gl 0913 issue web

A sitting Illinois Supreme Court jus-tice, Lloyd A. Karmeier, may havebeen compelled to testify under oathabout allegations that he voted in2005 to overturn a $1 billion verdictagainst State Farm because the com-pany secretly funded a multi-milliondollar campaign to help him getelected to the state supreme court. The2004 Illinois Supreme Court race wasthe most expensive campaign for asingle judicial office in U.S. history.

Lawyers whose plan to deposeIllinois Supreme Court Justice LloydKarmeier became public now say theywill do it later or maybe not at all. OnAug. 14, they told U.S. District JudgeDavid Herndon that they would notrush into it if he lifts a temporary stayon discovery in their fraud and rack-eteering suit against State Farm.

In 1998 in the Avery v. StateFarm case, the original plaintiffs wonthe largest verdict ever against StateFarm for requiring the use of “imita-tion” crash parts in its auto repairs.After years of appeals, the verdict wasreversed.

On May 29, 2012, three plaintiffsfrom Avery v. State Farm filed a newclass action lawsuit, claiming that theinsurance company acted as the hubof an enterprise designed to defraudmillions of policyholders out of a $1billion judgment.

Mark Hale, Todd Shadle andCarly Vickers Morse, all of whom liveout-of-state and were class membersto the unsuccessful 1997 class actionsuit against State Farm, brought theircomplaint in May in the U.S. District

In one of the world’s largest antitrustprice-fixing actions, a group of autoparts manufacturers continues to faceclaims of bid rigging and price fixingin a multidistrict litigation (“MDL”)following a Michigan federal judge’srefusal to dismiss federal antitrustclaims.

Direct and indirect purchasers inthe putative class action of In re Auto-motive Parts Antitrust Litigation accusethe manufacturers of conspiring to fixthe prices of wire harness systems inautomobiles. The allegations track aU.S. Department of Justice (“DOJ”) in-vestigation into the auto industry, whichhas already resulted in guilty pleas in-volving the manipulation of wire har-ness pricing during secret meetings.

Judge Marianne Battani of theU.S. District Court of the Eastern Dis-trict of Michigan dismissed indirectpurchasers’ antitrust claims brought

under the state laws of Massachusetts,Missouri, and Illinois, among others.The court, however, declined to dis-miss direct purchasers’ federal an-titrust claims accusing defendants ofcreating a global conspiracy to controlpricing and manipulate bidding.

In an independent order, separatefrom the order dismissing the stateclaims, the court concluded that thefederal antitrust allegations could sur-vive because the direct purchasers hadsufficiently informed defendants of thesubstance of the claims, and that the al-legations provide “a reasonable expec-tation that discovery may reveal furtherevidence of an illegal agreement.” Theclass action complaint was sound, thecourt concluded, because it sufficientlyidentifies the products involved and themethods of communication utilized byconspiring competitors during the se-

by John Yoswick

Shop and vendor concern and unhap-piness about State Farm’s mandateduse of PartsTrader was evident at a

packed Automo-tive Service Asso-ciation (ASA) ofArizona meeting inPhoenix in August,the same week theprogram was beingrolled out in thatmarket.

We feel you’re using your size andintruding into our business through the

shops with PartsTrader,” David Priest,parts director for Brown & BrownChevrolet in Mesa, AZ, told StateFarm’s George Avery at the meeting.“You’re asking me to pay a fee for a

program that willprobably decreaseOEM part usage.How do you per-ceive that Part-sTrader for anOEM dealer is aneffective tool?”

Dale Sailer ofPartsTrader, who also spoke at the

State Farm & PartsTrader Meet with IndustryAs Program Rolls Out in the Southwest

See Antitrust Price-Fixing, Page 4

Federal Court Refuses to Stop Auto PartsAntitrust Class Action in Michigan

See PartsTrader Rollout, 6

See Avery v State Farm Judge, Page 12

Avery v State Farm is Back in the News, asa RICO Case making the Judge the Issue

See Correction to July 2013 Article on Felder’s CollisionParts v General Motors et al. . . . . . . . . . . . . . . . . . . . . . . . .p. 3

David Priest Dale Sailer

by John Yoswick

The Collision Industry Conference(CIC) Parts & Materials Committeecame to the CIC meeting in Boston inJuly looking for input from the assem-blage for a survey it plans to conductabout electronic parts procurementsystems. What it heard was an impas-sioned request to look at another as-pect of the issue.

The committee is working to pro-duce a matrix that would help shopsor other users of the systems under-stand the capabilities and featureseach system offers. At the Bostonmeeting, the committee shared the

questions aboutthe systems that itplans to ask theproviders, andasked CIC partici-pants at the meet-ing whether thequestions wouldprovide informa-

tion about the systems that would behelpful.

But as the committee was com-pleting its presentation, Californiashop owner Randy Stabler drew ap-plause when he told the committeethat understanding the differences be-

A Matrix of Parts Procurement Features Won’tHelp Shops If They Have No Choice on Usage

See No Choice on Usage, Page 37

Randy Stabler

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Audi Wholesale Parts Dealers . . . . 36BASF . . . . . . . . . . . . . . . . . . . . . . 5, 11BMW Wholesale Parts Dealers . . . . 29Car-Part Pro. . . . . . . . . . . . . . . . . . . 23CCC Information Services . . . . . . . 15Certified Automotive PartsAssociation (CAPA). . . . . . . . . . . 17

Chief Automotive. . . . . . . . . . . . . . . 19CJ, Inc. - Signature - Star-A-Liner . . 26Classifieds. . . . . . . . . . . . . . . . . . . . 38Equalizer . . . . . . . . . . . . . . . . . . . . . 10Erhard BMW of Bloomfield Hills . . . 18Erhard BMW of Farmington Hills . . 18Ford Wholesale Parts Dealers . . . . 37Forklift Wrecker . . . . . . . . . . . . . . . . . 6Ganley Auto Group, Inc . . . . . . . . . 12Garmat . . . . . . . . . . . . . . . . . . . . . . 13GM Wholesale Parts Dealers . . . . . 33Graham Auto Mall . . . . . . . . . . . . . . 31Honda-Acura Wholesale PartsDealers. . . . . . . . . . . . . . . . . . 20-21

Hyundai Wholesale Parts Dealers . 33Infiniti of Naperville . . . . . . . . . . . . . 24

Jake Sweeney BMW. . . . . . . . . . . . . 8Jake Sweeney Chevrolet . . . . . . . . . 8KBS Coatings . . . . . . . . . . . . . . . . . 16Laurel Auto Group of Westmont . . . 40Lexus Wholesale Parts Dealers . . . 35Malco. . . . . . . . . . . . . . . . . . . . . . . . 13Mazda Wholesale Parts Dealers . . . 30Mercedes-Benz. . . . . . . . . . . . . . . . . 7Mitchell International. . . . . . . . . . . . . 9MOPAR Wholesale Parts Dealers . . 25Nissan/Infiniti Wholesale PartsDealers . . . . . . . . . . . . . . . . . . . . 38

PPG . . . . . . . . . . . . . . . . . . . . . . . . . . 2PreFab Ads . . . . . . . . . . . . . . . . . . . . 4Rare Parts, Inc. . . . . . . . . . . . . . . . . 14SEMA Trade Show . . . . . . . . . . . . . 39Subaru Wholesale Parts Dealers . . 35Toyota of Grand Rapids . . . . . . . . . 28Toyota Wholesale Parts Dealers . . . 32Urethane Supply Company . . . . . . 29VIM Tools. . . . . . . . . . . . . . . . . . . . . 34Volkswagen Wholesale Parts Dealers. 37Walcom USA. . . . . . . . . . . . . . . . . . 27

Inde

xofAdvertisers

ContentsREGIONALAASP-MN Scores Fall Seminar “Hat Trick” . 6Avery v State Farm is Back in the News, as

a RICO Case making the Judge the Issue . 1BASF to Show Custom Bel Air at

Woodward Dream Cruise . . . . . . . . . . . . 4Detroit Shop Partners Lions’ Bill Bentley

for Schools . . . . . . . . . . . . . . . . . . . . . . 6Federal Court Refuses to Stop Auto Parts

Antitrust Class Action in Michigan . . . . . 1IL is 20th Medical Marijuana State,

Not OK at Work . . . . . . . . . . . . . . . . . . . 6Illinois Appelate Court Rejects Restrictive

Covenant . . . . . . . . . . . . . . . . . . . . . . . . 8Michigan Court Hears Class Action by Car

Dealers Against Japanese Parts Suppliers . 4Ohio’s Captive Insurance Law, Options for

Small Business Self-Insurance?. . . . . . . 9Safelite Opens Chicago Store . . . . . . . . . . . 4San Antonio Lawyer Faces 22 Counts of

Health Care Fraud, Ohio Connectionto Case . . . . . . . . . . . . . . . . . . . . . . . . . 6

Sherwin-Williams Automotive Finishes‘Achieving Service Excellence’ CourseWas Held at Cleveland Headquarters . . . 4

COLUMNISTSAttanasio - Autobody-Review.com—Where

Yelp Meets Reputation Defender . . . . . . 35Franklin - Don’t Mess With My Marketing! . 10Insider - Responding to Reader Feedback on

Insider’s Parts and Materials Column . . 14Yoswick - Snapshot - September

Retrospective on the Collision Industry. 27

NATIONAL‘Fax-Only’ Parts Ordering Option will

End by September For Shops UsingPartsTrader 2.2 . . . . . . . . . . . . . . . . . . 34

3M’s New Body Protection SystemCuts Time Needed on Panels . . . . . . . . 31

A Matrix of Parts Procurement FeaturesWon’t Help Shops If They HaveNo Choice on Usage . . . . . . . . . . . . . . . 1

AAPEX to Address Warehouse DistributorManagement . . . . . . . . . . . . . . . . . . . . 34

American Honda LaunchesBody Repair News . . . . . . . . . . . . . . . . 29

ASRW Creates Free App forEvent Information. . . . . . . . . . . . . . . . . 10

AUTODATA has a New Manual . . . . . . . . . 30BMW Considering Mexico- based

Assembly Plant . . . . . . . . . . . . . . . . . . 22BMW i8 Series will be first to use

Corning’s Gorilla Glass . . . . . . . . . . . . 22BMW to Recall 1,500 09-10 X5s for

Fuel Filter Heaters . . . . . . . . . . . . . . . . 23Body Shop Improvements May Earn

Image Award . . . . . . . . . . . . . . . . . . . . 24Charging System Maker Says it May

File Bankruptcy . . . . . . . . . . . . . . . . . . 24Chief Expands its 3rd Qtr Training Schedule . 19Chrysler and Ford to Exhibit at 2013

ASRW Rotunda . . . . . . . . . . . . . . . . . . 22CIC Committee Deletes Reference to

“Class A” Shop . . . . . . . . . . . . . . . . . . . 3CIECA Launches CIECA-TV . . . . . . . . . . . 30Columbia, SC, and Dallas, TX, to be Next

Sites of Sherwin-Williams CollisionFacility Digital Marketing Seminar . . . . . 24

Connecticut Body Shop Fined a Total of

$54,300 for Repeat Violations byOSHA, Did Not Contest Citations . . . . . 38

Dealerships Continued to LoseBody Shops in 2012 . . . . . . . . . . . . . . 26

EPA Reduces Regulatory Burdenof Wipe Use. . . . . . . . . . . . . . . . . . . . . . 8

Garmat’s Sharp Shooter Contest is Back,Winners Get a Free Trip to SEMA anda SATAjet 4000B . . . . . . . . . . . . . . . . . 13

GM Adds Production Week on Cruze,Yr on Yr up 70% . . . . . . . . . . . . . . . . . 23

GM Wants to Improve Volt ElectricRange by 20% . . . . . . . . . . . . . . . . . . . 22

Herkules Wins IAMG 2012 Vendorof the Year Award. . . . . . . . . . . . . . . . . 30

Honda Aces Crash Test, Kia andNissan Less So . . . . . . . . . . . . . . . . . . 32

Honda to Invest $180M more in Anna, OH,Engine Plant . . . . . . . . . . . . . . . . . . . . 22

Hyundai Recalling Santa Fes . . . . . . . . . . 23Hyundai to Recall 239K of its 05-10

Sonatas in ‘Rust Belt’. . . . . . . . . . . . . . 23July Article on Felder’s Collision Parts v

General Motors et al. was Wrong Aboutthe Lawsuit Being Dismissed . . . . . . . . . 3

Mercedes-Benz to Offer Head-upWindshield Display . . . . . . . . . . . . . . . 22

Mitchell Brings 5 New Add-Ons toRepaircenter Tools . . . . . . . . . . . . . . . . 24

NABC Award of Distinction NominationsStill Open. . . . . . . . . . . . . . . . . . . . . . . 24

NABC is Accepting Nominations forSeven Open Board Seats . . . . . . . . . . . 32

NACE MSO Symposium Open to SomeSingle Shops . . . . . . . . . . . . . . . . . . . . 36

NACE Panels to Review Parts Procurement, Certification. . . . . . . . . . . . . . . . . . . . . 33

New Test Fails Half the Small Cars Tested. 32Nissan Sees Triple Last Year Leaf Sales,

Boosts Output . . . . . . . . . . . . . . . . . . . 23OSHA Focused on Preventing Summer Heat

Illness, Isocyanates Ongoing Concern. . 26OSHA Withdraws Proposed Rule Amending

on On-site Consultation Program CitingConcern About Employer Participation. . 28

PPG MVP Conference Registration isNow Open . . . . . . . . . . . . . . . . . . . . . . 30

PPG Passes Milestone withPaintManager at 5K . . . . . . . . . . . . . . . 34

Progressive Evaluates Snapshot Campaign,Expresses Surprise that 40% Say‘No Way’ . . . . . . . . . . . . . . . . . . . . . . . 31

SAAR Increases to 15.8 Million . . . . . . . . . 4SEMA Show Expands to Three New

Exhibitor Areas . . . . . . . . . . . . . . . . . . 33State Farm & PartsTrader Meet with Industry

As Program Rolls Out in the Southwest . 1Tesla Model S Gets 5 Stars . . . . . . . . . . . 22TopTech Finder Expands Job Board

for All Workers. . . . . . . . . . . . . . . . . . . 14Toyota Expects to Sell 2.25M Vehicles

in U.S. in 2013 . . . . . . . . . . . . . . . . . . 22Toyota Recalls 342K Pickups . . . . . . . . . . 22U.S. Auto Parts Network Has Loss Over

2nd Quarter 2012 . . . . . . . . . . . . . . . . 30UniCure Spraybooths Joins CREF

Leadership Circle . . . . . . . . . . . . . . . . . 30VISA and Mastercard Owe About $7.25 Billion

to Merchants Who Have Taken Their Cards Since 2004, Fairness Hearing on Sept. 12 Could Change Amount Owed . . . . . . . . 18

www.autobodynews.com | SEPTEMBER 2013 AUTOBODY NEWS 3

Autobody News regrets an error in ourarticle (Federal Anticompetition LawsuitAgainst GM Program Dismissed Againbut Amended Complaint is Allowed)published in the July 2013 Issue whichstated that:

“A federal judge in Louisianahas again dismissed an aftermarketparts retailer’s lawsuit challengingGM’s ‘Bump the Competition’ pro-gram designed to boost sales of orig-inal-equipment parts at dealerships,but he gave the plaintiff, Felder’s Col-lision Parts Inc., permission to amendits complaint.”

The statement that the suit wasdismissed is wrong. Rather the judgedenied the Defendants’ Motion to

Dismiss and allowed the suit to pro-ceed. The rest of the story is correct.

The error was brought to our at-tention by the law firm for the Plain-tiff: Sher, Garner, Cahill, Richter,Klein and Herbert LLC of New Or-leans, who pointed out the error andwrote: We thank you for reporting onthe lawsuit and the important issuesinvolved in the lawsuit. We remainsteadfast in our confidence in the mer-its of this case and look forward incontinuing to assist our client in thepursuit of remedies for its damages in-curred at the hands of the Defendants.

Autobody News will continue tomonitor developments in the case andreport in future issues.

July Article on Felder’s Collision Parts v General Motors etal. was Wrong About the Lawsuit Being Dismissed

Since CIC first compiled its definitionof a “Class A” collision repair facilityin the 1980s, the Definitions Commit-tee has periodically updated the docu-ment, adding to or changing the list ofequipment, training, compliance is-sues and other elements that CIC par-ticipants believed distinguished thenation’s top shops.

But at CIC in Boston, the com-

mittee presented its final draft of therevised document, with the term“Class A” no longer in the title. Theline items in the definition are largelyunchanged from the 2005 version, butit now defines simply the, “recom-mended equipment and capabilities fora collision repair facility.”Several CIC participants in Boston

CIC Committee Deletes Reference to “Class A” Shop

See Class A Shops, Page 13


Safelite AutoGlass announced it hasopened a new store in Elgin, IL. Thenew location is at 555 N. McLeanBlvd., Elgin, IL, 60123. This Chicago-area facility serves multiple suburbs inthe area.

The 4,000-square-foot facilitycan stock more than 300 windshieldsand tempered glass parts and offersfour full service bays, according tothe company.

Peter Theer serves as the storemanager, overseeing four techni-cians. He plans to add several moretechnicians over the next few years.

