Change is coming thick and fast in the collision repair sector, but as Jason Moseley notes, there are opportunities for those willing to make the right investments.
As CEO of IBIS, Jason Moseley has a unique perspective on the changes happening in the collision industry on a global level. In an exclusive interview with Collision Management, he shares some of his career highlights as well as proving insight into some of the trends happening in the industry and how we can collectively position ourselves to be prepared for them.
Collision Management: Can you tell us a little about how you first got started in this industry? From what we understand you have an engineering background, is that correct?
Jason Moseley: Yes, that’s correct. I studied engineering at university and when I graduated, I went into the engineering field in the design development and supply of vehicle components to the OEM production line.
I spent about 15 years working in that sector and in multiple different countries for multiple companies. I ended up spending a lot of time in Europe in progressively more senior roles and ultimately, it led me into the aftermarket and collision industry sector.
Where did things progress from there?
When I started working in the collision industry, I was approached by the UK-based motor repair research and insurance entity known as Thatcham. At the time, in 2001, Thatcham was looking for somebody to work on a very specific project for the insurance sector—an accreditation program for alternative collision repair car components.
Because of my OEM background, I had the credentials in terms of the technical aspects of what’s needed to make quality vehicle components. Running this initiative at Thatcham led to the first UK wide insurance alternative parts and accreditation program.
Can you tell us a little more about that and perhaps some other career experiences to date that stand out?
During my time at Thatcham, I gained recognition for my skills and was promoted to the role of Chief Operating Officer. In 2005, we launched an industry-wide standard–HAS 125. This was the first specific national standard supported by the collision industry for repair shops. With the establishment of this program, I received a standard achievement award for contribution to the industry.
While at Thatcham, there were a lot of milestone introductions, including raising the bar on estimate quality and establishing a department for specific repair methods. It was a very interesting time as the industry was changing and we were seeing new vehicle substrates and technologies emerging and I felt privileged to be a part of it.
How did your career evolve from this point?
In 2010, I moved to Solera/Audatex and worked there for five years, before becoming board director for the Retail Motor Industry Federation in the UK where I headed up the collision repair association. I subsequently joined IBIS and currently serve as its CEO.
In your current role as CEO of IBIS Worldwide, how do you see the organization and brand evolving and developing, given the changes happening in the collision repair industry?
My objective is to make IBIS the conferencing and networking platform of choice for the collision repair sector on a global basis and by that I mean that IBIS becomes synonymous with the very best knowledge sharing of information in the collision industry as well as providing the very best networking opportunities from the real decision makers and industry influencers.
Our ultimate plan in also becoming the global premier event platform for the industry, is to host a large event in Europe and build 5-6 satellite events around that for other markets, including North America, South America, the Middle-East, Africa and Asia. Think of it as providing a global message with a local focus.
Prior to COVID-19 we had 400 people from 30 countries attend our global summit and then take the message from that event and tailor it more specifically to different regions. There’s so much information out there and you want to make sure it gets to the right people, but in order to do that, you need to cast the net as wide as possible.
From your perspective, what are some of the strengths and perhaps improvements that can be identified in the Canadian collision repair industry sector?
When it comes to Canada, I think it’s ironic in that some aspects, the strengths of the market are also some of the weaknesses. A major strength, and partly because Canada is quite a mature market, is that the collision repair industry has become very customer focused and very aware of the right standards as well as how the standards are developed. There’s a great deal of emphasis on customer care and collaboration.
Yet when it comes to relationships between repairers and insurers there are still areas where improvements can be made. The relationship between shops and insurers is nowhere near as adversarial as it was in the past and there is evidence to show that all stakeholders are trying to do their bit to improve the claims process, but there still needs to be more inter-division cooperation and understanding.
I think one of the other challenges is that given the investments in technology, training and repair requirements shops are required to make to today, working with insurers and insurer contracts can be difficult for some for some repairers in terms of the rates and the contracts they receive.
Today, shops and technicians are essentially making repairs using aircraft technology and they need to be re-numerated in the right way.
If they struggle, there will be a reduction in capacity which means prices will go up, so the insurers need to be careful to prevent a self-fulfilling prophesy in terms of too much control over the repair economics. Insurers actually benefit from having thriving, well-invested body shop centres to handle the repairs.
Do you think there are some initiatives and trends in other parts of the world, such as Europe and perhaps Asia that could benefit collision repair operators in North America and perhaps vice versa?
I think one of the trends we have seen, notably in Europe but by no means fully played out—is a more holistic approach to the collision sector in becoming a solutions network, where the focus is not just on the repair itself but having a strong pool of repair centres that drive the business with an emphasis on customer service.
It’s been quite a journey in some respects. There was a period, roughly 10-15 years ago where insurers in Europe wanted to control everything and even started opening up their own affiliated collision centres. Insurers know their business, but their speciality isn’t collision repairs.
One analogy I like to use is that we like to drink a glass of milk, but do we really have the desire to own a cow? I think that today, insurers are really listening to that concept now, but the repair industry has to step up.
It’s something we’ve definitely seen in other markets such as Canada and I think Europe and other developing markets such as the Middle East can benefit from that kind of model.
