Welcome to CIIA Newsletter

The Basic Estimating Collision Damage course is back

17th year of the popular training offered
Commencing April, 2013
Eligible for four I-CAR points

The popular basic estimating collision repair training course is back to help shop or office employees, new estimators and insurance company staff who may need assistance in estimating collision damage on cars and light trucks in Ontario.
Taught by experienced apprenticeship instructor, Jim Miles, this six-night course includes, introduction to estimating, understanding vehicle construction, fundamentals of estimate writing, understanding collision manuals, additional charges and collision damage analysis.

The first evening course commences April 15th, two classes per week over a three-week period. Total instruction time is 18 hours.

Time & Locations:

  • London- held at Fanshawe College Motive Power Centre
    6:30 pm to 9:30 pm Monday & Wednesday evenings, commencing Monday, April 15, 2013.

  • Burlington-held at Robert Bateman Secondary School
    6:30 pm to 9:30 pm Tuesday & Thursday commencing Tuesday, April 16, 2013.

  • Toronto East and West: starting June 17, 2013-call for details

Cost:
Association Members - $450.00 plus HST, per person
Non-Members - $550.00 plus HST, per person
Students can register by contacting the Association office at
1-866-309-4272 or e-mailing info@ciia.com  
Pre-payment is Mandatory

No Charge 37-week pre-apprenticeship autobody training

Always wanted to be a professional collision repairer?

Funded by the province of Ontario, Fanshawe College in London, Ontario is offering a no charge 37-week pre-apprenticeship auto body, collision repair and painting program.

This full-time course includes Level 1 apprenticeship training, trades readiness and value-added skills training, academic upgrading, job search techniques and up to eight weeks on-the-job training with area employers.

Admission requirements:

Ontario Grade 12 or equivalent
16 years of age or older and eligible to work in Ontario
Advanced English language skills( if English is not your first language)
-Problem-solving abilities, a strong work ethic, a reliable can-do
attitude and a desire to succeed in the transportation services industry

Information sessions are  being held at the College at 1764 Oxford St
E., at Third St., London

Wed March 20 at 7:00 pm  Room Z2005
Fri March 22 at 10:00 am Room Z1024
Sat Mar 23 at 10:00 am Room Z2005
Wed April 10 at 7:00 pm Room Z2005
Fri April 12 at 10:00 am Room Z1024
Sat April 13 at 10:00 am Room Z2005

 

Encouraging the next generation

By Lorenzo Pellicciotta

It was a rainy day in 1977, and my mother had come to my school for a parent-teacher interview. The vice-principal, Mrs. Skuthe, was telling my mother how poorly I was doing in school. “Big deal!” I huffed. “I don’t see how good grades will help me when I’m out of here!” She turned to me and asked what I wanted to be when I grew up. “I’m going to be a mechanic, like my father,” I said, figuring that would put an end to the argument. “All right,” she said. “That’s good. But tell me, what kind of mechanic do you want to be? Do you want to be the kind that works in a cold, dark, dingy garage, living in a small apartment, making enough money to buy a case of beer once in a while? Or do you want to be the best mechanic out there, working in a big, clean shop, making enough money to live in a big house and own a couple of beautiful cars?”


I’d never really thought about that. Her question really sunk in… and stuck with me over the next few years. Suddenly it was important for me to do everything to the best of my ability. I made it my mission to be the best I could be. Along the way, I won many trophies and medals. I graduated from high school with good grades in 1983, and I enrolled immediately in an apprenticeship program.


Three and a half years later, I was a licensed auto mechanic. Over the years, I’ve worked at three different import dealerships. In 1991, I won first place in a regional service technician competition. Moving on to the nationals, I placed third in all of Canada.


Being on top of my game and wanting more, I eventually decided to start my own business. In September 1995, I opened a 12,500-square-foot facility, doing both collision and mechanical repair. In April 2003, I opened a second location: a 19,000-square-foot collision shop. I now have 24 employees.


This industry has been very, very good to me. It’s paid for my home, cars, motorcycles, holidays… and all the other comforts people aspire to. Despite what some people say, I believe you can still make a very good living fixing cars. That will never go away. If a kid’s passion is to fix cars, then let’s encourage him or her to be the best they can be. If they go for it the way I went for it, they will succeed.


