconsumer that there’s always unseen dam-age and unexpected things that could varythe length of repair,” he says. “But if we canuse better industry data to define what thatlength of repair is anticipated to look like onaverage, then let’s communicate that to thecustomer and set that expectation upfront. Ifit’s likely going to be 15 days, let’s tell themit’s going to be 15 days instead of tellingthem it’s going to five and changing it twice.”
When discussing insurer demands inthe repair process, it is not uncommon forsome stakeholders to use the default argu-ment that DRP shops can either work withinan insurer’s parameters or cover the financialburdens for the rental vehicle if the repairgoes beyond a certain period of time. But is it
THE RENTAL DELAYDILEMMA: Is the IndustryLiving in the Real World? BY JOEL GAUSTEN
SCRS and others try to makesense of controversial rental times.
FEATURENATIONAL
30 October 2014
reasonable to expect shops to indemnify an-other industry when a repair process fails tolive up to an arbitrary formula, considering in-dustry data demonstrates that this number isoften a fraction of the time truly needed?
“I think there’s an underlying issue therethat we, as an industry, need to address,”Schulenburg says.
Not surprisingly, SCRS’ work on the topichas influenced considerable discussion in otherparts of the industry. The length-of-rental de-bate took center stage during the most recentCollision Industry Conference (CIC), where theInsurer-Repairer Relations Committee hostedSchulenburg and representatives from insur-ers, body shops, rental companies and CSIfirms for a special panel discussion. CurtisNixon, president of UpdatePromise.com, of-fered intriguing – and at times downright star-tling – numbers based on data fromapproximately 8,000 shops to illustrate justhow damaging this dilemma can be to both re-pairers and insurers. Although Nixon’s re-search showed that the average customer willtolerate one to two promise date changesthroughout the repair process, things beyondthat target tend to go downhill quickly. Accord-ing to Nixon, going beyond three days to de-liver a promise date will typically result indiminished consumer confidence, while givingan expectation too early often leads to thesame result. And here’s the real kicker: Nixonhas experienced situations where shops makeup to 14 promise date changes on a single re-pair. Do you want to guess what that does tothe customer experience?
“There are so many variables in the repairprocess,” he said. “When we set an unrealisticexpectation by using formulas that are just kindof thrown out there, it does cause a diminishedreturn on your overall customer satisfaction.”
Frank LaViola, assistant vice president ofcollision industry relations for Enterprise Rent-A-Car, noted that an unexpected extension inrental time impacts all stakeholders.
“If an insurer makes a conscious effortwith the shop through a DRP arrangement…that they’re going to be picking up any extradays, as long as the customer isn’t aware ofthat and there’s no heartburn there, I don’tthink there’s an issue,” he said. “But I will tellyou when the customer gets involved in thatdebate, discussion or battle…it affects all ofour CSI.”
With more inter-industry discussions onthe length-of-rental issue taking place thanever before, one of the auto body field’s most
frustrating problems could finally see a resolu-tion. The data is out there – it’s just a matter ofshops and insurers agreeing to finally removethe blinders and operate in the real world. Nei-ther industry is doing the consumer any favorsby perpetuating the system as it stands today.
As Schulenburg says, “I feel like we, asan industry, do it because we’ve always done itthis way, and it just doesn’t make sense.”
*The full SCRS press release regarding lengthof rentals is available online athttp://archive.constantcontact.com/fs161/1101307009687/archive/1117246772024.html.
H&D
31October 2014
32 October 2014
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33October 2014
WMABA takes on one of the industry’s hottest topics.
STORYCOVER
34 October 2014
Whether you’re a shop owner just now beginning to considerupgrading due to the excitement surrounding the 2015 Ford F-150,a veteran repairer with multiple certifications or simply someonewho has followed the trade press in recent times, you know thataluminum has become the hottest topic in the industry. In an effortto help its members set a clear path through the murkiness andconfusion surrounding aluminum repairs and procedures, WMABAis in the process of organizing a special event for early Decemberdesigned to offer real world knowledge and insights from thosewho know these vehicles best. The association is pleased toannounce that noted instructor and longtime Hammer & Dollytechnical writer Larry Montanez III, CDA (P&L Consultants) hassigned on to present an extensive overview of what repairers andowners really need to know about taking on aluminum at theirshops. If you seek answers based on truth and not just a salespitch, this upcoming meeting is for you.
