A NEW DIRECTION IS NEEDED URGENTLY
The short-term view is wrong in collision repair. As usual in this trade there is hardly a day that goes by without some, or other new demand being imposed on our collision repair trade. The trend of insurers trying to gain extra leverage or dominance is riding high at present.
Right now, there is a circulating survey where they are asking our membership to define procurement source for alternate parts purchased in the vehicle repair cycle from both parts and paint supply concerns involved in the aftermarket transaction on each quotation. Quick question, when has an insurance company ever answered a survey of their profit breakdown, who their suppliers are and infringing on collusion and price factoring?
Where is business freedom in all of this? Why is another business constantly trying to dictate and micro-manage every step of another privately owned company to their advantage? Is there any work guarantee at the end of the day? It is no secret that parts purchases in the insurance cycle of repair more often than not yield an extra inflow to company profit for many short-term insurers. This seems to be the only part of the short-term business focus which has become to introverted.
What I would like to ask players in the aftermarket sector is this: what is the long-term outcome for the collision repair industry going to become for your average family-owned and run motor body repair shop? This looks and feels like an extra avenue to secure more profit in the pockets of others, leaving even less profitability for those carrying out the work, equipping their shops to meet requirements and keeping abreast of skills and training.
If the insurance industry is so focused on controlling every process of the repair, why not open their own body shops? But wait, that has already been tried and tested globally and has failed in most cases. Stick with the knitting and understand your own business. You understand insurance and we understand vehicle repair – just let us get on with it. It is professed that we are a “team” so why treat the industry like the crazy uncle who can’t be trusted?
In another development there is a constant drive to send franchised dealers work by OEMs. These dealers simply have no idea how to carry out this specialist repair. This leaves the body shop frustrated, let alone the customer who needs their vehicle back on time. Who is liable for sub-standard calibration and other jobs forcefully outsourced? As usual, it’s just a head-in-the-sand stance from OEMs and the sound of crickets when answers are asked for.
So here is the big question that needs an immediate answer. Where is this business going to in the next 10 years when viewed against the model complexity and repairability before your very eyes? With the many and varied forms of steering and rebates needed from different suppliers in the supply chain and the demand for consistent cost control monitoring – is this a viable business model? Definitely not. There is simply a lack of focus on the future viability of collision repair.
It is time for some of the clever people to sit back, take a breath and understand the bigger picture of what is involved – as well as what is to come in the form of new technologies and vehicles in the repair arena. With dozens of new models being unleashed onto the market this year alone, with hybrids, mild-hybrids, full electrical and combustion engine propulsion options – the complexities of vehicle repair are just astronomical.
Who is training for this? No one. No meaningful curriculum to train artisans is available, so who is meant to fix these “green” options? It used to be that before a vehicle manufacturer launched a vehicle, training had already taken place and a customer could be assured of excellent repair of their new vehicle. The customer nowadays is going to be sadly disappointed while their car is parked for ages or even scrapped because no one is able to fix it.
With professional repairers retiring or just quitting due to an exceptionally difficult business environment, it doesn’t bode well for the insurance industry, vehicle manufacturers or repair industry.
The current government cannot be relied on to institute change at present and have literally brought the local economy to a grinding halt, standing in the dark! Another fuel increase will see even more cars off the road which equals less repairs… and so it goes on.
Fundamental and urgent change is what is needed. An open ear and a desire to change this industry to give it the longevity and partnerships it needs is of utmost importance. Just what the next decade of repair will look like remains to be seen. Will there be anyone left to repair as our backs are already against the wall in many cases?
By Steve Kessell