It really bugs me when I hear a parent say there’s no way they’re going to let their kid become a mechanic. They want to send their kid to university. But I know a lot of kids who've gone through universitry and end up taking starter jobs for 30k a
year. They could have done so much better in the skilled trades, if that was their passion!


Parents need to stop saying discouraging their kids from becoming automotive technicians. And we in the industry need to do more to welcome them into this wonderful trade. If that’s where their passion lies, they’ll be a great addition to someone’s shop. As long as there are cars, someone will have to repair and maintain them. And if they’re smart and have a passion for it, they’ll make a very good living while they’re at it!

 Lorenzo Pellicciotta is the owner of CarStar Oakville, in Oakville, Ont.

7 dead is reason for hoist training

Between 2009 and 2011, seven workers were killed while working with an automotive hoist in Ontario.

There were 69 critical injuries at auto repair facilities in the province during the same time.

These deaths and injuries were preventable.  The Ontario Ministry of Labour picked up their site visits and went to 7,452 shops during that period.

They issued 19,976 orders to garages. Clearly some work needed to be done in the area of hoist safety.

The Workplace Safety and Prevention Services Vehicle Sales and Service Advisory Committee is now looking at this issue as a training requirement and has the following questions:

1) What does the Committee consider important in the safe operation of automotive lifting devices?
2) What type of training is needed for technicians to safely operate vehicle lifts?  Theory, practical, on the job?  How would most workplaces provide each?
3) What are the most practical ways to provide this type of training to technicians in the shop?  Hands-on, internet , DVD etc.?
4) In the absence of any prescribed automotive lifting device legislative standard in Ontario, which standard(s) would be most applicable and recognized by the vehicle sales and service sector?

Shop comments can be directed to CIIA at 1 866 309 4272 or info@ciia.com

Automotive committee reviews WSIB

Representing nine key sub-sectors within the agriculture, manufacturing and service sectors, the Workplace Safety & Prevention Services (WSPS) Advisory Committees are comprised of leaders from more than one hundred Ontario businesses.  They are driven by a shared focus to contribute to health and safety in Ontario; identify existing and emerging issues and trends that can lead to improvements; and advocate on behalf of their sectors.

As part of a quarterly system report, WSPS Advisory Committees were given an update on the upcoming WSIB Rate Framework stakeholder consultation.  As part of their mandate to advocate on behalf of the sub-sectors they represent, it was proposed by the Advisory Committees that representatives from each committee convene to prepare a written submission at both WSPS mandate wide and sub-sector specific level.  WSPS was asked to support the facilitation of the discussion and the written submission to ensure consistency of approach. Advisory Committee members will review and approve all statements prior to submission.

Participants were asked to review the discussion paper by Douglas Stanley and provide feedback based on the needs of their sub-sector (not their individual organizations) and in consideration of the areas of focus identified in the discussion paper:  Employer Classification, Rate Setting and Experience Rating. To guide the thought process, participants are asked to consider the ideal future state:  What would be different?  What would the bridge to the ideal future state look like?

WSPS Advisory Committees have also requested an opportunity to participate in a regional public hearing. The leadership of WSPS is continuing to activate the voice of its customers in providing valuable insight and critical windows of opportunity to influence decision- making that affects your bottom line and future wants and needs in health and safety.

Apprenticeship Career Connection event attracts 7000 students

On March 6 at the Toronto International Centre, the buses kept coming in all day long.  The Apprenticeship Career Connection event organized by the Peel Halton Workforce Development Group welcomed over 7000 students
from elementary and secondary schools across the province to find out more about careers in the trades.

The collision repair industry was well represented with a booth and displays from your collision repair association, CIIA.

Included with the booth was the opportunity for young people to try out the laser paint spray gun that simulates a laser guided distance tool attached to a HVLP type paint spray gun to experience the feel of real life spray equipment and attenders could then simulate car painting technique.

As well, attending students were asked for their contact information to be supplied to their OYAP or Technology Head at their school to better help them to enroll in the auto body course offering in secondary schools or for on the job co-op training.

Attenders had a chance to win a free seat at the Basic Estimating six-night training course.

CIIA is always looking for volunteers to help us in attending youth events. Please contact the office if you can help.


Ten night evening industry events planned

Collision repair shop owners and managers from across Ontario have lots to say. Many are frustrated with their daily challenges and now CIIA is making available some 10 nights of evening meetings to hear from those managers and techs and find out from them the recommendations to make their lives better. Guest speakers will highlight new industry activities.

