By Jeff Sanford
Toronto, Ontario -- November 21, 2016 -- Pfaff Autoworks held its annual Insurance Open House, drawing attendance at least four times greater than what it was in 2015. This year's event was held in association with Collision Industry Information Assistance (CIIA).
Attendees gathered at Pfaff's high-end repair facility in Vaughan. Representatives of Volkswagen-Audi, BMW, Porsche, Toyota-Lexus and McLaren were on hand to discuss and demonstrate the latest techniques in high-end collision repair. A master Audi tech demonstrated how to reset modern lane departure warning systems and on-windshield displays; a Porsche-certified tech showed how to replace the front clip on a Porsche 911.
Attendees also had a chance to win a free OEM training session from Volkswagen, Audi, BMW, Porsche and Toyota, each of which raffled off a training session. Techs and owners from various shops came together to enjoy the buffet and some industry chat.
“It's a chance for everyone to come out and learn something,” says Jeff Pabst, General Manager, Pfaff Automotive Partners. “We spend a lot of time competing against each other. It's nice to get together and talk.”
Discussing some of the exotic vehicles on display on the floor of massive and sophisticated Pfaff facility, Pabst showed off the new BMW i3. BMW sent over a naked version of the carbon fibre body used in the car. The body gets rid of the B pillar altogether, with the doors opening forward and backward to allow the entire side to open up. Another impressive auto is the new Audi Q7. “The new version is 41 percent aluminum,” says Pabst.
The company had a new Audi Q7 in the shop that had recently been in an accident. Techs had opened up the body to show the damage on the aluminum frame. Pabst pointed out how the material bends in a way that is different than traditional steel.
“It's interesting. The force has a different way of travelling through the metal. You have to look at it a different way. You have to develop a different eye to repair this,” says Pabst. “It's a completely different way of doing repairs.”
Kicking off the formal part of evening was Mike Anderson, the top-ranked presenter from industry consultancy, Collision Advice. Anderson discussed the big trends and developments among the OEMs.
“Hoods and trunk lids are going aluminum. We'll see carbon-fibre for struts,” says Anderson. “Eighty-five percent of hoods will be aluminum by 2018.”
An issue that will continue to emerge over the year ahead is the debate over pre- and post- repair scanning. “I don't care if you're at an insurance company or at a shop. We have a vested interest in scans. Cars are more complex than ever. We have to do this,” says Anderson. “Everyone is feeling so doom and gloom about self-driving, but that's a long way off. That's not going to be in our generation. The most important issue right now is scanning. BMW has on-window information. You have to make sure that stuff is repaired correctly.”
Anderson notes that OEMs are coming out with score cards and beginning to talk about more formal procedures. “Chrysler came out with strong position on scanning. Nissan has issued a strong statement. Toyota requires it now. Ford has also put out a statement,” says Anderson.
How these scans will be paid for between collision repair centres and insurance companies is being worked out. According to Anderson, “Some wonder if shops are taking advantage of scans. Insurers don't mind paying for scans. But want they want it to be 'fair and reasonable'.”
On the other hand, high-quality scan tools are expensive, and so shops will have an important interest in being fairly compensated. As it is, insurance companies are generally looking at scanning on a case-by-case basis right now. “They don't want to commit to a set cost,” says Anderson. “They're going to say it depends on car and the issue. Each case is unique.”
Anderson warns that when it comes to scan data, collision repair facilities need to get the permission of owners to release that data to a third party. “Customers don't want to hear after that you sent their data somewhere. Get signed consent first,” says Anderson.
Anderson notes that the insurance industry is going to have to change in the years ahead. As it is, insurance companies are in a tight spot right now. The basic business of an insurance company is to take in premiums and then invest that money to generate returns to pay out claims. The massive investment portfolios that insurance companies manage have a large bond component. But interest rates are at historic and weirdly low levels, so the returns on bond portfolios are unexpectedly low.
At the same time, the cost of repairs is skyrocketing as cars evolve through a unique period in which vehicles are becoming large computers. The business environment is a tough one for insurance companies. They are going to have to make more money from their products as investment returns dwindle.
“The insurance industry is going to change. The younger generation doesn't mind being monitored. And so you'll see a greater use of telematics. You're going to see a lot of rewards and perks offered for good driving,” says Anderson. He also predicted that insurance companies will offer policies to small groups of “five and six people.”
As for the business climate in the collision space Anderson said that he finds himself thinking, for the first time, that dealership-focused collision repair shops have an advantage in the current business climate. “For the first time in my life I believe a dealership is a benefit. A bet on dealerships is a good one,” he says.
Anderson also predicted that we could see another of the so-called Four Horseman (one of the four large banner chains consolidating the American industry) move north of the border in the year ahead. Boyd Group is one of these groups, and of course is headquartered in Winnipeg. “I bet we'll see Calibre Collision come into Canada,” says Anderson. “They'll come to Toronto first.”
Anderson also predicted that computer-assisted, “predictive estimating” will be more common in 2017. “First notice is reducing from days to minutes to seconds,” he says. “I guarantee you will see four OEMs come out with predictive estimating next year. The German manufacturers will lead that. It's already in the US. It's going to come soon to Canada.”
After Anderson's presentation the crowd split up to take in the various sessions with OEMs. Perry Mason of Pfaff Autoworks was on hand to demonstrate the latest techniques for recalibrating a new driver assist feature, in this case the lane change assist function. An instrument set behind the car reads the radar signals coming off the car to reset and recalibrate the function. The tech triggers the signal by tapping into the car's computer. Lasers are used to align the system. “It takes about an hour,” says Mason. Welcome to the new, advanced and more sophisticated era of high-end collision repair.
Also on the floor for the event were a couple of McLarens. Porsche brought in a car that races on the Toronto Indy weekend. The tech who works on the car describes some of the tight, overnight repair jobs done on the car to get it ready for a race if it’s been banged up in trials. Race rules prevent any repair that requires more than 2 millimeters of a filling compound. So techs can find themselves working overnight to get the body in shape for the race in the morning.
“You have to be ready for that green light,” said the tech. He noted that the car company now has six different lines available in Canada. This is up from three just a few years ago.
Representatives of BASF and 3M were also on hand to discuss OEM applications.