Safelite Opens Chicago Store

Its own Cleveland-based division head-quarters will be the site of the nextSherwin-Williams Automotive FinishesA-Plus™ University EcoLean™ Suiteof Training Course Offerings, featuringthe ‘Achieving Service Excellence’course was held August 21, 2013, offi-cially in Warrensville Heights, OH.

The ‘Achieving Service Excel-lence’ program is designed for shopowners, production managers, cus-tomer service representatives, and esti-mators to provide them with the skills,knowledge, and tools necessary to im-prove their collision center’s quality,production, and output… by focusingon the right types of customer service.

“Lean collision repair shops— andthose that utilize the right methods ofcustomer service—are able to reduce in-ternal costs and raise their level of CSIand output quality. This two-fold resultoften helps them gain a competitive ad-vantage in their respective markets,”says Steve Feltovich, Manager of Busi-ness Consulting Services for Sherwin-Williams Automotive Finishes.

The ‘Achieving Service Excel-

lence’ course discussed the followingtopics:● How to become more profitablewith a customer-focused strategy● How to establish a proven methodfor providing each customer with value● How to build a strong brand basedon customer service excellence● How to improve efficiency and ef-fectiveness of your customer servicestaff● Identifying service excellence pro-fessionals in and out of your organi-zation● Explain driving factors behind theexperiential service economy

To register online for an upcom-ing Cleveland A-Plus UniversityEcoLean ‘Achieving Service Excel-lence’ course, go to http://www.sher-win-automotive.com/customer-programs-services/a-plus-network/calendar-of-events/.

For more information on the A-Plus Network, call 800-798-5872 orgo to http://www.sherwin-automo-tive.com/en/Markets/Collision-Re-pair/A-Plus-Network.aspx.

Sherwin-Williams Automotive Finishes ‘Achieving ServiceExcellence’ Course Was Held at Cleveland Headquarters

Michigan Court Hears Class Action by CarDealers Against Japanese Parts SuppliersSeveral car dealerships have filed an an-titrust class action against four Japaneseautomobile parts suppliers for allegedlyrigging bids for lighting equipment soldto major car companies.

Mitsuba Corp., Koito Manufactur-ing Co. Ltd., Ichikoh Industries Ltd. andStanley Electric Co. are being sued in theclass action of Martens Cars of Wash-ington Inc. et al. v. Koito ManufacturingCo. Ltd. et al., which the plaintiff cardealers filed in the U.S. District Courtfor the Eastern District of Michigan.

The plaintiffs allege that the de-fendants violated federal and state an-titrust laws by conspiring to increasethe price of automotive lamps—in-cluding headlights and taillights—by“preordaining winners and losers” inthe bidding process.

The auto parts industry has re-cently been the focus of several in-

vestigations by antitrust enforcers onthree continents. Two of the compa-nies, Koito and Ichikoh, were finedless than four months ago allegedlyfor this same type of behavior by theJapanese Federal Trade Commission,Japan’s antitrust regulator. Koito wasfined $36 million, and Ichikoh wasfined $13.1 million.

An investigation into the autoparts industry by the U.S. Departmentof Justice has resulted in more than$800 million in fines and guilty pleasby several companies.

The European Commission,which is conducting a correspondinginvestigation, has announced that ithas imposed fines of more than $182million U.S. against companies thatwere found participating in cartels re-garding automotive products.

See related cover story this issue.

cret meetings. The court also reasonedthat the allegations are consistent withthe guilty pleas entered in the DOJ ac-tion.

This ruling on the wire harness

portion of the MDL is only a fraction ofthe claims in this massive antitrust ac-tion. Similar claims have been broughtconcerning alleged anticompetitiveconduct in the manufacture and sale ofother automotive parts, including in-strument clusters, fuel senders, heatercontrols, and alternators.

See related story above.

BASF will do its part to add to thecolorful and classic atmosphere ofthe 2013 Woodward Dream Cruiseby displaying a custom 1956Chevrolet Bel Air painted withBASF’s R-M Diamont paint.

BASF’s Dream Cruise displaywill be located at Morisette Auto-motive on Woodward Ave., justsouth of 13 Mile Road in RoyalOak, MI. In addition to the customBel Air, BASF will also feature art-work from airbrusher JefferyJames. He will have a displayshowing car parts painted with col-ors from BASF’s Carizzma paintline—a low-volatile organic com-pound (VOC) refinishing solutionoffering a wide range of colors andvirtually limitless effects, accord-ing to the company. Carizzma issupported by BASF’s R-M Refin-ish System.

“The Dream Cruise is the per-fect venue to spotlight the results ofour vibrant paint colors,” said VitorMargaronis, marketing director forBASF Coating Solutions. “It’s thelargest one-day automotive event inthe country and we love being outhere supporting the industry andthe community.”

BASF to Show Custom Bel Airat Woodward Dream Cruise

Continued from Cover

Antitrust Price Fixing

The annual revision to the seasonalfactors used in calculating the indus-try's seasonally adjusted, annualizedselling rate, or SAAR, increasedJuly’s rate to 15.8 million. The newdata reduced June’s rate from 15.98million to 15.91 million. The lowerfigure still represents the highestSAAR since the end of 2007. It alsoerases what had looked to be a con-spicuous sales dip in April, the onlymonth in which the SAAR came inat less than 15 million since October.The revised SAAR for April is 15.19million, rather than 14.91 million.

SAAR Increases to 15.8 Million


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On August 1, 2013, Illinois Gover-nor Pat Quinn signed the Compas-sionate Use of Medical CannabisPilot Program Act, making Illinoisthe 20th state to legalize medicalmarijuana. The law provides for afour year pilot program allowingindividuals with certain medicalconditions—including cancer andmultiple sclerosis—access to med-ical marijuana, pending approvalby their doctors and the Illinois De-partment of Public Health. The lawgoes into effect January 1, 2014.

The Illinois bill specifically pro-hibits employers from “penalizing”an individual for “his or her status asa registered qualifying patient.”However, no cause of action willexist against an employer who termi-nates or disciplines an employeewho, based upon the employer’sgood faith belief, used or possessedmarijuana on the employer’s prem-ises and/or was impaired while work-ing on the employer’s premises.While it is too soon to tell how Illi-nois courts will interpret these provi-sions, Illinois employers with drugtesting programs should consult withlegal counsel to discuss how this pro-vision may affect future testing.

IL is 20th Medical MarijuanaState, Not OK at Work

Adrian’s Collision Centers, with sixlocations around Metro Detroit, ispartnering with Bill Bentley, a sec-ond-year Detroit Lions cornerback, tocollect school supplies for the DetroitPublic Schools during the month of

August. Thosewho wish to do-nate may simplydrop off suppliesto the designatedboxes at any oneof the Adrian’sCollision Centerslocated in South-field, Farmington

Hills, Northville, Dearborn, Com-merce, and Marysville. In addition, allwho donate school supplies will be en-tered to win one of six footballs auto-graphed by Bill Bentley. “We’re veryexcited to partner with Bill Bentleyon this initiative,” said Neil Adrian,owner of Adrian’s Collision Centers.

“My partnership with Adrian’sCollision Centers will allow me to ac-complish this goal and I’m very ex-cited to help in any way I can,”Bentley said. Donations are beingcollected until August 31st at allAdrian’s Collision Centers, seewww.adrianscollisioncenters.com

Detroit Shop Partners Lions’Bill Bentley for SchoolsThe Alliance of Automotive Service

Providers of Minnesota (AASP-MN)will host “Wheel Alignment DiagnosticAngles & Resetting Electronic StabilityControl Systems,” Tuesday, September10, 2013, from 4:00–8:00 p.m., at Dun-woody College of Technology, Min-neapolis. The seminar, presented byRoger Creason, of Hunter Engineer-ing, will cover wheel alignment diag-nostic angles, including: ● SteeringAxis Inclination ● Included Angle ●Turning Angle ● Setback and ThrustAngle.

On Wednesday, September 18,2013, AASP-MN will host “8 Steps toa More Profitable Auto Repair Shop,from 8:00 a.m.–4:00 p.m., at theHyatt Place Minneapolis/Airport-South, Bloomington. The seminar,presented by Bob Cooper and DorisBarnes, Elite Worldwide, will teachattendees how easy it is to build amore profitable shop, in the most eth-ical way, and join the ranks of the in-dustry superstars at the same time.

Attendees will learn how to:● Set goals for the shop that will take itright to the top ● Find & hire the su-perstar technicians and service advisors● Put together a marketing plan thatwill keep your service bays filled ●Dramatically improve sales and cus-

tomer satisfaction ● Generate highersales and happier customers ● Generatehigher profits and increase shop value

On Wednesday, September 25,2013, AASP-MN will host two“Health Care Reform” workshops,from 11:00 a.m.–1:00 p.m. and 6:00–8:00 p.m. for those interested in learn-ing more about the Patient Protectionand Affordable Care Act (PPACA)before its January 1st implementation.This workshop will review the re-quirements and criteria of the PPACAto help attendees decide what strategywill work best for their business.

Topics covered will include:● Small business vs. large business def-inition ● Individual and small businesstax credits ● MNSure—Minnesota’shealth care exchange ● 2013-14 smallgroup renewal considerations ● Op-tions for small business employers, in-cluding pros and cons

The workshops will be presentedby Dennis Begley, CLU ChFC LUTCFCBC, Employee Benefits Manager,CBIZ AIA and Aaron Hall, CEO &Business Attorney with Thompson HallSanti Cerny & Dooley.

For additional information or toregister, contact the AASP-MN officeat (612) 623-1110 or 800-852-9071 orregister online at www.aaspmn.org.

AASP-MN Scores Fall Seminar “Hat Trick”

Bill Bentley

A San Antonio-area lawyer has beenindicted on charges that he defrauded$12 million from third-party insur-ance administrators by failing to pro-vide their clients stop-loss coverage asrequested.

Attorney Hugh Lappe ScottJr., 62, whose specialties are oil,gas and international law, dabbled inthe reinsurance or stop-loss insur-ance industry, which provides cov-erage of claims that exceed a setamount in self-funded or hybrid in-surance plans.

He and an alleged accomplice,Deborah Suzanne Williams, 42, areaccused of defrauding a handful ofthird-party administrators and theirclients in a Ponzi-like scheme. Scottalso is facing disciplinary hearings bythe bar’s Office of the Chief Discipli-nary Counsel, court records in FortWorth show.

“I’ve got no comment; you’ll haveto speak to my attorney,” said Scott, ofHollywood Park.

His lawyer, Mark Stevens, alsohad no comment.

Scott is charged with 22 counts

of health care fraud and 20 counts oftheft from a health care benefit pro-gram.

Scott’s indictment, obtained afteran investigation by the Department ofLabor and the U.S. Attorney’s Officein San Antonio, said Scott ran compa-nies that included United Re AG,Vado AG and Texcessre Inc., the latterof which often did business as UnitedRe Trust.

Williams, United Re’s formeroperations director, is described ashaving a lesser role, and her indict-ment charges her with 19 counts oftheft from a health care benefit pro-gram. Both are ordered to appear infederal court on Aug. 21. Williams, ofStonewall, told a reporter she did notwant to comment.

The indictment alleges Scottfalsely told clients that no more than20 percent of what they paid his com-panies would go to “management andadministrative services” and that theremaining 80 percent would be forreinsurance.

But Scott instead utilized much

San Antonio Lawyer Faces 22 Counts of HealthCare Fraud, Ohio Connection to Case

See San Antonio Lawyer, Page 28


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On June 24, 2013, an appellate courtin Illinois made it more difficult forIllinois employers, including those inthe automotive industry, to enforcenon-solicitation and non-competitionprovisions. Under the court’s “Fifieldtwo-year rule,” Illinois noncompeti-tion and nonsolicitation agreementssupported only by new employment orcontinued employment will becomeextremely difficult to enforce forshort-term employees, even when theemployees decide to terminate the re-lationship. It appears employees canbreach restrictive covenants with im-punity, as long as they resign withintwo years of their start date.

Specifically, the court deter-mined that such restrictive covenantswon’t be enforceable unless the em-ployee in question works for at leasttwo years after signing the restrictivecovenant. Generally speaking, like allcontracts, there must be sufficientconsideration for courts to enforce re-strictive covenants. The Illinois courtdetermined that, in the employmentsetting, there would not be enoughconsideration for enforcement until anemployee had been employed for twoyears. Several key facts make this casenotable. First, the restrictive covenantsin question were agreed to upon the

start of new employment, not somemonths or years after the employeehad begun working for the company.Even so, the court still required twoyears of employment before therewould be adequate consideration. Sec-ond, the employee had negotiated theterms of the restrictive covenant andsuccessfully had them altered to hisbenefit before accepting the new em-ployment. Despite this, the court stillrefused to enforce the restrictivecovenants. Third, the court determinedthat it was irrelevant whether a re-strictive covenant is negotiated beforeor after employment begins—eitherway, it would be a “post-employment”restrictive covenant.

Practically speaking, this meansthat an Illinois employer will be unableto enforce any non-solicitation or non-competition clauses in an employmentagreement if an employee leaves to gowork for a competitor before reachinghis or her two year anniversary withthe employer. This is the case even ifthe agreement is entered into at the in-ception of employment. This case islikely to be appealed but, until then,employers should use caution whenhiring and considering enforcement ofnon-solicitation or non-competitionclauses.

Illinois Appelate Court Rejects Restrictive CovenantRecently, the U.S. EnvironmentalProtection Agency (EPA) modifiedthe hazardous waste managementregulations under the Resource Con-servation and Recovery Act (RCRA)to exclude solvent-contaminatedwipes from the EPA’s hazardouswaste regulations, under conditionthat businesses clean or dispose ofwipes properly. This comes as EPA’sfinal risk analysis, published in 2009,concluded wipes possessing certainhazardous solvents do not pose sig-nificant risk to human health and theenvironment if properly managed.The EPA noted that wipes are used inconjunction with solvents for clean-ing and other purposes by tens ofthousands of facilities in numerousindustry sectors including automobilerepair shops. According to MathyStanislaus, assistant administrator forthe EPA’s Office of Solid Waste andEmergency Response:

“Today’s rule uses the latest sci-ence to provide a regulatory frameworkfor managing solvent- contaminatedwipes that is appropriate to the level ofrisk posed by these materials … I’veheard directly from stakeholders aboutthe benefits of this rule and the need tofinalize it. The rule reduces costs forthousands of businesses, many of

which are small businesses, whilemaintaining protection of human healthand the environment.”

This ruling excludes only wipesthat are contaminated with solventslisted as hazardous wastes underRCRA that are properly cleaned ordisposed of. To be excluded, solvent-contaminated wipes must be managedin closed, labeled containers and can-not contain free liquids when sent forcleaning or disposal. Additionally, fa-cilities that generate solvent-contami-nated wipes must comply with certainrecordkeeping requirements and maynot accumulate wipes for longer than180 days.

The EPA first proposed modifiedregulations for solvent-contaminatedwipes Nov. 20, 2003, and published arevised risk assessment for publiccomment Oct. 27, 2009.

Once the final ruling has beenpublished, it will be accessiblethrough ASA’s legislative website,www.TakingTheHill.com.

EPA Reduces Regulatory Burden of Wipe Use

www.autobodynews.comCHECK IT OUT!


A captive insurance company is es-sentially a private insurer that is awholly owned subsidiary of anothercompany. These captives accept thepremiums that the company wouldhave paid to a regular insurer and thencover any claims against the parentcompany. If the claims are less thanthe premium, the captive has made aprofit, just as a regular insurance com-pany would. The difference is that thecompany that set it up benefits, not theinsurer.

This is an alternative form of riskmanagement that is becoming a morepractical and popular means throughwhich companies can protect them-selves financially while having morecontrol over how they are insured.

In 2002, the Internal RevenueService issued guidance on how to setup captives to comply with the taxcode, and that gave way to a rush toform them. Now financial advisers areincreasingly pitching captives tosmaller businesses, including physi-cians’ groups, restaurant owners andcompanies that want to cut the costsof health insurance for their employ-ees. They are being portrayed as a way

not only to save money on insurancepremiums but also to reduce incometaxes and transfer money to heirs freeof estate tax.

A New York restaurant ownersaid he became interested in having acaptive insurance company when histraditional insurance policy did notcover a claim. Several years ago, oneof his restaurants was closed for threedays because of work in the neighbor-hood, but his policy had a waiting pe-riod of 96 hours before the insurancecovered any losses.

The captive he set up covers suchlosses. “I can write specific policiesthat go above and beyond my typicalcommercial liability coverage,” hesaid. “Business interruption coverage.Data breach. Legal fees. You can dodeductibles.”

While a company would get thesame tax deduction for paying premi-ums to a captive as to a regular in-surer, the real advantages come topeople whose company profits flowthrough to their personal income tax.

A person setting up a captiveunder section 831(b) of the InternalRevenue Code can put up to $1.2 mil-

lion a year into a captive, tax-free. Ifthe captive pays out less than that inclaims, it can eventually start return-ing the surplus to the business ownerin the form of dividends, which aretaxed at a lower rate than income.

The other advantage comes withestate planning. If a business ownerset up a captive in the name of theowner’s heirs, the captive could dou-ble as a way to transfer money to themfree of estate taxes.

