Once again, the CRA are grappling with new service level agreements with the supposed need for sustainability. Sadly, it seems to us no one out there seems to be getting the message because these agreements all have one thing in common – to introduce lower cost of claims, increased administration workload without reward and then to accept diminished parts mark-ups from our friendly insurers. Their teams of actuaries continue to eye extra profit from the business of collision repair on their motor books. Sadly, for all these players the truth is the body shop business is already reeling from cost increases that have been consistently driven downwards in recent time without any real increases forthcoming from the insurance companies and of any significance through unqualified understanding of cost structures and incentives.
It all borders on a type of unscrupulous behaviour with unsustainable rates for our repairing members. It’s an unsubstantiated business model right now.
So it’s about time that the trade took the matter into their own hands with a clarion call for some type of unity among repairers both on a regional and a national basis to curtail more insurance dominance and work steering that is now visible in our real world of car repair.
Looking at a trade that seems not to want to behave is never more visible than when you take a look at the state of regulation and being of good standing with as examples MIBCO and SARS. It is becoming more evident of not meeting commitment due to profit erosion. Estimates of unpaid contribution are staggering and actual recovery on debt will never be realised with the risk of meeting future ability to pay pension commitments a possible reality. This is over and above of settlement on parts purchases.
Disputes have been registered with Insurers for their totally unacceptable process repair time allocated and absurd allowances on painting of body panels. The average probable cost is running at levels below commercial offer for repair costs so our members will not accept these punitive parameters and may be downing tools forthwith in protest against these insurance unacceptable application rates in body repair.
Also on our watch list is the continued trend by insurers to outsource work to mandated underwriting concerns who operate with different levels of commercial terms that vary from their agreed contracted fees that are agreed. These new middlemen invariably go direct to their identified body shops and obtain digital quotes and repair then recoup admin fees through deduction of settlement for the work being carried out by the repair concern in our membership. Since when is everything to be carried for no reward. This is a worrying trend for us to navigate.
A warm welcome to Michelle
On a positive note, we would like to inform our Western Cape panelbeating fraternity that the CRA have now employed Michelle Speck to take good care of the Western Cape market in collision repair.
Michelle, who has actively been working in the body shop supply business for two decades, will in our hopeful opinion, be capable of extending the CRA membership base in the Cape area going forward. If you would like to see her on the revitalised collision repair accreditations of new membership benefits please call Michelle on 083 703 7639.
CRA will be at the Cape Auto Forum
The CRA are happy to announce their presence and participation at the Cape Auto Forum which will take place at the Cape Town Convention Centre from October 17-18. Not only will we be available to meet our members in this region face to face on our stand over the two-day show, but we will also be sponsoring, along with Automotive Refinisher magazine, Andrew Marsh as the keynote speaker in the two-day conference that is taking place as the show runs.
The theme for the presentation is “Automotive revolution and the age of disruption” and Andrew is no stranger to understanding this at the coalface. He will be focusing on the challenges of repair complexity and the enhancement of electronics and software skills inside the body shop. He will also take a look at ADAS and where this all fits in. These are also uncertain times for motor insurers with each new wave of technology affecting model specific repair costs.
The discussion will illustrate the depth of chaos, and an approach which can held reduce confusion as well clarify the best investment choices.
Andrew has a degree in mechanical engineering and has over 20 years of first- hand knowledge of the inside workings vehicle manufacturers. He then moved to Thatcham Research for seven years, a partially UK motor insurer funded repair research centre, to bring his unique blend of engineering knowledge for each new vehicle arriving in the marketplace.
In 2011 he founded Auto Industry Consulting which is an independent provider of technical information and consultancy to the global collision repair industry.
Their key product is Ezi-Methods, which provides OEM repair methods and information for a marginal fee, and which is available to our members exclusively at R350 a month. “Knowledge is power in this day and age and we always strive to give our members the latest information to help grow their business,” concluded Andrew.