In Canada, you have some very strong, well-established networks such as CSN, CARSTAR, Fix Auto and ProColor, while in the Middle East for example, these types of independent franchise brands haven’t really existed—most shops tend to be small independent operators or big, dealer affiliated collision centres.
Based on your observations how at present has COVID-19 impacted body shop operations in different parts of the world, notably Europe, North America and Asian markets?
Every collision shop around the world has felt the impact of COVID-19. Globally, repair volumes are down close to 80%. Across the main European markets 50% of collision shops fully closed at the height of the pandemic.
The key pain point is cash flow and for these businesses having enough of a liquidity buffer to ride out the re-instatement of volumes. There will no doubt be a re-calibration of repair capacity as some businesses will not survive.
On a positive note, and again using some strong European indicators, there will be less air travel during summer vacations in 2020. It is predicted miles driven will increase as people holiday in their local countries and regions. This could very well produce a spike in business.
Sticking with COVID-19, there are a number of analysts that are saying that the pandemic will forever alter the automotive landscape and businesses that operate in it such as collision centres. Do you have any thoughts or comments on that?
I think that’s fully correct. I see the adaptation of technology as being more rapid moving forward. The rise of the “touch-less” auto claim will be expedited. Using AI in estimating, along with fully online parts supplies, and touch-less rental/courtesy cars will all be key drivers.
I also believe that collision repair groups who have a proactive strategy can use this new climate to take on more insurance related claims aspects. It’s clear that insurers are looking at their existing claims models and what’s “core” to them. This will present opportunities for collision shops to provide additional or full-service supply. Positive collaboration, across the industry—will be key moving forward.
As the industry collectively moves forward, what do you think are some of the key factors repairers, insurers and vendors need to consider at both a national level and beyond?
I think there are several factors and a key one is increasingly autonomous vehicles. They will create a major change—the question is, how quickly that change will happen. Increasing vehicle autonomy will have a massive impact on insurance carriers.
If a vehicle does become completely self-controlled, what is the purpose of personal motor insurance? At that point you’re looking at shifting liability to the product and when you do so, the risk changes and so does the entire model of insurance. That is something the entire industry will need to consider as things evolve.
From the repairer point of view, it also becomes a question of making sure that if somebody does get into a collision, is the repair shop capable of repairing the vehicle, i.e. do they have the right investments in people, tooling, techniques and equipment?
Do they have the right skills to repair that vehicle and put it back on the road again as a safe, operable semi-autonomous or even autonomous car? That is going to require a huge investment and the biggest challenge for the repairers is will there actually be the skills out there to do this in the future?
We can have premises and we can invest in equipment, but if there aren’t people physically there with the right skills, the industry is going to run into capacity and quality issues.
Do you think we could potentially reach a tipping point where vehicles simply become uneconomical to repair?
That’s a good question and it may be the case. What we do know currently and what we’ve seen over the last five years is that the frequency of accidents aided by technology is decreasing. Many major consulting firms have predicted an overall and continuing decrease in vehicle collisions.
Under that scenario, the amount of work available to collision shops is going to decline, yet over the short-term (and I’m talking the next 10-15 years) repair severity and vehicle complexity will increase, complexity will increase and because each individual repair will become more expensive, there could be more profit per repair for the shop.
So, under that scenario, although repair volume might decrease, this will be offset by greater profitability in those repairs that are performed, so I don’t think there is really a need to panic. We might see a culling in the number of repairers, especially those that have not made the necessary investments but for those that have, I think the future is promising.
Although the future is hard to predict, how do you see the collision repair sector evolving over the next decade and what do you think are some of the prime reasons for that?
Going forward, I think things are looking stronger in the aftermarket for the OEMs and for those shops that are affiliated OEM collision centres. The OEMs and the knowledge and expertise they are putting in their vehicles and the telematics systems that can steer the customer to an affiliated repair centre are putting the insurer at a bit of a disadvantage, because insurers typically want to get that First Notice of Loss.
If the OEM gets that FNOL, they are more interested in controlling the value they can extract from it and protecting their brand.
So I think, you’re going to see the emergence of two different approaches about who controls the process. Repairs will still need to be done, but for the OEMs, their objective is to sell their parts and deliver the brand experience so they can keep the customer in that vehicle and bring them back to the dealership for servicing and purchasing another vehicle from that brand.
They want to work with affiliated collision shops and sell them their OEM parts. There’s a lot of value there for OEMs because today, manufacturing vehicles is not as profitable as it once was.
From the insurer’s perspective they can see a little bit of loss of control and they don’t want to see repair costs spiraling, which will make their claims ratios untenable. We’re already starting to see that, so I think this rivalry for controlling the process between insurers and OEMs is going to intensify over the next few years.
It will be interesting to see where it all goes but in order for both OEMs and insurers to be successful, there will ultimately need to be more collaboration between them.
Is there anything else you’d like to mention?
Getting back to IBIS, despite the COVID-19 pandemic, we are and will continue to deliver our networking and conferencing throughout the world. Our approach has been to invest in a ground-breaking virtual on-line event platform. We will launch that in July 2020.
This new platform will complement our physical events and form a hybrid strategy of driving know-how transfer and networking to the global industry. We’re also looking at some exciting growth in the different markets we serve and will continue on our mission to provide thought leadership and world-class networking for the collision repair industry.