“We chose to cover aluminum because it seems to havePandora-like characteristics for many shop managers andtechnicians,” explains WMABA Executive Director Jordan Hendler.“How to work on it properly is just as important as all of the otheraspects, such as proper repair estimates, equipment integration,space requirements, OE programs, and staff training. There is a lotof speculation coming our way from shops who are weighing theiroptions. There is a small percentage of repairers who decided earlyon to get in front of the aluminum and structural aluminum, andcertify with OEs. Those repairers have talked to us about wastedmoney on equipment they didn’t really need, how fast equipment
can change, how much investment in training their personnelcosts, and the lists go on. It is a huge commitment, no matter whenthe decision to start is made.”
As anyone who has read Hammer & Dolly in recent monthsalready knows, Montanez has been actively addressing thealuminum issue by working to dispel many of the commonmisconceptions and myths surrounding the repair of thesevehicles. Not surprisingly, he expects his upcoming WMABAcourse to shed light on the realities that shops must considerbefore diving into this kind of work. For one thing, it’s not just aboutbuying a bunch of fancy new equipment; it’s also about getting thecorrect training to know how to get these vehicles back on the roadwithout putting an unsuspecting driver or passenger at risk. When itcomes to training, Montanez cautions that there is a world ofdifference between the current requirements issued by Ford andwhat other aluminum vehicle manufacturers expect you to knowand perform.
“Those who bought equipment and went through a one-daytraining course are not certified in any way, shape or formaccording to the German/European companies,” he explains. “Thepeople who are making $80,000 to $300,000 vehicles are saying‘A,’ while the company that is making a $18,000 to $50,000 vehicleis saying, ‘Z.’ This is how far apart they are.”
Depending on the manufacturer, aluminum repair classes fordealer-sponsored shops can cost upwards of $16,000 and takeweeks to complete – without even beginning to factor in travel andother employee expenses, including the loss of production.
BY JOEL GAUSTEN
35October 2014
Compare that to Ford’s current one-day course, and it’s clear thatthere isn’t a one-size-fits-all, streamlined silver bullet when it comes totraining aluminum techs.
“If you’re an Audi, Porsche, Benz, Aston Martin or Jaguaraluminum repair facility, you’re already overqualified for Ford, due tothe stringent requirements from the European OEMs for theiraluminum programs,” Montanez says. “Ford has chosen differentequipment to make it more cost-effective for shops to becomealuminum certified, approved or recognized. The other [aluminumrepair] shops follow very strict programs, with very specific equipmentpurchases and training requirements.”
For example, Montanez says that students taking the Audi andMercedes-Benz tests need to be able to deliver the goods with zerohand-holding.
“When you go to those courses, you’re expected to know how toweld already, and weld well,” he warns. “Its a rarity that [theinstructors/facilitators] will actually put a mask on and watch you weld.They will give you suggestions and guidelines on how to overcome anissue, but it is not a training course – it is a test. You’re supposed toknow how to weld– end of story. And you need every bit of those twoweeks to take the test the first time, as it is very difficult andfrustrating. You are expected to weld like a machine every time – noerrors.”
If you want even more insight into how important skill andaccuracy are to successful aluminum welding, Montanez offers thistest: Write 2 + 2 = 4 six times on a piece of paper. Do all six lookexactly the same? Are all the equal signs parallel and the samelength? Are all the plus signs perfectly symmetrical? Are all the 4s and2s identical, but not exactly the same? If they’re not, you’re in trouble,because this is the kind of precision the European manufacturerswant. Some manufacturers like Audi require a two-year renewalof your welding certification, while Mercedes-Benz requiresre-certification every six months.
“It’s perfection or nothing,” he says. In addition to Montanez’s presentation about the myths and
realities of aluminum, WMABA plans to present a panel of repairerswho are already in the OE programs, fixing aluminum and understandthe process it took and how others can do it properly. Clearly,WMABA’s upcoming aluminum event will be a can’t-miss opportunityto get the tools you need to successfully take the leap into the nextgeneration of automotive events. Hendler encourages all attendees toprepare in advance to make the absolute most of what theassociation’s program will offer.
