IAG's online blockbuster

News

In a move that is seen by most NSW repairers as the most significant in 30 years, IAG will commence its WRM system of online tendering on July 1, 2005. Through its retail brands in NSW, which include NRMA and CGU, IAG now faces the formidable task of convincing its network of preferred smash repairers (PSRs) that they will benefit from the change from the current allocation system. While customers who have not paid an extra premium to exercise a choice or repairer could find the new system more convenient, and maybe eventually cheaper through lower premiums, most repairers appear to be apprehensive about the change.
IAG head of claims and assessing, David Brown, admits to a 'mixed reception so far' but puts that down to a lack of information and understanding on the part of the repairers. He says the company experienced a similar reaction in WA, Qld and SA when WRM was introduced there. And while he and his team will devote considerable time and energy to reassuring and educating NSW repairers in WRM, their stated primary mission is customer satisfaction ? which they claim has gone up in the states were WRM has been operating.
WRM stands for 'web-based repair management'. After July 1, Sydney's PSRs will log on to the NRMA and CGU website where they will view images of damaged cars and scopes of works to repair them. These scopes will have been prepared by IAG assessors. The repairers will respond with a tender quote for each job they want. The lowest tender, decided by computer, will win the job.
The damaged cars will be photographed and assessed at a number of centres which are being set up around the initial WRM areas of metropolitan Sydney, the ACT and Newcastle. Later in the year Gosford and Wollongong will be added. Victoria, where IAG does not have a majority shareholding in the main repairer, RACV, may follow at a later date.
The NSW assessment centres are currently being decided, based on the intention to have them no more than 20 minutes drive from where their customers are ? in NRMA-speak 'the catchment area'. The idea is for a customer to take his damaged car to a centre and, after assessment, either leave it there or drive it later to the PSR which has won the tender to repair it. Likewise, when the car has been repaired, the customer has the choice of Cars which are not driveable will be towed straight to a PSR who will work with an assessor - as happens under the current system. Likewise, cars in remote or country areas will go straight to PSRs.
The contentious matter of necessary repairs which turn out to be additional to the scope of works, is covered in the WRM system, according to David Brown. He says there is no penalty against a PSR for claiming an additional, but repairers who make a habit of it would be flagged on the WRM analysis and be queried.
Every NSW repairer to whom Paint & Panel has spoken fears that the WRM system runs the risk of missing some part of a repair because it cannot be seen before the repair is commenced ? and certainly not on-screen. NRMA counters this by producing figures which state that 96 per cent of all accident damage is cosmetic and can be assessed from outside the car. If this is so, it places a high load of responsibility on IAG assessors. But they, according to IAG, come to the job with at least five years previous experience in smash repairs or motor mechanics, after which they undergo continuous training ? which now includes computer literacy and imaging. Overriding this, IAG reminds its critics that it has three Australian states already running on the WRM model, so it has been through all this before. Brown says that doesn't mean the NSW arrangement will slavishly follow the other states. He acknowledges that IAG, which has a 46 per cent share of car insurance nationally, may have to fine tune WRM for NSW were he quotes its share at 54.1 per cent.
NRMA says that the principle elements driving WRM in NSW are more for its policy-holders rather than repairers. IAG wants to improve the repair experience for its customers by making it more convenient. That translates into repair centres easily reached by policy holders and a feeling by them that they can leave the repair in the trusted hands of IAG. Just how trusting the policy holders in NSW are will be apparent later in the year when all the policy renewals are in, and it is known what percentage have paid an extra $69.50 to take the choice of repairer out of NRMA's hands. The
betting is that the percentage of those opting for freedom of choice will by tiny ? not only because policy holders trust NRMA but because drivers do not expect to have accidents and very few have favourite repairers.
The other policy holder benefit is in lower premiums. Experience in the established WRM states suggests that a tendering system brings down average repair prices. That is good news for the policy holders (provided the savings are passed on) but dreadful news for the repairers, many of whom say there is no profit incentive now, let alone further erosion through the tender system.
The WRM system, while putting more back-office work on to IAG, lets it off arduous and sometimes painful decision making. By putting jobs into a reverse auction system, the cheapest will win. That will result in lower average repair prices and let IAG out of the continual wrangle between repairers and assessors over times and rates. It also, as a by-product, defuses the campaign being mounted to stamp out 'funny time, funny money', because only bottom line totals will count.
The other shift of responsibility is in suiting the repair to the repairer. Under the present system, if NRMA sends a repair to a shop that is not ideally set up to do it, part of the resulting flack will hit the insurer. Under WRM is it assumed that shops will only tender for the jobs they can handle. IAG says that WRM is self sorting, in that shops will tender only for the work they are set up for, want, and can complete in the required time. This, theoretically, makes the whole repair process more efficient. Again, the repairers are still to be convinced WRM will work to their benefit.
As part of the WRM sell, IAG is talking up the trust they place in their PSRs' ability and judgement, along with the continuing management assistance they have always provided - with auditing to discipline those not playing the game.
The PSR hierarchy of gold, sliver, bronze, red and ASR will remain, although its practical application is diminished under WRM. The higher rated will still enjoy preferences for non WRM jobs and will be paid quicker than those in the lower ranks. ASRs will be the most disadvantaged, only getting work when PSRs can't handle it or in the rare case of a policy holder exercising choice-at-a-price. The ASRs to whom Paint & Panel has spoken fear they will lose all of their IAG work. IAG says not necessarily; good ASR's will be invited to join the flock because more PSRs will be needed, either as a result of repairer attrition or growth in numbers of repairs required.
The level of computer technology currently enjoyed by PSRs will easily handle WRM, according to David Brown. Since the images and scope of works are placed at the IAG end and do not have to be downloaded at the repairer end in order to tender, no additional capacity should be required. However, for shop records, one would imagine that a copy of the images and scope of works for a successful tender would need to be kept.
It is left up to the repairer to decide between repair or replace ? dictated by the best cost outcome. Scopes of works will not suggest to a repairer whether a part should be repaired or replaced, nor whether it should be OE, recycled or aftermarket, but must take into account the warranty requirements of newer cars. Generally, cars over five years old will be open to repairers' decisions. Considering the Australian fleet is on average 10.1 years old, this represents a lot of parts that could come from anywhere.
David Brown said that although there was no specific parts policy released with the WRM announcement, parts supply was under current review.
Cynics of WRM will see IAG as corralling their repairers into a system that forces upon them work on subsistence ? or below - margins. At worst, enough of them will refuse to tender to run IAG out of repair capacity. On the other hand, advocates will see IAG using its scale (a favourite expression used by the company) to get the best deal for everybody. Repairers will give WRM a try and find it works to their benefit.
A small percentage of damaged cars will turn out to be uneconomical to repair and will either go to salvage auction or, in some cases, direct to a recycler under a scheme that IAG it currently trialling.
Robert McDonald, head of industry research at IAG says his company has no set percentage for total loss limits. The decision to write off a vehicle is driven by a number of factors including, sum insured, estimated salvage value, customer concerns, parts availability, and difficulty of repair.

