Welcome to CIIA Newsletter

New trades fees announced by the Ontario College of Trades

Starting in 2013, news fees for both apprentices and technicians for maintaining their license (called membership in the College) will start.  Employers will also be paying a fee that has not yet been announced.

Your trade association, CIIA, has already met with the College and will again in late December in an effort to ensure that the College provides a value for trades qualified techs and apprentices.

See the announcement below for more information and our CIIA September newsletter on this issue, or check out our NEWS site at www.ciia.com

http://www.collegeoftrades.ca/wp-content/uploads/Memb-Fees-NR-and-Backgrounder-FINAL.pdf

Pre-apprenticeship students on shop tour

Pre-apprenticeship students visited Martino Bros. Collision near the Toronto airport to get a better idea of a shop environment and  working conditions and see a progressive shop in action.

 

Pictured is the Autobody Techniques class from Centennial College, recently visiting Martino Bros. Collision airport location in Toronto.  Some 60 students toured a number of facilities and had the opportunity to "try out" the shop.  These students graduate on May 23, 2013 and can be hired immediately afterwards.

Request for interest being on committee to set industry training standards

The Ontario College of Trades plans to revise the existing Training Standards for the Auto Body and Collision Damage Repairer trade in early 2013.

About eight subject matter experts are needed to work on this project. Ideally, these individuals would need to meet the following criteria:

  • Hold a Red Seal certificate
  • Be "on the tools" (i.e. currently practicing in the trade)
  • Managers/supervisors/lead hands currently supervising apprentices and
  • "signing off" the training standards
  • All major areas of the trade are covered
  • Individuals represent all Ontario geographic areas
  • Individuals represent small, medium and large organizations

If you are interested in accepting this positive industry challenge, please contact the CIIA office at 1 866 309 4272 for further information and next steps.

Thank you for your industry interest and commitment.

CHEMtrac Update for Shops

205 Toronto shops(including franchise and banner shops) tell the City they do no or little painting.

The City of Toronto shop emission reporting program, CHEMtrac, is almost ready to cut off its reporting program or the year 2012 on Dec 21.

Collision repair, auto body and auto refinish shops originally were allowed until July 3 to report their emissions or to identify whether the shop exceeded the thresholds for the various emsisions.  Those emissions were: Volatile Organic Compounds(VOC) from spraypainting, manganese from welding, particulate matter from sanding and grinding and nitrogen oxide from spraybooth heating. To date, 112 automotive facilites have reported their emissions of which
36 auto refinish shops were included.  33 of those 36 reports were submitted by the association.

Of larger concern, 205 Toronto shops, some identified as large franchise and independant facities, told the City that their emissionss of VOC were below the threshold amounts.  In general terms it means that they were spray painting less than 3 cars or car parts per week and purchased below $15-18,000 of paint product for the year.

We know from our work in Toronto that this is simply not true. Here's what happens when a shop falsifies this reporting (information courtesy CHEMtrac):

Warnings are typically (but not always) issued first  When this happens an enforcement file for that facility is created.  For subsequent violations tickets can be issued, ranging from $200 to $350 depending on the infraction.  If violations continue to occur summons will be issued. Fines upon conviction are:  for the first offence $5,000 maximum, $25,000 for a seond offence, $100,000 for a third offence.  It should also be noted that there are no warnings or tickets issued for obstruction, for all obstruction charges summons will be issued.


Shops that have used the association for reporting will find a small change made in their CHEMtrac reporting account as the association is modifying the solvent used section in each shop account and putting it in a different heading as requested by CHEMtrac.  There is no change in the net reported emission amount and shops need do nothing at this time.  This is an administrative change only.

Almost 500 shops take advantage of fee waiver for environmental "permit"

The auto refinish industry in Ontario was the first sector in Canada to use a "template" process", called "Permit by Rule" for environmental approvals.

In the past, each shop individually applied for a mandatory Certificate of Approval.  The Ministry looked at each of these complex applications, that normally required a consultant to produce, examined areas such as booth and stack air flow, zoning, height elevations, corporate status, amount of paint, MSDS etc. before making a decision on granting the
Certificate.  Shops paid a minimum of $600 per application and  often more (average fee was $772).

With this new process, recommended and piloted by your trade association for two years, before regulation, ALL shops, as long as they meet a mimimum status will be authorized for a new Certificate of Approval now called a Environmental Activity and Sector Registry (EASR).

From its initial offering on October 30, 2011 until November 18, 2012, application fees for the Registry were waived.  The fee is now $1190.00.

