GETTING HEAVY

Repair not replace is a current sector trend

The CV repair market is facing tough times. The EU Product Directive is just two months away and an increasing skills shortage and static labour rates are hitting the giants of the repair market hard. Kelly Dalwood reports.
Cycle times of painting commercial vehicles have slowed down due to improved paint technology, vinyls and pressure on fleets to reduce costs. Another factor has been that most transport operators lease rather than own their vehicles, so that vehicle refurbishment and mid-life repaints are no longer necessary.

Margins are tight, customer expectations are increasing and new technologies in commercial vehicles are getting more complex.
?Significant levels of investment and a commitment to business development are essential to remain competitive in a market that is increasingly demanding more from its repairers,' said Mike Wilson, Bodyshop Manager at Perrys of Gobowen, joint winner of CV Bodyshop of the Year 2006. ?We specialise in accident repairs and have seen a steady increase in numbers. A lot of people in the industry would like to do that as it's more profitable. Some CV bodyshops continue to rely on a high volume of refurbishment jobs but it's a competitive market and the majority of work out there only provides a low profit margin.'


Taking advantage of the specialist training and support offered by suppliers can have a dramatic impact on the standard of repairs and bodyshop profitability, and a good relationship with insurers and engineers is essential. ?Gain trust and respect from the engineer, if they know you can do the job you can build a good working relationship,' said Mike Wilson. ?Our strong point is our relationship with the engineers. If you can explain the correct repair methods and you've got the quality of work to go with it, engineers have faith in you.'

Insight

Phil Ewbank, owner and MD of Commercial Contract Engineers (CCE), agrees and has been running a series of Insurer Insight days to give engineers practical experience of the commercial vehicle repair methods. ?Estimating is the key to a good repair method and of major importance to the claims/engineer department,' he said. A good relationship with the engineer can prove a win/win situation in the CV bodyshop. The success of CCE's Insurer Insight days has shown benefits for both insurer and repairer, Phil explained. ?AXA gave great feedback on the first training day held with CCE and has requested further training for four more engineers.' CV training is virtually non-existent, with very few local colleges offering training for commercial vehicles. CCE relies heavily on in-house training. ?Actual engineer experience is no longer available at Thatcham for CV estimating and repair methods. Thatcham could really capitalise on this and offer training on the CV side for insurance companies and repairers,' said Phil.

Skills

The CV sector is experiencing a skills shortage. Many repairers feel that more needs to be done to raise the profile of the CV industry to make it more attractive to young people.

Organisations such as Automotive Skills, Thatcham and IMI are working to change this. ?I think the image of CV repair as a career is getting better,' said Mike Wilson. Perrys has taken on three apprentices in the past three months. CCE reports a huge investment of £17,000 in staff recruitment and training over the past two years. ?This significant level of investment is essential to keep our business at the forefront of the industry,' said Phil Ewbank.

For those CV repairers investing in equipment, training and marketing, ensuring a profitable return depends on the bodyshop identifying changes in the market and adapting their business accordingly, as these repairers show. Phil Ewbank explained how a downturn in CV repairs in June 2005 at CCE meant a need to subsidise this with growth in its car repair business. In September 2005, CCE invested in AudaEnterprise, a wise investment according to Phil, that has assisted growth and volume in car turnover.

?One of the largest spins-offs for our business is that we have had to be ultra efficient in our car operations to prosper and survive,' said David Rolls, BP Rolls, Managing Director and joint winner of CV Bodyshop of the Year 2006. 'Car repair is audited and cost controlled fiercely by insurers. You can make a profit, but only if you're on top of your game. What works in cars will never be fully mirrored in commercials although some of the lessons, processes and approaches to customer service and quality control have served us well in their adaptation to commercials,' added David.

A significant growth over the last two years in the 3.5t van market follows a decline in 7.5t vehicle drivers due to licensing laws. Light CV repair equipment is a shrewd investment and knowledge of specific licensing issues is essential. ?BSI PAS125 will include cars and light vans,' said Mike Wilson. ?Elsewhere, licensing of the CV sector is happening gradually with insurance companies, accident management schemes, paint companies and industry associations.'

Recycle

Another current trend in the sector is the culture of repair not replace. ?We must look more closely at recycling quality parts such as cabs, body panels and trims,' said Glyn Heathcock, Director at Perrys. ?Parts suppliers must be aware of the increasing cost of parts to repair vehicles. The price of new vehicles and fleet discounts is affecting the number of total loss claims. At Perrys, cab repairs are now more common than shell replacement, with the use of two Josam cab jigs and correct repair methods.'

The CV market has the same controversial issue of suppressed labour rates. When you consider the huge investments needed to repair CVs correctly, and take into account the skill level requirement and the commitment to training and business development needed, realistic labour rates seem a long way off to some repairers. ?Labour rates continue to be well below that of our maintenance counterparts, and we do not see that changing in the near future,' said David Rolls. 'Every second a commercial vehicle is off of the road it is costing the customer money and CV repairers know that minimising downtime is vital in the competitive market.'

Successful

The joint winners of the CV Bodyshop of the Year Award, and CCE's Phil Ewbank, believe a good relationship with insurers is essential. ?Talking openly about repair methods with insurance and fleet engineers has developed a successful working relationship,' said Mike Wilson. ?With this in mind, the appreciation is only positive which gives good repair times and profitable labour rates.' Making the right choices, investing in the right equipment, building a professional team and providing a quality service is key to the success of the two winners of the CV Bodyshop of the Year Award. ?To reinforce the simple mechanics of any business, keep your customers happy, produce a quality product and strive for efficiency to make yourself as competitive as possible,' said David Rolls.