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Crash repair: the fightback begins

It is just over a year since Mazda UK introduced its free accident aftercare service, Call Mazda First, and dealers are reporting a significant jump in bodyshop work and spin-off benefits in new vehicle sales.

Mazda dealer T W White & Sons, in Surrey, says its bodyshop work has increased by more than 50% since Call Mazda First launched in August 2009.

In the event of a smash, regardless of fault, Mazda drivers phone the Call Mazda First telephone number.

Their claim is then managed by professionals who liaise with insurers, ensure a courtesy car is provided and minimise the burden associated with insurance claims.

Mazda UK says each job is worth an average of £540 in labour revenue alone.

Bodyshop programme manager Suzy Doutch said: “It is also helping parts sales for the dealers, with an average of £600- worth of parts for each job, and customers know their vehicles will be repaired by a Mazda Approved Bodyshop.”

Vis Pallay, of T W White & Sons, said: “It has made a big difference to our business in terms of volumes and parts turnover and has improved our customer retention. In the past we would give a quote for repairs, but customers would go back to their insurers and be directed to the insurers’ own approved bodyshop list.

“Now the core Mazda brand is behind us we are finding that we are winning around 98% of the business we quote for.

"Customers feel they are dealing not just with us the dealer but with Mazda the brand.

"It gives them confidence to stand their ground with the insurance company as to where they take their vehicle for repair.”

So just how big is this opportunity?

1,500 crash customers per dealership

Research by accident management specialist Accident Exchange shows that 5% of new car owners will have a non-fault accident within the first month of ownership.

What’s more, an average dealer with a customer base of 10,000 will see 1,500 involved in an accident every year, of which 500 will be non-fault. Accident Exchange says dealer penetration is currently only 20% of that.

Eastern Western Motor Group Accident Repair Centre in Edinburgh holds approvals for Audi, BMW, Ferrari, Mercedes-Benz, Volkswagen, Toyota and Saab, among others, and runs an accident management programme in conjunction with Accident Exchange.

General manager Peter O’Malley said: “Each of our dealerships has a bodyshop champion well-versed in handling these claims.

"However, as a multi-franchise site it is expensive to meet every manufacturer’s criteria.

“We have to repair cars to the manufacturers’ standards and that is not achievable on the hourly rate that insurance companies offer.”

So how can motorists be convinced to call their manufacturer rather than their insurance company?

“I have been trying to achieve that for the last 10 years,” says O’Malley.

“We invest heavily in equipment, training and standards, which makes our service more attractive to the end user. We probably get 20% uptake.

“Insurance companies put obstacles in the way to using a manufacturer bodyshop so motorists just give in.

“Franchised dealers must tell their clients that they need to have their vehicle repaired to the manufacturer’s standards. If they do not, then it could affect the trade-in value.”

O’Malley continues: “I have horror stories about cars which have been worked on by insurance company bodyshops.

"Sometimes when we are asked to rectify cars we cannot believe the mistakes that have been made.

“Insurance companies need to get their pricing right to make it pay so they can use properly trained technicians.

"It all comes back to the fact that insurance policies are too cheap, but people do not want to hear that.”

Customer choice

Andrew Moody, managing director of Retail Motor Law, also has strong views on the role of insurance companies. He entered the motor industry as a panel beater and is now a qualified barrister and solicitor specialising in automotive law.

“It is not for insurers to dictate where people have their cars repaired, yet this appears to be happening ever more frequently,” he says.

“If the insurer steers a customer away from the franchise the dealer should offer them a free post-repair inspection. This could be a great sales opportunity.”

The thorny subject of ‘standards’ is always on the agenda at bodyshop industry events, with the BSi Kitemark considered by many to be
the pinnacle.

Baldwins, which has manufacturer approvals from Honda, Mazda, MG, Mitsubishi, Nissan, Peugeot and Renault, recently announced that its four sites have all achieved the Kitemark.

Group general manager Peter Randhawa said: “The BSi Kitemark is a strong brand which is highly respected and recognised by the consumer. It has already helped us gain more business and we believe it is an efficient tool in gaining future business.”

Proving that there is money to be made, accident management company Easi-Drive reports that it has doubled its turnover year-on-year since 2005.

Head of sales Zac Mitcheson believes an in-house accident management service is a great way for dealers to maximise profits.

“By partnering with us dealers get the opportunity to nurture a relationship with a client long after the original sale,” he said.

“The economic climate is still tough and insurers are being much more forthright in diverting customers to their chosen bodyshops.

“However, if dealerships have their own accident management service they are in the driving seat. It presents the opportunity to sell the concept to the customer at the point of purchase, which in the long term will lead to vehicle and parts sales and help generate ongoing brand loyalty.”

One of Easi-Drive’s latest recruits is Knights BMW of Stoke-on-Trent. The company opened its on-site bodyshop earlier this year, having previously subcontracted the work.

Aftersales director Ian Dow said: “We do new and used sales and service and repair, so bodyshop was the last piece of the jigsaw.

“We signed up to Easi-Drive earlier this year. Apart from the obvious which any accident management company does, it offers like-for-like vehicles and helped to relaunch our accident management programme.”

In terms of publicising the new service, he said: “We are very active in collecting email customer details and we find e-marketing is an effective way to distribute information. We are strictly BMW and Mini and are not actively marketing outside of that.”

This approach seems to be working.

“The bodyshop has met all its targets during the year and customers like it because it is on-site,” said Dow.

Make the bodyshop the first port of call

As to battling against the messages from insurers, he said: “The insurance companies have too strong a hold on the market.

"They have almost indoctrinated the motorist that they should be the first port of call in the event of a crash and are very good at diverting customers to their bodyshops.

“In reality, the bodyshop should be the first port of call. Insurers are only interested in driving down the repair cost and we have to make our customers aware of that.

“Accident management programmes are part of that process. When you explain the situation to customers they understand, but it is hard to compete with the advertising of the insurance companies which drip-feed information like ‘you get a free courtesy car’.

"But these are the same benefits you get from a bodyshop.”

Insurance companies are not taking the motor trade counterattack lying down.

Robert Buckley, director at Blue Bell Bodyshop, warns that insurers are already responding to the competition from accident repair programmes.

“They are contacting the third party very quickly and jumping on every opportunity,” he said.

“Dealers need to provide a solution for every customer need so we offer a whole suite of services. Accident management is just one and we see it as an important part of our customer retention process.”

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