Collision Estimating Times: Are They Shrinking?

It sounds like a simple enough question. Are the times in collision estimating guides shrinking, yes or no? The times may be changing, but there is no single, clear-cut reason why.

Estimating system providers say that if times have been reduced, it’s usually a function of design changes leading to fewer operations to perform. But collision repairers can cite examples of where times have changed from one model year to another without design changes, and fear that labor-time estimates for new models are getting ever-closer to "real time."

Are cases of true shrinking times rare, isolated cases in otherwise sound estimating systems, or are the systems’ times moving rapidly downward, cutting out the overlap the collision industry has been accustomed to and setting apart a maze of "not-included" operations for estimators to wander through?

The answers to these questions depend upon whom you ask--information providers or collision repair professionals. A look at what both sides say shows that system providers do make conscientious efforts to obtain feedback from the industry, and that the Automotive Service Association (ASA) has ongoing efforts to compare system times with real-life estimating experiences and work with providers to improve systems.

Opposing Views
According to Joe Sanders, ASA’s Collision Division director who has been closely involved with the "shrinking times" issue, times are indeed shrinking. However, says Sanders, the way automated estimating systems take out overlap time (overlap is the labor associated with an operation that is common to two or more parts) has added to the perception that times are shrinking.

"In fairness to the information providers, the application of logic to overlap time explains part of the shrinking times issue," said Sanders. "But yes, I still believe times are shrinking. It may not be dramatic, but it exists."

Representatives with the information providers--ADP Claims Solutions Group, Mitchell International and MOTOR Publications (CCC Information Services uses MOTOR’s crash estimating guide for its automated system)--say changes from vehicle manufacturers are the reason some times for some vehicles are being reduced. New manufacturing practices such as glued-on roofs, bolted-on quarter panels and a reduction in the amount of fasteners can equate to fewer repair operations when redesigns occur, say information providers.

According to Rick Tuuri, director of Data Base Design for ADP’s Claim Solutions Group, basic, "root" operations such as masking a wheel or drilling out a spot weld are not changing in time.

"Our times are based on discrete, root operations, and here at ADP, the times for these root operations are not shrinking," said Tuuri.

Tom Fleming, manager of Collision Labor at Mitchell International, echoes that thought. "The historical labor values for roof panels, quarter panels and fenders compared to the new design values could lead someone not fully aware of the design changes to conclude that times are shrinking. It is, however, the number of operations that has been reduced for some models, not the required time to perform each operation," said Fleming.

System Factors
Each information provider uses different methods for arriving at labor times, but there are many similarities. All three major providers closely examine vehicle manufacturer warranty information and times, do independent time studies in shops or at their research facilities, and look at technical service bulletins or industry accepted practices. Some of the providers may also look at historical data or other sources, but one thing they all have in common is the use of information from vehicle manufacturers.

There is no doubt new cars are changing in design. For instance, at an International Autobody Congress and Exposition (NACE) panel in 1994, Brad Thatcher of General Motors Service Technology Group pointed out that the 1995 Chevrolet Cavalier had 28 percent fewer parts than the previous year’s model. However, what about cases of shrinking times where there have been no significant design changes, and the apparent trend of provider times getting closer to manufacturer warranty times?

Two years ago, Sanders documented some cases of shrinking times, as reported in the ASA Collision Division’s August 1994 Collision Repair Report. Sanders and the Collision Division Operations Committee continue to monitor shrinking times and are very concerned about trends involving the times for new cars.

"It is the general feeling of the committee that the times on new model cars more closely represent factory warranty times," said Sanders.

Sanders said ASA is in the process of developing a method to evaluate manufacturer warranty times with information provider times, with both past and present model year applications.

Information providers say that cases of shrinking times where there have been no design changes are anomalies that should be pointed out to providers. (Each information provider has feedback mechanisms such as toll-free telephone numbers for product users.)

"There should never be an instance where labor times, for the same operation, on the same model, for different model years, would vary. Inconsistency of this type is not acceptable in the MOTOR data base. If an error of this type occurs, it is corrected after research determines which operation time needs to be updated," said Phil Cunningham, director of data base development for MOTOR Publications.

Information providers get a considerable number of inquiries about their systems, though many are about such things as a wrong part reference rather than a labor allowance. For instance, Mitchell receives approximately 1,000 data base inquiries per month, about one quarter of which relate to labor allowances. Information providers have also been known to make a change or two resulting in increased times. ADP’s Tuuri notes that a few years ago ADP added four operations to salvage door times. Radiator support times have gone up in the Mitchell system, according to Sanders. However, adds Sanders, a change upward in time on one operation might be offset by a time reduction for an operation on a nearby or related part, so it can be difficult to account for the bottom line effect of a single change.