Now its preferred parts as well
IAG has called for tenders for a preferred parts supplier network in Victoria, New South Wales, Queensland, South Australia, Western Australia and the Australian Capital Territory.
The network, which has been trialled by over half of IAG?s preferred smash repairers (PSRs), is said to give PSRs the opportunity, if they wish, to purchase recycled parts from preferred parts suppliers.
When the network becomes active in June 2005 it is intended to enhance the profitability of IAG?s Preferred Smash Repairers (PSRs) as well as drive environmental benefits, while contributing to a consistently high quality of repair.
IAG Head of Claims & Assessing, David Brown, said the trials of the PPS network have shown it provides a number of benefits for PSRs.
?This system has been on trial within the smash repair industry for over a year and while it is a change in process for PSRs, the feedback from those in the trial is that it is easy to use, increases profit margins and allows PSRs to run their business more efficiently,? he said.
Brown said IAG would continue to uphold its commitment to customers, to return a car to the condition it was in before an accident, whether this is by using new or recycled parts.
?As we do now, we will continue to conduct random quality checks on cars repaired by members of our preferred repairer network to ensure the quality and safety of our work,? Brown said.
IAG believes that the increased use of recycled parts will also increase the sustainability of the smash repair industry. IAG research shows that if only new parts were used it would increase the number of write-offs by about 9,300 nationally and cause the loss of 277 jobs in the repair industry along with a potential reduction of revenue to the dismantling industry of around 50 per cent.
Brown said the introduction of a PPS network would also be less detrimental to the environment.
?In Australia approximately 500,000 motor vehicles are 'written off' annually, generating approximately 650,000 tonnes per year in waste requiring management, much of which is considered potentially hazardous,? Brown said.
IAG claims that the introduction of the PPS network also brings benefits for consumers, particularly those with older cars.
?The PPS network uses a central parts database to keep track of used parts. For consumers with older cars it will mean their repairer can obtain better access to a greater selection of parts to help get their car on the road sooner,? Brown said.
The system involves PSRs sending one fax or email form to a central database listing all the required parts. Within two hours the PSR should be advised of the available parts and pricing and the parts either delivered within the day or held by the PPS until needed.
When read in the light of the establishment of WRM online tendering it appears the alternatives between OE, recycled and aftermarket are left to the repairer, with the only requirement that the car is returned to pre-accident condition. Thus one PSR may win a tender over another based on parts costs.
Over time, one would assume that aftermarket will dominate the scene ? except where a PSR is also a preferred repairer for a particular car brand; then there could be a conflict. Currently IAG says recycled parts are used in six per cent of repairs but is not certain about the percentage of aftermarket.