The big red flags are companiesthat are insuring for risks that they donot have simply to take advantage ofthe tax savings, such as terrorism in-surance for a small, domestic com-pany, or a business owner in Nebraskainsuring against hurricane (not tor-nado) risk.

Ohio is about to be one of thenext states to allow the formation ofcaptive insurance companies. Texasand Missouri have enacted similarlegislation recently. Oregon has re-moved premium taxes from cap-tives, instead charging a $5000annual fee. In the United States, Ver-mont is home to more captive insur-ers than any other U.S. state, with

more than 900 licensed captive com-panies.

House Bill 117 was passed by theOhio House on June 4, 2013, and isnow before the Ohio Senate for pas-sage. The bill will be likely be signedby the Governor this year. House Bill117 provides for the formation of purecaptives and protected cell captive in-surance companies.

The Ohio captive insurance com-pany bill represents an alternative totraditional insurance for Ohio compa-nies or companies doing business inOhio. Previously, Ohio-domiciledcaptives were not an option for Ohiocompanies who were instead forced toestablish their captives in foreign ju-risdictions. Captive formation in otherjurisdictions is not without risk and anumber of administrative burdens.

Pure captives authorized underthe Ohio bill will be able to under-write the risks of their parent and af-filiates’ insurance needs. Protectedcell captive insurance companies arecaptives consisting of separate cells,and each cell owns particular liabili-ties and has assets associated with


Ohio’s Captive Insurance Law, Options for Small Business Self-Insurance?

See Captive Insurance Law, Page 12

My first glimpse of malicious com-petitors was seeing a runner for onebody shop remove a competitor’sbusiness cards in an insurance agent’soffice, and replace them with his own.In a highly competitive market, someshops may be striving to steal othershop’s business when the number ofjobs in the area is declining. In addi-tion to the straightforward attempts topush a shop out of a dealership deal inorder to gain the authorized repaircenter designation, I’ve seen someshops stoop to discrediting a competi-tor in every way possible. Sometimessigns are defaced, taggers sent to putan ugly image on a shop’s fences andexterior, and more. If you spot some-one taking photos of your shop or ve-hicles parked in your lot or in thevicinity of your shop, get that person’sname and file a police report at once.

These days a common maliciouspractice is placing phony complaintsagainst a shop on Yelp and local refer-ral websites. One shop suspected acompetitor of having a vehiclebrought into his shop and deliberatelysabotaged to create an insurance com-pany and Board of Auto Repair com-plaint and a vicious story to be sent tothe press and put on-line. The shopowner suspected he was under attackwhen an anonymous tip also sentOSHA inspectors into his shop forsupposed code violations. Anonymouscomplaints are most difficult to defendagainst, but even a complaint bysomeone giving his or her name couldstill be someone connected to a com-peting shop. One shop that was bro-

ken into resulting in the loss of nu-merous radios, GPS systems andmore, suspected a competitor of eitherarranging the theft or at least provid-ing information on how to get into theshop at night.

How far will a malicious com-petitor go to undermine a shop hewants out of the way? In the famousfictional industrial espionage tale,“Willy Wonka and the Chocolate Fac-tory,” author Roald Dahl has the evilSlugworth trying to steal Wonka’s se-cret recipes by bribing young visitorsto get them from the Oompa Loompasweets maker. Do body shop ownershave trade secrets? Could a competi-tor squash a shop’s marketing strategyefforts if he knew them in advance?Hacking into a company’s computersystem may be the most modern wayto steal trade secrets, but experts saymost thefts still occur the old fash-ioned way, by sneaking into a com-pany’s offices and making off withclassified information.

Ira Winkler, a top corporate se-curity analyst, in his book “SpiesAmong Us: How to Stop the Spies,Terrorists, Hackers, and CriminalsYou Don’t Even Know You EncounterEvery Day,” Winkler estimates Amer-ican companies lose as much as $300billion a year to pirating, counterfeit-ing and other corporate theft. He saysinside jobs are another tried-and-truemethod. We just saw an example ofthat when several people were bustedas they attempted to sell Coca-Colasecrets to rival cola giant, Pepsi.Could a competitor pay off an em-

ployee in his target body shop to re-port on planned marketing activities?How could a shop owner defendagainst a devious attack of this nature?

One news article reports that ex-perts say the best defense against cor-porate theft is to thoroughly vetemployees who have access to sensi-tive information. Then make sure thatthat information is secure. If a breachoccurs, report it to law enforcement assoon as possible. Corporations oftenhire a security analyst to perform sim-ulated espionage to test the company’ssecurity system. While few shopshave the kind of sensitive informationthat a competitor might try to steal,there are many more basic ways tomess with a shop’s marketing and totry to discredit their image.

Where it is still common for ac-cident victims to try to get three esti-mates, I’ve heard of a shop ownerdeliberately sending a prospective re-pair customer to the worst two other

shops he could think of, where hecould be sure the customer would geta high or faulty estimate. Some havemastered the fine art of tactfully bad-mouthing the competition to instillenough doubt about their integrity andreliability to eliminate them from therunning.

One shop owner I know wasstunned when he lost a couple of deal-ership deals he had for many years. Hesimply wasn’t prepared for the ag-gressive attacks on his quality thatwere made. Just running a shop is afull-time job and that doesn’t leave alot of time to be policing business re-lationships and marketing maneuvers.But in a highly competitive businessenvironment, it’s naive to assume allcompetitive moves will be honest andabove board. Thomas Jefferson said“Eternal vigilance is the price of free-dom,” but, in a body shop, constantvigilance may well be the price of sur-vival.


Don’t Mess With My Marketing!

On Creative Marketingwith Thomas Franklin

Tom Franklin has been a sales and marketing consultant for fifty years. He has writtennumerous books and provides marketing solutions and services for many businesses.He can be reached at (323) 871-6862 or at [email protected]. See Tom’s columns at www.autobodynews.com under Columnists > Franklin

ASRW Creates Free App for Event InformationAutomotive Service and RepairWeek (ASRW) has created a freemobile application allowing partici-pants to quickly access event infor-mation. The app is available foriPhone, Android and Blackberryusers and can be downloaded bysearching ASRW2013 in your de-vice’s app store.

The app will allow ASRW par-ticipants to search the exhibitor listand access the floor plan in additionto searching all educational sessionsand events. It is integrated with reg-istration, includes a calendar, shows

alerts, and has social integration withTwitter and Facebook.

Additionally, users can accesstheir hotel reservations and informa-tion on local restaurants and attrac-tions in Las Vegas.

“Based on feedback from lastyear, we’ve upgraded the technologyused in our app to provide a betteruser experience for our attendees,”said Shelby Hausler, ASRW associ-ate show manager. “There’s no bet-ter way to access all the criticalinformation from the show websitewhile you’re on the go or on site.”

those liabilities. A cell is not liable forthe liabilities associated with anothercell’s assets or the protected cell cap-tive’s general assets.

Though large corporations havebenefitted from operating captives formany years, smaller, closely heldcompanies are now learning that cap-tives can provide substantial benefitsas part of a risk management program.Some of the benefits of a well-man-aged captive insurance company in-clude:● Tax deduction for the parent or af-filiates for the insurance premiumpaid to the captive; ● Greater policyholder control over its

risk management programs;● Other tax savings opportunities,such as gift and estate tax savings; ● Opportunity to accumulate wealthin a tax-favored vehicle; ● Asset protection from the claims ofbusiness and personal creditors; ● Opportunity for stabilized or re-duced insurance costs; ● Access to worldwide reinsurancemarkets; and ● Insuring risks that would otherwisebe uninsurable or cost prohibitive.

Pure captives will be the focus ofmost Ohio companies or companiesdoing business in Ohio. Highlights ofthe proposed Ohio captive insurancecompany bill relating specifically topure captives include:

Permitted lines of insurance — Acaptive may only offer the following

types of insurance coverage:● Commercial multiple peril● Ocean marine ● Inland marine ● Medical malpractice ● Workers compensation (to the ex-tent permitted by Ohio law but onlyfor the purpose of indemnifying a self-insuring employer) ● Commercial auto liability ● Commercial auto physical damage ● Fidelity● Surety ● Any other line that the ODI super-intendent permits

Distinct regulatory scrutiny—The bill requires pure captives tomaintain minimum capital and surplusof $250,000. Capital and surplus mustbe in the form of cash, marketable se-curities or irrevocable, unconditional

and automatically renewable letters ofcredit. The captive’s board of directorswill determine appropriate invest-ments for the captive by adhering to aprudent-person standard of invest-ment, employing a strategy that seeksto preserve capital and is not overlyspeculative. A captive may make aloan to, or an investment in, its parentor an affiliate only with the approvalof the ODI superintendent. Captivesare prohibited from joining or con-tributing financially to any guarantyor insolvency fund in Ohio and areprohibited from being required to joina rating organization. Generally, cap-tives will be governed only by theOhio captive statute and only suchother provisions of the Ohio InsuranceCode specified in the Ohio captivestatute.

Court for the Southern District of Illi-nois.

The trio’s lawsuit named StateFarm; William Shepherd, an attorneyat the insurance company; Ed Mur-nane, president of the Illinois CivilJustice League; and Justice LloydKarmeier’s campaign committee, Cit-izens for Karmeier, as defendants,however the judge, David Herndonsince dismissed Citizens as a defen-dant.

Tennessee attorney W. GordonBall, who serves on the plaintiffs’legal team, said his clients’ RICO suitis very simple: “Shepherd, State Farmand Murnane used the Illinois CivilJustice League as an enterprise to ba-sically buy an Illinois Supreme Courtjustice.”

On August 5, 2013, the plaintiffsin Hale v. State Farm told the judgehearing the case that their “stated in-tention” was to ask Justice Karmeierto address the allegations in a deposi-tion. The plaintiffs contend that StateFarm violated the Racketeer Influ-enced and Corrupt Organizations Act(RICO) by using the U.S. Chamber ofCommerce, the Illinois RepublicanParty, and other entities as conduits toconceal its role in funding and operat-ing the justice’s campaign. RICO al-lows plaintiffs to sue persons orentities involved in a conspiracy to en-gage in improper activities such asbribery, fraud, or violent crimes. InMay of this year, a federal judge de-

nied State Farm’s motion to dismissthe lawsuit and ruled that the plaintiffscan continue with discovery. The trialcould unearth more details about theextent of State Farm’s involvement inJustice Karmeier’s 2004 campaign.

The events that form the basis ofHale v. State Farm arose in 1997,when more than 4 million aggrieved

policyholders filed a class-action law-suit in an Illinois state court againstState Farm. The 1997 lawsuit—Averyv. State Farm—concerned a clause inState Farm’s automobile insurancecontract that stipulated that the com-pany would pay for replacement partsof “like kind and quality” to restore avehicle to its pre-loss condition after

an accident. State Farm was accusedof breaching this promise by in-stalling inferior replacement parts. Ajury in Williamson County, Illinois,agreed with the plaintiffs in Avery v.State Farm and awarded them $1.18billion. The verdict amounted toaround $300 for each of the 4 millionplaintiffs.


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Avery v State Farm

Continued from Page 9

Captive Insurance Law

Back for the third year, GARMATUSA has announced the return of theimmensely popular Garmat SharpShooter contest for shop owners andpaint techs. This contest which beganin 2011, was designed to recognizequality paint techs and shop ownersthat use Garmat equipment. GrandPrize includes a trip for 2 to the 2014SEMA Show in Las Vegas and a SA-TAjet 4000B Camouflage LimitedEdition Paint Gun.

“We are amazed at the responsewe have gotten with our SharpShooter contest in the past two yearsand the feedback from the techs thatuse our equipment is invaluable,” saysJohan Huwaert, Garmat USA’s gen-eral manager. “The shop owners ap-preciate the contest too, as it providesthe added benefit of validating theircommitment to quality by showcasingtheir choice of equipment and capa-bilities of their technicians.”

The Garmat Sharp Shooter Con-test will run from July 25 -September30, 2013. Paint techs and their man-agers will have the opportunity to telltheir Garmat Story in either video tes-

timonial or written statements. Judg-ing is based on the shop owner andpaint tech’s dedication to providingquality paint jobs, superior customerservice, attention to safety and over-all equipment knowledge. Bonusquestions include an inquiry on howGarmat can improve their Garmat ex-perience with product improvements.

In addition to the Grand Prize ofa free trip to the SEMA SHOW in LasVegas, SATA has generously provided2 SATA Camo Paint Guns to be pre-sented to the top two entries. Five fi-nalists will each be awarded twoSamsung Galaxy Wifi tablets, (one forthe contestant and one for theowner/manager), and the first 100 en-trants will receive a custom GarmatSharp Shooter Cap. Contest rules andregulations can be found at www.gar-mat.com.

The 2012 Garmat Sharp ShooterWinners can be found on www.face-book.com/GarmatUSA.

questioned that change.“What we tried to do over the

years was distinguish those who stepup to a higher level,” CIC Administra-tor Jeff Hendler told the committee.“Now just to be in the collision busi-ness I’ve got to meet all this? But whatdo we do about those who don’t? Whatdo you call those guys?”

As he did at CIC earlier this yearwhen the committee presented a draftof the document, Aaron Schulen-burg of the Society of Collision Re-pair Specialists (SCRS) noted that thedefinition includes things like a shopmanagement system and ongoing CSIdocumentation that top-tier shops mayneed but that aren’t required by everyshop.

But Definitions Committee chair-man Chris Evans of State Farm saidthe committee had input from all seg-ments of the industry as it did its workon the definition. He also pointed to avote at CIC in January which he saidshowed support for the change in thedocument’s name. At that meeting,about 45 percent of CIC participantsvoted to rename it as the “minimum re-quirements” for a shop, but over halfwere split among the other alternatives

offered, including keeping the defini-tion unchanged from the 2005 version,revising it but maintaining it as the def-inition of a “Class A shop,” or deletingit altogether from the CIC website.

As a “conference” rather than aformal organization, CIC has no by-laws nor formal voting requirements.But traditionally before any commit-tee’s work product is considered fi-nalized and published on the CICwebsite, a floor vote is taken.

Although no vote to approve the3-page document was taken in Boston,CIC Chairman George Avery said hefelt the committee had completed itswork (which began last year), and thefinalized definition could be turnedover to the CIC Standards Committee.

“Let’s see where it fits in thework they are doing,” Avery said, al-though later in the meeting he said thatthe topic could be reviewed then ornext year. “And now let’s move it intowhat’s happening with this processwith the Standards Committee.”

As with all its work, CIC has noability to implement the definitionsor recommendations it develops. Butthe “Class A” shop definition hasbeen among the CIC documents mostwidely used in a variety of ways overthe years by insurers, associations,government agencies and other or-ganizations.


Class A Shops


Garmat’s Sharp Shooter Contest is Back, WinnersGet a Free Trip to SEMA and a SATAjet 4000B

I received a fair amount of feedbackfrom devout readers about a previouscolumn on parts and materials. Forthose who didn’t read (or don’t recall)that column, I addressed shops’ profitcenters. I said shops need to quitwhining about State Farm and Part-sTrader and instead focus on the profitcenters they do have control over. (Seehttp://www.autobodynews.com/colum-nists/insurance-insider/item/7264-stop-obsessing-about-parts-profits-when-you’re-not-managing-the-profit-centers-you-have.html)

Because I’m not solely focusedon pointing out the obvious, I alsoadded a few tips as to how shops canimprove their profitability on paintand materials. One suggestion, for ex-ample, was to reduce the amount oftheft in the shop.

Apparently, my tips for successwere not welcomed by all readers. Infact, a few readers took me to task ine-mail responses to the column. Al-though they were upset with my com-ments, they also were astute enough toask for help. I appreciate them takingthe time to write, and I offer the fol-lowing suggestions in response tosome of their questions.

Here’s an excerpt from “Laura,”who wrote from a shop in a Mid-At-lantic state. “Our rates for paint materi-als and labor that insurance companiespay us haven’t increased in 10 years ormore,” Laura wrote. “As you know,paint and material prices have increasedtremendously over that period of time.What are your thoughts on this? Whatare our rights against insurance compa-nies so that we may protect our bottomline?”

Your situation is one that is veryfamiliar to shops around the country,Laura. There are a number of marketsacross the United States that haven’tseen a labor rate or paint and materialincrease in years. These areas are usu-ally in states with regulatory issuesthat create barriers to increased shopunity. Unfortunately, if your shop isone of only a few in these areas re-questing an increase, you will NOTget one. If you are in a market popu-lated with unknowledgeable shopsthat are still operating as if it’s 1980,your shop will suffer.

There a few solutions to yourproblem. You can choose to removeyourself from any direct repair pro-grams and charge whatever rate youbelieve is fair. Since that can be a riskyendeavor, you can take a different ap-proach. I would recommend request-ing rate increases in a professionalmanner. Request a meeting at yourshop. Explain why the increase is nec-essary. Show the insurer the invest-ments you’ve made in your shop andemployees. Last but not least, showthem the “product” and service yourcustomers receive that they can’t getdown the street for the same price.

“Tom,” from a dealership in theNortheast, also wrote to me after mypaint and materials column.

