Ford responds to parts price criticism

Also at the meeting, Ford Motor Company at the most recent Collision Industry Conference (CIC) responded to a presentation at the previous CIC in which its price increases for parts covered under its design patents were criticized.

Dan Morrissey, a board member of the Automotive Body Parts Association, which represents non-OEM parts makers and distributors, had argued at CIC last November that allowing automakers to obtain design patents on parts eliminates competition and results in higher OEM parts prices, and he used a chart that he said showed that prices for seven parts covered under Ford's F-150 patent rose 20 to 81 percent from 2007 until November 2008.

At the recent CIC in Palm Springs, Calif., Paul Massie, powertrain and collision product marketing manager for Ford, acknowledged that some of the parts had “fairly substantial price increases percentage-wise,” but pointed out that others covered under the patent (but not cited in the previous presentation) had gone down.

“We do acknowledge we raised (prices) on five of seven (parts), but why didn't they show the decreases, too?” Massie said.

He listed a number of factors that play into changes in parts pricing, including changes in cost of raw materials, and whether a part is being made as part of an in-production vehicle.

He also used a chart to compare prices changes in twelve F-150 parts (including left- and right-side parts, and 2- and 4-wheel drive versions) covered under the parts patent to changes in the average price of corresponding non-OEM parts over the same period. That showed prices for the Ford parts rose 9.3 percent while the non-OEM parts prices rose 19.1 percent.

“If Ford's behavior was monopolistic and price-gouging, and if the evidence of that is price increases on design-patent parts, what was the aftermarket's behavior?” Massie said.

In other news and discussion at CIC in Palm Springs:

• Lou DiLisio, chairman of the CIC Database Committee, said that CCC Information Systems has asked the committee to help the company revise its data privacy policy. The move comes amid industry concerns as CCC and other information providers shift toward systems that store shop estimate and even shop management system data on the vendor's computers rather than the shop's.

"They have a 1-page (privacy policy) that talks about what they will and, more importantly, won't do (with data), and based on concerns that have been raised, they've asked if we would work with them a little more closely on developing a more enriched privacy policy," DiLisio said. "We applaud CCC for taking the initiation to work on that."

• Also as part of the committee's report, DiLisio noted that despite requests for several years that the estimating systems identify which replacement bumpers come unprimed from the automakers, "None of the information providers have addressed that in their system other than with a simple footnote." DiLisio said Motor Information System (whose database is used in the CCC estimating system) recently told the committee it was adding footnotes on the topic to its system, similar to those in the Mitchell and Audatex databases.

"We're looking for automation of the process, not a footnote," DiLisio said at CIC. "We are working on providing...a specific list - make and model - of what vehicles have unprimed (replacement) bumpers from the OEMs, so we don't have to do the guessing game. The information providers should include that data in their systems."

• Participants at CIC also voted by a slim margin to hold CIC's November meeting in Las Vegas the week it had been scheduled rather than move it to October in conjunction with the rescheduled NACE. Proponents of the November meeting pointed out that organizers of the Specialty Equipment Market Association (SEMA) show held that week had offered CIC meeting space and flexibility as to when during the week CIC was held. Because NACE runs from Sunday-Wednesday this year, a CIC held during NACE week would have had to be on Thursday, pushing other groups that hold meetings in conjunction with CIC, such as the National Auto Body Council, to meet on Friday. The final vote on the decision, following more than 30 minutes of discussion, was 71-65 in favor of the November meeting.