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  Special Feature

Mechanical and Collision Trends in 2012:
Whatís Ahead?

Posted 1/16/2011
By Rachael J. Mercer and Leona Dalavai Scott

What should you be watching for as you tweak your business plan for
the New Year? Fellow shop owners weigh in on key trends for 2012.

As the New Year begins, members of the Automotive Service Association’s (ASA) Mechanical Division and Collision Division Operations Committees discuss trends and what to watch for in 2012. Following are three key trends that came up in discussions among both collision and mechanical shop owners. These top three trends are areas where each shop should examine its involvement and learn about the ways in which the trends affect their businesses.

No. 1.: Communities are key through social, digital media

Facebook and digital media are becoming the most important methods for marketing businesses. According to Facebook, there are more than 800 million active Facebook users. That is a huge audience for any sort of business. Strategic marketing and providing information to customers through Facebook can help shops attract new customers and communicate better with current ones. Facebook is helping to build online communities among like users or “friends.”

Likewise, Twitter is growing by leaps and bounds, and it presents small business owners with the opportunity to reach new and current customers with informative “tweets” and educational tidbits. With an average of 140 million “tweets” per day, Twitter is another social media outlet offering small-business owners the opportunity to network with their customers.

In fact, more and more shops are recognizing the importance of having a Facebook or Twitter presence to build a sense of community with their current or future customers. Some ASA member-shops have had success with serving as a “Go-To Expert” for their followers. Facebook presents many opportunities to share your vast automotive service knowledge.

Angie Kilbourne, ASA’s manager of web operations, encourages thoughtful conversation on a shop’s Facebook page by asking customers questions about service or repair issues and then providing them with the answers to address those issues. She also says shops can add a fun twist to their Facebook presence and offer games or contests or post automotive trivia questions. Engaging your followers and friends through social media outlets can be an inexpensive yet important way to build relationships with your community.

Mechanical:
Trends to Watch For

Here are some other trends that were outlined by members of the Mechanical Division Operations Committee:

  • More software programming to fix customer concerns.
  • Scan tool costs sinking while subscription costs rise.
  • Changes in state and federal legislation, which could lead to increased fees and taxes. The Bush-era tax cuts are set to expire at the end of 2012.
  • The need for better aftermarket parts standards.

Pete Rudloff, owner of Pete’s Garage in Newark, Del., says, “Connecting with customers through Facebook and Twitter and other social sites is all the rage right now. It makes sense to  take advantage of these forums.”

In addition to the posting ability that Twitter and Facebook offer, communication through other digital media is much more prevalent for today’s shops, and many mechanical and collision operations committee members believe this is a trend that will only grow in 2012.

 “I believe we will continue to see increased communication with our clients via texting, email, Facebook, etc.,” said Diane Larson, AAM, owner of Larson’s Service Inc., in Peabody, Mass. She continued, “Phone calls are quickly becoming a thing of the past, especially for our younger clients, who may be our biggest market and who adore the technology.”

Taking advantage of the ease of communication that digital methods such as email, texting and social media offer has the potential to drive new customers – particularly as shops reach out to a younger demographic of customers.

No. 2: Economy is forcing customers and shops to be smarter

The economy plays a role in the trend forecast for 2012 in a couple of different ways. First, many operations committee members commented on the trend toward customers hanging onto their vehicles longer than was once customary. According to R. L. Polk & Co., the average age of today’s American vehicle is approximately 11 years. This is the highest average in more than 16 years. Because money is so tight for many American families, maintaining the vehicle they own – even by making costly repairs – is a priority over replacing the vehicle with a newer one.

Tom Piippo, AAM, owner of Tri-County Motors in Rudyard, Mich., commented on this trend: “In the shop we are doing a lot more cooling system repairs, brake repair and service, gas tank replacements, fuel line and brake line replacements. We are in the heart of the ‘Rust Belt,’ and most of these services are directly related to old, rusty cars – the fleet is certainly getting older these days.”

In addition, the economy is forcing shops to work smarter. Greg Horn, vice president of Industry Relations, Mitchell International, says smart shops recognize the importance of technology in repairing today’s cars and are making the investments with hardware and software equipment and training to perform vehicle repair.

“Shop technicians will need to have the correct repair procedures to repair increasingly sophisticated vehicles to pre-accident condition safely,” he says. In addition, he believes estimators will need to accurately assess whether the parts can be repaired or replaced. Collision repairers will be pressed to perform more complex repairs while reducing cycle times and increasing customer satisfaction. They will need to quickly assess the most up-to-date step-by-step repair information associated with the specific part or procedure.

Collision: Crash-Avoidance Technology Increasing

With the complexity of vehicles growing with each year, here is a collision trend that will be affecting repair.