Highlighting the need for change
Outspoken VACC member and Melbourne repairer, Gerry Raleigh, wants to get his hands on a special car. He believes a certain 1996 Holden Berlina would be ideal for the crash test that he and fellow Victorian repairers want to carry out to prove that shoddy repair work can have safety issues that could lead to a fatality.
The car received a massive rear hit in May 2004 and instead of being written off, was cut off and joined to the rear of another of the same model in a 'cut and shut' procedure. Ironically, the replacement rear half that was welded on had, itself, been the subject of a previous accident and still carried some damage.
Raleigh believes that the repair of this car perfectly illustrates the key issues of the recent Productivity Commission hearings where cost cutting, repair quality, assessor competence and codes of conduct were all examined.
After a protracted dispute between the owner and the insurer, has now been purchased by RACV in a payout settlement. RACV had previously expressed its willingness to assist in the carrying out of the test if a suitable car could be found and Raleigh wants to hold the company to it.
The way the accident in question took place produced a classic not-at-fault third party claim for the owner of the Berlina. The car was sent by the RACV assessor to a Melbourne repairer who was instructed by the insurer to quote it as a cut and shut repair ? rather than repair it by conventional means or write it off. The car had an agreed value of $17,400 - excessive for the year and model, but left unadjusted by the insurer for four years.
The cut and shut repair was quoted at $7547. While the repair was being carried out the owner visited the repair shop to find his car "cut in half". He had not been notified that this would be the repair method and he objected to it. However, the repair continued and when he got the car back he found it had a permanent mind-set to turn right, as well as numerous other faults.
He took the car to an independent assessor to have it checked, and was given a list of 31 needed rectifications. That assessor expressed the view that the car should have been written off after the accident.
RACV told the owner to take the car back to the original repairer where its assessor would re-inspect it. But before that could happen, the original repairer got to work to fix the faults. Later, RACV suggested that the owner had tampered with the vehicle and that he had also lowered the suspension prior to the accident. On both accounts the insurer turned out to be wrong.
When the rectification work was completed, the owner was still far from satisfied and refused to drive it on safety grounds. He continued to appeal to RACV which, to its credit, bought the car from him at the agreed market value in April of this year.
Gerry Raleigh believes that this example illustrates the need for a code to regulate the quality of repairs carried out under the instruction of insurers. He wants RACV to donate the car to a crash test to show that there are real safety issues when price alone dictates the method of repair.
"Cut and shut is not an illegal procedure," he says, "but it is seldom the best repair method. When it is used, it must be carried out by highly skilled technicians and inspected throughout the repair. That should be mandatory. In addition, cut and shut is such a drastic repair method that it should have the permission of the owner of the car before it is attempted."

