By John Yoswick
Collision industry events in the United States have continued to be held “virtually” this year, bringing together panel discussions including collision repairers, automakers and insurers. The moderator of one such online panel discussion asked automaker representatives on the call to respond to the view — which he said was put forth by insurers on another panel discussion — that OEM repair procedures are “subjective.”
George Irving, senior manager of service and collision operations for Toyota, said he’d use the same one-word response that World War II Army General Anthony McAuliffe did to a German surrender ultimatum at the Battle of the Bulge: “Nuts!”
“How somebody can see the technology that we have in a vehicle and say they’re smarter than the Toyota engineers who put it together is totally beyond me,” Irving said. “Fix ’em the way the engineers tell us to fix ’em.”
He noted that anyone viewing Toyota procedures online can use a “bubble in the upper right hand corner” of the screen to give the automaker feedback on the procedures.
“Anyone who says they don’t have a voice [in them] hasn’t been looking at Toyota repair procedures,” Irving said.
John Eck, a collision manager for General Motors agreed.
“To say you don’t have to follow the OEM procedures [from those who] designed, built and engineered those vehicles, doesn’t make sense,” Eck said. “It’s just something that’s not negotiable, and I would challenge anyone having their own vehicle repaired to question whether or not they would want the OEM repair procedures followed.”
Andy MacDonald of Lucid Motors, the California-based company whose first electric vehicles are expected to be released as early as this month, said the company is developing a portal for its repair procedures, “information that’s critical to our own customers’ well-being.” If someone “takes a subjective view and thinks they know better, I’d be interested to hear it, but I wouldn’t want it practiced on my vehicle,” he said.
MacDonald, who previously helped build collision shop programs for Aston Martin and Tesla, said he is developing a similar program for Lucid, with an eye toward ensuring a return on investment by participating shops.
“That means doing more than one car once every six months,” MacDonald said. “I don’t need 5,000 body shops tomorrow. We’ll work with a select few in the beginning just as we begin to roll things out. Then as the [Lucid vehicle population] grows, we’ll open that up and bring shops on as appropriate.”
Insurers in the United States have been handling virtually all claims remotely during the pandemic, and insurance company representatives on one panel said that is likely to continue.
“Prior to COVID, we were scratching our heads, wondering how much customers would accept a touchless claims experience,” Chris Evans of State Farm said. “We went to 99.2 percent virtual inspection activity toward the end of last March, and it’s just phenomenal how we were able to make that transition. There’s a lot more customer acceptance. I think, long term, we’ve proven that virtual works, and I think you’re going to see more of it.”
Sandee Lindorfer, auto line director for Allstate focused on what she sees as the benefits of virtual claims handling for shops.
“We’re not in their shops, which helps keep them healthy, and it also offers them efficiency gains,” she said. “ If you think about adjusters coming into a shop, they interact with the folks in the office. Many know the folks who work in the shop, so they stop and chat with them to be friendly. Then they work with an estimator or manager. You think about all the time that adjuster takes from a shop throughout the day. When we do a virtual interaction, it’s a one-on-one interaction, and it’s very efficient. [Shops] also can reach us when it’s convenient for them. When we physically inspected cars, we were more on our schedule rather than the shop’s schedule. So there are lots of wins for the shop.”
A topic discussed during multiple virtual industry meetings has been the use of “artificial intelligence” (AI) within the industry in terms of estimate preparation or auditing.
“I’m probably going to be cursed by some of the folks on this call, but I think what artificial intelligence is going to do is take a lot of the labor out of both the body shop and the insurance industry,” investment banker Rex Green. “That should be welcomed, but it will be disruptive.”
Chris Andreoli of Progressive Insurance said he foresees AI within the industry moving forward in phases, with only what he called “verified artificial intelligence” being available in the near term.
“It’s not that some AI is spitting out final estimates this year,” Andreoli said. “I think of it as sort of an efficiency accelerator. You know when you click on a form online and the computer can fill out most of the form, and you just tweak or correct some errors on it? I think similarly we can use AI, and will be doing that at this early stage in the near term. It’s not going to be, ‘Hey, the computer wrote the estimate and this is the be-all end-all to the estimate.’ No, we’ve got to work together closely, just the way we do with photo-estimating. Just like today when you write an estimate in-person, it goes to the shop and there’s some modifications. That stuff is all going to continue to happen. AI will facilitate the work, it will increase efficiency. But I don’t think in the near-term it will replace the need for a qualified set of eyes to finalize that estimate, and work with the shop to get to the place you need to in order to fix the car. But some of these innovations can improve cycle time to get an initial estimate to the shop and to the customer quicker; write more estimates with the same amount of staff; and get payments into customer hands faster than we have in the past.”
Darrell Amberson, president of operations for LaMettry’s Collision, a chain of 10 collision repair and two mechanical repair shops in Minnesota, said he thinks development of artificial intelligence in estimating will present some interesting dynamics.
“Right now the insurers are using it more and more for auditing,” Amberson said. “We’re spending more and more time being questioned on lots of items on estimates. As artificial intelligence grows to the point where systems can become good at automating the estimate, it will be interesting. The elephant in the room is insurance companies are enjoying photo-estimating because it [produces] a very modest estimate, and there’s an obvious financial benefit for the insurance company, paying that modest amount. Once the estimating gets better, will they still embrace it? Because, frankly, if automated estimating gets good, that’s going to drive up the cost for the insurers, and what will their reaction be? I don’t know. It will be fascinating to watch.” •
John Yoswick, a freelance writer based in Portland, Ore., who has been writing about the automotive industry since 1988, is also the editor of the weekly CRASH Network bulletin (www.CrashNetwork.com). He can be contacted by email at john@CrashNetwork.com.