We are pleased as an association to have saved the industry $600,000 in fees during that 13 month period. Almost 500 shops took our advice and registered their facility during that no fee period.

Your association has forwarded an information package to all the shops that we worked with and a full explanation kit is going to those that registered independently. Training course information is included.

P.S. For shops that have not registered-If your shop qualifies for an EASR, you must apply for the EASR as no Certificate of Approval will be issued.  If you have submitted a Certificate of Approval application, it will be refused until the MoE Director issues you an order to do so.

For the almost 500 shops that do possess an EASR-Although MoE has not announced it yet, we believe that the requirement for annual reporting has been dropped.  More details or answer to questions can be obtained from CIIA, your association, at 1 866 309 4272

How to handle reporting of CAPA certified part failures

Some repair facilities, such as Gunder’s Auto as evidenced below, have been utilizing a CAPA return process to demonstrate deficiencies in CAPA certified parts they have received which do not fit. Programs such as this (for parts) and the DEG (for data) allow repair facilities to communicate the real world findings of professional collision repairers, to help fix problems that we come across which impact our businesses.  (courtesy Aaron Schulenburg). Here are some of the examples:

Gunder's Auto letter 1
Gunder's Auto letter 2
Gunder's Auto letter 3
Gunder's Auto letter 4

CASIS Vehicle Security Professional program

The new Vehicle Security Professional progam is now released for technicians and locksmiths to use.

From January 1 to September 30, 2012, during the test period. over 272,000 individual transactions were handled in this program from Canada and the United States.

Shops should investigate the advantages of being on this progam.

Read the press release here.

For more information please see www.vehiclesecurityprofessional.ca

Ontario's Anti-Fraud Insurance report and what it means to repairers

Sixteen months ago, the Premier of Ontario appointed a Task Force to advise the government of the extent of automobile insurance fraud and what to do about it.  Your collision repair trade association, CIIA, made a number of presentations and recommendations to the Task Force and the Task Force Final Report was released in November. What should interest collision repairers is:


1)     The strong recommendation to regulate the towing industry. Complaint after complaint and massive reports of "tow truck chasing" to accident scenes and kickbacks paid to tow operators by collision repair shops and illicit activities involving medical remediation clinics were epidemic.  A new regulatory regime to control towing abuse is being proposed.  Although the report identifies that many felt that a towing regulatory process could not work without collision repair shop regulations, the collision repair industry was not regulated.  Collision repair shops were urged to co-operate with tow regulations and controls, but given no legal or statutory basis to do so.

2)    An important recommendation was made that we encouraged: that government should require of insurers to publicly disclose how they choose and assess the performance of businesses and professionals they recommend to consumers or refer them to see.  This recommendation covers our suggestion that insurers would sometimes use non-compliant, untrained and inadequately equipped shops on their DRP or parts procurement programs to lower their labour and parts costs.  We had an example we gave the Task Force of a well equipped, trained, and compliant professional shop that was losing all its insurance business after 20 years with one insurer because another shop in town offered a futher 5% discount on all work performed.  That shop had no licensed staff nor any environmental permit to paint. The shop would not confirm whether it even possessed a frame rack.  Another complaint, that a trained professional shop was dumped by one insurer, when he refused to participate in an insurance parts procurement program and the work was then give to other shops in the area, who were legally non-compliant in trades certification and environmental minimum functions and inadequately equipped. Shops can, with more and more restrictions on them, expect a similar race to the bottom as insurers look for more savings despite the Ontario government guaranteeing insurers a 12% return.

3)    A recommendation that the regulations should ensure that when conducting an audit, that an insurer has complied with protocols and practices that they have disclosed and promised to the public.  If an insurer's policy is that they will use parts, for instance, that are the same as OEM, then they may have to prove it.

4)    Whistle blower legislation.  During our presentations, shop after shop declined to be with us for the actual meetings with the Task Force and with government, for fear that their testimony of what actually happens at a shop, would  be used by the insurer to "blacklist" that shop.  A number of times, your association has had to bring instances of non-compliancy or fraud to the attention of the insurer or regulator as the shop had no whistle-blower protection and so used the association for that communication.  This fear of having their shop "blacklisted", has meant that the number of complaints against insurers continues to be very low.  An insurer will advise us that a "communications" error was made and that the offense was a "one time event".  This new protection now allows shops and the association opportunity to receive more information from shops that shows patterns of activity by the insurer.


The new recommendation that a prohibition  on reprisals and retribution against individuals who, in good faith, provide information about suspected fraud is a positive step for shops.   It also allows shop employees to tell us about fraudulent behaviour regarding towing activities.

