Tuesday, 31 December 2002 17:00

NACE 02: Smaller but still the industrys meeting place

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"Working Small and Effective" was the title of a class at the International Autobody Congress and Exposition (NACE) in Dallas, Texas in early December, but it could have been an apt theme for the event. Many wondered whether NACE would "feel the impact" (the actual theme of the show) of the five major paint companies being absent from the trade show floor. Indeed, attendance by both shops and vendors was down. (For details, see "NACE by the numbers".) 

But as it has for 20 years, the show continued to be a key meeting place for the collision repair industry, offering more training sessions (nearly 60) than ever, a keynote address by former President George H. W. Bush, a Texas-style welcome party and rodeo, an "Evening with Comedian Bill Cosby", and a "Town Hall" discussion of industry issues in which a Texas State Senator announced that he will sponsor a bill in Texas to prevent insurers from owning body shops.

NACE chairman pulls no punches

In his State of the Industry address, NACE Chairman Chris Dameron, pulled no punches with his observations on key industry issues.

NACE 2002 Chairman Chris Dameron was escorted from the stage by the Dallas Mavericks cheerleaders as he lead delegates from the general session to the opening of the trade show floor. To make certain that even a blind man could find his way to the exhibit floor, Dameron and the cheerleaders were accompanied by the blaring brass of The Dallas Golden Bears Marching Band.
Dameron, an executive of the True2Form repair chain, urged shops to "be careful" about joining one of the shop networks being promoted by third-party claims processors, paint companies and estimating system providers.
 

"This is adding a fourth party to our already complicated business, and will add to the ever-mounting administration work," Dameron said. "In these programs, not only may some shops have to 'buy their work,' but they have to meet the [network's] requirements and may even be audited by one more entity besides the insurer and consumer."

State Farm praised as "changing"

Dameron praised State Farm for what he called "its changing philosophy." "Their focus is now on doing the best possible repair, and having the final bill reflect exactly what was done," Dameron said. "This is what we in the collision industry have been asking for. State Farm's new focus [is] to be admired. It will be a great day for our industry when this same philosophy reaches the thousands of adjusters who come into our shops every day."He criticized the concept of insurer-owned shops, saying the success of such shops will require "steering customers to the shops." Since Allstate purchased the Sterling collision repair chain, he said, about 1,000 shops have been cut from the Allstate DRP program.

"This is only one insurance company and only one year into this conflict of interest," Dameron said. "Where is this going to lead? Our livelihood is being challenged. This is way too important to ignore. We must work together. We must unite to stop unfair competition before it spreads any further."

 
Bush urges optimism, service to others
 
George H.W. Bush - or "41" as he is sometimes called to differentiate him from his son, the 43rd U.S. President - offered a mostly light-hearted look at the presidency in his keynote address to the NACE opening session.

He said he strongly believes that former presidents should lead useful lives, and urged that everyone find a way to give something back to their community and nation. "There can be no definition of a successful life that does not include service to others," he said.

Though he repeatedly emphasized that he wasn't making a political speech, he talked briefly about his frustrations while in office of working with an opposition-led Congress, and said that while he was wrong about Saddam Hussein's ability to politically survive defeat in Desert Storm, the current President, his son, "does not want war." He also humorously noted the irony that while the U.S. defeated Iraq in the Gulf War, "Saddam Hussein got to keep his job while I lost mine."
 
 
NACE by the numbers
 
As NACE grew dramatically during the 1990s, show organizers focused increasing attention on the event's impressive numbers, with attendance peaking at 41,034 in 1997 and total trade show square footage reaching nearly 278,000 in 2000.

While organizers would probably prefer less fanfare about more recent show numbers, the absence of five major paint companies and the nation's shaky economy had many wondering how NACE '02 would stack up.

Galen Poss of Hanley-Wood Exhibitions, the company that produces the show for the Automotive Service Association (ASA), said this year's attendance was more than 24,000, about what organizers anticipated (although show promotional materials cited expectations of 30,000 attendees). That number was the lowest since 1993.

The trade show floor at NACE '02 was easier on most attendees' feet, encompassing 171,000 square feet in the Dallas Convention Center, down about 80,000 square feet from last year and the smallest since the 1990 show. The absence of the often-mammoth Sherwin-Williams, Akzo Nobel, DuPont, PPG and BASF booths accounted for some but not all of this decline; there were 473 exhibiting companies at NACE '02, down by more than 75 from the preceding year, and the first time since 1992 that fewer than 500 companies had booths at the show.

Poss and most vendors said they expect a strong uptick in the numbers for the 2003 event, thanks to what is often seen as a more popular show location (Orlando, Fla.) and the expected return of the paint companies' involvement.

As to being a proud father, he joked to applause and laughter: "As much as I might be tempted to stand here and sing the praises of the United States President and the great Governor of Florida, I'm not going to do it. Wouldn't be prudent."

The former President encouraged the collision industry to stay aware of and active in local and national politics, and praised the role of the "entrepreneurial spirit" in the nation's economy and communities. He said he is "an unabashed optimist about the future," saying the fundamentals of the nation's economy are strong. He urged confidence in the markets, and called for a return of business ethics.
 

Town Hall examines issues

The "Town Hall" luncheon meeting featured a panel discussion - more like a debate - focused on insurer-owned shops.

With most paint companies missing, Valspar became a major player and used NACE to introduce its new European line of auto paint and reaffirm its support for the industry.
 
Texas Senator John Carona, a panelist, said he planned to introduce legislation to prohibit insurer-owned body shops in his state, saying such ownership is a clear conflict of interest and predicting it would lead to the same problems and consumer backlash as managed healthcare (HMOs). "Why would an insurance company own an interest in a body shop today except to repair cars at a cheaper price, which more often than not will lead to lesser quality?" Carona asked.
 

Town Hall panelist Robert Hurns, an attorney with the National Association of Independent Insurers, disagreed with Carona, saying customers would be protected by the insurance contract and the obligation insurers have under the contract to restore vehicles to pre-accident condition.

The panel, which also included Alan Walne, a Texas shop owner who serves on the Dallas City Council, touched on a variety of legislation and regulatory issues, including shop licensing, point-of-sale controls on paint products, non-OEM parts certification and use, etc.
 
 
Upcoming NACE plans

While some exhibitors, mainly the large paint companies, have been calling for NACE to become a biennial rather than annual event, show organizers and ASA leaders continue to maintain there is interest by most vendors and attendees in holding the event each year.

One of the larger paint companies that did attend was Valspar, based in Louisiana. Marketing Director Shelly Cullen said the show had been very worthwhile for Valspar, which used NACE to introduce its new European line of paint. Cullen said "we intend to be here every year supporting the industry."

Those who cited the Dallas location as a primary reason for the downturn in attendance have apparently gotten their message through. NACE organizers say that for at least the next four years, the event will alternate between Orlando and Las Vegas, starting December 4-7, 2003, in Orlando.

And if you wondered why NACE is held in December during the busy Christmas season, ASA says it's because they get a better deal of convention space at that time and can charge less.

John Yoswick is a freelance writer based in Portland, Oregon, who has been writing about the automotive industry since 1988.

 

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