“How do insurance companiesdetermine when the paint and materi-als reimbursements need to be raisedon the estimates they provide” Tomasked. “Every time 3M or DuPont orPPG sends a notice that they are rais-ing their prices, I ask them (by emailor, if I can reach someone, by phone)to make sure they let the insurance

companies know that they are raisingtheir pricing.”

Insurers, Tom said, will in turnonly honor a shop’s higher rate “aftermuch complaining,” and many shopscomplaining. Then the insurers makeit appear they are doing the shops afavor by raising the rate at a later date,all the while ‘complaining’ that THEYare losing profits. Is this how it works,in your professional opinion? It seemsthat the real theft here takes placefrom the time of the (supplier) in-creases to the time the insurance com-panies raise rates. They seem to be thethieves, not our employees, as youseem to think the problem is.”

Well, Tom, insurance companiesdetermine the paint and material reim-bursement rate by using an algorithmdeveloped by an engineer in mathe-matical computations. Not! Of courseI am joking. Sadly, most if not all in-surance companies only raise theirrates when shops “complain,” as you

state above. That isn’t a joke. We aren’tin the business to give money away.Unless you ask, you aren’t getting.

We don’t receive any documen-tation from the paint companies. I’msure they would provide it upon re-quest but we really don’t care. Yearsago when gas and paint and materialsprices were rising like the tide after atsunami, we watched from afar asthose near the beach were swept away.Unfair yes, but it’s not our problem.We see those increases only whenthey are reflected in the rates shopssay they need to charge us. Unless alarge number of shops in a geographicmarket submit for an increase, wearen’t increasing our reimbursementrate.

I concur, Tom, with your assess-ment that we revert to pointing to em-ployee theft or waste as the reason youaren’t profitable. Old habits die hard,but there also is a lot of truth to thatstatement.


Responding to Reader Feedback on Insider’s Parts and Materials Column

with The Insurance InsiderInside Insurance

The Insider is a corporate-level executive with a Top 10 auto insurerin the U.S.. Got a comment or question you’d like to see him addressin a future column? Email him at [email protected]

TopTech Finder has expanded its jobboard to help repairers find all typesof collision repair workers. “AtNACE in New Orleans, shops saidthat they wanted help finding allkinds of employees, not just PDRtechs. We are expanding to bettermeet the needs of the industry,” saidJeff Herman, CEO of TopTechFinder. Free for job seekers, TopTechFinder is also free for employers for alimited time in 2013. “Employershave a hard time finding qualified

technicians on general job boards.They aren’t designed for the collisionrepair industry and don’t draw manytechnicians,” said Herman. “In con-trast, TopTech Finder allows candi-dates to list industry-specificqualifications like I-CAR Platinumand ASE certifications, making thejob board a natural place for techs tofind jobs.” Herman said all jobs, fromestimators to collision technicians,entry-level to experienced, can nowbe posted on the website.

TopTech Finder Expands Job Board for All Workers

meeting, pointed out that dealers cannow see and quote prices for an entireparts list for each job, whereas cur-rently they may not know about partsthat a shop contacts only a recycler or

non-OEM parts vendor about. Averyagreed that PartsTrader gives dealersa chance to see other potential busi-ness and shop customers.

“The performance of those whoprovide parts has an impact on repair-ers, and repairers have an impact onour shared customer,” Avery toldPriest and other parts vendors at themeeting. “So you’re in the game. Ifyou’re not on PartsTrader, it’s yourdecision. But you need to decide ifthose repairers that are working withme are repairers you want to dealwith. Because I’m asking them to usePartsTrader.”

Priest noted that dealers couldjust as easily lose business throughPartsTrader as gain new business, andthat any number of different insurerscould require different electronic partsprocurement systems.

“How many fees am I going topay? How many hoops am I going tojump through,” Priest asked. “We havethe slimmest margin of anyone in theroom, yet we have to pay for the pro-gram. State Farm should pay for theprogram. It’s going to benefit them.”

New Information on FeesAbout 130 people, including two Ari-zona state legislators, attended themeeting, which also offered some newinformation about PartsTrader. Sailersaid 1,400 shops and 2,300 suppliersare now using PartsTrader followingits roll-out in early August in majormarkets in Arizona, Colorado, NewMexico and Texas. He said majormarkets in California, Nevada andUtah will follow on September 9, withmarkets in Michigan and Ohio fol-lowing in October.

Sailer said 56 percent of shopsusing the program are using it for at

least some non-State Farm work; thisis up from the 30 percent Sailer re-ported at a meeting in May.

Use of the system for jobs otherthan State Farm work is somethingPartsTrader is counting on given itsplanned fee structure. PartsTrader iscurrently free to shops and Sailer saidthe company doesn’t “expect to ever

charge a shop to use the sys-tem.” Sometime next year,however, suppliers will begiven 60-days’ notice aheadof the start of a monthly feefor their participation; Sailerwould say only that the feewould be “modest” and “lessthan you’re used to payingtoday for comparable prod-

ucts.”The supplier also will pay a yet-

to-be-determined fee per transaction,Sailer said, but there will be no trans-action fee charged on State Farmjobs.

“Our success is dependent onshops finding value in using Part-sTrader beyond State Farm,” Sailersaid. “That is an absolute must for us.”

State Farm Defends MandateAvery was asked several times aboutthe elimination of the “fax-only” op-tion in PartsTrader, which had al-lowed a shop to use the system to buyfrom a vendor even if that vendordidn’t participate in PartsTrader. If

State Farm wentback on its assur-ance that shopscould buy fromany vendors theywant, Avery wasasked, might theinsurer also stepback from its as-

surance that shops aren’t required tobuy the cheapest part the system lo-cates?

Avery responded that the “fax-only” option was available only dur-ing the pilot testing of the program infive markets, and insisted that shopsstill can use the vendors of theirchoice provided they are on the sys-tem—something that can only happenif a shop “nominates” those vendorsto participate. In terms of otherchanges to the system or requirementsdown the road, Avery encouragedshops to remember that State Farmdoesn’t require the use of non-OEMparts, doesn’t require discounts unlessthey are given to another insurer,doesn’t have paint caps, and “has a

pretty good book of business.”“You’re going to have to decide

for yourself as to what sort of partnerState Farm is,” Avery said. “There’snothing else I can say. I will tell you:There is no value in pushing you totake the cheapest part. It doesn’t makesense. If (your Select Service score) isbalanced between quality, efficiencyand competitive price, and I put pres-sure on you for the price, it’s going tohurt what? Your efficiency. It’s goingto slow you down if you get bad parts.So that decision about what parts tochoose is in your hands.”

Other Concerns RaisedBob Schubert of Impact Auto Bodyin Mesa, AZ, was among the SelectService shop owners who spoke at themeeting. He challenged Sailer’s in-troductory comments in which Sailercompared PartsTrader to travel web-sites like Expedia or Orbitz, whichallow users to see all the available op-tions and make a choice based on thefactors they see as most important.

“Plane tickets and collision partsare nothing alike,” Schubert said. “I’msorry, but it’s a terrible analogy. Any-body, a 10-year-old, can get onlineand figure out how to buy a plane

ticket. Not so with collision parts. Notso with the people who fill the or-ders.”

He said he found it “kind of in-sulting” that State Farm felt the in-dustry “wasn’t smart enough to orderparts efficiently, get them there on

time and have sin-gle-digit return ra-tios.” He notedthat no one has ad-dressed how Se-lect Service shopswith automakercertifications willreconcile the con-

flicting requirement some of thoseprograms have for using a particularparts sourcing system. And he criti-cized PartsTrader for not providingparts suppliers with more than vagueexplanations of what fees they willeventually have to pay.

“Once these dealers are signedon, they’re signed on, they’rehooked,” Schubert said. “They’re notgoing to get off of it. They won’t beable to. They have a right to knowwhat their costs are going to be, or atleast a range, before they sign on toit.”



PartsTrader Rollout

See PartsTrader Rollout, Page 28

George Avery

Bob Schubert

If you’ve accepted MasterCard andVisa payments from consumers withinthe past nine years, you may havesome money coming your way. Noticeof a settlement was recently filed inthe amount of $7.25 billion with mer-chants who have accepted MasterCardand Visa payments since 2004.

According to David Cherney,vice president of Digital FinancialGroup (DFG), a merchant servicegroup in Carson City, NV, the suit wasfiled in 2006 and has had more than50 million pages of documents and400 witnesses to date.

“Basically [MasterCard/Visa was]violating anti-trust laws, which youwould call price fixing,” says Cher-ney. “I have made my living in themerchant service industry so indi-rectly Visa and MasterCard put mykids through college… but I have noproblem in being candid about whatthey’re being accused of. I’ve seen it.They wouldn’t be agreeing to a $7 bil-lion settlement if there wasn’t[cause].”

The class action settlement au-thorized by the U.S. District Court

for the Eastern District of New York,represents two separate classes in thesettlement. Members qualifying inthe first class, “which includes allpersons, businesses, and other enti-ties that accepted any Visa or Mas-terCard cards in the U.S. at any timefrom January 1, 2004, to November28, 2012,” according to a notice, willsee $6.05 billion given in cash re-funds.

The second class, according to thenotice, “which includes all persons,businesses, and entities that as of No-vember 28, 2012, or in the future ac-cept any Visa or MasterCard cards inthe U.S.,” will see a ten basis-point re-duction in interchange rates for 8months which is equivalent to a $10savings for every $10,000 processed.

Cherney says, “An article fromthe April 22 Green Sheet says industryexperts may receive from the firstfund anywhere from $400 to $600 forevery $100,000 spent” in Visa/Mas-terCard purchases.

Merchants can determine a roughestimate of the settlement amount theymay receive by multiplying the aver-

age monthly Visa/MasterCard volumeby 12 (the number of months in ayear), then multiplying that figure bynine (the number of years eligible inthe settlement). Divide that figure by$100,000 then multiply by $400 to seea conservative estimate of the poten-tial amount your company could re-ceive.

A fairness hearing has beenscheduled for 10 a.m. September 12,2013, at the courthouse for the UnitedStates District Court for the EasternDistrict of New York.

“After the hearing, a claim formwill be submitted to the court for ap-proval and a claim deadline willthen be set … Big box stores arecurrently contesting the $7.25 bil-lion figure; the final amount, whichcould increase or decrease, will befinalized at the September hearing,”says Cherney.

“Until this hearing, when the final[amount] is decided, unless you’regoing to opt out of the settlement thereis nothing you need to do at thispoint,” he adds. “After the hearing,claim forms will be available.”

Interested merchants can receivemore information on the settlementand potential claims by visitinghttps://www.paymentcardsettle-ment.com/en. This is the official web-site for this settlement. Please do notrely upon other sites that may providedifferent and unauthorized informa-tion.

If the Court grants final approvalof the Class Settlement, Claim Formswill be sent to all known Class mem-bers. Claim Forms will also be avail-able at the website or by calling theClass Administrator at the toll-freenumber shown below.

Preregistration is optional anddoes not affect your rights under thesettlement.

Merchants with multiple locationsand/or franchise locations as well assingle location merchants are encour-aged to Preregister. The informationyou provide will be used to assist theClass Administrator in the preparationof your Claim Form.

In case of questions, call 1-800-625-6440 or send an email to:[email protected].


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VISA and Mastercard Owe About $7.25 Billion to Merchants Who Have Taken Their CardsSince 2004, Fairness Hearing on Sept. 12 Could Change Amount Owed


GET THE TRAINING THAT HAS EQUIPPED 50,000+ TECHS TO PROFITABLY REPAIR TODAY’S VEHICLES.

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Chief University, the training arm of colli-sion repair industry leader Chief Automo-tive Technologies, has added 14 classes toits remaining third quarter schedule, in-cluding one new session of its flagship De-sign Based Repair course. A total of 26classes will be taught in August and Sep-tember at a variety of locations across theUnited States. Courses combine classroomlearning with hands-on training using re-cently damaged vehicles.

Class offerings are updated fre-quently. A partial schedule of availableclasses is below. For the most up-to-date schedule, course descriptions andto register, visit www.chiefautomo-tive.com/training/chiefuniversity.asp.

Technician/Estimator/AppraiserDesign Based RepairSept. 10-11 Orem, UT

Technician, Computerized MeasuringAug. 13-14 Charlottesville, VAAug. 20-21 Kansas City, MOAug. 27-28 Altoona, PASept. 10-11 Norwalk, CASept. 17-18 Denver, CO

Full Frame Analysis & Repair PlanningAug. 19-20 Collegeville, PAAug. 22-23 Kansas City, MO

Unitized Body Analysis & Planning

Aug. 6-7 Troy, NYSept. 19-20 Kansas City, MO

Estimator/Appraiser, Structural DamageAnalysisAug. 21-23 Portland, ORSept. 10-12 Windsor, CTSept. 24-26 Collegeville, PA

Advanced Frame AnalysisAug. 6-7 Houston, TXAug. 8-9 Walla Walla, WAAug. 15-16 Charlottesville, VAAug. 27-28 St. Louis, MOSept. 17-18 Windsor, CTSept. 24-25 Lakewood, CO

Advanced Steering/Suspension AnalysisAug. 6-7 Walla Walla, WAAug. 8-9 Houston, TXAug. 29-30 St. Louis, MOSept. 12-13 Norwalk, CASept. 12-13 Orem, UTSept. 19-20 Windsor, CTSept. 26-27 Lakewood, CO

Most Chief University classes cost $655.Structural Damage Analysis is a three-daycourse that costs $985. To register for aclass or find more information, visitwww.chiefautomotive. com or call (800)445-9262. See twitter.com/ChiefAutomo-tive, www.facebook.com/ChiefAutomo-tive, www.youtube.com/ChiefAutomotive.

Chief Expands its 3rd Qtr Training Schedule


Victory HondaPlymouth

800-824-4646734-453-3600

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Bob Rohrman HondaLafayet te

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Bosak HondaHighland

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Honda of FishersFishers

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Russ Darrow HondaMilwaukee

888-318-1671414-586-5401

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Wilde HondaWaukesha

800-526-3209262-542-9300

Dept. Hours:M-F 7-9; Sat 8-4

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Carr’s HondaChicago

800-272-7477773-274-7777

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Jay HondaBedford

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Ed Martin AcuraInd ianapol is

888-812-1269317-706-1933

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Acura of LibertyvilleL iber tyv i l le

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800-991-8438847-991-9005

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Continental Acuraof NapervilleChicago/Suburbs888-711-1506630-960-2175

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AUTOMAKER, OEM, AND RECALLAUTOMAKER, OEM, AND RECALL

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Autobody News September 2013MICHIGAN • OHIO • INDIANA • ILLINOIS • WISCONSIN


Toyota Motor Corp. is recalling342,000 Tacoma pickup trucks to fixdefective seat belts. The models in-volved are Tacoma Access Cabsequipped with rear-hinged rear doors,built from 2004 to 2011. Toyota said ascrew could come loose in the front seatbelts on some of those trucks, causingthe belts to malfunction. If the screwsloosen completely, Toyota said the seatbelt pre-tensioner and the retractorspring cover could detach from the seatbelt retractor, which can affect retractorand pre-tensioner performance.

Toyota Recalls 342K Pickups

Honda North America intends to in-vest another $180 million in itsAnna, Ohio, engine plant to boostaluminum die-casting and engineparts production. Honda said at the2013 CAR Management BriefingSeminars that the investment willsupport “engine parts productionrelated to the new Honda EarthDreams Technology engines andtransmissions.”

Earth Dreams is Honda’s um-brella classification for a new gen-eration of more fuel-efficienthigh-output engines that range insize from 1.3 liters to 3.5 liters. TheEarth Dreams concept was unveiledin late 2011. It includes gas anddiesel engines, a hybrid engine sys-tem, a battery-powered electricdrive system and a continuouslyvariable transmission.

The investment follows othermoves to bring parts of the EarthDreams initiative to Honda’s Ohioplants, including a new direct-in-jection engine and the pulley com-ponents that are at the heart of thenew CVT transmission.

Honda also said it will invest$35 million to build a 160,000-square-foot office and technical train-ing center in Marysville, Ohio. Thenew building will open in fall 2014.

Honda to Invest $180M morein Anna, OH, Engine Plant

Chrysler will exhibit at 2013 ASRW inthe all-new OEM Rotunda area on theshow floor.

“We are so pleased to welcomeChrysler and Mopar back to ASRW,and are grateful for their support of thisyear’s show,” said Dan Risley, ASAexecutive director. “We are focused onmaking changes to ASRW to provideexactly what our attendees want, en-gaging with the OEMs on the showfloor. Their presence is critically im-portant to the success of the show.”

Darrell Amberson, AAM, ASAchairman, said, “Our industry startsand stops with the car manufacturers.Their support of the show is a clear in-dication of their commitment to sup-port those who repair their vehicles.”

Ford will also return to ASRWthis year. Chrysler and Ford will bejoining I-CAR in the OEM Rotunda.The OEM Rotunda is one of the newestadditions to the ASRW show floor.

“We value the opportunity tomeet face-to-face with the automotiveservice/repair community and discussChrysler and Mopar’s role in serviceinformation, parts procurement andnew vehicle technologies,” saidPatrick Dougherty, vice president,Mopar Sales and Field Operations.