US warning on aftermarket
Developments in the United States should send insurers in Australia back to examine the fine print in their policies after the recent class
action lawsuit against State Farm Mutual Insurance, one of America?s
largest motor insurers. The case was about insurers and repairers indulging in the practice of repairing vehicles using aftermarket components without the knowledge of the vehicles' owners. These policyholders claimed they were deceived over the use of aftermarket components in the repair of their vehicles.
The insurer was accused of breaching its policy contract by concealing that it was instructing repairers to carry out repairs using non-OEM parts. The insurer has been ordered to compensate its policyholders to the tune of US$1.8 billion, with interest accruing at $350,000 an hour. Collision repairers in the U.K. have been advised to be aware of their possible implication in a fraudulent activity if they are instructed to use aftermarket parts without the policyholder?s knowledge, unless the policy specifically allows the insurer to authorise such repairs.

Toyota is best recycler

Toyota Motor Corporation was ranked first in the use of safe, recyclable plastics among the six top-selling automakers in the United States, according to a new study, though no company scored better than a C. The study by the Ecology Centre, a non-profit activist organisation based in Ann Arbor, Michigan, graded the six companies on a scale from A to F. The report, done in collaboration with the non-profit Clean Production Action of Spring Brook, New York, was e released in conjunction with the Global Plastic Environmental Conference in Atlanta. Sustainable plastics are defined as those that do not contain toxic chemicals and are recyclable and manufactured from renewable raw materials. Toyota's use earned it a grade of C, while General Motors Corp, Ford Motor Co, DaimlerChrysler AG, Honda Motor Co and Nissan Motor Co all received D's or D-pluses. "Toyota is the clear leader in integrating safer and environmentally friendly plastics into its automobiles and has implemented many practices that US automakers can learn from," said Charles Griffith, the Ecology Centre's auto project director. "But the fact the top performer received a C grade means there's still a lot of room for improvement across the board." The amount of plastics used in vehicles increased from 0.6 per cent in 1960 to 7.5 per cent in 2003, accounting for 1.95 billion kilograms of plastic annually in the United States alone, the Ecology Centre said.

Hidden workforce offers benefits
Employers in the automotive industry seeking lower levels of absenteeism, increased workplace morale, lower recruitment costs, and greater loyalty may be missing out on a ?hidden Australian workforce? ? skilled people with a disability.
Australian Disability Training Advisory Council (ADTAC) co-chair and manager of IBM Australia/NZ's Accessibility Centre, Mark Bagshaw, said employers in the automotive industry who consider hiring people with a disability can open the door to an additional workforce of up to 750,000 people.
?More than 1.5 million working age Australians with a disability can work, but less than half of them have jobs,? Bagshaw said. ?At the same time, the Australian automotive industry is facing skill shortages in every state and territory for trades such as motor mechanics, automotive electricians, panel beaters and vehicle painters."
Automotive Training Australia has identified skill shortages as one of the key issues facing the industry, an issue made worse by retention problems with experienced people, as well as an ageing workforce.
?Over the last five years there?s been a 70 per cent increase in the number of people reporting a disability who are increasing their skills through Australia?s vocational education and training (VET) system," Bagshaw said. "But only half of VET graduates with a disability find employment after completing their courses, compared to almost three quarters or 74 per cent of all VET graduates.
?People with disabilities are getting training around Australia particularly through group training organisations, however these figures show a trained workforce that is largely untapped.?
Employers seeking information on hiring people with a disability can use the website www.jobable.gov.au as an information resource. A revised 'Blueprint for Bridging Pathways' ? the five-year national VET strategy for people with a disability ? was released in December 2004.
For information and copies of 'Bridging Pathways? revised blueprint, contact Julie Mackey at ADTAC. Ph:(03) 9830 9865, email: adtac@anta.gov.au or download from www.anta.gov.au/vetADTAC.asp.

