AirPro Diagnostics: Tips for Running a Family Collision Business
Association encourages insurer to make parts system voluntary to Select Service shops, not mandatory.
The Automotive Service Association of Ohio (ASA Ohio) has sent a letter to State Farm CEO Ed Rust Jr. expressing the association’s opposition against any insurer-mandated parts ordering system.
In the letter, ASA Ohio President Joe Sanfillipo III explains the association’s concerns surrounding State Farm’s new policy, which requires all collision repair shops participating in its Select Service program to electronically order parts through PartsTrader.
After piloting a program in various locations throughout the country, State Farm intends to complete a nationwide rollout of the plan by the end of 2014. ASA Ohio states that it reviewed the information available on State Farm’s new parts procurement mandate and held open sessions to discuss the proposal. After reviewing the program and hearing concerns from ASA Ohio members, it was determined that the State Farm mandate had the potential to disrupt the relationship between automotive repair facilities and their parts vendors. Furthermore, the letter describes that the added influence such a mandate would give State Farm over collision repair market pricing would have a negative impact on repair facilities’ operations and would take even more control away from automotive repair professionals.
The letter explains that the most efficient method of ordering parts is in a free market system, and goes on to state that disrupting this process through a single mandated system will negatively affect the relationship repair professionals have developed with their customers, who have trusted them to service their vehicles.
In its letter, ASA Ohio encourages State Farm to offer the online parts ordering system to its Select Service network on a voluntary basis. Should the electronic platform prove to be efficient and improve the automotive repair process, ASA Ohio states, then the industry will adopt the program.