“Bring questions to the meeting - all the questions,” she advises.“What kind of shop preparation is needed? How do I schedule forthese types of repairs versus traditional steel? What are some of thebudgetary items, at minimum, that I should be considering? How doOE programs differ from one to the other? When shops don’t get thefacts, it makes things frustrating. That’s why we’re here to help.”
More details about this special WMABA event will be featured inour next issue. Please contact WMABA Executive Director JordanHendler at (804) 789-9649 if you have immediate questions. H&D
The 2015 Ford F-150:Your Questions AnsweredIn an effort to provide the WMABA community with the most accurateinformation possible regarding the 2015 Ford F-150, we assembledsome of the industry’s most commonly asked questions and passedthem along to Elizabeth Weigandt, dealer communications managerat Ford Motor Company. Weigandt’s responses appear below.
If a repairer has zero past experience with aluminum but wants totake advantage of the opportunity to repair the Ford F-150, howmuch money should they plan to invest in order to become compli-ant with the equipment/training specifications and be consideredFord-recognized?
Ford estimates it will cost $30,000 to $50,000 for a dealer or bodyshop to purchase new equipment needed to repair damage to alu-minum.
What kind of rivet guns should be used on the 2015 F-150?
Here is a full list of equipment (including the rivet gun) we recommendshops purchase for collision work on the new F-150.
What are the parameters/limits for pulling on the Ford F-150?
The vehicle may require anchoring and pulling operations to correctcollision damage. This may be done with the use of the Ford recom-mended solid cab mounts to allow the pulling of the vehicle’s alu-minum intensive unibody along with any frame damage. With thedamaged areas pulled back to proper dimensional condition, the af-fected areas are inspected for cracks, damaged fasteners and anyother concerns, then replacement of any damaged components maybe done per Ford guidelines and procedures. H&D
What kind of shop preparation is needed? How do Ischedule for these types of repairs versus traditionalsteel? What are some of the budgetary items, atminimum, that I should be considering? How do OEprograms differ from one to the other?
36 October 2014
37October 2014
The nation’s largest autoinsurer is in the hot seat.
FEATUREWMABA
38 October 2014
State Farm has seen better days. If the last three years of automotive
media coverage has taught us anything, it isthat the nation’s largest automotive insurer isunafraid to court controversy. With dealershipsacross the country now being made to payupwards of $199 a month to use the insurer’smandated PartsTrader part procurementsystem, the insurer’s seemingly permanentblack eye is getting even darker. When youconsider that State Farm is also facing ahigh-profile lawsuit by a well-known AttorneyGeneral, it appears that the good neighborsare having a very hard time getting much lovein their community.
The King vs. the GiantTo music lovers in Louisiana, James
David “Buddy” Caldwell is one of the mostpopular operatically-trained Elvis Presleyimpersonators around. But when he takes offhis stage clothes and dons a suit and tie, hestands as perhaps the greatest adversaryState Farm has ever seen. Since becomingthe state’s Attorney General in 2007, Caldwellhas made a career out of hunting internetpredators, senior citizen scammers and otherswho work to harm the public. On August 19,he announced his intentions to go after StateFarm.
In an official statement issued to media,Attorney General Caldwell alleged that the in-surer “has engaged in a pattern of unfair andfraudulent business practices aimed at con-trolling the auto repair industry and forcing un-safe repairs on vehicles without theknowledge or consent of Louisiana con-sumers.”
Specifically, the suit alleges that StateFarm violated Louisiana’s Unfair Trade Prac-tices Act and Monopolies Law by (in the wordsof the statement) “using scare tactics to steerLouisiana consumers to State Farm’s pre-ferred repair shops and forcing shops to per-form vehicle repairs cheaply and quickly,rather than in accordance with consumersafety and vehicle manufacturer performancestandards.” The Attorney General has alsoexpressed concern that vehicles repaired bythese shops are done using “junkyard” or“foreign knock-off” parts.