For more information, please visitasrwevents.com.

Chrysler and Ford to Exhibitat 2013 ASRW Rotunda

The i8 will be the world’s first volume-produced vehicles to be equipped withchemically hardened glass or GorillaGlass as it’s called in the smartphoneworld. It will be used to separate thepassenger compartment and trunk ofthe i8 and is comprised of two layers,each 0.7 millimeters thick withacoustic sheeting between.

Gorilla Glass is the registeredtrademark for an alkali-aluminosil-icate sheet toughened glass manu-factured by American glassmakerCorning, Inc.

Engineered for a combinationof thinness, lightness, and damage-resistance, it is used primarily as thecover glass for portable electronicdevices including mobile phones,portable media players, laptop com-puter displays, and some televisionscreens. It is manufactured using ionexchange to produce compressiveresidual stress at the surface to pre-vent cracks from propagating.

BMW i8 Series will be first touse Corning’s Gorilla Glass

Mercedes-Benz has done a 180 onhead-up display and now plans tooffer the feature on its redesigned Sclass and C class. The redesigned S-class flagship arrives in showroomsin September. Head-up display is ex-pected to be added as an option toboth the S class and C class in the fallof 2014. Mercedes’ system will proj-ect speed, navigation data and certainwarning lights onto the windshield.

The system likely will include awarning function if a pedestrian isdetected by the vehicle’s night visionsystem.

Today head-up display systemsare offered by several carmakers andthe technology comes in various de-grees of sophistication. BMW launchedhead-up display in 2003. Audi offers iton the A6 and the A7. Mercedes issomewhat late to the game. Daimler en-gineers have previously thought head-up display to be a potential driverdistraction, but this assessment has beenreversed.

Mercedes-Benz to OfferHead-up Windshield Display

BMW Considering Mexico-based Assembly Plant

The Tesla Model S got a rave reviewfrom the National Highway TrafficSafety Administration’s crash test.NHTSA gave the Model S its top five-star rating for each safety category:front-end crash, side crash and rollovercrash. NHTSA had not previously testedthe Model S or Tesla’s other model, theTesla Roadster. While triple 5-star rat-ings are not rare, there are plenty ofmodels that do not get that top score, anaccomplishment for a new automakerthat has not had years of vehicle designsand safety measures to fall back on.

Tesla Model S Gets 5 Stars

BMW is studying expanding its NorthAmerican manufacturing footprintwith an assembly plant in Mexico.Ludwig Willisch, CEO of BMW ofNorth America, said that the automakerhas been in preliminary discussionswith “local governments” in Mexicoabout the possibility of building a fac-tory in their districts. He declined tospecify which areas of Mexico thatBMW is studying or which vehiclesthe automaker would build there.

Toyota Motor Sales U.S.A. hasagain increased its 2013 sales target.At Toyota’s recent national dealermeeting in Atlanta, Bob Carter,senior vice president, told dealershe expects Toyota and Scion divi-sions to sell more than 2 millionunits this year. Including Lexus, thetally should exceed 2.25 million.

Toyota has increased its indus-try forecast to 15.5 million units forthe year. At the beginning of 2013,Toyota predicted the industrywould finish around 14.7 millionsales. In April, Toyota bumped its2013 industry estimate to 15.3 mil-lion.

Toyota Expects to Sell 2.25MVehicles in U.S. in 2013

General Motors, working on the nextgeneration of the Chevrolet Voltplug-in hybrid, is aiming to improvethe electric-only range of the car byat least 20 percent, said CEO DanAkerson. The first-generation Volt,which was introduced in 2010, cantravel an estimated 38 miles on bat-tery power before a gasoline engineengages. Akerson wants more, as hetold Automotive News.

“We hope to extend that signif-icantly,” Akerson said during an in-terview on Bloomberg Radio to bebroadcast in September. “For some-thing to be significant to me, I've gotto get at least a 20 percent improve-ment in performance. If we can getit up to 50, 60 miles or more, wewill, but that's going to be anotherthree to four years out.”

GM Wants to Improve VoltElectric Range by 20%




Nissan Sees Triple Last YearLeaf Sales, Boosts OutputNissan plans to begin building moreall-electric Leafs as dealers ask formore of the once slow-selling car.Retailers have been selling about2,000 Leafs a month which is tripleits volume of a year ago, before thecar was moved into U.S. production.

Through July, Nissan sold11,703 Leafs in the United States—a230 percent increase over the 3,543units sold during the seven monthslast year. The company sold 1,864 ofthe cars in July, compared with 395during July 2012.

Nissan is already taking meas-ures to increase its output of electricmotors from its engine factory inDecherd, TN, Bill Krueger, NissanAmericas vice chairman.

Battery prices worldwide havedecreased Nissan’s outlay for theLeaf, allowing it to check costs. Nis-san is the only North American au-tomaker that produces an all-electriccar, its battery module and the elec-tric motor that powers it.

Competitor GM Volt has an-nounced a $4K rebate on the 2013Volt and $5K on the 2012, of whichit has 6000 in inventory and says itwill carry over to the 2014 Volts.Lease prices have also been reduced.

Hyundai is recalling certain modelyear 2006-2010 Sonata vehiclesmanufactured March 1, 2005,through January 21, 2010; andmodel year 2006-2011 Azera vehi-cles manufactured September 27,2005, through November 22, 2010originally sold in, or currently reg-istered in, Connecticut, Delaware,Illinois, Indiana, Iowa, Maine,Maryland, Massachusetts, Michi-gan, Minnesota, Missouri, NewHampshire, New Jersey, New York,Ohio, Pennsylvania, Rhode Island,Vermont, West Virginia, Wisconsinand the District of Columbia. Roadsalt and water can enter portions ofthe rear crossmember, leading tocorrosion of the crossmember steel.This may lead to detachment of oneof the rear control arms.

Control arm separation maysuddenly change the rear wheelalignment, affecting the handling ofthe vehicle, increasing the risk of acrash.

Hyundai will notify owners,and dealers will repair or replace thecrossmember assembly. The recallis expected to begin by the end ofSeptember 2013. Hyundai’s recallnumber is 113.

Hyundai to Recall 239K of its05-10 Sonatas in ‘Rust Belt’

General Motors has added a week ofproduction at its Chevrolet Cruze fac-tory in Lordstown, Ohio, to meetgrowing U.S. demand for the com-pact car. The Lordstown Assemblyplant was originally scheduled to beclosed the week of Aug. 26, UAWLocal 1112 said on its Web site. Now,workers will continue to assemble thecars “as normal” that week, the unionlocal said.

“Sales have been brisk,” saidGM spokesman Annalisa Bluhm.“We didn't want to lose momentum sowe decided to abstain from taking theweek off.” In July, U.S. sales of theCruze shot up 70 percent to 25,447vehicles over July 2012, according tothe Automotive News Data Center.

GM Adds Production Weekon Cruze, Yr on Yr up 70%

BMW is recalling certain modelyear 2009-2010 X5 xDrive35d ve-hicles equipped with a diesel engineand manufactured from June 13,2009, through November 9, 2009.The fuel filter heater, which is usedfor warming up the diesel fuel dur-ing vehicle operation at low outsidetemperatures, could experience anelectrical overload condition andbecome permanently activated.

The fuel filter heater could re-main activated even when the igni-tion is off and lead to a dead battery.The unit could also overheat, possi-bly resulting in a vehicle fire.

BMW will notify owners, anddealers will replace the fuel filterheater, free of charge. The safety recallis expected to begin in August 2013.Owners may contact BMW customerrelations at 1-800-525-7417.

This recall is an expansion ofsafety recall 11V-441. Owners mayalso contact the National HighwayTraffic Safety Administration Vehi-cle Safety Hotline at 1-888-327-4236 (TTY 1-800-424-9153), or goto www.safercar.gov.

BMW to Recall 1,500 09-10X5s for Fuel Filter Heaters

Hyundai Recalling Santa FesHyundai is recalling certain modelyear 2013 Santa Fe Sport vehiclesmanufactured July 13, 2012, throughMarch 12, 2013; and equipped with2.4 liter engines, due to a manufactur-ing issue, the right front axle shaft mayfracture, resulting in a loss of power tothe wheels. Without the parking brakeapplied, it may roll away.

www.a

www.autobodynews.com



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Ecotality, Inc. said Aug. 12 that it mayneed to file for bankruptcy, citing ad-verse developments that may impactits ability to meet ongoing obligationsand also fund anticipated operatinglosses. The company’s shares aredown more than 74 percent in the reg-ular trading session. The San Fran-cisco-based maker of electric vehiclecharging and energy storage systemssaid in a filing with the Securities andExchange Commission (SEC) thatwhile it is exploring options for a re-structuring or sale of its entire busi-nesses or assets, it may file forbankruptcy as part of any suchprocess in the very near future. Thecompany said that recent adverse de-velopments include, among others,failure to attain sales volumes of itscommercial electric vehicle serviceequipment or EVSE that were neededto support the company’s operationsin the second half of 2013. In addi-tion, the U.S. Department of Energyinformed Ecotality that it was sus-pending payments to the company inconnection with the EV Project. Thecompany noted that the suspensionhas had a significant impact on re-ceivables that were anticipated to becollected from the DOE.

Charging System MakerSays it May File Bankruptcy

The National Auto Body Council isstill accepting Body Shop ImageAward nominations for the 2013year! The competition, which runsthrough early-September, applies toany body shop remodeling projectcompleted during the calendar year2013 and also 2012! One winnerand three runners-up will be recog-nized. Each will receive visualrecognition on the NABC website.The name of every facility enteringthe competition will be listed on thewebsite, as well. In addition, thewinner will receive a trip for two inthe continental US, 2 nights stay,and some spending money, with thewhole trip package capped at$1,500. Those wishing to submit ashop for consideration should sub-mit a nomination form to theNABC with three exterior imagesand one interior image of the facil-ity (before and after pictures, soeight total images should be sub-mitted). A form and a complete de-scription of the nominating processis available at http://www.auto-bodycouncil.org/files/NABC_nom-inate_imageaward.pdf

Body Shop ImprovementsMay Earn Image Award

Mitchell has announced the releaseof five new add-ons to the Repair-Center ToolStore. The company saysthese add-ons bring extensive func-tionality from third-party partnersinto Mitchell’s RepairCenter plat-form. They will be joining a wide se-lection of other add-ons in theToolStore catalog, where all the add-ons can be browsed and added in-stantly.

“Shops will now have even moreexpanded and powerful capabilities attheir fingertips with Mitchell’s Re-pairCenter through their ToolStoreadd-ons,” said Brian Elmi, seniorproduct manager, auto physical dam-age solutions.

“The third-party services thatshops use on a day-to-day basis willnow be available to them all in oneplace, through easy-to-use add-ons intheir RepairCenter. With these newadd-ons, shops will be able to doeverything from shipping and order-ing parts, to managing their parts in-ventory with third-party services intheir RepairCenter.”

Mitchell Brings 5 New Add-Ons to Repaircenter Tools

The National Auto Body Council isstill accepting nominations for the2013 year. Do you know someone whodeserves this great award? Someonewho has gone out of their way to pro-mote the image of the Auto Body in-dustry. They could be a vehiclemanufacturer, supplier/vendor, educa-tor, insurer, independent appraiser ortrade association. Send all nomina-tions in before September 15, 2013!The Award of Distinction has beengiven for bravery, philanthropy, char-ity, and selfless acts of kindness. Ittranscends the rigors of daily businessto uncover those helping the worldaround them without a thought ofrecognition for themselves. Any indi-vidual, business organization, or groupemployed in a collision industry-re-lated segment such as collision repairfacility, manufacturer, supplier/vendor,educator, insurer, independent ap-praiser or trade association is eligible.The winner will receive a trip for twoin the continental US, 2 nights stay, andsome spending money, with the wholetrip package capped at $1,500. Formore information contact: KentSeavey, NABC Award Chairman,Phone: (201-448-5158) or e-mail:[email protected].

NABC Award of DistinctionNominations Still Open

The Sherwin-Williams Automotive Fin-ishes A-Plus™ Network University andSummit Software and Marketing Solu-tions will be taking their successful Dig-ital Marketing Advanced BusinessClass—specifically created for collisionrepair facilities—on the road Sept. 5,2013 to Columbia, S.C. (Columbia Mar-riott) and Oct. 9, 2013 to Dallas (Sher-win-Williams Training Center in GrandPrairie, Texas). Facilitated by FrankTerlep the program is designed to meetthe challenges body shop decision-mak-ers face in today’s rapidly changing dig-ital and information age. The workshopis recommended for all collision shopowners and managers, and those in-volved with marketing shop services totheir customer and prospect base.

The workshop will include the fol-lowing strategies and tactics:● What is digital marketing? ● Why isdigital marketing a requirement for suc-cess in today’s world? ● Who is a shop’spotential digital marketing audience? ●What benefits can a shop expect to re-ceive from digital marketing? ● What’sthe importance of a digital marketingdatabase? ● What digital marketingtools are available? ● Why your websiteis your online lobby● SEO, PPC, SEM,and other online marketing tools ●

Email, Text messaging, Smart phones;phone apps ● Mobile internet marketing● Online reputation management; Cus-tomer reviews and ratings ● Digital ads,promos and coupons: Groupon, LivingSocial and other social commerce sites ●Location based services and marketing● A review of the latest social media:Facebook, Twitter, YouTube, Google+,Yelp, and others ● Using digital market-ing tools to generate revenue and profitfrom previous customers ● The impor-tance of digital marketing processes ●Who in the shop should “do” the digitalmarketing ● How much time andmoney should a shop spend on digitalmarketing ● Creating your digital mar-keting strategy and action plans

The Sherwin-Williams Automo-tive Finishes A-Plus Network offersseveral social and digital media part-ner programs, in addition to co-hostingthe digital marketing advanced busi-ness management course. Register on-line at www.sherwin-automotive.com/customer-programs-services/a-plus-network/calendar-of-events/ for theupcoming Columbia, S.C. or Dallasdigital marketing workshops or contactFrancine Schaefer at (216) 332-8524.For more information on the A-PlusNetwork, call (800) 798-5872.

Columbia, SC, and Dallas, TX, to be Next Sites of Sherwin-Williams Collision Facility Digital Marketing Seminar



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Heat IllnessOSHA has made heat stress and its im-pacts on workers a priority problemthis summer. Since 2008, there havebeen several heat related fatalitiesthroughout the country, including somein southern Wisconsin and northeast-ern Illinois. As a result, OSHA has im-plemented a nationwide Heat IllnessPrevention Campaign.

Heat stress results when the bodycannot naturally cool itself. As a con-sequence, a variety of heat illnessescan occur, ranging from minor heatrash to serious—and sometimesfatal—heat stroke. Some people aremore susceptible to heat illness thanothers. Persons who work outsideand/or perform strenuous work activi-ties in heavy clothing are most at riskfor developing a heat-related illness.The protection of these more suscep-tible workers is a priority for OSHA.

OSHA’s heat awareness programis summarized by “Water, Rest, Shade.”Specifically, if workers are in an envi-ronment that could produce heat stress,OSHA recommends that they:● Drink water every 15 minutes, evenif not thirsty;● Rest in shade to cool down;● Wear a hat and light colored cloth-ing;

● Learn the signs of heat illness andwhat to do in a heat-related emer-gency;● Keep an eye on fellow workers (instressful conditions a buddy system isrecommended); and;● Acclimate to conditions slowly.● Use sunscreen protection with a sunprotection filter (SPF) of 30 or more.

IsocyanatesIsocyanates are chemical compoundscontaining the isocyanate group(–NCO). Isocyanates in the form ofraw materials are incorporated intonumerous polyurethane products,such as foams, paints, spandex fibers,insulation materials, car seats, mat-tresses, under carpet padding, packag-ing materials, polyurethane rubber,adhesives and fiberglass.

Many industries in addition tocollision repairers use polyurethaneproducts (and isocyanates), includingautomotive interiors, medical care,printing, plastics, mining, textiles,paints, food, building constructionand electronics. Thus, isocyanates arewidely used and are found in many ofthe products we use.

The health effects of isocyanatesinclude irritation of skin and mucousmembranes, difficulty breathing and

chest tightness. OSHA and similarregulators have developed occupa-tional exposure limits for eight iso-cyanate components. One isocyanate,2,4-toluene diisocyanate, has beenclassified as reasonably anticipated tobe a human carcinogen.

OSHA and its counterpart agenciesalso have prepared several referencedocuments addressing isocyanates.

On June 20, 2013, OSHA re-leased a new Instruction for the FieldOperations Manual (Instruction Man-ual) regarding isocyanates. The In-struction Manual describes policiesand procedures for implementing aNational Emphasis Program on Oc-cupational Exposure to Isocyanatesto identify and reduce/eliminate theincidences of adverse health effectsassociated with occupational expo-sure to isocyanates. OSHAʼs Instruc-tion Manual sets forth a system thattargets multiple industries and fo-cuses on evaluating inhalation, der-mal and other routes of occupationalexposure to isocyanates.

If you have employees who workwith polyurethane (and isocyanates),you should consult the InstructionManual.

