Words In Review: Key quotes heard in the industry in 2012
compiled by John Yoswick
Here’s our annual compendium of some of the most important, interesting or memorable quotes heard in the industry during the past 12 months.
"I think it was very clear from our folks on that call that (standards) are something that are valuable if done by collision repairers for collision repairers, but that there was skepticism of having involvement among entities such as insurance carriers in the establishment of repair standards.”
– Aaron Schulenburg, executive director of the Society of Collision Repair Specialists (SCRS), speaking of a conference call with representatives of more than a dozen SCRS state affiliate groups on the topic of creating collision repair standards
"If you don't have a third-party doing this, I can guarantee you that the OEMs are going to have certification programs for independent shops. We're seeing that already. And it's not going to be open to just anyone who's qualifies. They're going to be chosen. If you qualify and you weren't a chosen one, you're not going to be able put a (certified) sign above your door like you could if the industry creates a third-party that certifies all who qualify."
– Steve Nantau of Ford Motor Company, also discussing the possible creation of an entity to oversee the development and implementation of collision repair industry standards
"We have been working on this notion for over a decade. We really do feel very bullish on the prospect of getting it on the ground."
– David Strickland of the National Highway Traffic Safety Administration, on possible mandates for vehicle-to-vehicle communication technologies in new cars, which he said could improve crash avoidance in up to 80 percent of crash scenarios
"How much are you being billed to tint paint, feather edge, cover cars and dispose of hazardous waste. While not the bulk of the estimate, fluff can really add up."
– from a blog by claims consultant Christopher Tidball, recommending that insurers keep an eye out for such items when subrogating claims
“Not wanting to pay for something is one thing. Calling something ‘fluff,’ as if it's a non-existent procedure pulled out of the air, is another. Mr. Tidball should spend a few days observing in a paint shop to gain some understanding before calling the work performed there "fluff."
– William Bray, co-owner of Fix Auto Portland East in Portland, Ore., responding to Tidball’s blog
"One way or another, we want these people to be made whole.”
– West Virginia Assistant Attorney General Matthew Stonestreet, after a judge ordered Liberty Mutual to halt its policy of calling for use of salvage parts on vehicles three years old or newer, and to release the names of vehicle owners who may have had their cars illegally repaired with salvage parts
"Having an outside entity tell you what processes you're required to do, and who you must do them through and how, is the furthest thing from 'lean.’”
– SCRS’s Schulenburg, on State Farm’s mandated use of PartsTrader
"At this point we are moving forward. "We are moving through our test. We're obviously gathering information, making adjustments along the way. But I can tell you that State Farm is moving forward with this. We think it is in the best interest of our customer. I know we don't have agreement, and that is fine, and I carry that information back. (And) something could happen that I can't predict. But I can tell you that, right now, that we are moving forward with the process with our Select Service providers."
– State Farm’s George Avery, when asked back in May if the insurer would move forward with PartsTrader if shops, dealers and other parts vendors are resistant to it
"The biggest thing that frustrates me about this is I've worked for 35 years to build relationships with suppliers. My father and I have both used our negotiating skills to get the best prices we can to help us stay in business, because we have to continue to increase our profits on parts to stay in business. This is going to undo that. It's going to unfairly affect those businesses who are efficient. And those are probably the businesses who are treating our mutual customers the best as well."
– Randy Chevrier, business manager of Paintmaster Collision Center in Tulsa, Okla., speaking to Avery at the Collision Industry Conference (CIC) last spring about State Farm’s mandated use of PartsTrader
"Now it's parts. What's it going to be next? Paint? Where does it end?"
– SCRS board member Paul Val of Raintree Auto Body in Scottsdale, Ariz., also speaking of State Farm’s mandated use of PartsTrader
"I feel like a donkey that got dumped into the Kentucky Derby.”
– Arizona shop owner Dan Hunsaker, speaking back in July about how PartsTrader was more cumbersome than the electronic parts ordering system he'd already had in place
"It's not business-to-business with State Farm; it's master-to-servant. If you want to be on their program, you've got to figure out the PartsTrader program. That's just the way it is.… So it's not a matter of whether I like the program or not, or am I going to use it or not. Really the question here is: How can I use it to my benefit? Because it's here. We have to deal with it."
– Diane Rodenhouse of Rodenhouse Body Shop in Grand Rapids, Mich., saying she expects other insurers to eventually mandate use of PartsTrader or similar systems
"If State Farm cannot provide data showing how this application benefits collision repairers, ASA will respond appropriately on behalf of repairers."
- Denise Caspersen of the Automotive Service Association (ASA), speaking of PartsTrader this past fall
“We’re not interested in short-term for our stockholders. We are interested in long-term for our customer. We do not expect a dramatic decrease in cost-to-repair, but we know this is part of it. We do not expect to see an overnight (improvement) in cycle time, but we know this is part of it.”
