Automotive News Canada - April 2021-v2 - F14

FIXED OPS JOURNAL

CRASH AND EARN

More collision business expected; newer vehicles need expertise
DAN SHINE

dan.shine@crain.com

raffic at dealership body shops should slowly return to
pre-pandemic levels in 2021, though it may not be until the
following year before the numbers are back to normal.
That's the view of Susanna Gotsch, director at CCC Information Services, a collision software provider. She
says most shops reported a 15 to 20 percent decline
in business last year - recovering from the first few
months of the pandemic when some saw business
drop by half.
" Our expectation is that we will continue to see
people start to get out more, we'll continue to see
improvement " in collision repair numbers, she
says. " The second half of the year could be pretty
healthy from a volume perspective. Well above Gotsch: Driving
where we were in 2020 and maybe only slightly patterns changing
down from where we were in 2019. "
Traffic levels - as well as accidents - plummeted during the pandemic
as many people worked from home and rarely ventured out. Gotsch says
CCC research indicates typical bone-shaped driving routes - errands

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PAGE 14

What was the
appraisal?
Average appraisal amount
on collision repairs
2017
$2,900
2018
$3,100
2019
$3,300
2020
$3,400

How many said yes?
Percent of consumers in 2020
who agreed to repairs at these
appraisal amounts
$0-$500
81%
$500-$1,000
69%
$1,000-$2,000
76%
$4,000-$5,000
80%
$10,000 and up
70%

How long did it take?

Average number of days in collision repair cycle*
VEHICLE ARRIVAL
TO START WORK

2017-18
2018-19
2019-20

1.1
0.9
0.7

REPAIR START
TO FINISH

8
8.4
8.5

END OF WORK TO
VEHICLE'S DEPARTURE

0.8
0.9
0.8

*4th quarter through 3rd quarter of following year
Source: CCC Information Services 2021 Crash Course

around home and back and forth to work - may be changed permanently, something dealership body shops need to monitor.
" How the driving patterns change will also potentially drive the types
of accidents and where they occur, and the shops chosen potentially to
do some of that work, " she says.
If a dealership is contemplating whether to add a collision shop,
Gotsch says, the time might be right to invest.
" I think there's a lot of interest in sort of diversifying and bringing in
more capabilities to broaden your ability to grow your revenue, " she
says. " Most people think that the collision industry is going to be pretty
healthy for some time. "
She also says CCC research shows people who may have relied on
public transportation or ride sharing before the pandemic are now buying vehicles instead. And stimulus checks that people received during
the pandemic spurred some to buy new vehicles or newer used cars.
Newer vehicles are made with lighter materials, have different joining
techniques and are equipped with more sensors. All these things mean
that collision repairs are more complex, requiring more technician
training and special tools - an advantage dealerships might have over
independent shops.
" The dealerships, if they have body shops, are sort of positioned well
for, and oftentimes they're sort of the first in line for, some of that " body
repair work, Gotsch says.
Gotsch says the parts department at dealerships also can play a role in
helping the body shop grow its business and keep customers happy.
She says the complexity of today's collision repairs can take a long time.
" So on the part side, the more things - processes and tools and technologies - that can be put in place, " the better, Gotsch says.
" There's not going to be much they can do to control the growing cycle
time other than trying to improve the processes internally, " she says. " So
some of the technologies like online parts ordering and invoicing and
reducing of returns - all of that will become increasingly important. " 

APRIL 2021

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4/2/21 2:11 PM

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Automotive News Canada - April 2021-v2

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