New DuPont logo
The DuPont red oval has, for many decades, been a recognisable symbol of a brand which spans an enormous number of competencies over a wide range of industries and international markets.
Under this corporate umbrella, many of the company?s most important products are, additionally, identified with their own logo and brand style. DuPont Refinish is also one of the key areas of the DuPont business to which the company devotes significant research, development, financial and management resources.
Because of this, the company has recognised that a unique brand image for DuPont Refinish is well overdue and communication and support material for this important area of the business will soon begin to feature a new visual style.
The striking ?liquid car? icon, based on the DuPont corporate red colour, in the form of a glossy droplet of paint, will, in future, immediately identify the DuPont Refinish brand and clearly differentiate it from its competitors.
Tony Skallias, group marketing manager for DuPont Performance Coatings commented: ?We are serious about providing refinish products with the best technological, marketing and sales infrastructure in the business. We are also serious about providing innovative paints with extremely flexible refinish systems which offer bodyshops a value for money automotive paint solution. It is important, therefore, that everything we do is instantly recognisable as being a product of these vast resources that we are committing to the brand.
?Our bright, new look corporate identity gives DuPont Refinish a distinctive flair whilst illustrating clearly the nature of our business and our fundamental corporate values?.

Tough times in US
The collision repair industry in the USA is witnessing a decline in the number of total repair jobs available, according to new analysis from consultants Frost & Sullivan.
The firm says that contributing factors are higher insurance premiums for vehicles with high claims, and an escalation in the overall total loss frequency.
Rising insurance premiums restrain many people involved in accidents from making claims, choosing either not to repair the damage or making private arrangements to avoid notifying the insurance company. Total loss frequencies are rising, further restraining collision victims from seeking repair jobs.
The report also estimates that insurance-paid repair work to be as high as 90 per cent of the total available repair work, which is particularly detrimental to the interests of repair shops.
Frost & Sullivan says the US insurance companies' position of power creates a highly competitive bidding situation for each repair job and therefore, despite rising component costs, the repair market is witnessing reduced operating margins. Insurance companies usually pay lower rates for repair work through both labour rate concessions and lower-cost replacement components.
The upside is that collision revenues from mechanical/electrical components, sheet metal, plastic, paint, and labor have experienced a general rise since 1993. Another factor likely to drive revenue in the repair sector is the constant rise in new vehicle pricing with luxury vehicles rising from just 4.1 percent of the vehicle population in 1997, to an estimated 10.7 percent in 2005.
This rise in high-end vehicles is a mixed blessing for the repair industry. Historically, higher value vehicles warranted repair, but currently, higher-end vehicles include more safety features such as crumple zones, laminated glass, and multiple air bags that, if activated, elevate the vehicle?s chances of being totaled.
A reduced availability of technicians is exacerbated by the decreased value placed on collision repair skills. Skilled body collision technicians earn approximately 20 per cent less than their mechanical counterparts, a major obstacle in attracting new talent to the industry

Sikkens goes racing
Akso Nobel, through its Sikkens paint brand, has become a sponsor for the two-car WPS Racing Team for 2005.
Sikkens will be supplying refinish paint products in order to maintain the high standards of appearance required of the WPS Racing Team vehicles.
WPS Racing made its debut in 2004 and has spent the last twelve months developing a solid team based on the Gold Coast.
Drivers, David Bernard (Car 48) and Craig Baird (Car 8) recently spent a full day of testing prior to the V8 Supercar race at the Australian Grand Prix. Both drivers reported that the vehicles handled well and were confident of a good showing throughout 2005.
The V8 Supercar Championship rounds began in Adelaide at the Clipsal 500.

