All posts filed under “Electronic Technology

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Non Payment for Electronic Diagnosis – Industry Culture Overrides Logic

One of the first steps in understanding the damage caused by an accident (and a mandatory step in determining the repair needed) is the pre-repair electronic scan of the vehicle’s systems and modules.

Many insurance companies take the position that they will pay for this step if any damage codes are found, but will not pay if there are no codes that can be attributed to the accident.

When I describe this stance on payment to anyone outside of the collision repair industry they are amazed and find it very hard to understand the logic. If you go to the doctor with a health complaint; the doctor sends you for a blood test or other diagnostic and the tests come back negative. That is probably good news but you wouldn’t expect to not be charged for the test. So why would it make sense to anybody to not pay for a diagnostic test on a car because the test results show no damage.

The answer lies in the culture of the repair industry, which has been built up over 50 years and still serves many participants well. That culture is that payment is made only for actual physical repair; nothing else is paid for. This worked well enough when diagnosis involved little more than looking at the damage and making a few quick guesses on what was needed for the repair.

When electronic measuring became an accepted part of the repairer’s tool kit the time spent on this measurement was not paid for. However, if damage was found set up time could be charged, which would cover the time spent on diagnosis. This worked reasonably well because in most cases it was possible to see that some damage existed and measuring was needed to confirm what was very likely to be there.

It started to work less well as cars began to be built more accurately and needed equally accurate repairs. Visual inspection did not always reveal damage; the repairer was now at risk of spending time on diagnostics and not getting paid if he could not find damage.

This is the background and current reality; nothing gets paid for other than actual repair. Electronic issues are invisible and can be caused by a very wide range of incidents or events; there is no visual check to determine if it is needed or not. Not checking before the repair starts compromises the repair.  Despite what the sellers of equipment claim in their promotional material this diagnostic work cannot be left to the least experienced and lowest paid staff member. The equipment costs money, the software licensing costs money and the analysis of the results requires a high level of skill.

The insurance companies are not paying for it because they are clinging to a model that is outdated.  As long as they have power over the repair side, based on asymmetric size and market control they will not be in any hurry to change this model.

They will change when they have to but not before. The ‘have to change ‘will come when the problems caused by the old model become too expensive.  However, this ‘have to change’ recognition will not come when the change is needed, but sometime after it should have been implemented.  It will then be implemented with some urgency and hit a repair industry that is not well prepared (the repair side is stuck in the same old culture.)  By refusing to accept the need for change and allowing it to be introduced gradually we are setting up for another long, inefficient and expensive transition

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Windshield Replacement and Calibration

There was an article posted by CBC last week about a car in Newfoundland that tried to steer itself into the oncoming lane after a windshield replacement.

http://www.cbc.ca/news/canada/nova-scotia/camera-directed-car-toward-oncoming-traffic-after-windshield-replacement-man-says-1.4715817

The driver, while very surprised, had an easy time taking control and there was no collision or other damage. According to the article he had not been told clearly that a system calibration was needed after the windshield replacement.

The facility replacing the glass would have known that the calibration was needed but they also know that they do not get paid by the insurance company to manage the calibration process, with the result that it becomes a cost to the company. They will get reimbursed for the cost of the calibration, but they get paid nothing for the time spent getting the car to and from the dealership for the calibration or for the phone calls needed to set up the calibration appointment.  This post from November 2016 goes into some detail.

A Current Reality – Correct Repairs are Not Easy

It is easier and to either ignore the calibration, or tell the customer that they should take the car to the dealer for this work.

The insurance company paying for the claim would also have information that the calibration was needed. Insurance companies are quite good at catching a $75 charge for a part that could be bought on the aftermarket for $50. This suggests that their internal systems are well set up to track how claims are managed and submitted. They have to pay for calibration in many cases and these numbers must be tracked as well. So why do they not flag a submitted claim that does not have the calibration included?

For both parties above, the repairer and the insurer, there is to date no financial incentive to doing the truly complete repair. This Newfoundland case cannot be the only instance of missed calibrations which means that repairers and insurers have been getting away with it until now. They will continue to get away with it for some period of time, but as more owners become aware of how their cars are designed and how they have to be repaired the getting away with it will not be as easy.

My sense is that owner awareness is building.

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Something New and Who are You Going to Call

In the past few weeks and months I have been seeing a slowdown in the amount of new information related to Next Accident Ready repair. At the same time there does seems to be a lot supporting or collaborating the information and concepts that were being discussed last year. This tells me that those who were working actively with the principles of Next accident Readiness last year will be ahead of the curve as it becomes fully understood and accepted by all parties.

I do get information from sources other the John Huetter at RDN, but his daily articles are my first look every day. Today, March 17, he has written a very interesting piece about OEM parts and a major Australian insurance group.

FCAI praises ‘strong signal’ on OEM parts from major Australian insurer IAG

The one sentence synopsis is that OEM parts seem to be good for everyone involved.

In the something new department, there was a short quote attributed to the insurer IAG that included ’….repairers will benefit from strong technical support.’

This is an example of what seems like an incidental comment causing a flash of understanding.  Cars are getting far more complex and we have to check repair procedures on each repair, but if there is some ambiguity or uncertainty who do we call?

If you have bought the part on the aftermarket good luck with any call. If you have bought all the aftermarket parts you could and only one or two technical parts from the OEM that you will maybe get a response from the OEM. If you consistently buy all, or at least most, parts from that OEM they will take your call and offer support.

The car will be repaired and calibrated properly, your customer will be happier and safer and, while maybe not right away, in the longer term the insurer will be happier was well.