Starting at the end of April and running until mid-June the evening events are scheduled for : Ottawa, Windsor, London, Cambridge, Burlington. Concord, Oshawa, Barrie and Toronto(2). News updates will be forwarded to media and all shops as soon as the details have been completed.

Please check with the CIIA office for more details at 1 866 309 4272

 

CAPA parts return compensation

I want to remind and inform repairers of CAPA’s parts return program and the distinct benefit for the quality oriented shops who elect to participate in it.

As stated in CAPA’s website: http://www.capacertified.org/complaint.asp

 “The Complaint Program relies on consumers, auto body shops, part distributors, insurance adjusters and others for real-world input concerning the quality of part”

Aside from the Complaint Program, CAPA has another process by which many are finding additional compensation well worth the effort,. The program is referred to as: COM-VTF-Complaint  Vehicle Test Fit: You can find the following quote and more information on this program at: http://www.capacertified.org/vtfsup.asp#comvtf

Purpose: To verify the report of part complaints in the market, and provide CAPA and the manufacturer with the opportunity to analyze and correct any problems reported on a certified part.

Process: Upon receipt of a Quality Complaint form, CAPA will contact the complainant in order to review the complaint and if applicable, secure the complaint part for the purpose of conducting a COM VTF at the Validator’s facility. In addition to purchasing the complaint part, the Validator purchases a car company service part from the market. Both parts are fit on an undamaged vehicle and assessed for their overall fit and finish quality. If no defects are found, if previously requested, a CAPA VTF Technician will contact the complainant to attempt to clarify the noted defects and discuss the VTF outcome. A letter will be sent to the complainant advising them of the VTF outcome. Once the VTF is complete, regardless of outcome, a full report with digital photographs is provided to the manufacturer via a secure website. If defects are found, a joint investigation between the Validator and Participant will be initiated in order to determine the cause of the defect(s). Potential results of the investigation include decertification of the part or part lot, a corrective action request (CAR), or no action when the reported nonconformity was not substantiated by the investigation. CAPA reserves the right to decertify the lot number or the part number immediately, prior to investigation

 

Basically, as I understand it; the repairer buys CAPA parts and if and when they find quality issues with them, they complete a CAPA complaint form and request to send the part to CAPA. CAPA will then purchase the parts (at “retail price”) from the shop, provide a shipping crate/carton and CAPA pays for the shipping as well as for the shop’s handling of the part. Once received and tested, the shop receives notice from CAPA with their findings/results.

I’m not sure how long this CAPA parts return program will continue but I would like to see enough people participate and take full advantage of the program to where they elect to discontinue it because it is no longer economically feasible for them to continue.

I fear the reason for their offering this program may be to illustrate several things:

1.      The program attempts to validate CAPA’s concern for fit, finish and presumed function as a means to encourage legislature’s support.

2.      That during the years of the programs existence, only a small percentage of parts were returned (in comparison to those sold) suggesting CAPA parts are comparable (LKQ) to OEM. (due to repairer’s reluctance/failure to participate)

3.      Of the 30,000 shops using them, only a handful of shops (the renegades and mavericks) claimed defects and returned the parts.

4.      That of the parts returned, only a ____% were found to have fit issues…again, to discount those who returned parts and minimize the concern over them meeting the level of “LKQ”

5.      That this program was a voluntary program to illustrate the concern over aftermarket parts has been without merit.

Obviously this program was designed, developed and implemented to benefit CAPA and the manufacturers and distributors of parts they endorse. You may not know it but CAPA is funded by insurers, the largest financier being State Farm. We all know they didn't’t develop this program to safeguard the consumer or protect the repairer’s reputations. As such, I encourage you to share your experiences and the program with others so they too may participate and have their experiences and voice be heard by CAPA as well as enjoy the financial rewards it currently has to offer.

Some participating repairers are recovering much greater profitability from the program than they did before they participated. It also aids to document the issues with aftermarket fit and finish.

For more information on how you and your shop may benefit from the CAPA Part Return Program call 1-800-505-CAPA (2272) or visit their website http://www.capacertified.org/complaint.asp .

The 15% solution

Ontario's NDP party is pushing for a 15% reduction in auto insurance premiums for Ontario motorists.  It's certainly a hot-button topic for those that drive in the province.  A 15% reduction would save each motorist some $270.00 a year on an $1800 car insurance bill.