Australia is second-biggest car nation
A global online automotive survey conducted by ACNielsen has found that Australia has the world?s second-highest car ownership rate. With 90 per cent of survey respondents aged 16 and over saying they owned a car, Australia ranked second behind the USA (92 per cent car ownership) and equal with Italy. New Zealand was ranked third with 89 per cent car ownership.
These and other results were released In Mach by ACNielsen, a leading provider of consumer and marketplace information, as part of a global online study of consumers? car ownership and purchasing intentions. The survey, which captures responses from over 500 Australians and more than 14,000 people in 28 countries around the world, is conducted six-monthly by ACNielsen.
Toyota, Holden and Ford were the most commonly owned vehicles, however, the survey also found that Honda, Mazda and Subaru were poised for Australian sales growth in 2005, with consumers? purchase intentions for the next 12 months running ahead of 2004 sales share.
?Honda, Mazda and Subaru all have strong brand equity in comparison to their market share,? said Tina Katsinikas, director, client service, ACNielsen Australia. ?In addition, they currently have some very strong products, attracting aspirational buyers.?
Not surprisingly, price played a major role in consumers' car purchasing decisions, with 76 per cent of Australian consumers rating price as a primary consideration in purchasing a new car. Men, however, were less concerned with price than women, with 70 per cent ranking price as their main consideration, compared to 84 per cent of women. Price was followed by performance (45 per cent) and fuel consumption (39 per cent) as major considerations when purchasing a car.
Female buyers (82 per cent) were also more likely to favour top ten brands than their male counterparts (71 per cent), with over half (51 per cent) likely to purchase models from the top three manufacturers (see Chart 2).
?The survey results suggest that male buyers may be casting the net more widely,? said Katsinikas. ?In contrast, female buyers have a strong focus on the major brands, which offer a higher degree of familiarity.?
Asked to indicate the type of car they own, the majority of respondents (41 per cent) owned a sedan, followed by hatchback (25 per cent), and 4WD/SUV (13 per cent). However, hatchbacks lost marginal ground for intended new car purchases, with less than one in four consumers (23 per cent) intending to purchase this type of car, while sedans gained a point (42 per cent) and 4WD/SUVs were up slightly (16 per cent).

* Honda, Mazda and Subaru poised for Australian sales growth.
* Price still the major consideration for car purchases in Australia.
* Female buyers stick to major brands.
* Sedans the most common car type, but 4WDs gaining ground.

Dead cars don't go to heaven
"ELVs (end of life vehicles) are generally older, unroadworthy vehicles which have completed their useful lives ? cars which are simply worn out,? says Alan Marshall, executive officer of the Auto Parts Recyclers Association of Australia (APRAA). ?Others are accident damaged and insurer write-offs which are uneconomical to repair". But once off the road, where to do they go? Not to heaven, unfortunately.
?Most ELVs are recycled by quality auto parts recyclers, commonly known in the past as dismantlers or wreckers, Marshall says. ?Our sector is now a modern and professional industry, with licensed, qualified, customer friendly, environmentally compliant businesses, which salvage the re-usable parts. Re-use is the purest form of recycling, which also conserves resources which would otherwise be used in making a new part.
?Quality auto parts recyclers de-pollute the vehicle and control waste fluids, gases and contaminants; remove the re-useable parts for cleaning or reconditioning prior to sale (electro-mechanical parts, panels, wheels etc); and finally, pass the remaining shell on to the metal recyclers for materials recycling."
However, not all ELVs are channelled through quality auto parts recyclers. In some cases ELVs are dumped in out of the way places such as creeks, dams or the bush. Others may be handled by unlicensed car removalists who by-pass the auto parts recyclers in disposing of these vehicles, without reuse and perhaps without environmental safeguards.
"APRAA promotes the importance of a recognised system for the proper management of ELVs in Australia,? says Marshall. ?The auto parts recycling sector is already efficiently handling the bulk of the 500,000 that come to the end of their lives each year, without any government or community funding or regulatory support. However a lot of environmental costs are incurred during the processing of ELVs, which are really the responsibility of the last owner, the car manufacturers or the general community.?
The environmental authorities, both federal and state are looking closely at the way ELVs are managed in Australia, under initiatives such as Extended Producer Responsibility and Product Stewardship. ELVs are also getting a lot of attention overseas under environmental programs, in places such as Europe and Japan, where specific ELV laws are now in place to make the car manufacturers responsible for their ELVs.

