Insurer-mandated parts procurement systems, and I-CAR’s decision not to follow through with its plans to work with automakers to identify and close the gaps in existing collision repair procedures, dominated discussion at a repairer-only meeting held in Phoenix in April.
Aaron Schulenburg, executive director of the Society of Collision Repair Specialists, led the “Repairer Roundtable” meeting, but said it was less tied to any one organization than to an over-arching goal of providing repairers a place to discuss and establish objectives without the influence of other industry segments.
“I think our industry has become well-informed,” Schulenburg said. “There is a great network of information going in and out of the associations, and from the trade press. But just being informed isn’t enough. We need to be able to strategize as an industry and have a plan. Being informed without having a plan won’t get us there. That’s part of what this meeting is, to formulate our voice.”
I-CAR’s decision, announced just the week prior to the meeting, was widely criticized by those in attendance. In late 2011, three national trade associations (later endorsed by more than two dozen state and regional groups) asked I-CAR to take on the task of communicating with the automakers in an effort to increase the amount and availability of OEM repair procedures. As recently as late January, I-CAR CEO John Van Alstyne said his organization was moving forward with a planned roll-out this summer of a 5-pronged approach to the issue, but the members of I-CAR’s board in attendance at a March meeting voted unanimously to halt the program.
The request from the trade groups had indicated such an effort would support their statement that OEM repair procedures are the industry “standard” for repairs. Meeting attendee Tony Passwater, executive director of the Indiana Auto Body Association, said based on his past involvement with I-CAR, he believes it was the word “standards,” more than the concept of expanding the availability of OEM procedures, that led to the decision.
“That’s where they all cringe, especially on the insurance side,” Passwater said.
Meeting attendee Dusty Womble, an I-CAR board member and an operating partner in Roger Beasley Collision Center in Austin, TX, said the I-CAR vote would not have been unanimous had it not taken place at the first board meeting he’d missed in four years.
Meeting attendee Barry Dorn, a Virginia shop owner, said he felt it was important that people ask I-CAR what led to the decision.
“I implore all of you to talk to the folks at I-CAR about what happened, ask them to explain why they voted the way they did,” Dorn said. “To me this is inexcusable. In my opinion, I-CAR has been hijacked by special interests.”
But meeting attendee Scott Biggs of the Assured Performance Network, which joined the national associations in their 2011 request to I-CAR, noted that it was a decision made by the I-CAR board, not staff.
“It should be noted that the staff did a huge amount of work in the last 18 months to address a lot of the things that we wanted them to do,” Biggs said. “Most of those things they’re going to continue to do.”
What won’t continue, Biggs said, is I-CAR’s planned creation of a “council” to help facilitate and filter the communication between automakers and the industry. Biggs and Schulenburg each said the conceptual solutions for the council was one aspect of I-CAR’s plan they hadn’t been “entirely comfortable with.”
“I-CAR seemed like a good fit at the time. But any organization that isn’t willing to publicly and clearly state that the OEM repair procedures are the standard for repair probably isn’t a good partner for what we’re looking to accomplish here,” Schulenburg said. “So while there’s not a lot of detail I can give, what I can share is a large subset of the original requesters do intend to create an industry council to address collision repair procedural standards. The primary mission of this council will be to gather feedback and provide input to the OEMs to address deficiencies in the library of procedures and issues or question that arise form the industry dialog. It’s about communication.”
Meeting attendee Dan Risley of the Automotive Service Association, which also was among the organizations requesting I-CAR’s involvement in 2011, said communication will be important because there “are some instances where the OEM repair procedure probably may not apply.” He noted, for instance, that Honda calls for replacement of sun visors after airbag deployment.
“And you can’t even use the same screws. You’re supposed to have brand new screws, otherwise you’ve just deviated from the standard procedures from Honda,” Risley said.
Similarly, he said, Toyota calls for the complete replacement of some seats after airbag deployment.
“And if you meet with Toyota and you ask them, ‘Why can’t I just replace a seat back,’ which was the procedure at one time, their response is a little bit different than you might think,” Risley said. “Most people assume it’s a safety issue. In this particular case, the reason they want you to replace the full seat is the impact on customer service. The material on the seat back wouldn’t match the seat bottom and customers were dissatisfied.”
Schulenburg acknowledged that the goal is not to give “automakers carte blanche” in terms of procedures but to have two-way communication with them and to have mechanisms in place to ensure it is a collaborative industry effort.
“I think the key take-away is that the industry can be assured that there will be solutions for you,” he said. “Where we go is predicated only on the needs of the repairers who are using these procedures.”
The discussion of insurer-mandated parts procurement system also focused on potential ways to address what one Arizona shop owner termed “the death knell of the industry.”
Several attendees discussed existing or proposed state legislation that could limit such programs. A bill introduced earlier this year in Maryland, for example, would prohibit an insurer from requiring a shop to use a specific vendor or process for the procurement of parts or materials necessary for repair of a vehicle.
A number of attendees also discussed the importance of shops educating their local parts vendors.
Although several attendees said that based on their conversations with State Farm they felt it was now inevitable that the insurer will move ahead with PartsTrader, Schulenburg said he’s not so sure.
“I think ‘resistance is futile’ would be a position I would want to take, too, if I wanted to get people who were resisting to stop resisting,” Schulenburg said. “‘We’re moving forward with it regardless…’ is a great approach to encourage people to stop questioning it. I just don’t know that that’s true. I would caution anyone hearing those messaging points to take it with a grain of salt.”
Schulenburg ended the meeting by saying he looks forward to eventually having hundred of repairers in the room for future meetings.
“I see the discussion in the industry moving to more proactive strategy versus just a reiteration of war stories and gripes and complaints,” he said. “That’s really healthy for our industry to make that transition.”
John Yoswick, a freelance writer based in Portland, Oregon, who has been writing about the automotive industry since 1988, is also the editor of the weekly CRASH Network (for a free 4-week trial subscription, visit www.CrashNetwork.com). He can be contacted by email at jyoswick@SpiritOne.com.