None of the providers said they could put an exact number on the percentage of repair operations that are time studied. They point out that due to "sister" designs among carmaker lines and the study of basic operations, most repair procedures have at least indirect time study relationships.

Only one information provider--Mitchell--is saying that today’s paints may "potentially" contribute to reductions in labor allowances.

"Mitchell’s labor time studies have identified that high-solid paints often require fewer coats to cover than non-high-solid material," said Fleming.

Fleming notes that by high-solid paints, Mitchell is referring to medium-solid paints used in many areas of the country, as well as the ultra-high-solid products used in a few heavily regulated areas.

"They [new paints] have the potential for reducing labor times," said Fleming.

However, adds Fleming, due to a request by ASA, Mitchell has added language to its refinish procedure No. 28 that some colors identified by paint manufacturers as highly transparent may require additional application coats to achieve visual hiding.

"In instances where four or more color coats are necessary to achieve adequate hiding, as stated in our procedure pages, some adjustment in refinish times may be appropriate," said Fleming.

Procedure Pages
One bone of contention between collision repairers and information providers is why so many commonly needed operations are put in procedure page explanations as "not-included" operations rather than made part of the labor-time allowances.

"There are many instances where more add-on operations could be applied to the logic of their systems," said Sanders.

James Busch, a shop owner in Issaquah, Wash., and also a member of ASA’s Collision Division Operation Committee, agrees that more commonly needed operations should be put into estimating systems, with the option to exclude them if they are not needed in a particular repair.

"My concern is that if all these not-included operations are needed 70 or 75 percent of the time, then why aren’t they automated into the system instead of hidden in the P- Pages," said Busch.

Information providers contend they must build up their systems from some sort of baseline, and can’t possibly automate all repair situations, vehicle conditions, or vehicle options. As is well known, estimating systems are also based on "new, undamaged panels." Time needed to work on damaged panels is typically a "not-included" operation. For instance, MOTOR’s premise section states that labor time does not include "cutting, pulling or pushing collision damaged parts for access."

ADP’s 1996 Reference Database Manual sums up ADP’s reasoning about procedures this way: "No matter how accurate and complete our research is, we can only provide the foundation of a collision repair estimate. Using this as a base, the professional estimator must determine the need to perform any not-included operations and supply judgment times based on each individual damaged vehicle."

Shop owners readily admit it is up to them to seek compensation for "not-included" operations that are needed to perform a proper repair. But obviously, having these operations included in labor times would make negotiation a moot point.

According to Busch, information providers took too long to recognize that air-conditioning (A/C) system recovery should be an "included" operation after the government began requiring recovery of R-12 refrigerant.

"A/C recovery was recognized after a certain point, but not before the collision repair industry lost hundreds of thousands of dollars," said Busch.

Abusive Caps
One area where information providers are not to blame, observers say, is the imposition of materials caps by people in the insurance industry.

Currently, paint material compensation on a job is typically derived by an estimator computing a given rate per refinish hour. Of course, shop owners are free to track actual costs. Mitchell International is the only major information provider that offers a guide to calculating refinish materials costs. Paint manufacturers may have guides for calculating paint costs, otherwise, it’s a matter of tracking all actual materials used, such as sandpaper, paper and tape. In February 1995, ASA mailed a sample worksheet to Collision Division members that provides a way to track materials costs. All major materials categories are included on this simple form, which technicians can quickly fill out as they proceed through repairs.

Trends with estimating system times should be considered as separate from the issue of materials caps, says Sanders.

"We shouldn’t confuse poorly written estimates or abuses of estimating systems with shrinking times," said Sanders.

According to Marv Rather, president of TR Enterprises, a collision industry consulting and education firm based in Yuma, Ariz., shop owners need to set the record straight with insurance company representatives on the matter of caps by asking those who say there is a cap to put it in writing.

"There may be assumptions made about caps by people who don’t have the authority to say there is a cap, but most insurance companies will say that if you can document the cost of materials, they will pay it," said Rather.

Improving Systems
ASA has ongoing efforts to work with information providers to make data bases as accurate as possible. ASA has representatives on inter-industry committees maintained by all the major information providers.

In addition to their work with information providers, ASA Collision Division leadership welcomes the comments of members on concerns with estimating systems, or other industry issues, say Sanders and Busch.

Rather points out that collision repairers who have questions about estimating systems, or disagree with a time in a system, should use the feedback mechanisms of each system.

"There is a lot of good people can accomplish by simply communicating--either individually or through groups such as ASA," said Rather.

There are several steps shop owners can take to improve the estimating systems they deal with:

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AutoInc. Magazine ®, Vol. XLIV No. 5, May 1996