AFTERMARKET PARTS SURVEY
CBC Marketplace report on fake airbags
KEYSTONE AUTOMOTIVE INTENDS TO CONTEST PRELIMINARY RULING..
Part decertification and recall notices are provided only for parts that have been originally certified by CAPA ( Certified Automotive Parts Association). Canada has no procedures at the present time to notify or recall defective aftermarket collision repair parts. A report on this issue is available at "Finished Businesses" For Original Equipment Manufacturer (OEM) recalls and some recalls of defective aftermarket mechanical parts please see our Transport Canada site link under "Links" on the opening page
 
 

Keystone Automotive intends to contest preliminary ruling on Ford patent complaint

Keystone Automotive Industries, Inc. has stated that the company and other respondents intend to vigorously contest portions of a preliminary ruling issued on December 4, 2006, by an administrative law judge of the United States International Trade Commission in a complaint initiated by Ford Global Technologies, LLC against the company, another distributor and certain manufacturers.

The judge ruled that seven of ten design patents directed to parts for the Ford F-150 truck were enforceable and infringed Ford's design patents, but agreed with Keystone and the other respondents that three patents are invalid due to Ford's prior public use of the designs.

The judge did not accept the respondents' further arguments that Ford's prior public use and other conduct also render the remaining seven patents invalid and unenforceable, and that even if valid, none of the ten patents is infringed. Consequently, he ruled that the importation of automotive parts covered by these seven patents violates Section 337 of the Tariff Act of 1930, as amended.

This ruling will be reviewed by the International Trade Commission, which must issue its ruling on or before March 5, 2007.

"We believe the decision invalidating three of Ford's patents is correct, but incomplete and that all of the patents are invalid, unenforceable, and not infringed. We, therefore, intend to vigorously pursue our appeal rights," said Richard Keister, president and chief executive officer of Keystone Automotive.

The seven patents in question cover 13 parts sold by Keystone, which represents less than 0.1% of sales on a trailing 12-month basis. However, Keystone cautions that, depending upon the nature and extent of any adverse future rulings, Ford and other automobile manufacturers may attempt to assert similar allegations based upon design patents on a significant number of parts for other models, which over time could have a material adverse impact on the entire aftermarket collision parts industry.

Keystone Automotive Industries, Inc. distributes its products primarily to collision repair shops. Its product lines consist of automotive body parts, bumpers, and remanufactured alloy wheels, as well as paint and other materials used in repairing a damaged vehicle.

(see headlines)

Auto insurers can access cheaper replacement parts

Parts Direct, the wholly owned subsidiary of AutoWorks International Ltd., has fully designed, developed, and tested its PartScan software so that it is now available for 'live' installation and network systems integration with insurance company clients.

Testing of the software was implemented in order to ensure efficient functionality at the automobile repair facility and wholesale parts distributor levels.

"Live, in house product and services demonstrations have been requested by several automobile insurance companies and a provincially operated mutual automobile insurer in Canada," Brad Brock, president of Parts Direct, says. Parts Direct offers an on-line automated service bureau allowing insurance companies to use the PartScan technology and related services to purchase replacement parts at a significantly lower cost than through automotive repair facilities. The replacement parts are ordered for the insurer by
PartScan directly from the wholesale parts distributor and 'drop shipped' to the appropriate automobile repairer. PartScan's accounting system then invoices the automobile insurer directly for parts purchased and services provided.

This procedure is different from current industry standard practices, where each individual automotive repairer purchases and invoices the insurance companies for the full retail value of these parts.

The size of the automobile repair industry in Canada is estimated to be $2.8 billion. The automobile repair market encompasses the total costs incurred to repair damaged vehicles. Parts and labor are the two major components involved in vehicle repair, with parts comprising approximately 45% of the total cost of repairs. The aggregate value of the automobile replacement parts market in Canada is estimated to be $1.26 billion.
AutoWorks International Limited is an international software design, development and services provider.

(Courtesy of Canadian Underwriter)

(see headlines)

Friday, Oct 7, 2005

CAPA Announces First Lighting Parts to Achieve Certification

The Certified Automotive Parts Association (CAPA) announced that TYC, one of the world’s largest manufacturers of aftermarket lighting, has certified four of their parts to the CAPA Lighting Standard 301. The certified parts are headlamps for the Ford Expedition 1997-02 and tail lamps for the Jeep Grand Cherokee 1999-02.