See https://www.osha.gov/Osh-Doc/Directive_pdf/CPL_03-00-017.pdf

OSHA Focused on Preventing Summer Heat Illness, Isocyanates Ongoing Concern

According to the Mitchell Interna-tional Third Quarter 2013 IndustryTrends Report, the number of deal-ership body shops continues to drop.Citing research from the NationalAutomobile Dealers Association(NADA), Mitchell estimated that 34percent of dealerships featured on-site body shops in 2012, a declinefrom the 36 percent estimated tohave had shops in 2011.

NADA reported approximately6,314 dealers operating on-site bodyshops in 2011. By those numbers,Mitchell estimates there were 5,996operating in 2012. This is a sharp de-cline from the 8,692 shops NADAestimated to be in operation back in2006.

Based on a preliminary esti-mate of independent repair facilitiesin the U.S., Mitchell pegged the totalcollision repair facility population at40,448 facilities in 2012 with ap-proximately 14.8 percent being on-site dealer facilities.

Despite the decreasing numberof shops, the total amount of body-work performed by all new-vehicledealerships was up slightly from$6.78 billion in 2011 to $6.9 billionin 2012.

Dealerships Continued toLose Body Shops in 2012

20 years ago in the collision repair in-dustry (September 1993)In a unanimous vote, the AutomotiveService Association (ASA) CollisionDivision Operations Committee re-jected a proposal by CCC InformationServices to have ASA endorse the newCCC Collision Center Connectionprogram.

The CCC marketing program re-quires a shop to pay $499 verificationfee to sign up for the program. Thebusiness is then charged a $30 to $50referral fee for each insurance claimdirected by CCC to the shop.

“Quite simply, the costs for ad-justing a claim are the responsibilityof the insurer, and this attempt to shiftthis burden to the repair facility isclearly not in the best interests of ourmembers, the consumer or the repairindustry,” said Bob Anderson, chair-man of the ASA committee.

“ASA has been involved in ex-tensive industry research that con-

cludes that the claims handling systemutilized today by most insurers is ar-

chaic and ineffi-cient,” Andersonsaid. “This (CCC)referral programin its current formdoes little to alterthe status quo.Since this third-party intervention

does nothing to streamline the claimshandling process, it is likely that evenmore friction (costs) will occur.” —from Automotive Dateline

15 years ago in the collision repair in-dustry (September 1998)A court ruling in West Virginia givesthat state one of the strictest laws in thecountry regarding parts used in colli-sion repair. Judge Charlie King wrotein a court opinion that insurance com-panies must pay for new OEM parts tofix body damage on newer vehicles.

King ruled that repairs on vehicles stillcovered by a manufacturer’s warrantyand less than three years old need to bemade with new factory parts.

“I think it’s a real good decisionfor consumers in West Virginia,” As-sistant Attorney General Doug Davissaid. “If you get into a wreck in a car,insurance companies can’t force youto accept junkyard parts.”

The ruling apparently settles aheated dispute among insurance com-panies, automotive recyclers and thestate Attorney General’s office. Thecase was brought to the court by aconsortium of insurance companiesthat wanted a judicial interpretation ofs state law. That law requires the useof “genuine crash parts,” and the in-surance companies contended that thisincluded new parts and OEM partstaken from wrecked vehicles. Thestate Attorney General’s office chal-lenged that interpretation.

► A judge in West Virginia last

year issued a injunction against Lib-erty Mutual to force the insurer to stopusing remanufactured, reconditionedand used parts in violation of this statelaw; the judge also ordered the insurerto release the names of vehicle own-ers who had their vehicles repairedwith salvage parts.

10 years ago in the collision repair in-dustry (September 2003)Allstate Insurance Company and Ster-ling Collision Centers have filed alawsuit challenging the new Texas lawprohibiting insurers from purchasingfurther interest in collision repairshops.

In the pleading, Allstate claimsthat HB 1141 “stops dead in its tracksa promising, market-based mecha-nism for improving customer satisfac-tion, providing efficient, cost-effectiveauto collision repair services, andeliminating incentives for waste andfraud in auto repair estimates and ac-


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September Retrospective on the Collision Industry

with John YoswickHistorical Snapshot —John Yoswick is a freelance writer based in Portland, Oregon, who has a body

shop in the family and has been writing about the automotive industry since 1988.He is the editor of the weekly CRASH Network (for a free 4-week trial subscription,visit www.CrashNetwork.com). Contact him by email at [email protected].

Bob Anderson, 1993

of those proceeds for personal use,Assistant U.S. Attorney Bill Harrissaid in the indictment.

Scott and his companies weresued in Ohio by the WashingtonCounty Board of Developmental Dis-abilities over a $95,000 self-fundedhealth insurance plan it purchased forits employees in 2006.

An Ohio judge found it did noth-ing but fund a Ponzi scheme, and or-dered Scott’s companies to pay$200,496 for unpaid claims and anadditional $400,000 in punitive dam-ages.

“He was robbing Peter to payPaul,” alleged Ethan Vessels, theboard’s lawyer. “My great worry andbelief is he took the money he was(allegedly) pilfering and squirreled itin an account overseas.”

Scott faces up to 10 years inprison on each of the 42 counts and$12 million in restitution. Williamsalso faces up to 10 years in prison oneach of the 19 counts she faces andrestitution that is yet to be deter-mined.


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tual repair work.”Allstate asserts that forbidding

insurers from acquiring, expanding,supporting or promoting its interstatenetwork of Sterling collision repairshops is a violation of the corpora-tion’s protected free commercialspeech.

The real purpose of HB 1131, ac-cording to the lawsuit, is “to turn theAmerican business model—wherecompetition brings out the best—onits head by protecting and insulatinglocal Texas autobody shops from hav-ing to compete with Allstate’s (or anyother insurance company’s) own col-lision repair operations.”

► As reported in Autobody

News. The legal battle over the Texaslaw lasted until 2008 when the TexasSupreme Court rejected Allstate’s re-quest to consider the insurer’s chal-lenge to the law. ASA’s Bob Reddingpredicted that other states, which hadpreviously considered legislation sim-ilar to that of the Texas bill, wouldpass such restrictions on insurer-owned shops after the Texas law wasupheld, but none have. Unlike otherlarger MSOs, Sterling has added rela-tively few new shops since 2008.

5 years ago in the collision repair in-dustry (September 2008)Following a similar decision by StateFarm back in June, Allstate an-

nounced this month it would no longerspecify full-body sectioning (or“clips”) on its estimates.

“Furthermore, only when a colli-sion repair facility is confident that afull-body section is the appropriate re-pair, has the proper training and equip-ment to facilitate a quality repair, andhas the approval of the customer orclaimant for such repair, will the ad-juster authorize it,” the Allstate policystates.

Allstate’s Tech-Cor research cen-ter developed full-body sectioningprocedures in the 1980s, but the in-surer now says “changing vehicle con-struction techniques” and “the varyingmetallic composition of some modern

vehicles may prevent collision repair-ers from facilitating a quality repair”using such procedures.

As with State Farm, Allstate hadbeen pushed on the issue of clips byPam Pierson of Princeton Auto Bodyin Princeton, Ill. Just days before All-state’s announcement, the Alliance ofAutomotive Service Providers of Illi-nois said that based on Pierson’s ef-forts, it had appealed to Illinois StateRepresentative JoAnn Osmond toask the state Attorney General to pro-vide a legal written opinion on the useof full-body sectioning.

► from CRASH Network(www.CRASHnetwork.com), Septem-ber 22, 2008

The Occupational Safety and HealthAdministration (OSHA) announced itsdecision not to amend its regulationsfor the federally-funded On-site Con-sultation Program citing concerns thatproposed changes, though relativelyminor, would discourage employersfrom participating in the program.

“The On-site Consultation Pro-gram, including recognition throughthe Safety and Health Recognition Pro-gram, is a valuable way to assist small-

business employers who are workingto improve their workplaces,” said As-sistant Secretary of Labor for Occupa-tional Safety and Health Dr. DavidMichaels. “We remain committed toencouraging participation in this pro-gram.”

The On-site Consultation Programoffers free and confidential safety andhealth advice to small- and medium-sized businesses across the country,with priority given to high-hazard work-

sites. Employers who successfully com-plete a comprehensive on-site consulta-tion visit, correct all hazards identifiedduring the visit and implement an on-going safety and health program toidentify and correct workplace hazardsmay achieve status in OSHA’s Safetyand Health Recognition Program(SHARP). Exemplary employers whoreceive SHARP status receive an ex-emption from OSHA’s programmed in-spection schedule during a specified

period. The proposed amendmentswould have provided clarification of thelength of the exemption period providedto “recognized” sites and the initiationof certain unprogrammed inspections atboth sites that have achieved recogni-tion and sites undergoing a consultationvisit.

For more about the OSHA On-Site Consultation Program at:www.osha.gov/dcsp/smallbusiness/consult.html.

OSHA Withdraws Proposed Rule Amending on On-site Consultation Program Citing Concern About Employer Participation

Schubert conceded that, as waspointed out earlier in the meeting, noone is forcing a shop or vendor to usethe system. But he said just as partsmanager Priest said State Farm jobsaccount for at least 20 percent of hiscollision parts sales, Select Service isa significant part of his repair shop’sbusiness.

“This is just one in a long lineof control we have lost in ourshops,” Schubert said. “We’re a Se-lect Service shop in defense as muchas anything else. You can act likewe’re stupid for doing it, and bygosh, I might agree with you. Butsometimes the alternative is evenuglier.”

John Yoswick, a freelance writerbased in Portland, Oregon, who hasbeen writing about the automotive in-dustry since 1988, is also the editorof the weekly CRASH Network (for afree 4-week trial subscription, visitwww.CrashNetwork. com). He can becontacted by email at:[email protected].


PartsTrader RolloutContinued from Page 6

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American Honda has announcedthat the first two editions of BodyRepair News, a new collision indus-try communication covering newHonda and Acura model body repairinformation is now available.

The inaugural issues cover the2014 Acura MDX and 2013 HondaAccord. Copies can also be ac-cessed by independent shops atAmerican Honda’s Service Expresswebsite at techinfo.honda.com ortechinfo. acura.com. Click on “In-dustry Position Statements & BodyRepair News,” and then scrolldown.

Body Repair News, free to in-dependent collision repair shops, arepart of a series of American Hondapublications that will be created tosupport new models that are con-structed with significant amounts ofhigh strength steel, and variousother new technologies.

Body Repair News publica-tions are also planned for the fol-lowing new models that havealready gone on sale:● 2014 Acura RLX● 2014 Honda Odyssey.

An edition of Body RepairNews will be issued for every fu-ture new model. Any minor model

change where significant body de-sign changes are made will alsohave a body repair publication is-sued.

This publication is being issuedas part of American Honda’s currentinitiative to enhance the ability ofbody shops to make safe and com-plete collision repairs on Honda &Acura vehicles through easier ac-cess to an increasing amount of col-lision repair information.

The company notes that BodyRepair News summarizes new bodyand vehicle technology that may af-fect collision and other body repairs.It is not intended to replace the de-tailed information contained in thebody repair and service manuals.Rather, it simply helps collision re-pair industry personnel understandwhy using the factory service infor-mation is so important to make safeand complete repairs.

American Honda Launches Body Repair News

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UniCure Spraybooths has joined theCollision Repair Education Founda-tion’s donor Industry Leadership Cir-cle by donating more than $10,000worth of equipment and uniforms forcollision students. Wiregrass GeorgiaTechnical College in Valdosta andTennessee Technology Center in Shel-byville both received donated equip-ment that included intake and exhaustfilters, JetAir waterborne fans, and ad-ditional miscellaneous items. UniCurewill also sponsor 100 sets of Cintaswork shirts and pants uniforms forcollision students. “It is a privilege towork with these schools. I am gladthat we are able to provide them withproducts and support that will en-hance their paint departments. It isalways rewarding when you get togive back,” said Allen Jenkins, pres-ident of UniCure Spraybooths/Inter-state Marketing Corporation.

UniCure Spraybooths JoinsCREF Leadership Circle

U.S. Auto Parts Network has reportednet sales for the second quarter endedJune 29, 2013 of $67.9 million, com-pared with net sales of $80.7 millionfor the second quarter ended June 30,2012, a decrease of 15.9 percent. Sec-ond quarter 2013 net loss was $9.6million, compared with second quar-ter 2012 net loss of $1.7 million. “Webelieve in the strategies that we haveimplemented to return to profitablegrowth and increase customer traffic,and expect these strategies to over-come the challenges of the past year,”said CEO Shane Evangelist.

U.S. Auto Parts Network HasLoss Over 2nd Quarter 2012

The Collision Industry ElectronicCommerce Association (CIECA) in-troduces of CIECA-TV. CIECA willpublish videos monthly, covering arange of topics from news and eventsto actual implementation case stud-ies from collision industry leaders.The first production video is avail-able on CIECA’s YouTube channeland provides an overview of CIECA.

More information can be foundon the CIECA website or by email-ing CIECA executive director FredIantorno at [email protected].

CIECA Launches CIECA-TV

AUTODATA has released 2013Maintenance Reminder Reset Proce-dures. The new manual guides tech-nicians through the specific stepsrequired to reset vehicle maintenancereminder alerts, which must be resetafter any maintenance work.

AUTODATA has a New Manual

PPG has announced that registration isnow open for the Fall MVP BusinessSolutions Conference at the OmniAmelia Island Plantation Resort Sept. 8-10 in Amelia Island, FL. Expert speak-ers from both outside and inside thecollision repair industry will discuss amix of topics, and there will be numer-ous networking opportunities with othercollision repair professionals.

“The pace of dynamic change inthe collision repair industry is increas-ing at a light-speed rate, and we knowthat our customers’ needs and require-ments are growing at a similar pace,”says Jim Berkey, director of MVP Busi-ness Solutions for PPG. “The businessacumen, the vehicle technology, pro-duction processes and leadership knowl-edge all are playing an elevated role inperformance, which makes it imperativethat we develop and deliver the educa-tional elements that assist our customersdrive to out-perform competition and bebest-in-class in their marketplace.”

The conference schedule is high-lighted by prominent keynote speakersScott Deming, David Horsager andMichael Hoffman.

In his keynote address titled “Per-ceptual Reality,” Deming, a customerservice and emotional brand buildingguru, will challenge the audience toknow what their customers or clients are

thinking: how they perceive your com-pany and your service and using theirperception as reality, not yours. He willalso discuss the impact of using outsidevendors or suppliers to serve your cus-tomers and how to keep them tightlywithin your brand strategy, brand in-tegrity and service commitment.

Horsager is an author, entrepre-neur, professor, and award-winningkeynote speaker who researches andspeaks on the bottom-line impact oftrust. His presentation discusses whytrust has the ability to accelerate or de-stroy any business, organization or rela-tionship. With greater trust comesgreater innovation, stronger brands, in-creased retention of good people, highermorale, multiplied productivity, betterresults and a bigger bottom line whenyou gain the “Trust Edge.”

“Igniting Performance in the Tor-nado of Business” is the closing keynoteheadline, and Hoffman’s real-world ap-proach will deliver concepts and topicssuch as “Sales Secrets of the One Per-centers,” “Anything You Do Is Every-thing You Do” and “Coaching within theTornado: Ignition for Leadership.”

The conference is open to ownersand managers of collision centers usingPPG Refinish products. MVP confer-ences are biannual events by invitationonly.

PPG MVP Conference Registration is Now Open

Herkules Wins IAMG 2012 Vendor of the Year AwardHerkules Equipment Corporationwas awarded “Vendor of the Year” bythe International Autobody Market-ing Group (IAMG) at the annualIAMG Vendor/Warehouse Distribu-tor meeting banquet.

“Herkules Equipment Corpora-tion is a top-notch proactive partnerto the Group and we honor them for

their outstandingservice, supportand professional-ism.” says LloydFields, Presidentof IAMG (Inter-national Auto-body MarketingGroup). “Theyoffer exceptionalproducts, contin-ued marketing

efforts, and excellent value to our in-dustry with a dedicated commitmentto their customers. We are pleased toaward them with our 2012 vendor ofthe Year Award!”

Kevin Prost, Vice President ofHerkules, accepted the award fromLloyd Fields. “We are deeply honoredto be presented with this award and weare proud to be part of a very specialindustry. This award recognizes the ef-forts of Russ Terry, our National Sales

Manager, Kris Fairbrother, our Direc-tor of Marketing, our sales reps, andour production staff that build highquality products here in the USA.”

The IAMG is a leading, full-ser-vice corporation that delivers strategicsolutions and high-quality products tothe automotive aftermarket since 1992.As a leader in Paint, Body & Equip-ment distribution, IAMG constitutes14 individual warehouse Membersacross the United States and Canada,47 distribution centers, and over 350salespeople, according to their website,www.iamgaz.com.

Herkules Equipment Corpora-tion, established in 1984, is a leadingmanufacturer for the AutomotivePaint & Body Repair industry, hav-ing designed, manufactured, andpatented the first Paint Gun Washer.The company has been manufactur-ing quality vehicle lifts and scissorlift tables for close to 30 years, pro-viding many different industries er-gonomic solutions for countlessapplications. Herkules also suppliesAir Jacks, Handling Equipment, andCrushing Equipment.

For more product information,please contact Herkules at 800-444-4351, or at [email protected] or visittheir website at www.herkules.us.