5)    The Storage and Liens Act is recommended for modification to reduce unreasonable storage costs for a vehicle after a collision. In one case, a towing firm demanded a $1000 a day storage fee in order to increase it's revenue.


6)    A recommendation that the regulators be given more power to investigate and sanction unfair or deceptive acts or practices. These practices are spelled out in the Insurance Act and largely refer to kickbacks and commissions.  This was a strong recommendation from your collision repair trade association because of massive illicit payment schemes between two firms and shops and because of some unusual financial relationships between insurers and some DRP or parts procurement enabled facilities.


7) A recommendation to add to the list of activities described as unfair or deceptive practices, the charging to insurers much more for goods and services than the ordinary retail price.  We reported on a large number of recyclers under a parts procurement program that were charging the identical inflated price to insurers, however, when contacted for the same part as a non-insurance repair, all recyclers quoted different but all lower pricing to the shop.

This report is a good step in the right direction in efforts to combat fraud in insurance activities and while, admittedly, most fraud is engaged in by individuals and rings against insurance companies, there are finally some areas highlighted in the report that allow shops to identify non-compliance and regulation violation by insurers without being sanctioned or penalized or having their business "blacklisted."

Association's Predictive Estimating work pays off- coming soon

I would like to take this opportunity to thank all of you for your support over the past several months getting our new estimating tool from a vision to a reality.   As you all know, Toyota is taking bold steps to supply repairers with repair procedures connected with complete repair blueprints.  Toyota is outlining a new “Predictive Estimating” concept with plans to work with estimating companies to develop the new approach.  Toyota has illustrated that the proactive approach assumes that the types of damage will require corresponding sets of repairs functions, related parts, and specific repair procedures.

Please take a moment to read Jason Stahl’s article athttp://www.bodyshopbusiness.com/article/106608/toyota_unveils_predictive_estimating_concept_at_sema_show.aspx and leave your comments and/or suggestions. 

For those you who haven’t had the opportunity to see our “Predictive Estimating” tool I’ve attached a sample linkhttp://tccc.seainternet.com/camry/select.htm

Thanks again for your continued support.  

Rick Leos

Marketing Division/Collision Business Development Consultant

Toyota Motor Sales, USA, Inc

 

USE YOUR MELON

What happens when the repaired vehicle's airbag in the next collision goes off seven one-hundreth of a minute too late? American Honda on their collision site will show you the results using a melon.  It ain't pretty.

According to Honda's survey;

93% of body shops report they use aftermarket parts.
body shops report that over 40% of their repairs included aftermarket parts
2/3 of body shops say the strongest influence on their part choice isthe insurance company
only 4% of body shops say they like aftermarket parts

Non-certified aftermarket parts are not required to be crash tested with your vehicle

Twice this week, our office has been contacted by shops explaining that they wanted to install a bumper shock from the OEM supplier but were denied by the insurance company.

In one case the shop was penalized by being removed from the insuance company vendor list for a month, becasue the shop insisted and indeed installed an OEM bumper shock rather than an untested aftermarket piece.

The shop knew that the car might not perfom the same in a crash and the shop would liable for their repair, even thougn the insurer demanded it on threat of shop business blacklisting.

If that bumper shock responded seven one-hundreths of a minute too long after another hit, the driver's head would look like a melon when dropped.  An ugly and tragic picture.


As insurer and parts procurement programs attempt to "cheapen" pricing and obligate licensed technicians to put on parts they can not trust or fear for the customer's future safety in using them, what does the industry do?  In the case of the shop that was suspended by his insurer because of his desire for structual OEM parts use, his franchise banner partner would not support him, and indeed complained of his "anti-insurance" behaviour.

To be fair, there are a number of public insurance provinces and some private insurers who would never consider using aftermarket parts for structural replacement part repair.  Others clearly do not share that concern.

Is it finally time to get the federal Transport Department to review the crash safety of aftermarket structural parts?  Is it time to prohibit importation and sale of aftermarket structural parts until we know that they will indeed match with OEM parts for performance ?

As some insurers continue to demand the use of structural aftermarket parts that puts repairer into a difficult liability situation if using them and puts drivers and passengers into potential situations where their vehicle no longer repsonds in a collision in the fashion it was designed to do, then all of us need to take a serious look at regulating the importation and use of structural replacement parts.

There are a variety of approaches to solving this issue, and insurers trying to say a buck while potentially risking the life of their insured is not one of them.

Collision Centre Appreciation Breakfast in Toronto

December 21 is the date of the first Collision Centre Appreciation Breakfast. For three years a pre-apprenticeship autobody and collision repairer damage technician pre-apprenticeship class has been offered in the Toronto area.