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OEM Requirements for Vehicle Code Scanning – Tension between Industry Participants

This article from Repairer Driven News reviews a panel discussion last week at the SEMA conference and trade show. I was at the session myself and felt the tension that is hinted at in the article, between manufacturers and insurers with repairers and vehicle owners caught in the middle.

It was clear to me that the instructions for the panel members were that they were only to provide information and not discuss who is to pay for the required actions that flow from this information.  Manufacturers are saying that with modern cars these procedures are needed, but the insurance companies are resisting implementation.

Justin Miller of Nissan took a deep breath and went as far as he could to express his frustration based on his participation in a previous panel at the 2016 NACE conference “some of the insurance partners had mentioned … By saying ‘all,’ we weren’t kind of being clear enough.”

That quote captures the current situation; none of the insurance companies want to be the first to move because then they will be the first to need to increase rates.

This second article is taken from Claims Magazine May 1016 issue. In this article the writer who as an appraiser is one step closer to the insurance industry discusses the importance of scanning.

He is writing in an insurance industry magazine which suggests that the insurance industry is starting to recognize the need for this work. Starting to, but they are not there yet.

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Report from SEMA 2016

This post may come across as very vague, but only three paragraphs are being used for something that could go on for pages, which no one would read.

SEMA is the Specialty Equipment Manufacturers Association and despite its name has become the operator of one of the two major showcases for collision repair equipment, technology and education. There is a significant, almost overwhelming trade show floor and four days of seminars and presentations on a wide range of topics.

After the first day, I am encouraged by the information I was taking in. There was nothing that suggested the themes and issues highlighted in previous posts are wrong, but there is a hint that progressive operators may be able to find a way through the chaos of the technological change that is happening.  Words like culture, scale, documentation and training came up in different presentations. The path forward will not be presented in a simple way that everyone can follow, because at this time the path forward is not yet known.

The indicators are there however that those who are ready to participate in the development of the way forward will be able to collectively get to a point where cars are being repaired to true pre-accident condition.

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It May Cost a Lot But That is Only Part of the Problem

A friend in Ontario sent this link to a Province article by Mike Smyth. Yes the wonders of the internet, he is in Ontario, I am in the lower mainland but he saw the BC article that I missed completely.

Mike had a point to make about expensive parts being one reason why insurance costs are rising and he made that point accurately.

However, his article invites a bit more comment; the cars need to be repaired correctly. A broken headlight is easy to see, and the cost of replacing the light can be determined. With the Mazda example the new light gets put in, aimed, high and low beam checked and away you go, with the insurance company paying close to $2,000. But did anyone check if the lights have Auto Dimming or Active Cornering Response and do these features need to be recalibrated. The camera behind the Camry windshield may turn on and send information, but if it is not aimed correctly it will send the wrong information and the auto braking feature will not be there for you the next time it is needed.

To continue the example of how carefully repair procedures have to be researched before repairs start, I have no idea if Mazda 5 headlights have any auto features (I made up the Active Cornering Response phrase, but it sounds as real as Lane Watch which is a current Honda feature) and I don’t know if the Camry camera controls Auto Braking. I would need to go to one of a few sources of information to determine if these features are in these cars or not. If I think I know because the last Mazda 5 we worked on did not have these features I am getting it wrong, one trim level difference and many almost invisible features can be included.

And as a fun comment on the Tesla that Mike led off with. I hope ICBC sold that with solid documentation to keep it from being registered after repair. My guess is that it will be repaired, because there is no market for Tesla used parts and whoever bought it will figure out a way to register it somewhere. If Tesla thinks it can’t be repaired they will not supply parts nor technical information so whoever does the work will be improvising and whoever buys the car will not be buying a Tesla but something that could be a called a TesLike. That car will definitely not be ready for its next accident.

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Complexity in Every Car

How complex? This July, 2016 Honda Position Statement quickly becomes overwhelming reading, but it is a very real example of the issues that must be looked at for a complete Next Accident Ready repair.

If you do read through it you will see that it addresses only issues of electronics. In addition to the electronics that must be correctly incorporated into the repair plan the 2016 Fit in the photo has sophisticated zones of high strength steel that must be properly identified and understood for safe collision repair.

rfina

 

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More Change in the Next 5 to 10 Years than in the Last 50

Mary Barra, the Chairman and CEO of General Motors, made this presentation at the 2016 World Economic Forum in Davos. In it she talks about the changes that GM and other manufactures were planning at that time. The key point was ‘there will be more changes in the next 5 to 10 years than there have been in the last 50 years.’

Five years on in 2021 we certainly have seen more change than we had seen in the previous 50 years and the industry is struggling with the new reality.

Peter Sziklai

The Next Revolution in the Auto Industry

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Ready for its Next Accident?

We are truly in a period of rapid change in vehicle technology.  A 2016 or 2017 vehicle may look to the owner like a newer version of a 2010 but below the surface there have been many changes in very important areas.

The physical structure of today’s vehicles and the electronics supporting the safety features are both vastly more complicated than they were 5 years ago. These changes are dramatic and not just an evolution in vehicle design

This 2016 Fit is a very safe car but it has to be repaired with 2016 knowledge and equipment to be Next Accident Ready

Correct repair of these dramatically more complex vehicles requires very different methods from what the both the repair and insurance side of the collision repair industry have been using for the past several decades.  The move to these new methods has started, but at the start of 2017 the industry is still dominated by repair methods that have been in use for 20 years.

A vehicle that has been repaired with outdated methods and equipment will meet the current measures of success; on time delivery of a clean and shiny car at as low cost as possible. Safety is talked about but it is not yet measured or regulated.

If this clean and shiny vehicle has been structurally compromised with incorrect repairs it will in most cases drive as well as before the accident but it will not be Ready for its Next Accident.