Filed Under:Risk Management, Loss Control

The Horsepower Race

You’ve heard me talk about how the Obama administration’s recent change to the Corporate Average Fuel Economy Standards (CAFE) will impact the collision-repair industry. In case you need to jog your memory: In late 2009, President Obama announced an aggressive mandate requiring all new cars and trucks to achieve 35.5 miles per gallon by 2016 (an average of 39 mpg for cars and 30 mpg for trucks), cutting four years from the previous regulation timetable. Although this change will vastly affect vehicle construction—particularly vehicle size—it snuck under the radar and went unnoticed by many.

There’s another major change that also needs to be brought to the forefront, as it too will no doubt have a far-reaching effect on the industry—the cutthroat horsepower race between vehicles on U.S. roads. Horsepower has come a long way in a fairly short amount of time. When I worked at a detailing shop in high school (ok, so maybe not such a short timeframe), I had the privilege of detailing several exotic cars. I have always been a James Bond fan (what car buff isn’t), so when an Aston Martin DB5 came into the shop, I loudly raised my hand to be the first to volunteer to work on this beauty.

Related: More Blog Posts from Sounding the Horn

I opened the owner’s manual to find out where the well-hidden hood release was, and in the process, I found something else I’ll never forget—a welcome letter to the lucky owner of this machine. It so eloquently began, “Dear Sir, you have just purchased one of the world’s fastest motor cars.” Wow, what a sentence…not only for the obvious, sexist assumption that the owner could only be male, but that the DB5 was one of the world’s fastest cars. Looking at performance figures in the 1960s, it was both one of the quickest and most expensive cars to be had.

The world has changed a lot since the DB5 starred in “Goldfinger.” Today’s consumers (even those in the market for economy cars) would not stand for the performance of the top-selling small car of the 1960s—the VW Beetle. With a 0-60 time of 23 seconds and a top speed of 72 miles per hour, many drivers likely consider them a fun way to take a trip down memory lane, but I suspect that many would not darken the VW’s doors for everyday use on today’s roads.

We have come to expect spritely performance from economy cars, and car makers are giving us what we want. Believe it or not, a Honda Civic can out accelerate the Aston Martin DB5. Can you imagine James Bond driving a Honda Civic instead? Even the unsuspecting 2006 Civic Si can outperform my favorite muscle car: the iconic 1965 Pontiac GTO. The recorded time for the GTO was 0-60 in 7.0 seconds and a quarter mile time of 15.8 seconds, with the stock 2006 Honda Civic Si coming in at 6.2 seconds with a quarter mile of 14.7 seconds.

So what impact does this have on collision repairers? Two things come to mind. First, there are a host of advanced mechanical components needed that work together to squeeze such performance out of four-cylinder engines. Computer-controlled valve timing, transmissions and throttles all complicate repairs when the impact has intruded on the engine compartment.

Secondly, these cars are light weight, with the weight savings coming from the smaller, lighter components that unfortunately tend to be destroyed in moderate impacts. Surrounding structures sacrifice themselves to protect the passenger compartment, which is great in terms of occupant safety, but it’s not such good news in terms of reparability because in most situations where this occurs, the car can’t be economically repaired.

Many vehicles in the latest car magazines fall into this category. Just scan the pages and you’ll see that they are full of what in the 1980s were called “econoboxes” but are now slippery wedges that are surprisingly quick. Look at the front end of these sleek cars, and you’ll see that these low-slung, wind-cheating cars are easily capable of driving under the back bumper of SUVs and trucks. That kind of impact will take out two xenon headlamps, an alloy hood, two fenders, the A/C condenser, radiator and the alloy core support while also deploying the two front airbags, which will destroy the dash panel and windshield. Most three-year-old small cars sustaining that type of damage are not going to end up in the shop for repair.

The folks at American Honda recognized this trend and are doing something about it by offering collision-impact kits, which help make front-end repairs more cost effective. Kits include a front-bumper cover, front-bumper beam, front-bumper absorber, right and left fenders, right and left headlights, hood, SRS unit, driver’s airbag, and driver’s pre-tensioner seatbelt. Buying those parts individually could cost just over $3,000 at manufacturer’s suggested prices. However, purchasing the parts in the kit is significantly less at roughly $2,000, giving you the potential to save around $1,000.

I have yet to see other small-car makers launch such a program. Other OEMs need to follow Honda’s lead so there is more than just one company offering solutions to reduce economic total losses. There’s no reason not to since there are so many benefits to repair cars. Shops get more work, owners (who may be upside down on the loan) keep their car, and OEMs sell more parts.

In the past, many OEMs believed that they benefited from an owner totaling out a car, but in today’s new-car sales market and credit crunch, can they be so sure? There are several steps you should take when a borderline total comes in to your shop.

1. Understand the state regulation on totals; you need to know how an insurance company makes the decision.

2. Find the realistic salvage value of that particular car and proactively educate the insurance company on the facts.

3. Work with your OEM parts suppliers too and understand if there are additional discounts available through their competitive crash parts program. It may make the difference between them selling a lot of parts or not selling any.    

What else can you do? As members of the collision-repair industry, you can work with the OEMs to make this situation better. Join your local shop organizations and work with them to leverage the power of their experience to make your voice heard.

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