Solera logo

By Jeff Sanford

Toronto, Ontario -- November 6, 2015 -- This past August major industry software manufacturer Solera was taken over by private-equity firm Vista Equity Partners. Since then brokerages have downgraded the stock. Presumably, investor interest in the stock has faded a bit now that the sale is out of the way. Activist investors will often jump into a stock if a sale seems imminent in an attempt to catch the increase in prices that typically accompany a big sale like this. Now that the sale is done investors may want to redeploy that capital.

So no wonder Solera has made a string of announcements recently, which gives investors some positive news about future prospects of the company.

Most recently, the company announced a new efficiency strategy. This past week Solera announced it is going to integrate its parts procurement divisions, Distribution Service Technologies and APU Solutions, into a new online parts procurement platform called InPartTM. This should help the company become more efficient and spend less.

"Our vision is to become the premier procurement solution for all part types, including OEM, aftermarket, and recycled parts, for global collision and mechanical repair workshops," said Tanvir Arfi, President of Solera's Service, Maintenance Repair & Parts platform. "InPartTM leverages the capabilities of Solera companies across market segments, extending the value of our solutions for all of our customers – whether an insurer, repairer, or part supplier."

The press release went on to say that InPartTM will “streamline the process of searching for, pricing, and purchasing OEM, aftermarket, and recycled parts for both the collision repair and mechanical repair markets.” In terms of the collision repair market InPartTM builds on APU PartsNetwork's “successful 15-year foundation and provides benefits for all three stakeholders involved in a collision repair - the auto insurer, body shop, and parts supplier.”

Solera also just announced a project aimed at longer-term growth. The company is building the first “third party automotive insurance research centre” in China. The oddly-named CESVICHINA Vehicle Research Center is a joint venture of Solera and and Spanish insurance group, MAPFRE, The centre officially opened in Beijing last week at that city’s Goldenport Motor Park.

"This centre will enable the creation of mutually beneficial partnerships among car manufacturers, repair shops and insurers while leveraging global expertise to drive innovation through better data, training and processes,” said Tony Aquila, founder, Chairman and CEO of Solera. "This will result in a smarter, safer and more advanced auto industry in China."

The will do research and consulting on the Chinese market, including “standard labour time research, group rating, body shop certification and road traffic accident re-construction.”

CESVICHINA will also provide practice for medium to senior level assessors and auditors. As well, the institute will provide “insurance knowledge and collision repair estimation technique training for body shops” as a way of improving the professional level of personnel and quality of service in the world’s largest car market.

The centre will develop a rating system for China that “takes into consideration vehicle body structure, parts performance, price of frequently damaged parts and repair labour time.”

The centre will also introduce the unique collision facility certification system developed by CESVIMAP. “The system will assist insurance companies in establishing a more scientific repair partner selection and assessment system thus enhancing efficiency and quality of repair,” according to a press release.

"To simplify and facilitate the repair process will translate to better customer experience for insurers, repair shops and car manufacturers," said Antonio Huertas Mejías, President and CEO of MAPFRE Insurance Group. "A win-win situation that makes us look to the future with enthusiasm and to renovate our commitment to the Chinese market in the years to come."

As it is, there are thought to be 100,000 collision repair shops in China, ranging in size and sophistication from small one-person ships using handmade tools, up to massive extremely sophisticated repair facilities. Getting in on the ground floor of the development of the country’s growing collision repair industry bodes well for the future of Solera.


Preview Our Magazines