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The week of July 06, 2009
Some Good – Some Bad
by Dennis Liphardt

The future of the collision industry should be interesting to watch as the bad economy and new technology will affect you entire operation. To cover all the factors that you deal with might take a small book so this morning we will only deal with two, the results of all the dealers being terminated by the manufacturer and the new safety items designed to reduce the number of accidents in this country.

The impact of thousands of dealers losing their franchise will create some benefits and some problems for repairers. If these dealers all close their doors, as most of them will, the opportunity for a shop to acquire one or two excellent techs is great. Or is it?

Most of the dealers who close their doors probably participated in a variety of DRP programs. If these dealers are gone there will be tremendous opportunity for any of you to expand your DRP network. Or will there be little or none?

Think of the additional repair jobs that will be available with so many dealers out of business. You might be able to increase you total volume by ten or twenty percent if a couple of those dealers are near you. Or will there be less?

The first two questions are comparatively easy to answer. Of course my answer is purely speculative, but that is true of anybody who ventures into predicting what will happen in the future. If I'm right I can play "I told you so", if I'm wrong I can depend on most everybody forgetting what I had predicted.

Regarding all the new techs that will be available, yep, there will be plenty of them, but maybe only one or two per dealer that are better than the average technician in most shops. Dealers like most independents have one or two "class A" techs. Those will be the ones that are truly marketable. They will also have their pick of where they go. The shop with the best pay plan, greatest amount of work and most benefits will have the best chance of gobbling up these people. The rest will find jobs replacing a borderline employee at another dealer or independent. Those that are replaced or those from the terminated dealers that can't find jobs will be added to the growing number of unemployed in this country. When this happens you can expect an increase in the back alley garage business as these people try to pick up a little under the table cash. Naturally this will thrill all legitimate shop owners who just love back alley garages.

What happens to the DRP programs that any of the terminated dealers participated in is really anybody's guess. Some insurance companies who already think they have too many shops on their programs will simply not replace them. On the other hand if the terminated dealer was doing a lot of volume with an insurer there should be an opportunity for one or two shops to fill that void. So depending on how you market your operation each of you should have a chance to fill the void.

New technology and the wishes of the present "administration" will have the largest affect on business. Obama wants alternative sources of energy to fuel our cars of the future and the driving public wants safer vehicles. New cars that run on batteries, corn oil, sour mash or garbage will require new knowledge of the "powertrains" that drive these vehicles. Being able to handle the mechanical repairs of these cars will make a big difference between you getting the job or losing it to the dealer down the street who has received factory training. So spending money on training will be very important for you and your techs. Even more than it is today. The sheet metal, aluminum, or plastic parts shouldn't really create any problems you can't overcome; you have handled this stuff for years. Because of increased cost of repair that will come with the new technology the industry may see more totals than they do today (if that is possible).

The push for safer cars is scary. Is it possible to design and build a car that because of technology CAN NOT have an accident. I don't think so, but there an awful lot of people trying, and some of the new options that are available will certainly reduce the number of accidents. Rear end cameras or warning signals will prevent many simple parking lot accidents. Mazda's "blind spot monitoring" system will certainly reduce a number of accidents. Although "like" how many Mazda's are on the road? Laser-radar braking available on some Volvo's will reduce accidents. Mazda also has lights and chimes that go off if another car gets too close. Hummm, maybe there will more Mazda's on the road. Mercedes offers and option that will help prevent drivers from falling asleep at the wheel. Mercedes also has a feature that detects if the car is drifting into the next lane. I'm telling you if the manufacturers want to sell parts they better stop making these cars so safe that accidents are impossible. Of course there is still hope as long as people "text", talk on cell phones, put on make-up or read the paper while they drive. And just yesterday I yelled at a woman who was texting while driving. I have to learn to keep my mouth shut!

How about you, what do you see in your crystal ball?

 



NOTE: This editorial expresses the opinions of its sole author only and does not necessarily reflect the opinions of Autobodyonline, or any of its subsidiary companies, clients, or supporters.


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