LAWSUITS &LOST FAITH:STATE FARM FACES A BITTER INDUSTRY BY JOEL GAUSTEN
Caldwell says the suit aims to change theculture of unsafe business practices led byState Farm in the auto insurance and repair in-dustries. State Farm currently holds the largestshare of auto insurance policies in Louisiana.In 2012, State Farm wrote one third of all autoinsurance policies in the state totaling over $1billion in premiums.
State Farm quickly issued a characteristi-cally reserved public statement on the suit:“The description in this lawsuit is not in linewith State Farm’s mission to serve the needsof its customers, and our long, proud history ofachievements in advancing vehicle safety. Weare reviewing the lawsuit and will have more toshare soon.”
While State Farm is gearing up for a battlein her state, Alysia Hanks can’t help but feelthat these recent events – especially if the AGwins in court – could have considerable bene-fits for her industry. As executive director forthe Louisiana Collision Industry Association(LaCIA), Hanks has seen many of her industrypeers struggle to maintain their standing in themarketplace as more and more competitors –and insurers – beat them to the sale using thecheaper/quicker method. According to her,LaCIA reached out to Assistant Attorney Gen-eral Randy Ishee after efforts to get theLouisiana Insurance Commissioner on theirside ground to a halt. Not surprisingly, thegroup is supportive of the AG's current head-line-grabbing activities.
“We’re behind them, and we’re willing tohelp them in any way that benefits the con-sumer,” she says.
In existence for roughly a year, LaCIA hasalready attracted considerable attention andsupport from the industry it aims to serve. Asan encouraging sign of things to come, thegroup’s very first meeting drew well over 200people.
“It seems to be something that a lot ofpeople in the state have wanted,” offers Hankson the growing association. “They just neverknew where to start.”
Looking ahead, LaCIA plans to focus con-siderable time promoting a full-fledged revivalof the 1963 Consent Decree. Although thatdocument (as well as AG Caldwell’s actionsagainst State Farm) puts the Direct Repairconcept under great scrutiny, Hanks insiststhat her group exists to serve all members ofthe Louisiana auto body industry. For example,some LaCIA members swore off DRPs yearsago, while others have a dozen DRP contractsand zero complaints.
“[Our members] are not out to do wrong;they’re not out to get rich quick or make a for-tune doing this,” she says. “They just want tobe able to run their business and get paid forwhat they do and not have all this stress andfighting.”
Above all, Hanks is optimistic that theevents that continue to unfold in her state willfinally change her long-beleaguered professionfor the better.
“I hope that shops will be able to run theirbusinesses without the outside influence of in-surance companies," she says. "We're fightingthese people every single day over the littlestthings that they know they are responsible forpaying, but they don’t.”
More Parts, Less TradingWhile the attitude in Louisiana is one of
optimism, the current mood among more thana few dealerships in the WMABA market is oneof frustrated resignation. Just as Caldwell an-nounced his legal campaign against StateFarms, parts dealers closer to home were fi-nally hit with PartsTrader subscription feesafter utilizing the system free of charge for thelast six months. A PartsTrader user since hiscustomers first recommended him for the pro-gram, one Maryland-based parts dealer tellsHammer & Dolly that he will now have to pay$2,400 a year if he wants to continue. Unfortu-nately, he says that the much-hyped programhas only succeeded in decreasing sales whileadding to his already-high administrative de-mands. Additionally, he claims that Parts-Trader requires three times the steps thatOEConnection needs to fulfill its function.
“There’s so much banter back and forth,”he offers. “Number one, we’re getting duplicateorders. Number two, we’re losing orders in thetranslation. Number three, I don’t have the op-portunity to Conquest bumper covers, head-lights, fenders and things of that nature. I’mlosing sales on those.
“Some estimating systems are very accu-rate and some aren’t, so we have to go in andre-verify all the part numbers, which you don’thave to do on OEConnection,” he continues.“At least on OEConnection, you know whichnumbers are questionable because they arehighlighted that way; you know which ones areabsolutely okay. On [PartsTrader], we have tolook at the whole order, look at the pricing, fixeverything and then send it back to [the shops]to review. They review it, take parts off thatthey are going to get elsewhere and send itback to us as an order. Then, they see that we
fill the order once we do. It isn’t like OECon-nection, where they send you an order, you fillit and you’re done.”
