Supply Chain Issues and Repair Complexity Major Concerns in 2022 by Ed Attanasio
Before the pandemic hit, people in the collision repair industry were most concerned about a lack of qualified employees and the growing complexity of OE repairs. Those problems still exist, but now the crippled supply chain has been added to the equation. It’s a whole new world and scary in many ways, so how will auto body shops be able to navigate through these uncertain and troubled times? Solid, carefully researched and highly relevant data can surely help everyone in this industry. Director/ Industry Analyst Susanna Gotsch from CCC Intelligent Solutions, Inc., is well-known for being the author of the company’s annual Crash Course since 1995, where she interprets the numbers and forecasts what is going to happen next. Gotsch’s historical perspective supported by data is invaluable for anyone who works in the automotive industry. Gotsch set the table for this year’s report before diving into the numbers. “It’s hard to fathom that we are nearly two full years into the pandemic, but one thing we know for sure: The natural pre-pandemic order of things has been altered, leaving us searching for a new normal or rhythm to how we live, communicate and conduct business,” she wrote. Obstacles created by supply chain issues are a concern to every body shop in the world right now. “Despite new variants and ongoing debates on how best to balance public health and economic well-being, the U.S. economy has roared back, with consumer buying things like cars, homes, furniture, electronics and other goods,” she said. “As a result of the increased demand, supply chains have been pushed to their brink, either from shortage of goods or people to deliver them. “Whether it’s the auto industry’s shortage of semiconductor chips or metals critical to development of electric vehicles, or the medical industry realizing many of the most critical drugs and supplies are only manufactured overseas, all industries are hav-
“Unfortunately, new vehicle pandemic, the Crash Course said. While repairers are seeing an technology such as ADAS and EVs increased number of non-driveable have added increased complexity DRP repairs relative to the preced- and requirements for new skillsets, ing two years, both driveable and training and tools for the collision non-driveable repairs are taking repair industry,” she said. “So, while longer, and repairer productivity is the industry has demonstrated its relower. silience and ability to adapt to new “Unfortunately, as repair costs vehicle technology over the years, climb, repairer productivity can adapting takes time, and today’s ensometimes suffer, custom- vironment means these repairs may er satisfaction can fall and cost more.” the likelihood that the cusA sharp increase in motor vetomer needs to bring their hicle fatalities occurred in 2020 and vehicle back for additional 2021 in the U.S., highlighting the work after repairs complet- need for new directives to improve ed also increases,” Gotsch vehicle safety. An estimated 20,160 people explained. “And it’s not just repair time that is tak- died in motor vehicle traffic crashes ing longer. The time to get in the first six months of 2021, acDirector/Industry Analyst Susanna Gotsch from CCC an appraisal has increased cording to the NHTSA—an increase Intelligent Solutions forecasts that supply chain problems, for traditional channels of 18.4% from the first six months inflation and repair complexity will continue to be major where the customer either of 2020, and the highest number of obstacles for collision repairers in 2022 is visited by an insurance fatalities during the first half in 15 data pointing to higher wages in staff appraiser or brings their vehicle years, based on this year’s Crash Course. 2022,” she said. “The disruption in for a DRP appraisal.” Ultimately, the key to combat The fatality rate per 100 million experienced over the last two years has accelerated the pace of innova- higher costs is to improve produc- vehicle miles traveled increased to 1.34 for the first six months of 2021, tion across all industries, leading to tivity, Gotsch outlined. the transformation of how business is conducted as technologies such as artificial intelligence (AI), telematics, mobile and cloud are being adopted to help inform and speed processes, and combat challenges stemming from labor shortages, new consumer expectations and other market dynamics.” The automotive repair industry is still struggling to find employees, Gotsch reported. “Representatives from Universal Technical Institute predict a wave of retiring baby boomers will create 100,000 auto technician job openings over the next decade or so, • Competitive • Daily Deliveries to the • Professionally Pricing & Greater Los Angeles Metro Trained Wholesale with the Bureau of Labor Statistics Discounts Area & Orange County Parts Specialists projecting a 4% decline in employment in the overall auto technician field through 2029,” she said. “Finding technicians with the right skillsets is also a growing challenge as Parts Parts Hours vehicle complexity increases.” Mon - Fri 7am - 5pm Most collision repairers inSat 8am - 5pm Ask for Tom Reeser - Wholesale Manager dicate the technician shortage has www.infinitioftustin.com been the primary reason for longer Parts2682@autonation.com 24 Hr Fax backlogs of work. Repair work is up as auto accident frequency has ris714-573-5497 33 Auto Center Drive l Tustin, CA 92782 en. Many shops have indicated they cannot repair as many vehicles at the same time as they did before the ing to re-examine and restructure their supply chains.” The supply versus demand imbalance has also impacted U.S. inflation in a huge way, which hit a 40year high in December 2021, Gotsch said. “Labor shortages have also driven up wages across nearly all industries, with Conference Board
30 MAY 2022 AUTOBODY NEWS / autobodynews.com
AutoNation INFINITI Tustin
The Collision Parts You Can Trust
714-832-6252
