The first, held Saturday from 8-10AM, was "Honda Technology and Emerging Industry Trends," presented by American Honda's Chris Tobie and Susan Gotsch of CCC Information Services. Sunday morning's Honda OEM panel discussion, "Information for Innovation," was co-hosted by Axalta Coating Systems and was mediated by Axalta's Livia Guarneri. The panel included Gotsch, Collision Advice's Mike Anderson, Andy MacDonald from VeriFacts, Caliber Collision's Jeff Brewer, and from American Honda: Leigh Guarnieri and Gary Ledoux.
On Saturday morning, the room filled with ProFirst shops who indulged in the breakfast burritos provided by American Honda as Gary Ledoux, ProFirst Administrator, welcomed attendees. Noting American Honda's goal to bring value to their certified shops, Ledoux announced that the OE is in the process of revamping its ProFirst logo to assist with brand recognition and that they will also be providing a short advertisement that certified shops can personalize and use as a marketing tool. He stated, "We have 975 certified shops, and our goal is 1200. About 50% of the shops that apply for certification don't make it, so you all are the elite!"
American Honda's Chris Tobie then began the "Honda Technology" session with a Honda and Acura body repair update. Mentioning that Honda vehicles' body structures have seen some minor model changes and alterations in the locations of the ultra high-strength steel used, he warned, "Looks can be deceiving. You need to look at the OEM specifications for the specific model you are repairing, or you may unknowingly repair the vehicle unsafely. You always have to go to the information to know what you're working with because it's not possible to memorize all of this."
Looking at the 2017 CR-V, Tobie noted it's a completely different car as it has a front floor center tunnel with 1500 MPa rear frame rails. While shops have to follow manual procedures, specific areas of the rear frame can be sectioned.
Tobie then turned to the 2017 Clarity fuel cell which has all bolt-on exterior panels and front bumper beams constructed of aluminum which was driven by safety regulations and fuel efficiency requirements. The 980 MPa front frame rails and center floor tunnel permit no sectioning, and the laser brazed roof panel is serviced by bolted-on brackets and a panel bond adhesive. It also comes with Honda's standard sensing suite of advanced driver assistance technology. Tobie hinted, "These are things you're likely to see more in the future, so you should start thinking about the tools you'll need if you aren't already prepared."
Tobie informed attendees that 95% of Honda and Acura questions can be answered with published information and encouraged shops to call Honda's technology line whenever they need support. He pointed out, "Every improper repair begins with the best intentions and a lack of information. You don't know what you don't know."
Honda's new diagnostic scanning and calibration position statement applies to all Honda and Acura models. It requires pre and post repair diagnostic scans and provides the background, reasons and guidelines for these requirements to explain how to do it, why and how to get paid. The OE's Warranty Paint Refinish Requirements Service Bulletin announced the need to use approved paint vendors and specific lines with many requiring hardener in the basecoat to meet Honda's standards. Tobie encouraged the audience to utilize their Body Repair News Publications for free industry support: "They don't replace the manual, but they highlight things that can trip you up. Use them for repair planning - it all starts at the estimate."
After mentioning I-CAR's Hands on Mig Brazing Course (BRZ02), Tobie demonstrated how to access the Service Express information from the ProFirst website, and he discussed some of the diagnostic tools that are useful for repairing Honda vehicles. He closed with "Even if you can't be a ProFirst shop, this information is available to aid safe repairs. There aren't enough ProFirst shops to repair all our vehicles, but Honda provides the resources, and it's up to the shop to market itself as ProFirst."
Moving on to the "Industry Trends" portion of the morning, Susanna Gotsch, Industry Analyst for CCC Information Services, began by noting that miles driven, collision frequency, and collision severity (average cost) have all increased over the past few quarters. Data compiled by the National Safety Council indicates that more people are driving during peak time and in congested areas, and as a result, an increasing number of vehicles are being equipped with safety features.
Each year since 2013, the population of vehicles in the US has grown by an average of 2% so more people are driving, and there are more cars on the road. Additionally, higher speed limits have resulted in an 8% increase in fatality rates on interstates and highways for every 5mph increase. People are also distracted with 40-50% of surveyed drivers admitting to texting while behind the wheel.
