Monday, 13 March 2017 15:43

Australian Motor Body Repairers Association (AMBRA) chairman Jeff Williams voices his concerns on parts procurement policies and industry direction.

Some manufacturers have stopped publishing trade or list prices on certain parts and where this is happening insurers are saying that they will only pay the last published list price, even if this is many months old and out of date. This has come about because some insurers decided to dictate aftermarket or parallel parts to repairers while forgetting to tell the policy holders and the OEM’S what they were up to.

This is just one of many issues that repairers are facing in the parts supply line.

“While there are a very few repairers who don’t do right by their insurance company customers, the vast majority do. This edict from one large insurer about going direct to the suppliers invades repairer’s commercial agreement. Is it leading to a situation where insurers will order parts on repairer’s behalf and pay the supplier directly?

And then we have the annual ‘how much it costs to build a car out of spare parts and how outrageous this is’ campaign. The story is usually pedalled by a large insurer crying foul, often as paid advertorial.

Getting factual

Manufacturers spend many millions if not billions to create, design, build, test, engineer, tool up factories, produce training materials, workshop method data, meet government regulations on everything from emissions to safety and then build and then crash test a vehicle all before it gets to the dealer. That dealer also has an investment in the process, so really there has to be a return on billions of dollars of investment – unless of course we all want unaffordable cars.

The market dictates the price of vehicles, parts and, by the way, insurance policies too and we pay what the market dictates for that product. The insurance industry needs to stop crying foul. The facts are plain to see annually in their profitable financials. We know it, the public knows it and the ACCC knows it.

With margins already squeezed so hard, chipping away at one of the last areas where repairers can make a modest profit simply pushes out more and more of the industry who can’t continue if profit margins move from unsustainable to totally untenable.

Maybe its time for the repair industry to broaden our conversation to those outside of the industry because it looks like some people haven’t been listening.

Code of Conduct data

The Code of Conduct that is now collating the valuable data from the hundreds of IDR disputes lodged on line, can accurately identify those most important issues that currently affect small repairers’ day to day survival.

Collectively the Australian Motor Body Repairers Association and all state MTA’s have made considered amendments and produced a draft document with full endorsement of the national industry body MTAA towards a continued review of the Code of Conduct. We have presented this paper to the Code Administration Committee as the national position and look forward to the Insurance Council of Australia’s in good faith considerations in continuous improvement towards the insurer and repairer relationships. Is this the type of conversation that needs to take place rather than the recent communications repairers have received which really were a ‘take it or leave it’ conversation.

Code of Conduct disputes

AMBRA is currently rebranding the IDR builder which is available to all signatories to the Code AMBRA and your state Association advise contacting your local insurer assessing managers first to discuss any insurer /repairer relationship issues you may be experiencing. If this is unsuccessful contact your respective state Association representative who can offer further advice for your consideration.

Source: www.paintandpanel.com.au, 7 March 2017

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