To illustrate this tedium, the parts man-ager says that he needed approximately 820communications to process just the first 300orders that came through on PartsTrader. Con-sidering that PartsTrader appears to increase asupplier’s workload and expense while offeringno positive effect on profits and sales, whywould a dealer even want to consider having iton a daily basis? Unfortunately, it’s for theexact same reason that Select Service shopsowners have it in their facilities.
“The vendors are stuck,” offers a longtimeWMABA parts manager. “If they want to get ridof PartsTrader, get rid of State Farm. The bodyshops aren’t going to do that, because it’s theirlivelihood – just like it’s my livelihood to sell theparts. For some people, this program is 70, 80,90 percent of their business. They can’t walkaway from it.”
With PartsTrader’s presence in theWMABA only a few months away from the one-year mark, dealers find themselves reluctantlyaccepting State Farm’s mandated partsprocurement system. This has done very littleto improve the public image of the insurancecompany that was once considered by many tobe the best of its kind. While the legal drama inLouisiana has brought the industry’s ongoingissues with State Farm to the attention of morethan just this industry, this offers little solace toparts pros who are struggling to make senseout of paying for something they don’t want orneed.
“I’m in the business to sell parts, so I’mgoing to sell parts,” says an area dealer rep. “Itcosts me $200 more a month and a lot more inlabor to sell the same amount I was selling inthe first place. In this business, we’ve learnedto change and adapt as situation arise, andthat’s all we’re doing. It’s just another phase inour life where we have to change and adapt tosomething that’s being dictated to us.” H&D
39October 2014
State Farm was once known by many repairersas “the only insurer that doesn’t give me asmuch of a headache as all the others.” Withthe company's changes in management tactics,lack of negotiation and parts procurementmandate, what I now hear is, “I need to figureout how to do this without them.” Their lossof industry confidence doesn’t bode well foranyone. - Jordan Hendler
Executive Director’s Thoughts
40 October 2014
41October 2014
BEING SAFEIn Hawaiian, the word “ohana” means
“family.” Many similarities exist between ourhome and work “families.” Many of us actuallyspend more of our waking moments with ourco-workers than we do with our spouses andchildren. Like our home family, we caredeeply about them. The smaller the organiza-tion, the more tight-knit we become. Weshare milestones and setbacks with one an-other. Being safe and compliant is about pro-tecting your ohana.
I have been in safety for over 25 years.While my company works with Fortune 500companies and government agencies, I reallyenjoy working with small businesses. Overthe years, I have found that the vast majority
of business owners genuinely care abouttheir work family. Likewise, employees careabout the organization they belong to and areprotective of the company and their fellowworkers.
The biggest reason small businessessuffer a disproportionate number of injuries,illnesses and fines is not because they don’tcare, but because they don’t know. Smallcompanies do not have the luxury of an in-house person to focus solely on compliance.
Over the coming months, I would like toshare with the readers of Hammer & Dollysome of the most common OSHA regulationsthat commonly lead to citations for shopowners.
The bedrock of all safety programs isOSHA’s Hazard Communication Standard,a.k.a. the “Right to Know” law. As the name
implies, it’s about informing employees ofhazards (both chemical and physical) theymay encounter in the workplace.
Recent changes to the law, now calledthe Globally Harmonized System (GHS),mandate new labeling requirements, a transi-tion from Material Safety Data Sheets(MSDS) to Safety Data Sheets (SDS) andemployee training.
Labels (e.g., “Flammable,” “Corrosive”)are the primary way in which hazards arecommunicated. The new GHS labels consistof new pictograms and signal words (e.g.,“Danger,” “Warning”) in accordance with UNrequirements.
Safety Data Sheets, which replace Ma-terial Safety Data Sheets, standardize andsimplify the safety information provided toend-users (shops) by the manufacturer.
By June 1 and December 1, 2015, re-spectively, manufacturers and distributorsmust provide the new label on all new prod-ucts and make Safety Data Sheets availablefor each hazardous material they sell.
By June 1, 2016, all employers must bein full compliance with the regulation. Thedeadline for training on the new label andSDS format was December 1, 2013. Addition-ally, all chemicals in the business must haveproper labeling with an SDS available for em-ployee review.
