By Jeff Sanford
Toronto, Ontario -- February 18, 2016 -- It’s time once again for our weekly round-up of news, facts and general weirdness from around the collision repair sector and beyond.
- A very interesting idea is contained in a new research report. Believe it or not, but cycle time might not be the most key factor when it comes to overall customer satisfaction with collision repair services. The notion is contained in a report from CCC that was published last month in a property and casualty insurance magazine. The idea is simple. An analysis of customer satisfaction finds that what's really important to customers is the quality of the repair, overall customer service and successful management of customer expectations. That is, shops that keep a client informed of what to expect throughout the repair and go good work combined with good service will be more successful than the shop that reduces cycle times to the bare minimum. It actually seems quite sensible. Good service and communication ... nothing beats it, apparently.
- Reuters is reporting that paint and coatings maker AkzoNobel has agreed to buy BASF's industrial coatings business for $531 million. Note that this is industrial coatings, which includes commercial transport, but does not include automotive refinish. The deal is expected to strengthen AkzoNobel's position in “coatings for widely used steel and aluminum bands.” AkzoNobel is paying a multiple of more than eight times the asset's expected 2016 earnings before interest, taxes, depreciation and amortization. According to Reuters coatings groups Axalta and PPG trade at “8.7 and 9.4 times their expected core earnings,” while BASF and AkzoNobel trade “at only 6.7 and 6.5 times” earnings. That is, Axalta and PPG are considered a little more valuable by markets than BASF and AkzoNobel.
- Boyd Group Income Fund announced a cash distribution for the month of February of $0.042 per trust unit. The distribution will be payable on March 29, 2016 to unitholders of record at the close of business on February 29, 2016.
-Intact Financial Corporation is getting in on the newest game in the insurance industry. The company has just announced it will make a strategic investment in Metromile, a company that provides “pay-per-mile” car insurance. Intact, of course, is Canada's largest P&C insurer. So far, Metromile only operates in the United States. Could it be just a matter of time before pay-as-you-go insurance comes to Canada? Seems so. According to a media report the deal is in line with Intact's “long-term strategy to invest and partner with emerging and innovative businesses.”
- Also on the insurance side, Ryan Michel has been appointed to the position of President and CEO of Allstate Insurance Company of Canada. Michel takes over for outgoing President and CEO John O’Donnell, who has taken on a new role as a Senior VP with Allstate Insurance Corporation in the US.
- An elephant grabbed headlines this week when he went on a car-crushing rampage. Apparently the pachyderm was rejected by a potential mate, and he took his anger out on nearby cars, trashing several of them.
- BCC Research has just released a report on carbon fiber. It finds the reinforced resins are “replacing heavier metal components as the auto industry endeavors to meet increasingly stringent fuel economy mandates.” According to the report production of reinforced plastic composites was about 6.7 million tonnes in 2015. By 2020 production will expand by another 8 million tons as Corporate Annual Fuel Economy (CAFE) regulations see metal components increasingly replaced with plastics. The 2025 CAFE standards now require a fleet average of 54.5 mpg. This will force the auto industry to “significantly reduce the average weight of its autos.” According to the report the auto industry has 10 years to accomplish this task. Industry observers claim that by “2025, at the latest, the average weight reductions in most vehicles is expected to average almost 500 or more pounds.” Thermoplastic and composites presently comprise an average of almost 400 pounds per car. It is anticipated that “plastics usage in the engine-related segment will increase significantly by the end of the decade.”
- Walker's Automotive in Knoxville-Tenesssee is taking shop design to the next level. The company recently put out a press release announcing that it has partnered with Studio Four Design, a “top ... architecture and design firm, to build a distinctive building design that provides a unique experience to customers and insurance companies.” The 50,000 sq. ft. collision facility will differentiate itself “from typical auto shops with its comfortable, inviting and warm atmosphere,” according to the release. The presser went on to say that the “layout of the building was designed with customers and insurance companies in mind – creating a space with intuitive design and furnished in a modern, yet functional fashion.”
- Ford is testing a new feature that sees the car scanning the road in front of it for potholes. When cameras pick up an approaching pothole the wheel that is rolling over the hole is lifted up. The car runs on three wheels for a fraction of a second. The car avoids dipping into the pothole. It’s a really neat trick. You can see it in action in the video below.