– State Farm’s Avery, speaking of his company’s “moral and legal obligation” to ensure it makes prudent use of the $3 billion it spends on parts, given State Farm’s status as a mutual company, owned by its policyholders
"If there's involvement in the decision-making process, I think the repairer believes there should also be involvement in the liability. The argument from the repairer standpoint is that if the insurer...had left me to do what I do - put the part on I want to put on, or do the operation the way I wanted to do it - none of us would be in that court to begin with.”
– Oklahoma shop owner Gary Wano, pointing out hypothetically during a panel discussion on the clause in most direct repair agreements that requires shops to indemnify insurers, that if a problem occurs based on a repair, the shop and insurer will both find themselves in court
"Though his veto message states that he is concerned about the consumer, he clearly put the consumer and small business' interests aside and bowed to the pressure of the real 'special interest group' - the billion-dollar insurance companies.”
– from a statement by Auto Body Association of Rhode Island after that state’s Gov. Lincoln Chafee last summer vetoed legislation that would have given shops there the right to sue insurers directly in small claims court over disputed repair costs
“I would say I would not encourage my kids to get into this industry. It’s such a fragmented, disjointed industry. That’s just extremely frustrating. You have players within the industry who one minute want to look out for our mutual customers, and then the next week that all changes because a percentage point on their profitability went down. You just have to have thick skin, I guess. I don’t think my kids have thick enough skin.”
– Mike Schoonover, the president of Schoonover Bodyworks & Glass, a third-generation business in Minnesota
"Our focus here is on enhancing the repair procedures that are out there for the industry, and working with the industry and OEMs to accomplish that."
- I-CAR CEO John Van Alstyne, in announcing that his organization will work to improve the availability of comprehensive collision repair procedures from the automakers
"We're not choosing companies. We're choosing people. And I think we've chosen a great one."
- Jeff Handler, the CIC administrator (and a chairman of the conference back in the late 1980s), defending the selection (by the past CIC chairmen) of George Avery of State Farm as the chairman for 2013
"I know we don't all agree, but I'll leave you with this: You can't shake hands over the phone. And CIC is an opportunity where those with whom we disagree have a chance to shake hands. We have some spirited discourse, of course, which I think is healthy, but it's something we work through together, and I hope you see and will support my desire to move CIC forward as a place where everyone can come together and express their opinion and make the industry better."
– State Farm’s Avery
"Through targeted investments we will support DuPont Performance Coatings’ product development and growth objectives as it transitions to a stand-alone company."
– Greg Ledford of The Carlyle Group, following the private equity firm’s acquisition of DuPont’s 11,000-employee automotive paint business
"Although at times employed for benign purposes, most-favored-nation (MFN) clauses can, under certain circumstances, present competitive concerns. This is because they may, especially when used by a dominant buyer, raise other buyers' costs or (prevent) would-be competitors from accessing the market. Additionally, MFNs can facilitate collusion and stabilize coordinated pricing among sellers."
– from a joint statement of the Department of Justice (DOJ) and Federal Trade Commission (FTC) as the agencies focus on MFNs, such as the basis for State Farm's pricing requirements for its Select Service shops
"State Farm maintains that whether you are an independent or an multi-shop operation (MSO), you should be able to compete, and so State Farm evaluates even MSOs as individual repairers. I'm not discounting (the MSOs') ability, but I am saying that those with individual repair facilities have skin in the game, and that can have a lot of value on the customer service side, which we're all after."
– State Farm’s Avery
“Only vehicles that have had an airbag replaced within the past three years by a repair shop that is not part of a new car dealership may be at risk.”
– from a National Highway Traffic Safety Administration warning (which was widely criticized by associations representing independent repair shops) to consumers about the need to check for the installation of counterfeit replacement airbag
“I think insurance companies will have a more focused approach to identifying the best collision repairers in a market: those that that do a high quality repair, and are up-to-date on current technology, training, equipment. And the one thing we’re already starting to see: I think customer service will be viewed on par with some of the other key operational metrics, such as vehicle repair cost. For some carriers, the customer experience may be even more heavily weighted and more important than some of the traditional key operational metrics.”
– Dan Risley, a project manager for Allstate Insurance at the company’s home office in Northbrook, Ill.
“Every time in the past I’ve played this out in my mind, I say that five years down the road it’s going to be a much better industry. Then that five years will go by and it’s not a whole lot better. But I always hold out hope. I’m optimistic that things are finally going to break.”
– Rick Starbard, president of Rick’s Auto Collision in Revere, Mass., and past-president of the Alliance of Automotive Service Providers (AASP) of Massachusetts
Every year, CRASH editors assemble a compilation of some of the most memorable, important, interesting or enlightening quotes heard in the industry during the past 12 months. Read more quotes from years past.