Fleets are Facing Higher Repair Costs — and Greater Hidden Risk


Wayne Smol­da, CEO, The CEI Group


Auto­mo­tive fleets are expe­ri­enc­ing  just the begin­ning of an accel­er­at­ing trend toward high­er repair costs, greater risk of unsafe repairs, and more lia­bil­i­ty from vic­tims of fleet acci­dents.  That’s the lat­est view from Wayne Smol­da, founder and chief exec­u­tive offi­cer of The CEI Group, Inc. Mr. Smol­da makes the com­ments in the Novem­ber Decem­ber 2013 issue of Fleet Finan­cials mag­a­zine, in a guest edi­to­r­i­al titled, “Fleet Exec­u­tives Must Be Futur­ists.”

Mr. Smol­da cites sev­er­al fac­tors for what he said is “the begin­ning of a tech­nol­o­gy-dri­ven increase in the cost of auto­mo­tive acci­dent repairs.” Among them are the increas­ing use of plas­tic, car­bon fiber and exot­ic steel alloys by auto man­u­fac­tur­ers in the pur­suit of greater fuel effi­cien­cy; the extra time and expense it takes repair shops to com­plete repairs for vehi­cles with those mate­ri­als, and a con­tin­u­ing pro­lif­er­a­tion of expen­sive safe­ty tech­nol­o­gy that relies on sen­sors that must be replaced and pre­cise­ly repo­si­tioned.

Mean­while, he said that fleets need to be aware that not all repair shops in the finan­cial­ly pressed col­li­sion repair indus­try will be able to make the required invest­ment in advanced tools and train­ing to keep up with the chang­ing con­tent in the vehi­cles of the future.

“One poten­tial out­come is that some shop own­ers will save mon­ey by repair­ing vehi­cles the same way they’ve done for years,” Mr. Smol­da says.  “The dan­ger is infe­ri­or repairs, more crash­es and sig­nif­i­cant­ly reduced vehi­cle resale val­ues.”

The pro­lif­er­a­tion of traf­fic cam­eras and on-board elec­tron­ic data recorders means fleets may have incom­plete knowl­edge of who their most dan­ger­ous dri­vers are, and so are more vul­ner­a­ble to neg­li­gent entrust­ment lia­bil­i­ty when those dri­vers cause acci­dents.  Typ­i­cal­ly, traf­fic cam­era vio­la­tions don’t cite dri­ver names, while fleets may not be using all the data that telem­at­ics sys­tems are cap­tur­ing to iden­ti­fy high-risk dri­vers, he explained.  “In court, this opens fleet oper­a­tors to the charge that ‘you should have known what you could have known,’ ” he warns.

To min­i­mize those risks, Mr. Smol­da says fleets need to rely on sup­pli­ers who can help them eval­u­ate repair shop capa­bil­i­ties, close­ly mon­i­tor repairs, and bridge the infor­ma­tion gap to iden­ti­fy their high-risk dri­vers.


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