The purpose of the GHS is to make iteasier for employees to access neededsafety information in an understandable for-mat. This keeps the whole shop safer. No onewants to see their “family” members come toneedless harm. H&D
Joseph J. Kenny II is president of Safety Reg-ulation Strategies, Inc., a nationwide safetyand environmental training and consulting firm. He has helped thousands ofbusinesses create safe and compliantworkplaces and can be reached at 800-723-3734 or at www.SafetyRegulations.com.
A view from the supplierside of the industry. VENDOR
CORNER BY JOSEPH J. KENNY II
42 October 2014
43October 2014
MESSAGEEXECUTIVE DIRECTOR’S Jordan Hendler
(804) [email protected]
IT’S ALL-IN ORFOLD TIME
I don’t usually bring up the history I haveas a welder. But the advancements of vehicletechnologies and OEM certification programsand the need for repairers to either go all-in orfold their hand on certified repairs remind me ofmy time in welding school. There, instructorstalked about the same concepts of making per-fect welds every time, having pride in your work,being timely for your customer and working to-gether to accomplish the goals of a project.
Many of the discussions about aluminumrepair center around the welding portion.Though I know that many of the repair proce-dures are rivet-bonded, you still must prove thatyou have the capacity to perform – as LarryMontanez said earlier in this issue – just like amachine. Perfection is the expectation. TheOE doesn’t have any tolerance for deviation.Specifics for all aspects, including the training,the welder and the setting, don’t give anyroom for personal choices or extenuatingcircumstances.
So, why are repairs taking place every dayin all areas of the country that are againstREQUIREMENTS? Because many repairersthink that giving the car on time and deviatingfrom proper procedures for the happiness of theinsurer are more important than customersafety and protecting the investment.
Please, take offense. Get angry at me.But if it were my car, I would sue your ass offif I found out my car was intentionally fixedimproperly.
If you haven’t invested the time and moneyinto getting the necessary certification, adoptedthe OEM requirements with that certification
and devoted yourself to delivery of that promise to the customer, then DO NOT FIX THECAR. You are not allowed, you are not justified and there is no excuse in the world thatgives you the right to do so. “Getting away with it” will run its course. Soon, this will hitcourtrooms around the country.
Just make a decision, stick with it and be proud of it. As a consumer-minded person, Iwould rather see you protect your customer from yourself. Tell them, “I’m not certified toperform the procedures necessary to fix your vehicle for this type of repair, but I recom-mend ‘X Repairer’ that you will be very happy with. I hope that you will return to us for your next repair.”
You don’t have to jump on the bandwagon. There isn’t anyone who will make you, ei-ther. But don’t play me that little violin if you’re going about it the wrong way and get caught.
H&D
44 October 2014
45October 2014
46 October 2014
ADVERTISERS’INDEX
Alexander & Cleaver............................20Alexandria Toyota ................................19All Foreign Used Auto..........................15American Honda Motor Co. ................4Audi Group ..........................................13Axalta Coating Systems ......................OBCBMW Group ........................................24-25BMW of Bel Air ....................................IBCBMW of Fairfax....................................3BMW of Rockville ................................IBCBMW of Towson ..................................IBCCAPA ..................................................4Car-part.com........................................46Chesapeake Automotive Equipment ..50Empire Auto Parts................................21Ford Group ..........................................17Future Cure ........................................31GM Parts Group ..................................11Hendrick Honda ..................................23Honda Group ......................................45Hyundai Group ....................................22Koons Ford ..........................................23Malloy Auto Group ..............................8Mazda Group ......................................29MINI Group ..........................................32MINI of Baltimore County ....................IBCMitsubishi Group..................................33Mopar Group ........................................36Nissan Group ......................................37NORTHEAST® 2015 ..........................14O’Donnell Honda ................................19Packer Norris Parts ............................9Porsche Group ....................................16PPG ....................................................IFCProSpot................................................46P&L Consultants..................................28Russel Toyota ......................................21Safety Regulations ..............................42SEMA Show ........................................7Sherwin-Williams ................................7Steck Manufacturing............................46Subaru Group......................................40Toyota Group ......................................41VW Group............................................43
47October 2014