A Forum Research poll last month asked voters how they would feel if the NDP's Andrea Horvath forced an election unless motorists receive a 15% premium discount on their car insurance.  58% of the respondents supported her position.

Manitoba's former-premier Hugh Pawley, considered the "father" of public insurance in that province, uses the example of a 35 year old male in Toronto with a good driving record and driving a minivan and paying over 5 times the insurance premium as a driver in Winnipeg.  He urges a change to go to public insurance in Ontario.

Andrea Horvath complains that insurance companies are making huge profits out of the higher premiums charged in Ontario.  Insurance Bureau of Canada officials advise that profits for insurers are low and only make up for previous year's poor results.

Is Andrea Horvath right?  Let's check:

Desjardins General Insurance announced that their annual net income for 2012 hasrisen this year to $186 million from $128 million.

Co-Operators General Insurance reported net income for the year of $258 million compared to previous year profits of $150 million

Economical Mutual Insurance reports full year net income of $153 million up by $62 million

Intact Insurance also did well, with net income of $181 million this quarter compared to last years' $84 million  Intact's net operating income for the year was up $215 million to $675 million

So profits are up. Dramatically.

What about insurance company costs?

In testimony to the Ontario Standing Committee on Economic Affairs in July, Mr.Philip Howell, CEO of the Financial Services Commission of Ontario and Tom Golfetto, Executive Director of the auto insurance division of FSCO, laid out some dramatic cost reductions that insurers have enjoyed between 2010 and 2011.  The differences in per car costs to
the insurance industry from 2010 to 2011 were:

Accident benefits per vehicle(Down from $764.21 to $300.19)

Medical coverage per vehicle (Down from $271.14 to $99.21)

Attendant care costs per vehicle (Down from $94.53 to $36.84)

Housekeeping costs per car (Down by $62 to $8.58)

Medical examination costs per car (Down from $195 to $82)

Despite this some insurers have asked for authority to charge higher premiums-and they got them.

In the third quarter of 2011, State Farm Insurance asked for and received authority to raise premiums by an average of 3.16 percent. Then Aviva followed getting a 3.54% increase and TD with a 6.94 % increase

Even in the year 2012 some insurers requested and were approved to charge more for their car insurance. Aviva got a further increase averaging 2.40%, Intact got 0.52% and Wawanesa just received an OK to raise average
premiums by 4.87 percent starting in 2013.

No wonder motorists perceive insurance companies to be raking in extra profits at motorist expense!

Also, we can't find  any actual FSCO reporting for the 2-3 percent fees charged by at least one insurer for the cost of each automobile body repair part purchased nor the records on keeping an up to 5% of
the repair cheque sent to the repair facility for the "privilege" of the insurer simply sending repair work to the shop.

Assuming that Andrea Horvath and the NDP get their way (and the AG has asked FSCO to look immediately at premium reductions) while reviewing the NDP request for an even higher premium reduction, what does that mean to repair facilities?  You can bet that insurers will try and recover that 15% premium reduction by going after shops.  And for shops, a 15% reduction in their labour rates or parts profits is a serious matter.

For other insurance industry providers it may not be a problem.  For instance medical assessment clinic costs have risen by 158%.  A 15% cut for many of them will mean the clinic that FSCO reports filed some 98 fraudulent medical
claims a day now must go down to only 84 fraudulent claims per day.


Collision repair facilities, however, are under incredible press sure to stay alive and stay profitable.  Mitchell International reports that a vehicle repaired for an insurer in December 2011 is being billed out at a 1% lower price that an average repair done in Dec. 2004. Insurance costs for car repair that used to take up 18% of the premium
dollars in 2004, now only take up 10%.

While labour rates paid to repair shops by insurers in Manitoba and other western provinces continue to rise ($66.69 per hour this year in Manitoba), two of the major insurers in Ontario (who both requested and received
premium rate increases) in the  last two weeks have advised shops that their labour rate paid for repairs will decrease by $2 to $52 per hour. One insurer who uses a heavily promoted parts procurement program that often delays shipment of parts and causes the shop to take longer to complete the repair job is even asking the repair shop to pick up the extra costs of car rental on the basis that the insurer has no further budget for this, while rolling in extra profits.