In order to achieve CAPA certification, lighting products are tested for fit, form, appearance, composition, coating performance, mechanical properties, adhesives, fasteners, hardware, photometric performance, electrical performance, aiming performance and compliance with Federal Motor Vehicle Safety Standard 108. CAPA 301 requirements also call for demonstrated ongoing compliance to all of these requirements, including FMVSS 108.

“TYC compliance with the CAPA 301 Lighting Standard enables the market to confidently identify high quality, fairly priced alternatives to car company brand lighting,” said Jack Gillis, Executive Director of the non-profit association. “TYC’s ongoing commitment to CAPA certification indicates a strong company commitment to quality. That commitment will not only serve them well, but provide the American consumer and the marketplace with both quality and choice.”

In July, TYC was the first lighting manufacturer to join CAPA after participating in an earlier program offered by CAPA to introduce lighting manufacturers to the CAPA certification program in January of this year.

DEPO Auto Parts Ind. Co., Ltd, and Eagle Eyes Traffic Industrial Co., Ltd., also announced their participation in the CAPA lighting certification program. DEPO alone currently produces almost 3000 different lighting products for the U.S. market.

Illinois Supreme Court Overturns Avery vs State Farm, Non-OEM Parts Suit

After almost three years of deliberation, the Illinois Supreme Court issued its decision overturning the billion dollar Avery vs State Farm suit alleging that the insurer deceived policyholders by specifying the use of non-OEM parts for collision repairs.

Because of differing language in different policies, the court ruled that a Williamson County Circuit Court erred in certifying a nationwide class in the Avery case.

In the1999 case, a jury had decided in favor of the plaintiff resulting in a judgment against State Farm amounting to over $1 billion. In 2001, the 5th Appellate Court affirmed the ruling, leaving State Farm liable for $1.056 billion.

The Supreme Court issued its decision Thursday morning.

Download the 82 page Supreme Court decision (in Adobe Acrobat format - 231k)at:

http://www.collisionweek.com/cw/graphics/2005-0818-SFDecision.pdf

GM Says Insurance Policy is Key to Avoid Non-OEM Parts

In a new public release, General Motors is warning consumers that their insurance coverage may not provide for the replacement crash parts they want. The OEM says that insurance policy coverage often is limited to repairs that use "like kind and quality," "certified" or "functionally equivalent" parts. These are parts intended to cost less than OEM parts, and there is reason to beware, the automaker said.

Pointing to the recently released impact tests conducted by GM (see related story below), the carmaker says there can be big difference between aftermarket parts and genuine OEM parts. "When a customer purchases genuine GM collision parts, they are getting replacement parts made with the same engineering requirements, materials, construction methods and tooling as the original parts," said Bob Clark, director, Collision Business Line, GM Service and Parts Operations. "These OEM parts also were tested on the
vehicle to assure compliance with applicable Federal Motor Vehicle Safety Standards."

Aftermarket parts are produced through a reverse engineering process and are typically not tested on a vehicle to assure that they maintain the vehicle's compliance to applicable federal safety standards.

To demonstrate that imitation parts can sacrifice vehicle performance, GM conducted tests on some aftermarket parts that the company said are typical of aftermarket parts requested by many insurance policies. The tests involved two identical 2001 Chevrolet Cavaliers and followed the Insurance Institute for Highway Safety IIHS 5 mph rear-into-pole impact protocol.

"These tests proved the tested parts were inferior to the OEM parts they were intended to imitate, and were neither functionally equivalent nor of like kind and quality," Clark said.

"The bumper performance test results reinforce the findings of sheet metal comparison tests we performed in 2002 - aftermarket crash parts may look similar, but may not perform to the standards of genuine GM Parts," Clark said.

GM says that insurance coverage is key and that many consumers aren't aware that their insurance coverage may allow use of aftermarket parts. One of the easiest ways for consumers to ensure they get the highest quality parts, GM concludes, is to choose an insurance policy that assures use of OEM parts.