Crash-avoidance systems such as vehicle-stability technology requirements on all 2012 models aimed at preventing rollover accidents are prominent in 21st century vehicles and are made possible by the use of telematics technologies like GPS navigation systems and advanced computer-controlled drive systems. The National Highway Transportation Safety Administration is on board, too, with its Intelligent Transportation System that uses vehicle-to-vehicle (V2V) and vehicle-to-infrastructure telematics to avoid intersection accidents. Manufacturers are developing automatic-braking systems, back-up cameras and blind-spot warning systems.

Black box technologies such as event data recorders (EDR) are also increasingly mainstream, present in almost all new vehicles going forward. There is tremendous interest in the data contained in telematic technologies and their potential to reduce collisions by aiding in accident assessment. The aim is to eliminate auto accidents, but so long as people are driving the cars, repairers will have plenty of business. As well, these technologically advanced vehicles aren’t cheap; with higher vehicle cash value, there is greater likelihood that shops can repair them instead of reaching the total loss threshold. If you would like to learn about more collision repair trends, please request a copy of Mitchell International’s Industry Trends report at www.mitchell.com/ pubs/index-industry-trends-report.asp.

Working smarter has also resulted in shops “tightening their belts” and looking at ways to retain more of their revenue.

A collision repairer in Illinois commented on the state of his business in the 2011 “How’s Your Business?” survey. He wrote, “Business has slowed down for us here; however, the bright side is that it has helped us take a really good look at our financial statements and hone in on them and be able to maximize and make a profit. We have cut expenses and sustained a healthy gross profit. Along with doing all we can to increase sales, we are ending 2011 in the black!”

The second way the economy is driving trends for the mechanical industry – especially in 2012 – revolves around a new type of customer: One who, instead of simply handing over the keys and saying, “Do what it takes,” is price shopping. “At Downing Street Garage, we see more price shoppers these days,” said Douglass Kirchdorfer, AAM, owner of the Denver repair shop. “It’s not just the big stuff, but for maintenance services as well. The customer is changing, and we need to change as well. We offer free check engine light consultation — where we scan the code and help the customer understand the problem.” Kirchdorfer explained that by providing perks like free diagnostics and analysis, his business is building a relationship with its customers — one that will hopefully pay off in the future even when repairs are more high-dollar.

No. 3: Changes in education

In 2012, expect to see more changes in technician education, including the continuing growth of technician-driven training. Currently, tech training revolves around a group of geographically related technicians who pool their resources and ideas to bring “top-shelf trainers to areas they would not normally come,” said Rudloff. He continued by pointing out “this type of training is generally more ideal for an established technician who is looking to expand a relatively solid knowledge base.”

Internet-based training, as opposed to training that takes place at a conference, has both advantages and disadvantages. Our experts expect that destination-centered training will continue to decrease as the most attractive option for independently owned mechanical businesses.

Betty Jo Young, AAM, owner of Young’s Automotive Center in Houston, Texas, and assistant director of the ASA Mechanical Collision Division Operations Committee, echoed these sentiments: “Time and money are always an issue, and many things can be learned through Web-based training in the shop. ASE prep classes are a good example of this type of training.”

She continued by explaining one type of training opportunity that her shop takes advantage of. “We use the CARQUEST system of training, and many fellow automotive shop owners are using this training system as well. Our business has a monthly payment that covers six classes that are two-night sessions throughout the year. We are given the lineup of classes early in the year, and everyone knows in advance what classes they will be taking.”

Piippo added: “In the past I invested in a lot of training by taking my crew to events such as CARS, iATN, ASRW, UnderCar EXPO, and more. I still feel that this type of training is invaluable. But I am slowly turning the corner toward Web-based training. 

 “When our company has a slow day, or we are cursed with a customer no-show and have some time to kill, our technicians can sit in front of their workstations and do an hour’s worth of training. There are no travel expenses, no one has to give up free time, and the training costs me only a Web access fee – if there is any fee at all.”

Scott Benavidez, owner of Mister B’s Paint & Body in Alburquerque, N.M., sees networking as an important facet to education for today’s automotive service and repair professional.

“I believe that it will be more important than ever to network with shops that are successful in today’s tough market,” he says. “Ideas are out there and shop owners are willing to share, and it’s about getting the information … we will want to be more interactive than the classroom style of learning. We must be willing to bounce ideas off of each other in hopes of understanding these tough times. We will want to hear about equipment from each other along with the vendor to make informed decisions on our business.” Benavidez believes that the choice networking that ASA offers through its nationwide network of repair professionals will become more important than ever and can move in a new and exciting direction.

The year ahead will certainly bring new challenges for independent shop owners and their technicians. These new trends toward marketing, helping customers stay on budget, working smarter and Web-based training should help you be more successful in reaching new customers, keeping the current ones and in training your technicians. Happy New Year 2012!

 

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