The California Autobody Association’s San Diego chapter is coming back to life after lying dormant for several years post-pandemic.
The chapter has now held two meetings this year, its first two since 2019. The first was in May, and the second was held Sept. 24 at Admiral Baker Golf Course, sponsored by 19Industries.
Members reviewed the notes from a “Who Pays for What?” meeting the chapter held in 2018, comparing progress local collision repairers have made in getting paid by insurers in some areas, while identifying new pain points that have since developed.
Chapter President Juan Martinez, who owns European Coach Works in San Marcos, CA, led the meeting, along with members Hop Sanchez, district sales manager for FinishMaster; Luke Burger, senior solutions specialist with Mitchell; and Daniel Carrillo of Carrillo’s Auto Body in San Diego.
“It’s asking the body shops that are in the room: what are they encountering? What are they seeing? What are they not getting paid for?” Martinez said.
Refinishing Material Calculators
Refinishing material calculators (RMCs), like in Mitchell’s Cloud Estimating system or EagleMMS, is a more accurate way to calculate how much material goes into a paint job.
Rather than using an older multiplier formula in invoicing systems, RMCs use a per-ounce formula to submit to insurance companies for payment.
Martinez acknowledged some DRP agreements do not allow shops to use RMCs -- and body shop owners in the room confirmed they all had one or two DRPs that would not -- but otherwise, he recommended using one.
“I use it, it works, I get paid, I don't have a problem with it,” he said.
Using an RMC can protect a shop from legal trouble with the California Bureau of Auto Repair (BAR), as it has been identified by law as an “industry standard method” for charging for refinish materials.
Martinez explained that if an insurance company files a complaint on behalf of its customer about a shop’s invoice with the BAR, a shop using an invoicing system will lose.
“The reason you will lose is because the invoicing system alone is not considered industry standard -- it's considered bait and switch,” Martinez said.
When the invoice is created using an RMC, it bases it materials calculations on the specific paint line the shop is using. It also takes into account materials like sealers, fillers and sandpaper.
“When your customer signs your work order, if you have an RMC from the gate, then you're golden,” Martinez said.
OEM Repair Procedures
When the first “Who Pays for What?” meeting was held in 2018, Martinez said, a lot of shops weren’t using OEM procedures to research repairs.
In the past six years, more shops are doing so, especially after they became more successful in getting insurers to pay for the time required to do the research. Most shop owners in the meeting said they are now being paid to research OEM repair procedures.
One owner said they only charges non-DRP insurers, because their shop’s DRPs won’t pay.
Paint Warranties
Clear coat needs to go “up and over” to the next natural break or it won’t be covered under warranty if it starts to delaminate due to UV exposure, Martinez said.
One shop owner said they doesn’t see it as a big issue, as their shop doesn’t see those types of warranty claims, but Martinez said he has worked at a shop that was getting claims on paint jobs it had done 15 years earlier.
“I think it just is demographical based on the community where you're at,” he said.
Aluminum Repairs
In 2018, not a lot of vehicles had aluminum panels, but in 2024, more shops are seeing it.
One shop owner said their shop replaces more aluminum than it repairs, because it’s “so flimsy.”
Another shop owner agreed, but said when they do repair aluminum, they charge double the labor rate.
Negotiating with Insurance Companies
Martinez said he ran a body shop consulting company before opening his shop in San Marcos. He trained shop owners and estimators on how to negotiate with insurance companies.
“I trained them on how to the tactics that the insurance carriers were going to use against you -- how they’re trained to use psychological terms, how to make you feel bad for charging for things or try to make you feel better for charging for things, how to use the day's hours against you, how to manipulate the conversation into paying less for everything,” Martinez said.
He recommended finding a course, perhaps at a local community college.
One shop owner asked how to deal with “desk reviews” of supplements, which often don’t give the shop a chance to negotiate. Another shop owner suggested documenting every line item with thorough notes and photos to justify the supplement.
Martinez said shops also aren’t required by the BAR to copy the insurer’s initial estimate; they can write their own after disassembly.
ADAS Calibrations
Martinez asked how many shops in attendance get pushback from insurance companies performing necessary procedures on ADAS features.
One owner said their shop is “getting paid for everything,” but they have different rates with different insurers.
Another said they “do different things depending on who [the customer’s] insurance carrier is and what ADAS is on their car.” For instance, a 2017 model with no ADAS features will get an aftermarket scan, but a 2022 Subaru with all the bells and whistles will get an AirPro scan that uses the OEM information.
Battery Chargers
EV batteries will start to degrade if they sit uncharged in a shop for weeks waiting on repairs. Martinez recommended every shop invest in a battery charger to prevent that.
Even when the repair is complete, some systems cannot be correctly “read” if the battery voltage is too low.
“You'll get a clean health check, the car goes down the road and then, once the battery cycles up to where it needs to be, it comes on when the customer is 30 miles away. That's a quality issue,” Martinez said.
Keeping the batteries charged also prevents the repairer from needing to buy a replacement.
Legislative Update
Martinez encouraged all San Diego-area repairers to join the CAA. Members receive regular information, including updates on proposed legislation making its way through the California Assembly and Senate. Banding together as a larger group also gives all repairers more of a chance of influencing the legislators voting on bills.
He spent a part of the meeting reviewing some of those bills currently up for consideration.
SB 615: This bill, among other things, requires automotive repair dealers who remove EV batteries from a vehicle for repair, remanufacturing or recycling to ensure the battery is disposed of properly, adhering to the end-of-life requirements specified in the legislation.
The bill was passed by both the California Assembly and Senate on Aug. 31, and was scheduled to be presented to Gov. Gavin Newsom on Sept. 11. The CAA has concerns.
AB 518: This bill would expand the definition of “family member” for purposes of the Paid Family Leave Program to allow workers to take time off to care for a seriously ill designated person.
The bill was scheduled to be presented to Newsom on Sept. 12.
Martinez said most members of CAA are small business owners who struggle to pay for labor when employees are not physically in the shop performing it.
AB 2751: This bill requires employers to establish a workplace policy that provides employees the right to disconnect from communications from employer during nonworking hours. CAA is concerned about the bill. It has been held in an Assembly committee since May.
AB 2188: This bill would create an exemption allowing owners of newer vehicles, no older than five years, to replace a stolen catalytic converter with a similar federal EPA compliant model, rather than a California ARB compliant converter.
CAA supports this bill, which has been held in an Assembly committee since February.
“This is a really good one. It would speed up your cycle time,” Martinez said.
SB 961: This bill requires 50% of certain vehicles, beginning with the 2030 model year, to be equipped with an intelligent speed limiter that would alert the driver when the vehicle’s speed is 10 mph over the speed limit. It is currently being held in an Assembly committee.
Abby Andrews