If insurers do cut their premiums by 10-15%, the beneficiaries will be insured motorists. But only if they never have a car accident. The damage and fallout from a decision by insurers to get that money back will show up in abandoned repair facilities across the province.  Those facilities that have operated for years on the edge of bankruptcy as some insurers use heavy marketplace dominance to force concessions on repair shops, will have little option than to close.

Repair shops are not guaranteed the 12% ROE like insurers get in Ontario. Those repair shops that want to do the job correctly will be left behind in a race to the bottom.  When insurers demanded parts procurement programs in New Zealand in order to make money for themselves out of shop profits, margins on repair parts disappeared and shops ended up after seven years on the program receiving a 10% handling fee for parts.  In New Zealand the shops that
survived are called "bottom feeders."

What can we expect to see if insurers demand further concessions from repair facilities?

1) Safety becomes only a faint hope.  After the initial flurry of stolen parts and fraudulent invoices orchestrated by the  desperate shops, legitimate repair shops will be forced to install more used and aftermarket parts, use improper but faster repair techniques with unqualified, unlicensed but cheaper staff. Repairing a vehicle back to pre-accident condition, so that the vehicle responds in an after-repair crash in the same fashion as before the accident will not be an insurance company  priority.  Repair shops want to do the job right but can't get paid to do it.

2)Massive shop profitability loss, including "banner" or franchise shops, unable to pay their franchise fees. Large shops often make deals with insurers (called DRPs) -a discount structure offered or ordered by their insurer in
return for the promise of insurer car volume. Between decreased labour rates that would be demanded by insurers, fees to their franchisor, insurers demanding that parts only be purchased from those suppliers who guarantee the insurer  a special fee-the insurer will also take a "cut" from the cheque to the shop for the repairs of up to 5%. Shops will close. Managers and techs will lose their jobs.

3)Staffing retention failure and creative but illegal pay structures.  Forget about hiring apprentices, the shop can't keep their current staff. Wages will go down and shops will resort to a wide range of payment options to pay staff that are usually illegal. Staff will be asked to take a further wage decrease down to just above minimum wage in many shops for a licensed collision damage repair tech or told to become contractors.  Many good techs will leave.

4)  Huge numbers of shops will be up for sale- with few buyers.

A 15% premium discount sounds great until you are forced out of business by the "collateral damage".

Are you prepared?

Few collision repair facilities are prepared for the force of nature.  Are you prepared? Here is how you can prepare. Click Here.

Incentives and tax credits available

Grants and incentives can reduce the risk and cots of hiring new employees.  This new list updates some of the incentives available. Click here to see the list.

Testimony to Standing Committee

What’s happened, unfortunately, is that it has modified and now, because of the number of vehicles—if you recall, we didn’t get a winter and our shops were wondering if they could even survive that. But we have so little cars coming in now and will in the next little while—for as long as we can see, certainly, we’ll have less vehicles. What’s happening is the insurance company wants to drop the number of facilities. So they dropped the number of facilities—one company will go from 400 preferred shops to 150.

Where the challenge shows up is when the insurance company—and there are some in Ontario that are very dominant that have bought up other insurance companies. Because of that they have now changed their dynamics. So you have insurers in Ontario who are saying, “We now have marketplace dominance,” sometimes 40% or 45% of all policies written in this general area. “We’re going to tell you, as a shop, what you’re going to do. We’re not interested in your quality of work. We’re not interested in your competence or compliance. We just want the 10% off.”

We have one shop the other day that got notified by an insurer they’d been with for 20 years that they were leaving tomorrow—30% of their business would disappear; he’d have 30% less business. It was going to a shop down the road that offered them a 5% cheaper price. That shop did not have a licensed tech or any equipment to fix the car, but they still got the work from the insurer.

So the demands by the insurer now are different. The insurer sets the rules and says to the shop, “You’re going to do this or we will blacklist you. You will never get work from us unless you do these things.”

 

Businesses for purchase

1700 SQ FT Garage: Only $159,900, Located in Central Hamilton, Zone  "J J"     Industrial---Excellent work shop for many uses. Close to rail, shipping port, easy access to HWY's, to view contact Tony Nigro at: 905-574-4600

East-Mountain Auto Body Shop: Located in an industrial strip mall on a very busy street in the midst of a fast growing area, this is a rare opportunity. This business has been established since 1994, and now you can be a part of one of Canada's largest and fast growing franchise group. For further info, and to arrange a private viewing contact Tony Nigro at: 905-574-4600

 

Featured Ads