By Jeff Sanford
Toronto, Ontario — March 4, 2016 — It’s time for another round of the stuff you may have missed in the week that was. This week, we look at yet more recalls due to faulty airbags, how Campagna Motors will finally be able to sell its extremely cool trikes in Ontario and why Warren Buffett thinks insurance premiums have increased.
– It keeps getting bigger. Toyota has announced it has added another 331,000 cars to the Takata air bag recall. You can add the 2008 Corolla and Corolla Matrix sedans and the 2008 to 2010 Lexus SC430 convertible to the list.
– Fifteen hundred horsepower and only five hundred will be made. The Bugatti Chiron is a steal … at just $2.61 million. It was unveiled at the Geneva Motor Show and is the successor to the Veyron. Fun fact: in Greek mythology, Chiron was the name of a centaur, the fabled half-man, half-horse. With that price tag, it might be cheaper to have a genetic engineer make you an actual centaur.
– A burglar got a big surprise after breaking into Al’s Auto Parts in Providence, Rhode Island. According to a local media report “a silent alarm alerted owner Albert Scialo at his home just before midnight Monday that there was activity in the shop.” Scialo and his 23-year-old son responded to the shop and came upon the suspect, 32-year-old Angelo Lamourt. They tackled him and after a brief struggle tied the suspect’s hands and feet with zip ties and held him until police arrived.
– Ontario drivers are going to see a whole new type of vehicle on the road this summer. The province is now allowing registration of certain three-wheeled vehicles that have been certified by Transport Canada. Campagna Motors manufactures sophisticated three-wheelers and has been lobbying for changes to provincial legislation to allow their vehicles on the road. That happens this summer. A pilot project will see the Canadian manufacturer introduce its T-REX and V13R vehicles to driving enthusiasts across Ontario. The vehicles use a Harley-Davidson V-Twin liquid-cooled motorcycle engine. Founded in 1988, Campagna Motors is a vehicle manufacturer based on the South Shore of Montreal. The company “designs, hand-builds and distributes powerful, stylish, innovative, street-legal and unique three-wheeled vehicles” according to promotional material. We’ve never driven one, but they certainly look cool.
– According to a local media report, “A new real-time auto insurance monitoring system is now being used in Baton Rouge to help state police ensure motorists are up to date on paying their premiums.” Traditionally police could only check to see if a driver had an insurance card, but “could not verify if coverage had lapsed due to non-payment. The new system will pull reports from insurance companies and provide the information to the state Office of Motor Vehicles and state police. Troopers will be able to check the database from their vehicles during a traffic stop.”
– Speakers at a P&C Insurance Technology Conference recently discussed how autonomous vehicles could change the auto insurance model. “Clearly you are seeing some manufacturers step up and say that they will assume liability for when the car is in autonomous mode,” said Karim Hirji, Senior Vice President of International and Ventures at Intact Insurance. “Are these companies going to self-insure, and what’s the impact on the balance sheet by those companies doing so? Or more likely, will they want to partner with an insurance company in some sort of ecosystem to actually provide coverage and take that capital risk on like we do today? It could be a reinsurance arrangement, it could be a quota share arrangement or it could be a strict insurance arrangement like we have today …” Another speaker suggested the insurance industry is in the “early days” when it comes to new models driven by emerging transportation technology.
– RSA Canada reports an underwriting profit of $225 million for 2015 and a combined operating ratio “well below its annual target for 2015.” For fiscal year 2015, net written premiums were down 4 percent to US$2.651 billion.
– It could be years before connected cars are fully secured against cyberattacks according to researchers. A report running in the tech media finds that, “While car makers and software companies are keen to add new features to cars … there are still significant concerns about the security implications.” Research carried out by analysts at IDC predicts “a security lag of up to three years before systems catch up with cyber threats.” As well, “the ‘Always on’ nature of today’s software-reliant cars means using your smartphone on the road opens up additional attack vectors and vulnerabilities.”
– What a great idea: A Hawaiian collision facility has been running an essay writing contest for high school seniors for half a decade now. The effort at promoting literacy got the shop a write-up in the local paper and that’s great publicity. Auto Body Hawai’i runs its annual essay contest for high school seniors and the winner can take home a prize of $750.
– Warren Buffett knows what’s up: The rate of distracted driving is higher than ever. This is having an effect on insurance rates, which will go even higher according to the Sage of Omaha. Rates at Geico have already been increased, partly as a result of the fact everyone loves to text while driving.
– Confirming Buffett’s outlook: a recent report from AAA in the US finds that 87 percent of drivers engage in unsafe behaviors behind the wheel. The report finds that “1 in 3 drivers have had a friend or relative seriously injured or killed in a crash, and 1 in 5 have been involved in a crash that was serious enough for someone to go to the hospital.”
– According to the CCC’s 2016 Crash Course report the auto claims and collision repair industries are at an ‘inflection point’ as vehicle technology, driving data, mobility and analytics converge and gain momentum. According to the splash page of the report, “The start of 2016 finds the property casualty insurance and collision repair industries at what might be described as an inflection point. Auto claim frequency and loss costs are on the rise again: consumers are back at work, spending more time behind the wheel, and quickly adapting to a world that is rapidly becoming more digital. With technology providing greater speed and transparency, businesses are using mobility, big data and analytics to improve processes and products that cater to a broader array of customer demands.”
– An analysis finds the big four US consolidators grew by 25 percent last year. According to the report, ABRA, Boyd, Caliber and Service King expanded the number of new locations during 2015. But unit growth was still down from the frenzied acquisition activity in 2014. Overall, the acquisition and new collision repair facility openings by the big four grew by nearly 300 units during 2015. Overall, Caliber (which is tied to the private equity arm of the Ontario Municipal Employee Retirement System) had the largest number of locations, at 358, up 126 from 232 at the end of 2014. It’s now bigger than the other Canadian player, Boyd Group, which had 349 locations last year, up from 333 in 2014.