Vehicle sales show continued growth which is setting records, though growth has begun to stabilize. The average age of vehicles in the US is 11 years old with more owners of each vehicle and an increasing demand for used cars. This means insurance companies have to pay the value of the vehicle more often as repair costs are more likely to exceed the value. Historically, 15% of vehicles were totaled, and this number has increased to closer to 20% for non-comprehensive claims. Gotsch noted, "More older vehicles mean more total losses, and this translates to fewer repairs."
Gotsch explained how estimates are uploaded to CCC and how this information is disseminated to insurance companies as well as the difference between how CCC and insurers use this data and apply it to scorecards. She predicted, "The industry is shifting towards a more holistic view of performance."
Claim costs are rising steadily with repair costs for newer vehicles increasing the fastest; the average repair cost rose 4.5% last year. Assuming similar shifts, Gotsch anticipates a 2.6% increase in 2017. She discussed the distribution of repair costs, noting an increase in labor hours, labor rates and calibration costs. Technological advances have led to repair complexities and newer vehicles require more replacement parts than in the past.
"Due to complexity, cycle time has also increased by nearly half a day industrywide for the actual repair, but pre and post repair days remain stable," Gotsch said. Noting OEs' increase in safety components, Gotsch predicted, "Frequency will begin to taper due to safety features, and we anticipate a 12% reduction with 80% penetration by 2033. With vehicles becoming more complex and more miles being driven, we can expect an increase in repair costs and total loss frequency to remain elevated."
At Sunday morning's "Information for Innovation" OEM panel, co-hosted by American Honda and Axalta Coating Systems, Ledoux introduced the event moderator, Livia Guarnieri from Axalta, and the panel of experts which included Gotsch, Collision Advice's Mike Anderson, Andy MacDonald of VeriFacts and Caliber Collision's Jeff Brewer, while Leigh Guarnieri and Ledoux represented Honda.
The discussion began with an exploration of how autonomous cars will impact the collision repair industry. The panel agreed that autonomous technology is exciting and should be embraced by the industry, but they also noted that it's not an immediate concern since they need to work out details such as improving GPS accuracy and determining when the driver needs to take control of the vehicle.
Mentioning the rising number of fatalities, Anderson informed attendees that OEMs' current focus is on collision avoidance systems. In regard to avoidance systems, it will be necessary for shops to acquire the training and equipment needed. Leigh predicted, "Shops will need to become more mechanical. All of these vehicles can't be taken to the dealers, so shops will need to learn how to use repair information as it's made available."
Discussions about the future of vehicle ownership turned to ride sharing and the importance of shops managing online reviews. Brewer observed, "Technological changes make repairs more challenging, and the universal repair approach is in its dying days. Shops need to focus on technology and the customer. First and foremost for the OEs is protecting the customer experience, and we are likely to see a lot of segmentation in the near future. The primary reason for certification is access to information to ensure we're repairing these cars correctly, the car has to go to the right place for the right reasons, and certification helps define that."
Livia added, "The way the vehicle is repaired, based on the information available to the shops, is ultimately what drives lifetime customer loyalty."
Returning to the topic of collision mitigation systems, the panel was asked if the vehicle owner is responsible for insuring the car or if it's the manufacturer's responsibility to insure the technology. Gotsch noted that there is still a lot to be determined about who owns the digital copyrights to the electronic control modules data and anticipates a lot more discussion around personal and product liability. MacDonald quipped, "The attorneys will benefit the most until this all gets figured out."
Talking about recalls, the panel emphasized the shops' role in helping inform customers of recalled parts and the difficulty for OEMs to locate vehicles with recalled parts given the frequency with which cars are resold. When the audience was invited to ask the panel questions, topics ranged from the value of OE certification to how certification is managed by MSOs, and the necessity of technicians' involvement in the process.
OEMs are now holding regular roundtables to discuss the direction the industry is taking and to better serve their customers, and all members of the panel agreed that communication is key. Anderson predicted that OEMs will monitor KPIs more closely to ensure certified shops are performing to their standard, but he insisted that there is a lot of value in OE certification.
Brewer contributed, "You have to have the right training and equipment to safely repair today's vehicles. Training is the most critical component of certification, and certification is the cornerstone of the relationship between you and the dealer." MacDonald agreed, adding "Program involvement brings more value and helps improve your shop and your employees' skills."