NACE Chairman Outlines Challenges, Solutions Facing Collision Repair Thursday, Nov. 1, 2007 By Leona Dalavai Scott, Editor-in-Chief The decrease in the number of claims, increase in total losses, salvage parts and changing technologies are some of the challenges facing collision repairers that NACE Chairman Darrell Amberson, AAM, outlined during Thursday morning’s opening general session, which officially kicked off the 25th annual International Autobody Congress and Exposition (NACE). Before beginning his address, Amberson recognized the attendees and exhibitors who have attended every NACE since 1982: “These are individuals who have attended each and every NACE. These folks represent the core of our industry and are respected and admired by all who know them.” Amberson, who is the director of the collision division of the Automotive Service Association (ASA), also recognized the past NACE chairpersons who have served during the last 25 years. Discussing the decline in the number of claims, Amberson said that many vehicle owners fear filing a claim when they have an accident because they believe they will be dropped by their insurance companies or experience significant rate increases. “Many drivers are either not repairing damage or they’re paying for it out-of-pocket,” Amberson said. “Take a quick tour of any shopping mall parking lot – you’ll see a vivid example of many damaged and unrepaired vehicles.” Related to the decline in the number of claims, Amberson told the audience that there are more total losses of vehicles, which decreases the availability of work. As a result of declining availability of work and increased efficiencies, Amberson said, there is an overcapacity issue. “Therefore, there is an imbalance in the insurer and repairer relationship,” said Amberson. “Repairers find themselves in the weakest of bargaining positions. There are some insurers who use the situation to their advantage through aggressive negotiation practices and estimating practices such as abuse of the blend within panel philosophies, denial of payment for some repair processes. Some insurers are dictating terms to repairers. Prime, block and fill is a defined part of the refinish process that typically is not compensated for. Steering also continues to be an issue.” To address these problems, Amberson encouraged collision repair professionals to respect their insurer counterparts and to increase the level communication between insurers and repairers to resolve these issues without government intervention. He also encouraged the collision industry to make a conscious effort to come together and speak as one voice: “Unified rather than fractured – that should be our common goal as an industry.”. Amberson also cautioned attendees to partner with credible salvage businesses when buying salvage parts. Estimating practices remains an ongoing issue, Amberson told the audience. By its nature, estimating involves a tremendous amount of subjectivity when it comes to what should or should not be included. “I call on our industry to develop a better, long-term solution to our estimating model,” he said. Amberson introduced the creation of the Database Enhancement Gateway (DEG) – an innovative project that was developed to examine and enhance the content of the data found in the industry’s leading estimating systems. Through the DEG, repairers can request a review of operations in any of the three major databases. The DEG will then share the results and findings with the industry. Amberson discussed the issue of changing technologies and the new solutions they offer. But repairers must be proactive in getting the proper training and education, he cautioned. “As you walk and shop the NACE Exposition over the next three days, you’ll find vendors who offer that information, including estimate database providers, original equipment manufacturers, training sources, data warehouses and more,” he said. In concluding his address, Amberson challenged attendees to look for efficiencies in their business operations. “The world is quickly changing,” he said. “Our businesses will continue to change. Everything will only focus more on working smarter and faster – and saving the almightly dollar. If we accept this inevitable wave of change and research the efficiencies that can benefit our businesses, we can – and our industry will – benefit from embracing these more efficient repair processes.”