By Scott Shriber
4/29/2011 9:05:08 AM
Henry Ford’s age-old statement, “You can have any color car you want, as long as it’s black,” might have seemed a bit terse back in the 1920s. Today, it might not be too far from the truth.
I’m sure by now most of you have heard that the unfortunate disaster in Japan is about to affect those of us over here in the collision repair industry. In case you’re not aware of the issue, here it is in abbreviated form.
A factory in Japan that produces the key metallic automotive paint pigment called Xirallic suffered significant damage. Xirallic is a key ingredient in black, gray and red-shade paint colors. This is important to us since silver-based colors account for around 30 percent of vehicles produced last year. Silver has been a significant leader for car buyers for many years. Add to that the various red shades, and you’re talking about a big chunk of the car population out there.
Before anybody starts Japan-bashing, let’s be clear. This is the result of a very unfortunate natural disaster. Many people have lost their lives or had them significantly altered forever. I’m sure all of our thoughts go out to those who have been personally affected. This is not some corporate scheme to create a shortage or drive prices up. This situation is the result of a global economy. Products are sourced from all over the world to the most efficient and many times most specialized suppliers. This helps provide all of us with the best and most competitive supply for our use. When there’s only one major supplier and there’s an interruption in production, we’re all affected.
Luckily for our industry, we have a group of excellent paint manufacturers and suppliers. I spoke with them on this subject and found out that they’re already deeply involved in managing this situation on our behalf. Remember, none of them manufacture these ingredients either. They’re a purchaser of them and are all affected equally.
In speaking with them, it was evident that they’re all taking steps to ensure a supply for us that’s as uninterrupted as possible. All have indicated that they’re on an allocation system and have put in place controls so no hoarding of product will take place. One creative manufacturer has already changed its packaging so less product is sitting on shelves. Others have changed initial shipping amounts and restocking quantities. I’m confident that everything is being done to protect us and our customers in this difficult situation.
Another complexity is that new cars also use this additive in production. Many suppliers service both the production side and the repair segment of the market. Those suppliers are working closely with the OEs to manage inventories and lower requirements for use in production. Almost all of the new car manufacturers have taken steps to limit the amount of this pigment used. Dealer order restrictions and removal from the color options available are actions that are in place at most OEs.
The important thing to remember is that this is one of those situations that none of us can plan for. These unplanned events are called “life.” The good news is that there are some pretty smart people out there who are watching out for us and our industry. I guess in this situation 90 years later, Henry was wrong. You can have lots of colors...as long as it’s not black, silver or red.
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