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3M has announced the release of thenew 3M Body Protection System de-signed to make it easier for automo-tive professionals to match textureson rocker panels. The technology in-cludes a pressurized spray gun (3MAccuspray HGP spray gun) and arocker protector pouch available in3-ounce and 5.5-ounce sizes.

According to 3M, the new sys-tem cuts application time in halfwith the ability to adjust pressureand spray pattern to better matchOEM textures. The new pressurized3M Accuspray spray gun can besprayed at any angle and the pouchsizes allow estimators and repairtechs to improve estimates.

The 3M Body Protection Sys-tem helps painters spray low viscositytextured finishes with fine, medium,coarse and splattered patterns.

“As the use of these texturedfinishes continues to expand forsound deadening on thinner sub-strates, the need for the 3M BodyProtection System will increase,”said Steve Widen, U.S marketingsupervisor, 3M Automotive After-market Division.

3M’s New Body ProtectionSystem Cuts Time Neededon Panels

Progressive Corp., the fourth-largestU.S. auto insurer, is searching for theright message to attract customers toits Snapshot product that tracks a per-son’s driving to set rates, Chief Exec-utive Officer Glenn Renwick said.

Surveys of prospective cus-tomers have shown that “you getabout 30 percent of people saying,‘Yeah, why not?’; you get another 30percent of people saying, ‘Maybe, Ineed to know more’; and you getabout 40 percent of people saying,‘No way in hell,’” Renwick said on aconference call to discuss results atthe Mayfield Village, Ohio-basedcompany.

Progressive has sought to buildacceptance for Snapshot after a cam-paign that Renwick called “very ac-ceptable, but short of a breakout” in aletter to investors this week. The in-surer has been counting on the tech-nology to encourage safer habitsbehind the wheel and help identifythe most valuable customers. Somehave shunned the product, citing pri-vacy concerns, Renwick said. SellingSnapshot has been “a bigger burden”than many in the company wouldhave assumed given that it can lowercustomers’ rates, he said. “Intellectu-ally, I kind of go ‘Why wouldn’t 100

percent of people take this option?’”The insurer has increased the

percentage of its customers at its di-rect channel who have tried Snapshotto about 35 percent from 20 percenttwo years ago, he said. Part of thatgain has come from advertising howpeople who don’t take advantage ofthe product could be subsidizing oth-ers. In one “Rate Suckers” televisionspot, a spokeswoman says peoplewho behave worse behind the wheelmake “driving more expensive for therest of us.”

The base of premiums from theproduct total $1.8 billion, Progressivesaid in a report on second-quarter re-sults. Premium revenue from individ-ual clients was about $14.4 billion in2012, a total that includes policiescovering autos, motorcycles, water-craft and other vehicles. The directchannel includes customers who signup by Internet, rather than throughagents.

Renwick said there is more workto be done on Snapshot. “We’rebody-punching here,” he said. “We’retrying to find the message that actu-ally moves the needle. I think we nowunderstand how significant a burdenit is to try to educate consumers to dosomething that was not the natural

buying or engagement process.”Progressive has sought an edge

over competitors as it fights for an in-creasing share of the $175 billion inannual U.S. auto insurance premi-ums. The company has gained scalealong with the GEICO unit of WarrenBuffett’s Berkshire Hathaway Inc. inrecent years by emphasizing lowprices and selling directly to con-sumers over the Internet.

Snapshot helped open a newfront in the competition for cus-tomers. Progressive patented the de-vice and has been asserting itsintellectual property rights. It strucka deal in June with the United Serv-ices Automobile Association to li-cense the technology.

Advertising costs for auto insur-ers have shot up in recent years.GEICO spent more than $1 billion in2012, according to data compiled bySNL Financial. Allstate Corp. wasNo. 2 at $828.8 million, followed byState Farm Mutual Automobile In-surance Co. at $777.9 million, fol-lowed by Progressive with $526million, the data show.

Progressive Evaluates Snapshot Campaign, Expresses Surprise that 40% Say ‘No Way’




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Honda Aces Crash Test, Kia and Nissan Less SoThe Honda Civic earned top scores inthe Insurance Institute for HighwaySafety’s new “small overlap” crashtest, but similarly sized cars from Kiaand Nissan fared poorly.

The Institute put 12 new com-pact cars through the test, includingtwo- and four-door versions of theCivic and two Kia models. The KiaSoul and Forte, as well as the NissanSentra, earned the worst possible rat-ing of “Poor” in the test.

Kia and Nissan both pointed outthat their cars have performed very wellin other Insurance Institute and gov-ernment crash tests. Kia also noted thatthe “small overlap” crash test “goeswell beyond federal requirements.”

Both automakers said theywould review the test results as theyseek to make further safety improve-ments in their cars. This was the firsttime compact cars were subjected tothis new type of front crash test. In it,the cars are propelled at 40 miles anhour and strike a crash barrier withjust one quarter of the front bumperon the driver’s side. That concentratesimpact forces into a small area thatoften falls outside crash protectionstructures built into the cars. The im-pact also spins the car violently. Thetest mimics a type of impact that ac-

counts for nearly a quarter of all frontcrashes with serious or fatal injury tofront seat occupants.

“In the worst cases safety cagescollapsed, driver airbags moved side-ways with unstable steering columnsand the dummy’s head hit the instru-ment panel,” David Zuby, the Insti-tute’s chief research officer, said ofthe test results in a written statement.

Also, side curtain airbags some-times didn’t deploy or they didn’t pro-vide coverage far enough forward inthe car to be of any help, he said.

In the case of the two Kia mod-els, the cars’ seatbelts spooled out toomuch, allowing the crash test dummyto move too far forward. At the sametime, the side curtain airbags didn’tprovide protection that far forward inthe car, allowing the dummy’s head tohit the windshield pillar and instru-ment panel. The Kias’ steel structurealso provided insufficient crash pro-tection in the tests, according to theInstitute.

When the IIHS put a group ofluxury cars through the same test inAugust, the first time results for thenew test were released, only two carsout of 11 got top marks. The Institutehas also put mid-sized cars and smallSUVs through the new test.

Six of the cars tested in the new IIHStest, most of which were 2013 models,were rated “poor” or “marginal.” GM’sChevrolet Sonic and Cruze each re-ceived marginal scores, while Kia Mo-tors Corp’s Soul and 2014 Forte wererated “poor” in the results released bythe Insurance Institute for HighwaySafety. Nissan Motor Co’s Sentra alsowas rated “poor,” while VolkswagenAG’s Beetle was ranked “marginal.”

The IIHS increased the rigor of itstests last year to include crashes thatinvolve only a front corner of a vehi-cle. The insurance group said nearlyone-fourth of U.S. front-of-vehiclecrashes that result in serious injury ordeath involve only a single corner thatstrikes another vehicle or an object likea tree or utility pole. The IIHS contin-ues to score vehicles on side, rear,rollover and front-end crashes that im-pact more than just a corner.

“This is a challenging new crashtest and it’s not surprising that somevehicles are earning marginal andpoor ratings,” IIHS spokesman RussRadar said of the small overlap frontcrash test.

“This crash scenario doesn’t lenditself to a Band-Aid fix so for mostmanufacturers the countermeasurewill have to be built in when there’s a

full redesign,” he added.Vehicle manufacturers in the U.S.

market often design and engineer theirmodels to score well on IIHS safetytests and use the results in their mar-keting.

“It matters because in today’sworld cars are so competitive that allyou need is a small flaw and your com-petition can exploit it,” Kelley BlueBook senior analyst Karl Brauer said.

Most of the 12 small cars testedwere already in production before theIIHS increased the rigor of its frontcrash test last year. However, Radarsaid IIHS alerted the companies to thework the group was doing on smalloverlap research in 2009.

The specifications of the test werenot finalized until the last year, whichis late in a car’s development process,Brauer said. All automakers will even-tually redesign their cars to meet thestandards to pass the new crash test, hesaid.

In the tests, IIHS crashes a vehi-cle at 40 mph into a 5-foot-high bar-rier on the driver’s side that overlapsone-quarter of the vehicle’s width.

The small car segment was thefourth group of cars rated using thisnew test, and most of the groups havefared equally badly.

New Test Fails Half the Small Cars Tested

The National Auto Body Council(NABC) is now accepting nominationsfor seven open board seats to be electedat its upcoming Annual Meeting at theSEMA Conference this Fall in LasVegas. Deadline for third-party nomina-tions or self-nominations is Friday, Sep-tember 6. To be eligible, nominees mustbe a designated representative of a cur-rent National Auto Body Council mem-ber company. Board members areelected for three-year terms.

“As a result of strong active Boardleadership, our membership has grownsignificantly over the past few years asmore and more companies experiencethe value and benefits of participating inNABC initiatives,” said Chuck Sulkala,NABC Executive Director. “We wel-come nominations from all segments ofthe collision industry for leaders who arewilling to invest the time and effort tohelp guide the organization in our ongo-ing mission to identify, develop, and im-plement community based initiativesthat promote a positive image of our in-dustry.”

NABC initiatives include the suc-cessful and popular Recycled Rides pro-gram. Almost 800 vehicles have beendonated to deserving individuals andnonprofit organizations since the pro-gram’s inception in 2007. Other NABCcommunity service programs include

First Responder Emergency Extrication(FREE), the Distracted Driving initia-tive, and support for disabled veteransthrough Operation Comfort’s AutoMo-tivation program. NABC also annuallyrecognizes individuals or organizationsthat demonstrate excellence or selflessservice to others through its Award ofDistinction and Body Shop ImageAward. NABC Board members whoseterms are ending this year may also seekre-election. These Board members in-clude: Brandon Devis, Martin SenourPaints - Sherwin Williams AutomotiveFinishes; Craig Camacho, Keenan AutoBody; Dave Henderson, See Progress;Bill Mayer, Insurance Auto Auctions;National Auto Body Council 7044 S.13th St., Oak Creek, WI 53154, 888-667-7433, (Fax) 414-768-8001 DavidMerrell, Parts Trader; Ron Reichen, Pre-cision Body and Paint, Inc.; and ReneeRicciotti, 3M Automotive AftermarketDivision. Nominations for NABC boardseats must be submitted in writing: E-mail [email protected] or Ex-ecutive Director Chuck Sulkala [email protected]. Fax NABCadministrative office at (414) 768-8001Mail to: National Auto Body Council,7044 S. 13th St Oak Creek, Wisconsin53154, Attn: Mary Annen. For more in-formation about NABC Board memberscontact Chuck Sulkala directly.

NABC is Accepting Nominations for Seven Open Board Seats


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Ivan Gandrud ChevroletGREEN BAY

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NACE Panels to Review Parts Procurement, CertificationAutomotive Service & Repair Week(ASRW) is pleased to announce two90-minute panel discussions will takeplace during ASRW|NACE|CARSaddressing electronic parts procure-ment and certification programs.ASRW will take place Thursday andFriday, Oct. 17–18, with educationbeginning Wednesday, Oct. 16, at theMandalay Bay Convention Center inLas Vegas.

Understanding Today’s e-Com-merce Parts Solutions (session WE10)takes place Wednesday, Oct. 16, at10:30 a.m. “With the constantlychanging e-commerce parts procure-ment and search engine environment,it is critical that collision repairers un-derstand the impact to their business,”stated Roger Wright, vice presidentof operations for Sterling AutobodyCenters, and moderator of the WE10session.

Certification Programs: AreThey For You? (session TH17) takesplace Thursday, Oct. 17, at 3 p.m.“Certification is a term that is grosslyoverused, and more importantly,

under-defined. This session shouldhelp attendees learn about the varietyof certifications available so they canmake the decision as to what worksbest for their businesses,” said LouDiLisio, Automotive Industry Con-sulting, and moderator of the TH17session.

Registration for ASRW is avail-able online at http://www.asrw-events.com. Both sessions are includedin the purchase of a Super Pass regis-tration, which includes one ticket pertimeslot to the ASRW Conference Pro-gram, an Expo Pass to walk the showfloor, one ticket to the Opening Gen-eral Session/Industry Forum, one ticketto the Welcome Party, and a 2013 com-memorative pin. Sessions may also bepurchased individually for $70 each.Additionally, all ASRW exhibitors areoffering a discount of $50 off any con-ference purchase, and attendees are en-couraged to contact any exhibitordirectly to redeem.

The 2013 ASRW ConferenceProgram is sponsored by the Allianceof Automobile Manufacturers.

SEMA Show Expands to Three New Exhibitor AreasIn addition to 11 designated floor sec-tions, the 2013 SEMA Show will in-clude three different areas whereFirst-Time and Featured Exhibitorscan be found.

“In order for us to accommodatethe more than 2,400 companies ex-hibiting at the 2013 SEMA Show,we’ve expanded our footprint,” saidPeter MacGillivray, SEMA vice presi-dent of communications and events.“Collectively, the First-Time and Fea-tured Exhibitor areas include hundredsof new and innovative manufacturersthat represent all markets in the indus-try. These are must-see areas for every-one in the industry.”

While the SEMA Show has in-cluded a First-Time and Featured Ex-hibitors area in previous years, 2013marks the first time that the Show willinclude three such areas:

Upper South Hall, east end nearthe New Products Showcase: This is thesame area where First-Time and Fea-tured Exhibitors were located in 2012.

Bridge, between Central andSouth Halls: Many Showgoers will

know this area because of the MediaCenter, the Center for InternationalCommerce and the Show Office. For2013, the Media Center will move toN109 (Meeting Rooms to the east ofthe Grand Lobby), and the Center forInternational Commerce will be lo-cated in N255 (second floor above theGrand Lobby).

LVH South Pavilion area, nearCentral Hall: The LVH is locatedacross the street, but adjacent to thenorth side of North Hall. Several ex-hibitors will be located in the Pavilionarea of the LVH, along with GeneralRegistration.

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AAPEX to Address Warehouse Distributor ManagementWell-known professional experts ondistribution and management will bepresenting topics of particular interestto warehouse distributors (WD) inLearning Forum sessions during the2013 Automotive Aftermarket Prod-ucts Expo (AAPEX). AAPEX is setfor Tuesday, Nov. 5 through Thursday,Nov. 7, at the Sands Expo Center, LasVegas, NV. The Learning Forum WDManagement sessions cover: how toachieve profitability and success; fu-ture forces in B2B markets; sales andmarketing optimization; building to-morrow’s workforce; and trends af-fecting distribution businesses.

Featured speakers leading theWD Management sessions include:● Garrison Wynn, Wynn Solutions —“The Real Truth About Success: Whatthe Top 1 Percent Do Differently andWhy They Won’t Tell You” and“Being the Best vs. Being ConsistentlyChosen” ● Steve Diest, Indian River Consult-ing Group — “Channel Evolution:Lessons from Other Industries” and“Future Forces in B2B Markets”● Barry Lawrence, Texas A & M Dis-tribution Program — “Optimizing Dis-tributor Profitability: Best Practices forImproving Return on Investment” and“Sales and Marketing Optimization:

Driving Growth and Market Share”● Gene Marks, The Marks Group —“Economic, Political and Tech Trends:10 Things Happening Today That WillAffect Your Business Tomorrow”● Dan Schawbel, Millennial Branding— “Building the Workforce of Tomor-row: How to Recruit, Retain and GrowYour Young Talent”

This year’s Learning Forum willfeature nearly 40 free sessions, thehighest number ever offered atAAPEX. Sessions will start on Mon-day, Nov. 4, the day before the offi-cial start of AAPEX, and continuethroughout the event. Attendees areencouraged to make their travel plansaccordingly. All sessions are accred-ited by the University of the After-market toward the AutomotiveAftermarket Professional (AAP) andMaster Automotive Aftermarket Pro-fessional (MAAP) designations. Ses-sions will be held at the VenetianHotel, on the Venetian/ Palazzo Con-gress Center Level 1, Marco PoloRooms 701–707. Since the sessionsare free-of-charge, seating is firstcome, first served. For a list of topics,speakers, session descriptions and aschedule, visit the AAPEX LearningForum. See www.aapexshow.comor e-mail: [email protected].

PartsTrader held a webinar on Aug. 1to discuss several changes to the partsordering application, including theend of the “fax-only” ordering option.

In the new 2.2 release, whichwent live on August 1, PartsTraderhas made several changes that will af-fect users of the electronic parts mar-ketplace developed for State Farm’sSelect Service DRP.

Lucy Smith, Product Manager atPartsTrader, said that—with this re-lease—the option to place ordersthrough PartsTrader by fax will nolonger be available in the Tucson, AZ,market effective immediately. Thechange was made in preparation forthe full state rollout of PartsTrader inArizona beginning on August 12, ac-cording to her statement.

The fax option will remain in theother pilot cities of Grand Rapids,Chicago, Birmingham, and Charlotteuntil the end of August or September1, Smith said.

The fax-only option was originallyadded to the PartsTrader system so thatSelect Service facilities could still placeorders with their preferred vendors,even if those vendors refused to partic-ipate in the PartsTrader program. If aparts vendor chose not to sign-up forthe online quoting system, PartsTraderwould generate a fax order and forwardit to that vendor on the shop’s behalf.

With that feature no longeravailable, Select Service shops inArizona using the fax option havejust two choices: encourage their pre-ferred suppliers to sign up for, anduse, the PartsTrader application, orfind a new parts supplier for StateFarm repairs.