Paint will fly at auto Fair
Responding to feedback, Expertise Events, organisers of the 2005 Australian Automotive Trade Fair, will include spray booths on-site at this year?s Melbourne event to be held on June 17 ? 19 at Melbourne Exhibition Centre.
The booths will be used by paint exhibitors to showcase the latest finishes, mixes and new concepts such as chrome effects. Spray equipment suppliers will provide the newest available tools for the job. Demonstrations will take place in hourly sessions during the three day event.
The purpose-built spray booths will meet occupational health and safety regulations, emulating workshop conditions. Buyers can ask advice during the live demonstrations and all items shown will be on sale at the suppliers? stands.
Exhibition manager, Ross Hannan commented, ?reaction to supplying the spray booths has been extremely positive. Buyers can get much more out of the show by watching spraying techniques as well as seeing the end result. We expect the availability of the spray booths to encourage even more exhibitors from this specialist area to the show.?
The remainder of displays on show includes products for those involved in service, mechanical repair, exhaust, under-car, collision repair, engine reconditioning, parts, accessories, transmission, auto electrical, tyre industry, diesel and all forms of workshop equipment.
The Australian Auto Trade Fair is traditionally the venue for lively forums, seminars and meetings that keep the trade in touch with professional trends. The Australian Accident Repair Network (AARN) will hold its national meeting for members nearby, on Friday, June 17.
Industry supporters of the event are The Auto Parts Recyclers Association of Australia (APRAA), the Victorian Automobile Chamber of Commerce (VACC) and publications Motor Equipment News, Australasian Paint & Panel and Australian Bodyshop News.
Overseas participation in the 2005 Fair is at its highest ever, with exhibitors from USA, New Zealand, Taiwan, Korea, Malaysia, the Chinese Mainland, Turkey and the UK.
Several international automotive suppliers will take advantage of the custom-made show to demonstrate new heavy machinery. Major companies taking part include Launch Tech, European Equipment Organisation and the Machinery Research Institute. As with local heavy equipment suppliers, some will use the Fair as a venue for their Australian or South Pacific product launches.

CAPA has responded spiritedly to the story in the last issue of Paint & Panel headed "GE says OE is better". In it, GM claimed that an aftermarket CAPA part had performed poorly against its OE equivalent.
CAPA claimed that there is a serious flaw in the study and concluded that GM had used the wrong aftermarket energy absorber for the test. CAPA said that although GM tested the 2001 Chevrolet Cavalier, it chose to use an aftermarket energy absorber for a 1995-99 Chevrolet Cavalier. And that a part designed to fit a different model year series could not be expected to perform well.
?GM apparently chose the wrong part for a comparative test, and then may have compounded that error by spending hundreds of thousands of dollars to promote an inaccurate and irrelevant comparison," said Jack Gillis, executive director of CAPA. ?It makes you wonder if GM?s adamant opposition to a free and competitive marketplace for crash parts may have been in play here. The published results of the test might lead the casual observer to think that car company control over aftermarket crash parts is a good thing, but that conclusion is as faulty as the tests results on which it relies."
CAPA believes that what GM?s study does validate is the need for an independent, non-profit, third party, approved standards developer like CAPA. In spite of its flawed test, GM claims that aftermarket bumper reinforcements are inconsistent. As with other replacement parts, the market needs a mechanism to identify which ones do, in fact, perform well.
CAPA goes on to point out that the GM report also included a GM evaluation of a previously CAPA certified bumper cover. GM chose to include in its test a part that had been removed by the CAPA program in December 2003. (CAPA de-certifies parts which do not continue to meet validation criteria)
Gillis continues: "Leaving aside GM?s motivation for choosing such a part, it is quite clear that the problem was caused not by the performance of the bumper cover, but by GM?s use of the wrong absorber behind the bumper cover. In fact, there is no evidence that a GM brand bumper cover would have performed any differently when used with the wrong absorber.
"In its study, GM chose to use the Insurance Institute for Highway Safety?s 5 mph bumper test. General Motors was one of the car companies that successfully fought to lower the 5 mph test that the U.S. Department of Transportation once required all vehicles to pass, to a 2.5 mph test, which is about the speed at which we usually walk. Of course, in successfully lobbying for the change in that requirement,
GM helped to immediately expand the need for its repair parts. Who pays the price for this GM effort? Consumers who now must drive with less resilient bumpers. They now experience huge repair bills after backing into parking lot poles or tapping a vehicle in front of them. It seems fairly obvious that more resilient bumpers (i.e. those that could pass the now-abandoned 5 mph impact test) would result in far fewer repairs.

