Friday, 30 November 2007 17:00

NACE Faces Changes in Future

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Attendees at the 25th annual International Autobody Congress and Exposition (NACE) in Las Vegas in early November may not have known it, but they were witnessing the last NACE in its current form.

NACE organizers announced  that starting next year, NACE will be combined with the Congress of Automotive Repair (CARS), an event aimed at the mechanical repair segment that, like NACE, is sponsored by the Automotive Service Association (ASA). The two have been held the same week but at different hotels in Las Vegas for several years. In 2008, both events will be held concurrently at the Mandalay Bay Convention Center.

Though each event will maintain its own “identity” – its own name and schedule of classes and programs – a joint trade show will include vendors from both the mechanical and collision sides of the automotive aftermarket. NACE organizers say vendors that sell only to collision or mechanical will be at different ends of the trade show, with a middle ground for companies that sell to both segments.

ASA is designating the week “Automotive Service & Repair Week,” although it will be still taking place during what is already called “Automotive Aftermarket Industry Week” in Las Vegas, when the Specialty Equipment Market Association (SEMA) and Automotive Aftermarket Products Expo (AAPEX) trade shows are also held.

The change appears to be a recognition that changes in the collision repair market have led to flat or declining numbers for NACE. NACE organizers said attendance was similar to last year (about 27,000), but the size of the trade show has declined each of the past three years, about a 25 percent drop since 2004 – and about a 43 percent decline since the show’s peak a decade ago.

 

Amberson offers view of industry

NACE Chairman Darrell Amberson, president of Lehman’s Garage, a six-location business based in Bloomington, Minnesota, kicked off the 2007 event’s opening session with a speech offering his laundry list of the key issues he believes the industry needs to address.

Amberson said the decrease in auto insurance claims and the increasing percentage of totals have helped fuel an “overcapacity” in the industry, with too many shops chasing too little work. That and a lack of unity in the industry have helped add to the imbalance in shop-insurer relationships, something Amberson said that some insurers have taken undue advantage of. The industry, he cited as one example, must have a more fair way of determining fair and equitable rates, and that government involvement in such issues – as is being discussed in some states – may not be something either side finds as the best solution, Amberson said.

An audience of about 1,600 NACE attendees gave Amberson his first applause during his address when he cited some flaws he sees in the estimating systems used in the industry and called for development of a long-term solution to the problems in the current estimating model.

In a change from many past NACE addresses, Amberson discussed how ASA is working with other associations to effect change, such as the development of the Database Enhanced Gateway (DEG). Created by ASA, the Society of Collision Repair Specialists (SCRS) and the Alliance of Automotive Service Providers (AASP), the DEG will launch a website in December that will allow users to use one standardized online form to report concerns about an estimating system labor time in any of the estimating databases. The DEG will track and follow-up on such “requests for review,” posting responses and actions made by the estimating database providers on the website.

 

Keynote address excites audience

NACE organizers went for an “inspirational” focus for the 2007 event’s keynote address, inviting Chris Gardner to share his rags-to-riches story that served as the basis for his 2006 autobiography and the subsequent film, “The Pursuit of Happyness.”

Though Gardner did not reference the collision repair industry in his speech, even many of those familiar with his story said his message reverberated with them. A series of circumstances in the early 1980s left Gardner homeless in San Francisco and sole guardian of his son – who was only 16 months old at the time (although portrayed as an older child in the film).

Gardner, however, said at an early age he had decided that he would be “world-class at something,” and that any children of his would have their father in their life. So while working to provide food and shelter – sometimes in a church shelter or even a restroom at a train station – for his son – and despite his lack of connections or college degree, Gardner doggedly earned a spot in a Dean Witter Reynolds stock broker training program.

He became the sole trainee that year to land a spot with the firm, and Gardner showed off with pride his slightly bent pointer finger caused by the 200 phone calls he would make each day at work. Less than six years after being homeless, Garner founded his own successful brokerage firm in Chicago.

Gardner’s NACE address on the importance of perseverance, taking personal responsibility and breaking negative cycles brought NACE attendees to their feet.

 

 

Owners stage discussion of “lean”

As was pointed out at the start of Friday morning’s general session at NACE, many attendees say they often learn the most at such gatherings when talking to other shop owners in the halls – or bars – outside the convention. The NACE general session, sponsored by Akzo Nobel Coatings, tried to capture that atmosphere by staging a discussion among three actual shop owners in a “barroom setting” on the NACE stage. The subject: “lean processing,” an increasingly frequent buzz phrase in the industry that centers around streamlining shop operations to reduce costs, improve quality and speed production.

Moderator (or “narrator”) Garry Steele, a business consultant in the United Kingdom, outlined each of four key principles of lean processing, after which the three shop owners discussed how they have implemented each principle in their business.

Lean, for example, often starts with a “housecleaning” known as the Five S’s: sort, set in order, sweep or shine, standardize and sustain. Michael Giarrizzo, CEO of DCR Systems Accident Repair Centers, said his company’s model for dealership collision repair shops establishes clearly defined places for tool storage, for example, and elimination of clutter, such as those collections of “nuts and bolts you’re sure you’ll need someday.”

Ken Friesen, owner of Concours Collision Centers in Alberta, Canada, said his company practiced the Five S’s before he’d even heard the term. A “visual file rack system,” for example, helps the shop’s office staff quickly see at a glance not only where all necessary paperwork is stored but also where in production every vehicle is.

John Beckworth, co-owner of Collision Works, a shop in Beltsville, Maryland, with annual sales topping $6 million, said part of his company’s “standardization” includes limiting how many vehicles are scheduled in each day to regulate the flow through the shop and eliminate the logjams created by having too many torn-apart vehicles – and parts – were in the shop at any given time.

Steele cautioned shop owners that “lean” is an ongoing process, something you should always be doing, not something you can ever view as being “done.”

NACE 2008 will again be held at Las Vegas’ Mandalay Bay Convention Center, for the first time along with ASA’s CARS mechanical repair industry event, next November 5-8.

John Yoswick is a freelance writer based in Portland, Oregon, who has been writing about the automotive industry since 1988. He can be contacted by email at jyoswick@SpiritOne.com.

 

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