(Courtesy of CollisionWeek)

Insurer Restrictions on Lighting Replacements Escalate after CAPA Report

The Automotive Service Association (ASA) has praised the Certified Automotive Parts Association's (CAPA) release of two studies on automotive replacement headlamps and their compliance with the Federal Motor Vehicle Safety Standard (FMVSS) 108.

FMVSS 108 provides standards for the performance of automotive exterior lamps and reflective devices and is required for both original equipment manufacturers (OEMs) and the aftermarket replacement companies.

According to CAPA's study, 87 percent of the independently manufactured replacement headlamps tested in two studies failed to conform to FMVSS 108 photometric requirements and 10 percent of the OEM replacement headlamps failed.

At least five major insurance companies have issued notices to their direct repair program participants restricting estimates as far as the use of aftermarket headlamps and reflective devices.

"The Automotive Service Association appreciates CAPA's efforts in their formal review of specific crash parts. It's unfortunate that the National Highway Traffic Safety Administration has not taken the initiative reviewing replacement crash parts being required in the repair of American automobiles. CAPA is to be commended for taking the initiative with these
reports," said Bob Redding, ASA Washington, D.C., representative.

These reports can be reviewed on CAPA's Web site, http://www.capacertified.org.

Thanks to INSIGHT

MQVP Inc. Questions the CAPA Lighting Study

ROCHESTER HILLS, Mich. –

CAPA earlier released a document that reported findings from two compliance tests conducted on four part numbers of OEM and Independently Manufactured Automotive replacement headlamps. Due to the negative nature of this report, and conflicting recent testing results from competing independent labs, CAPA should withdraw its report or defend it by open and full disclosure.

“MQVP® was mentioned in the second study dated May 13, 2004, so we felt compelled to review the findings,” said William Hindelang, President of MQVP Inc. “MQVP Inc. requested from CAPA a full and open disclosure of all information surrounding these studies,” said Neil Stolman, Director of Operations. Stolman added, “We have sent 13 certified letters over a period of 6 weeks to Jack Gillis, Executive Director and members of the CAPA board. To date we have received no substantive, accountable response. All certified letters were signed for and confirmed receipt by the postal service tracking system.”

CAPA’s interest and motivation behind this study may not be unbiased. Independently produced automotive replacement lamp manufacturers are not in the CAPA program and the two manufacturers in the MQVP program have resisted endorsing the CAPA 301 requirement as unnecessary. One has to wonder why CAPA would perform such a test on parts not in their program knowing that this issue would cause a negative reaction within the industry. Information provided in their report raises more questions about their own tests than they answer.

“Why would CAPA hide? What would CAPA hide?” asks Hindelang. He added, “Their web site says they are a Not for Profit organization with a mission to be a consumer advocate and ‘promote price and quality competition in the collision parts industry, thereby reducing the cost of crash repairs to consumers without sacrificing quality.’” Unless this study’s results can be accurately and completely replicated, this is possibly just fear mongering. These and other independently produced parts previously passed DOT, FMVSS 108 requirements, and the manufacturers have some recent confirming “pass results” from independent labs. “If lamps have a potential to be out of spec, we want to know and react accordingly, for both quality and, more importantly, safety concerns,” stated Neil Stolman.

Essentially there has been no timely response of commitment from the CAPA organization to assure MQVP Inc. will receive open and full disclosure of the facts leading up to conducting and publishing the study on the internet. There are rumors of disagreement in the ranks of CAPA technical committee and their board over the results and approval of this study.

If CAPA believes firmly in both their actions, motivations, and the accuracy of results of this test project, then they should be agreeable to an open and full disclosure. MQVP suggests that CAPA should be willing to submit to a review by a panel of experts from the OEM and Aftermarket industries. A member panel should include an OEM and an Aftermarket product expert, a lab calibration and certification expert, a statistician, a FMVSS 108 and photometric expert, and a safety product engineer. “If CAPA won’t agree to such an independent review or withdraw their study, then CAPA’s intent and motivation should be obvious and the credibility of the study findings should be discredited,” stated Hindelang.

MQVP Inc. is an ISO registered information systems and quality management services firm. MQVP Inc. provides supplier qualification based on current OEM and auto industry methodologies, and international quality systems standards. The services include quality assurance tracking and traceability systems to members of global supply chains. They are located in Rochester Hills, Michigan. Their website is www.MQVP.com.

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