Salvage Wire

Salvage Wire
Helping Automotive recyclers become leaders in their industry

Friday 10 July 2009

Repair standards and how this could impact the Motor Salvage industry.

Repair standards and how this could impact the Motor Salvage industry.

20 years ago very few standards were in place in the motor vehicle accident repair industry, most body repair centres relied upon manufacturer approval or the support of local garages for their workflow.
Since then there have been enormous changes in the body repair industry, many bodyshops have closed their doors and those that have survived have done so on tightening profit margins whilst having to invest heavily in the business.
One of the latest investments in the UK is the Kitemark scheme from BSI British Standards, supported by Thatcham, the Motor Insurance Repair Research Centre.
This scheme is one of the very few in the marketplace that concentrates on repair standards rather than customer service standards, and is designed to develop a robust cross industry standard for the body repair industry, ensuring that vehicles damaged in accidents are repaired efficiently, effectively and safely by competent professionals working with the correct equipment and technical back up.

This scheme will drive up repair costs, well trained technicians will be able to demand increased salaries, repairers will have to finance their investment in training and equipment, and repair methods for some of the new vehicle construction techniques and exotic materials now appearing in motor vehicles will be more costly than some current methods.
When coupled with the current economic climate and severe downward pressure on vehicle values there is a strong possibility that more vehicles will be written off and disposed of as repairable salvage.

I am regularly asked about repair standards in the motor salvage marketplace, as once a vehicle moves into the UK salvage market it comes under the voluntary ABI Code of Practice for Motor Salvage, and this does not address repair standards.

So why not implement the Kitemark scheme for repaired motor salvage?
There are a number of very valid reasons for doing so, including:

Repair Standards and Quality, a vehicle repaired by a Kitemark approved repairer will have been repaired to a satisfactory standard by trained staff using the correct equipment, whereas a vehicle repaired in a salvage yard may not be repaired to a safe and satisfactory standard.
The vehicle will perform correctly in the worst-case scenario of another accident.
The vehicle has been repaired using correctly obtained parts, either new or second hand – i.e. not stolen or from an older vehicle.
It could be possible to have a process in place to remove the previous total loss marker from the vehicle following satisfactory repair

As in all cases, there are some compelling reasons for not implementing any initiative, including:
During the last eight years the motor salvage market has gone global!
Motor salvage is moving across borders in great numbers, a lot is going to Eastern Europe and then to Russia, some goes to the Middle East and Asia, and customers are even coming from China. A lot of these countries have much lower costs than the UK and our local salvage companies and repairers are finding it very difficult to compete, if you add the cost of repair standards to the UK salvage market then a lot of businesses will just cease to deal in this type of vehicle, leaving the way open for more salvage vehicles to be exported and could result in the closure of a number of UK based salvage businesses.

The Kitemark scheme is a voluntary, UK only, operation that has not been mirrored in other parts of the world, so a vehicle could be repaired at a UK repairer that does not have kitemark accreditation, or outside of the UK, to a high standard and put back into use quite legally.

All motor salvage dealt with by UK insurers should be categorised and recorded on MIAFTR (the Motor Insurance Anti Fraud and Theft Register), this data is then available to the general public through the various car data check schemes, if the customer decided to use these sources of information they would know the vehicle history and they can then make a choice - walk away or complete further checks on the vehicle if they wish, however if customers fail to use the information available then it is at their risk.

So how do we resolve this conundrum and look towards implementing sensible repair standards for salvage vehicles that will not cause significant harm to the motor salvage industry.

There are two areas that need to be focused on, and these involve salvage practices and repair standards:

The UK has the tightest salvage standards in the world – the adoption of the voluntary Association of British Insurers Code of Practice for Motor Vehicle Salvage has seen significant benefits to the UK, salvage categorisation should ensure that badly damaged vehicles are removed from circulation, and the steps taken to control vehicle documentation have significantly reduced motor vehicle fraud. Additional efforts with Motor Salvage Operators Registration, ELV (end of Life Vehicles) Licensing and Vehicle Identity Checks have only added to the controls in place to ensure that the general public are dealing with legitimate businesses and vehicles.
Unfortunately these controls are UK only, and there are no similar schemes in place anywhere around the world, so we need to look at the introduction of a European Salvage Code (ESC) that would offer similar benefits in the removal of vehicles from circulation and prevention of fraud.

Kitemark is too narrow and needs to widen its’ focus in the following areas.

The motor salvage industry must be included in the scheme, specifically with a view of:
Green Parts – use of second-hand parts in insurance and motor salvage vehicle repairs.
Parts standards – Setting the standards for quality of green parts and customer service.
Repair standards – setting the standard for quality repairs, enabling customers to purchase repaired salvage with confidence.

As with the ABI Code of Practice, Kitemark needs to be extended to the whole of Europe, and include repair standards, and sharing of information between member states.

To ensure full coverage Kitemark needs to include motorcycle and commercial vehicles.

Without this type of input and inclusivity there will always be ways of getting around the standards, and customers will suffer as a result. Additionally there is also the possibility that the Kitemark scheme would go the way of many other initiatives and fall apart within a few years if it fails to encompass some of these critical issues and close the potential gaps.

I appreciate that this cannot be implemented in a few months, and some of this could take many years, but the EU have already shown what can be done by implementing the End of Life Vehicle Directive (ELV) that is fully in place across all member states - Legislation that has set a standard and is being mirrored in other parts of the world, so lets set our sights high and work towards a consensus across the EU that promotes efforts to eradicate fraud, reduce the possibility of poor or unsafe repairs, and increases recycling by the sensible use of green parts in all types of vehicle repairs.
The UK motor salvage marketplace, by virtue of the controls already in place, should be at the head of any operation to drive up standards, an opportunity that should be grasped by all with an interest in the motor salvage industry, and a combination of the UK Motor Salvage Associations, Thatcham, Kitemark and the ABI would be an unstoppable force across Europe.