This offering, delivered by Centennial College and industry partners is co-ordinated by AYCE Employment Services, a division of Tropicana Community Services.

A number of industry shops have been active sponsors and employers of the graduates from this program and a few will be honoured at a special breakfast awards event at the Radisson Hotel.

Honoured for their work with autobody and collision repair pre-apprenticeship will be The Brimell Group, who have, through their Collision Centre Manager, Richard Marsh, supported the program by employing the graduates and offering
co-op placement and also using their facility for other required training.

Maaco Collision Repair and Painting, through Wayne James, another valuable sponsor and employer and AYCE has featured workshops at the MAACO Head Office building and John Norris of the collision repair trade association, CIIA, for his work on pre-apprenticeship.

The AYCE autobody and collision repair damage repairer pre-apprenticeship training program is a 30 week full-time program, offered at no charge to participants.

The program includes a 6 week course of pre-employment training, level 1 training at Centennial College,a tool kit and course material, a 12-week paid work placement and shop tours and site visits.

Insurance company parts procurement-report from SEMA

A central topic of collision repair discussion this year has been the advent of insurer-mandated parts procurement programs, of which State Farm's controversial Part Trader pilot in selected cities across the United States has garnered the most visability to date. In Canada at least one major insurer is involed in an active parts procurement
program while two other companies are advising shops that they are planning a parts procurement process.

While the effect of these programs have yet to fully play out in the United States, their nature as mandated intrusion into established business processes may well cause long-term harm to collision repairers
and suppliers.

In November 2012, the Society of Collision Repair Specialists (SCRS), brought together a panel of guests from around the world that have first-hand experience with insurer-mandated parts procurement in their respective countries.  The progam was entitled " Bidding Wars: A Global View on the Possible Economic Impact of Insurer Involvement in Parts Procurement".  The full house of attendees attested to the fact that this is a topic of much concern to the industy.

Panel particpants included David Newton-Ross (Australia), Publisher of National Collision Repairer and the NZ Collision Repairer magazines, and organizer of the Collision Repair Specialists of Australia (CRSA) Conference in Australia; Rex Crowther (New Zealand) , a former facility owner, current editor/publisher of Panel Talk Magazine and former Executive Chairman of New Zealand Collision Repair Association, and John Norris (Canada) collision chairman of the National Automotive Trades Association of Canada and executive director of Ontario-based Collision Industry Information Assistance, the second-largest trade group in Canada.

Though their markets are thousands of miles away from each other, with their own specific identities, the impact of insurer-mandated parts procurement on each was negative to varying degrees. "Based on my experience the situation in the U.S. is bad, and will worsen as more American insurers get on board with the programs" said Newton-Ross. "Over time the collision repairer will lose in almost every way imaginable; loss of profitability, thanks to cheaper parts, loss of
efficiency as inferior parts need to be reworked and loss of relationship with suppliers.  The only gain they will see is many more accounts to handle!  The reason that the impact of these programs wasn't worse in Australia is that we worked together as an industry to raise consumer awareness and that helped put a stop to the spread of this program.  When consumers find out what's going on they get concerned- and for good reason."

Perhaps the impact of mandated parts procurement has had its most devastating impact in New Zealand where the indutry didn't work together as vigourously as Australia.  As a small island country, New  Zealand, has it own set of unique parts supply challenges which are non-existent in the United States; as Parts Trader provided a solution to these unique challengs it was also promised to deliver improved efficiences and other positive attributes that convinced New Zealand (NZ) repairers that the progam would be mutually beneficial to all involved. Unfortunately, the resulting situation did not reflect the initial promises presented to the repair community.  "Prices were driven down- we weren't even allowed margin on freight- and quality control became non-existent" stated Crowther.  "There was additional administration time and constant interruption to workflow.  The model rewards shops that do not undertand profitabiity and business discipline, and by buying into the system, these lesser shops drag everyone down."

Insurers are also pursuing mandated parts procurement in Canada, with less than acceptable results. " In insurer-dominant marketplaces, shops fear saying 'no' to an insurer's program beacause it may result in the blacklisting of their business," Norris explained. "But shops that agree to particpate find significant discounts taken and parts orders taking extra days to arrive from distant and unknown suppliers, as the program restricts their supplier options to only those who pay a fee to the insurer when parts are sold.    Shops can not deliver on-time estimates. Anyone who says these sytems increase efficiencies is wrong.  If there is one lession to be learned out of this it's that shops should work with insurers, not for insurers.  They can not afford to become "DRP lazy".

 

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