What is CAPA?
CAPA stands for Certified Automotive Parts Association. It is a US based non-profit body which states its objective as: 'to ensure that the market has a high quality fairly priced alternatives to expensive car company parts. CAPA has been going since 1988. through testing, certifies aftermarket car parts which are of equivalent quality to OE.

AMBRA going for gold
For the third year in succession, the Australian Motor Body Repairers Association (AMBRA) will hold its annual conference in Queensland - at the Gold Coast International Hotel, Surfers Paradise, on the Queen?s Birthday weekend, June 10-13. The conference will open with a meeting of the association?s executive on the first day, Friday. This will be followed by a poolside cocktail party in the evening to welcome members, partners, delegates and guests. Organisers say the emphasis will be on revitalising the association?s stance on current issues affecting the industry and exchanging ideas for future activity. Agenda items will include: ? The final report of the Productivity Commission?s inquiry into relationships between the smash repair industry and the insurance companies. ? The Code of Practice for Parts Recyclers. ? I-Car, the American training package in Australia. ? New technology and its effect on how we rectify damage. Afternoon sessions will feature workshop groups discussing business operation issues including benchmark indicators, the true cost of doing business, wages, productivity bonuses, and the best of the software packages. There will be special programs for the partners of delegates and guests, including visits to leading coastal and hinterland tourist attractions and shopping expeditions. Children?s activities will be organised and supervised by professional carers. The conference will conclude with a gala dinner. Accommodation at the hotel costs from $148 per room, including breakfast. Airlines service Coolangatta Airport, a few kilometres from Surfers Paradise. Enquiries: Bonny on phone (07) 3237 8777 or fax (07) 3844 4488 or email service@mtaq.com.au

Daihatsu to quit Australia

Toyota Motor Corporation Australia (TMCA) has announced that it will wind down the Daihatsu vehicle sales arm of its Australian operations. The decision takes effect from Friday 31 March 2006. The TMCA board made the decision following an intensive study of Daihatsu's current and forecast performance in Australia. Toyota has managed the distribution of Daihatsu in Australia since 2000. During the next 12 months, Daihatsu owners will be supported through existing service outlets. From 31 March 2006, parts, service and warranties will be supported through a national network of service centres to be established. Where current details are available, letters will be sent to Daihatsu owners advising them of this announcement. Advertisements have appeared in major newspapers and owners have been invited to obtain information through a customer hotline on 1800 457 470 or from the Daihatsu website on www.daihatsu.com.au. TMCA's executive director of sales and marketing, David Buttner, cited the competitive sales environment and the future outlook for the brand in the small car segment as reasons for the decision. "We conducted a thorough review which examined matters including the local sales environment, customer preferences, increased competition, financial outlook and recent volume trends," he said. "This review determined that the long term viability of the Daihatsu business was limited in the Australian market. "Details of national service and parts outlets available to Daihatsu owners from April 2006 will be determined during the coming months. Customers who intend to buy a Daihatsu vehicle during the next 12 months can be confident their new car will be supported." There are currently 79 Daihatsu dealers in Australia and many are in multi-franchised arrangements. OE parts will be availble from dealers in the foreseeable future, but a spokesman for Daihatsu said that eventually aftermarket sources may be brought in to provide parts required for reapirs. Daihatsu began marketing vehicles in Australia in 1967 and current models include Sirion, Terios, Copen, Charade and Delta trucks.