According to an industry source,an email sent to repairers in Arizona,PartsTrader Support said that after

July 31, suppliers which have not yetbegun to use the PartsTrader applica-tion as “a fully active participatingsupplier,” will no longer appear on thesystem as an available vendor, andtherefore will no longer be able to re-ceive orders placed in PartsTrader.

During the webinar, Smith said,“The users in our pilot markets feltthat [the fax option] disrupted theirprocess and took some of the efficien-cies out because they still had to callthose suppliers to see if they were ac-tually going to get the part. When theysubmitted an order, we would [fax] theorder to the supplier, but then the re-pair shop would still have to call toverify prices, update the prices in theirestimating system [and] we found thatthey were running duplicate processes.

Other changes in the PartsTradersystem presented by Smith includednew functionality for users, includinga vendor star rating system, a VIN de-coder, the ability to save draft parts or-ders, and a new welcome page withaccess to training videos.

The VIN decoder, available forvendors, was developed in conjunc-tion with CompNine.

The star rating system, announcedin April by PartsTrader, is now begin-ning to be rolled-out. “We’ve been col-lecting this information for three monthsand now we have enough feedback tostart displaying ratings,” Smith said.

With this release, each shop andvendor will be able to see the star rat-ing for their own business only, and ina later release the star ratings willeventually be visible to all users.

Users of the system are rated onitems such as quoting accuracy, partyquality, communication, business prac-tices, and, for shops, how fast they paytheir bills.

‘Fax-Only’ Parts Ordering Option will End bySeptember For Shops Using PartsTrader 2.2

PPG Automotive Refinishes recentlyannounced that it now has 5,000 sub-scribers of its PaintManager softwarecolor retrieval and management pro-gram that have chosen to use the In-ternet instead of traditional CDreleases to update their systems. “Get-ting fast and accurate color and pro-gram updates is critical, and we arevery pleased to see our customers em-bracing this online option to enhancetheir PaintManager software,” saidMary Kimbro, global color director

of PPG. The PaintManager softwaredelivers color formulas that matchOEM colors and manages the paintmixing operation through touch screentechnology that can be configured byany distributor or collision center.“With PaintManager software, shopsare getting fast network access to colorinformation, new products and pro-gram improvements. They’re gettingthe data that keeps their managers andtechnicians aware of all aspects of therepair business,” Kimbro said.

PPG Passes Milestone with PaintManager at 5K

Every time I talk to body shop ownersabout social media issues, they in-variably bring up three things: Yelp,Facebook and how to defend theirreputations online, in that order. Theyeither smile or frown when they men-tion Yelp, look perplexed when theydiscuss Facebook and then get plainmad when they talk about howthey’ve been wronged online, nor-mally by their competition or a for-mer disgruntled employee.

Recently, the marketing managerof a large MSO told me about Auto-body-Review.com, a consumer website designed specifically for review-ing body shops and described it as‘Yelp meets Reputation Defenderwith enhanced SEO.’ I polled someother shops about the service and thefeedback was substantial. So, I con-tacted the company’s President/CEOChuck Nixon to learn more aboutAutobody-Review.com and why it’screated a buzz.

ABN: Shops are very concerned withYelp, because they claim that many oftheir reviews are not written by realcustomers. Tell us why your productis different from Yelp?

CN: Autobody-Review.com is uniquein that we connect to repair facilities’customer databases. We gather reviewsthrough two verified processes. Uponcompletion of the repair performed onthe customer’s vehicle a delivery sta-tus message is delivered to the clientallowing them to enter a review ontheir positive and negative experiencewith that company. The ease of using itis the key. The customer completes aparagraph or more conveying their truesentiment of the experience and thenit’s scored by our proprietary senti-ment engine giving the comment aGoogle approved Star Rating. Many ofour clients are gaining insight into theircustomers’ experience and ultimatelymeasuring the final performance

which did not align with what wasbeing reported to non-verified reviewsites such as Yelp. This created requestfor us to create a truly verified cus-tomer review site. It all comes down toverifiability and accountability, twothings lacking with Yelp.

ABN: Search Engine Optimization(SEO) is a huge concern for bodyshops, because they hate seeing theircompetition ranked higher than themon Google or Bing. Tell us about howyour system maximizes SEO for yoursubscribers?

CN: Not only does our system gatherand preview verified reviews about afacility but we also provide socialmedia interface allowing a facility topush reviews directly to their Face-book business page, Twitter and soonGoogle+. These plug-ins are designedto push reviews to the shops’ pagewhen consumers are most active on

social media sites. This increases thefacilities engagement score as well associal media SEO ranking. We alsoback link the facilities business web-site to their Autobody-Review busi-ness landing page. This two-way backlinking, along with our current dailytraffic and other blog back linking,helps to drive the facilities’ own backlinking initiative. Lastly we provide awebsite widget allowing the facility topost their rotating reviews directly ontheir own business website. Thiswidget is designed in a manner that isproviding web crawlers to find newcontent on their page. All of these con-nections and back linking help todrive not only the shop Autobody-Re-view landing page SEO ranking butalso their own sites SEO ranking.

ABN: Big-name MSOs are signing upfor Autobody-Review.com in largenumbers, but can independent shops canreap the same benefits from your site?


The followingdealerships areeager to serveyour needs.Call your localSubaru collisionparts specialisttoday!

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Autobody-Review.com—Where Yelp Meets Reputation Defender

with Ed Attanasio

Social Media for Shops

Ed Attanasio is an automotive journalist based inSan Francisco, California. He can be reached [email protected].

CN: Many MSO’s through our sys-tem have identified that larger isn’tbetter with SEO ranking. Since therelease of Google’s most recent up-date (they’re calling it Penguin) localsearch ranking is vital. The same ap-plies to Bing and Yahoo. So we ad-vise both MSO’s and independentfacilities to focus on local initiatives.We advise large brands to create in-dividual Social pages as the SearchEngines are designed to respond bestto local traffic. We recommend thateach facility create and connect tolocal listing pages such as Google+,Yahoo and more. As the search en-gines continue to change, they stilltend to support local listings and ac-tivity. This means that the largerbrands no longer have an advantage.Independent shops through verifiedreview sites such as Autobody-Re-view.com now have the ability tocompete with the big boys.

Now large MSO’s are joining at ahigh rate, because they see that Auto-body-Review.com is driving local traf-fic in a manner that their corporatestrategies in the past have overlooked.Our consultants provide new insightthat is valuable to both independentsand the larger chains.

ABN: Another aspect of your systemallows users to verify shops’ certifica-tions and awards. Some shops list cer-tifications on their sites and in manycases they’re not current or valid. Howare you going to be able to verify thesecertifications from groups like I-CAR,ASE and all of the car manufacturers,for example?

CN: We’re 100% committed to pro-viding only verified reviews, and thatalso includes verified industry certifi-cations. We’re connected with compa-nies such as Verifacts and I-CAR andthey’ve given us a direct feed to theirverified list of approved facilities. Thisallows us to add and remove certifica-tions and ensure that consumers are ac-curately informed of the hard work andinvestment an organization has madeinto their training.

ABN: How do you aggregate all of the“true” customer reviews for your sub-scribers?

CN: All reviews are scored throughour natural language sentiment engineand then displayed directly on our site.Both good and bad reviews are dis-played. This transparency provides a

verified and reliable source to helpthem make a better educated decisionwhen selecting a body shop. We notonly collect reviews but we also pro-vide an integrated proactive alertingsystem helping the facility to improvetheir future results and reviews.

ABN: Tell me briefly the history ofyour company and what you haveplanned for the immediate future?

CN: Our company started in the busi-ness of providing proactive communi-cation through an opt in text messagingsolution. We created a unique two-waymessage system that supported a leanprocess indicative for many servicebusinesses. Through the insight wegained front the two-way communica-tion we quickly realized we were gain-ing and providing insight to bodyshops about their consumer experiencethroughout the process that had neverbeen available in the past. This quicklygained the attention of many leaders innot only the collision industry but in-surance carriers nationally. Our cus-tomers’ customer satisfaction scoreswere skyrocketing. We then formed arelationship with CCC and MitchellInternational which provide us the

ability to interface directly with facili-ties Management systems. About ayear later CCC approached us to ex-clusively license our status softwareand integrate it directly into theirworkflow and estimating platform. Wethen created an integrated electronicCSI solution deliverable through bothemail and text messaging. This led usto create our proactive sentiment en-gine which mines and provides earlyinsight into the customer experience.Our proprietary sentiment alerting andscoring system allowed us to discoverthat our customer where provide valu-able insight and eventually true re-views directly from actual customers.This is what led us to develop Auto-body-Review.com.

Autobody-Review.com also fea-tures articles designed to improve yourshop performance. See, for example,Five tips to prevent a bad online re-view for your auto Body shop.


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NACE MSO Symposium Open to Some Single ShopsNACE has announced that the 3rd an-nual MSO Symposium will take placeWednesday, October 16 at the Man-dalay Bay Convention Center in LasVegas. Attendance to this highlysought after event will again be lim-ited to qualified collision repair multi-ple-location operators (MSOs) withtwo or more locations. However, newthis year, the symposium will open 75seats on a first-come, first-servedbasis to single collision repair ownersinterested in expanding their business.Registration is open and the fee to at-tend is $200 or $250 after August 22.Group-rate registrations are also avail-able for repair organizations with mul-tiple executives who wish to attend.

NACE’s MSO Symposium nowopen to expansion minded shop owners.

“The MSO Symposium is de-signed to provide a unique array ofcontent specifically for the collisionrepair multiple location operator seg-ment,” said Vincent Romans, TheRomans Group, producer of the MSOSymposium. “Based on ongoing feed-back and input, we are busy finalizingan agenda that we believe will be ofinterest to MSOs,” added Romans.

Content highlights for this year’ssymposium will include topics relatedto leadership, business continuity and

succession planning, private equity,MSO panel presentations and discus-sions on their business, market, fi-nancial and strategic focus, anddevelopment and insight about inter-national MSOs. Additional details re-garding the content will be releasedin the coming weeks.

Also new this year, a portion ofthe symposium will be open to thepress. Members of the press will alsobe invited to attend the evening net-working reception at the conclusionof the symposium.

The 2013 MSO Symposium isproduced by ASA, The Romans Groupand NACE. Sponsors of the symposiumto date include Axalta Coating Systems,AudaExplore, BASF, BB&T, CCC In-formation Services, Enterprise Rent-a-Car, Mitchell International, The RomansGroup and UniCure Spraybooths.

Details regarding the agenda andspeakers for the symposium are forth-coming. Visit e.hanleywood.com/e/15182/ee-Home-KeyEvents-MSOSymposium/57ps8/281231005for the latest details surrounding thesymposium.

The 2013 MSO Symposium isproduced in memory of Matthew Ohrn-stein, who produced the event in 2011and 2012.

tween the various electronic parts pro-curement systems won’t matter ifshops are being required to use a par-ticular system.

“Everybody in the room, I be-lieve, thinks that free market forcescreate the best value for consumers,”Stabler said. “I hear insurers talk

about that a lot. They want to havecompetition and free market forces todrive the best value for them. I thinkfor the purposes of parts procurement,the difficult question is how do weallow free market forces to create atool that is most efficient for the in-dustry and allow body shops and in-surers to choose the tool that allowsthem to reduce their operating costsand create internal efficiencies? Wedon’t have free market choices with

the direction that parts procurement isgoing.”

Stabler called electronic parts pro-curement systems “a necessary tool,”but said efficiency and features—rather than “external forces”—shouldbe driving which systems are used.

“Let the people who want tomake a parts procurement enginebuild the best tool, and let the market-place decide which one is the best,rather than being forced,” Stabler said.

Aaron Schulenburg, executivedirector of Society of Collision RepairSpecialists (SCRS), agreed.

“I don’t think there’s anythingwrong with the survey or the ques-tions, but I don’t think this touches onwhat we need to talk about,” Schulen-

burg told the com-mittee. “For morethan a year now,this committee hasbeen asked, atleast by individu-als of this body, fora very serious dis-cussion about the

entry-to-market (of the systems),” hesaid. “It keeps being avoided, frankly.I think we really need to have that be-fore we just ask how they work.”

Massachusetts shop owner ChuckSulkala also urged the committee toexamine that aspect of the topic.

“I understand you’re trying to puta matrix together. But the fact is, ifyou don’t have the free enterprise op-portunity to use the matrix to deter-mine what you’re going to use, whatgood is the matrix,” Sulkala asked. “IfI’m told, ‘Here’s what you have touse, it doesn’t matter what you’retelling me in the matrix.”


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Paul Massey of Ford Motor Company said shops and in-surers choosing an electronic parts procurement system

should think about the party on theother end of the exchange. Sayinghe was speaking on behalf of deal-erships and maybe other parts sup-pliers, Massey told those at theCollision Industry Conference (CIC)in Boston in July that if the systemtakes away from the parts sup-

plier’s efficiency, that will cost purchasers in some otherway.

“There’s no free ride here,” Massey said, saying deal-

ers are now having to hire people to administer multipleparts ordering tools. “They’re either going to have to takeit out of the services they provide, or they’re going to haveto add cost to the prices they offer.”

As they have in the past, parts suppliers can provideall the parts that are needed, Massey said.

“So this either has to make it more efficient ormore streamlined for them or help them reduce costs,or otherwise there’s no benefit to them,” Massey said.“Of all the systems I’ve seen presented, the fundingmodel is always to get a little more out of the supplybase. So they’re the ones who are being asked to bearthe burden and cost of someone else’s efficiency.”

Automaker Rep Says Parts Procurement Systems Should Benefit All


No Choice on Usage

Paul Massey

CIC Chairman George Averysaid the committee should continue itswork on the matrix, but acknowl-edged that “it seems like we jumpedahead,” and that “it’s prudent that wefacilitate the discussion that I think isbeing asked for.”

He said he would work with thepast chairs of CIC to develop a paneldiscussion on the topic for the next CICmeeting, being held in Las Vegas No-

vember 6-7, during the SEMA show.

John Yoswick, a freelance writerbased in Portland, Oregon, who hasbeen writing about the automotive in-dustry since 1988, is also the editor ofthe weekly CRASH Network (for afree 4-week trial subscription, visitwww.CrashNetwork.com). He can becontacted by email at:[email protected].


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Who Attends CIC?An electronic audience response system (clickers) being used this year forthe first time at the Collision Industry Conference (CIC) meetings is offeringa new way to gauge who attends CIC.

Each of the last two meetings have had well over 200 attendees. At themeeting in Phoenix this past spring, about 30 percent indicated they wererepairers, 10 percent were information providers and about 4 percent wereinsurers. But that survey lacked enough other categories, so the majority ofattendees (55 percent) got lumped together as “other.”

The survey at the Boston meeting in July was a bit more refined. Again,about 29 percent of those responding clicked in as repairers. Likely becausethe meeting was held in conjunction with I-CAR’s annual conference, insur-ers made up a larger percentage (7 percent) than at the Phoenix meeting.Consultants accounted for 9 percent of attendees, automakers 6 percent,and suppliers 29 percent. The category of “other” was still selected by aboutone of every five attendees.

Hoffman Auto Body Shop was cited inMarch 2013, by the U.S. Department ofLabor’s OSHA Division for nine allegedviolations of workplace safety standardsat its Connecticut Avenue facility in EastHartford. OSHA proposed fines totaling$54,300, mostly because of repeat cita-tions, the agency said. OSHA’s Hartfordoffice had seen problems in an inspec-tion in 2011, and a December 2012 in-spection did not find the problems hadbeen corrected, the agency said.

The agency also said the bodyshop had an improperly located elec-trical outlet, which could cause a shockhazard to workers, and a fire-suppres-sion system switch was blocked by acabinet. The electrical outlet problemwas remedied during the inspection inDecember, documents show. The threeserious violations resulted in $14,300in proposed fines. A serious violationoccurs when there is substantial prob-ability that death or serious physicalharm could result from a hazard aboutwhich the employer knew or shouldhave known.

Equipment and materials, someof it flammable, were stored near paintspray booths and electric panels. Thestored materials limited access to ex-tinguish potential fires, presented fire

and shock hazards and impeded clean-ing around the booths, which allowspotentially combustible materials toaccumulate. These conditions resultedin the issuance of two repeat citationswith $40,000 in proposed fines. A re-peat violation exists when an em-ployer previously has been cited forthe same or a similar violation of astandard, regulation, rule or order atany other facility in federal enforce-ment states within the last five years.

“The bulk of these fines stemfrom recurring hazards identified dur-ing this latest inspection,” said War-ren Simpson, OSHA’s area directorin Hartford. “Workers at the facilityremained exposed to potential haz-ards. This employer needs to take ef-fective action to correct these safetyissues and prevent their recurrence.”

The company did not contest thecitations. “The Hoffman family con-siders the safety of our employees atop priority and all issues identifiedby OSHA regulators in December of2012 were rectified immediately andcompletely,” said a statement releasedby the company in March. “We willmake whatever changes are appropri-ate to continue to ensure a safe work-place for our employees.”

Connecticut Body Shop Fined a Total of $54,300 forRepeat Violations by OSHA, Did Not Contest Citations


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