Recent Dallas lawsuit is reminder to industry to follow OEM procedure
West Hollywood, Calif.—By now, nearly everyone in the collision industry is aware of the Oct. 2, landmark judgment against John Eagle Collision Center, in Dallas, for not following OEM-specified procedures when it replaced a Honda Fit’s hail-damaged roof with adhesive bonding, not welds. A subsequent collision caused the roof and floor to buckle, because of the car’s lessened structural integrity.
That caused the fuel tank to rupture and the car to catch fire, resulting in severe injuries to its occupants, the Seebachans.
The jury in the 192nd Civil District Court of Dallas County awarded $41.966 million in damages to the Seebachans, ordering John Eagle Collision Center to pay 75 percent of that amount, or nearly $31.5 million.
While the court’s decision raises a red flag for shops not already adhering to OEM repair procedures, it merely serves to reinforce why Jack Balyan, co-owner of Premium Collision Center, chose to obtain OEM certifications from Nissan, Hyundai, GM, Chevrolet, GMC, Cadillac, Chrysler, Dodge, Fiat, and Jeep, more than four years ago.
“Improper repairs happen every single day,” Balyan said. “It is our duty and responsibility to make sure that every technician understands the importance of their repair and how that could affect our customers and their lives.”
Balyan hopes the John Eagle Collision shop verdict will help body shops realize the importance of doing a proper/quality repair, adding that OEM and I-CAR repair procedures should always be followed, even if the shop doesn’t have OEM certifications.
“Shops should not look at profit as the main factor of the repair, it should be the customer’s well being and the [repair] needs of the car.”
Having printed repair procedures, having a checklist, creating a repair blueprint that includes internal and external damage, checking welds, checking sealers, taking photos, documenting repairs, and quality checks during the repair process, not only at the end, are SOP at Premium, Balyan said.
“Making sure communication is always available and having daily and weekly staff meetings to make sure everyone is always on the same page is also vital,” he said.
Before joining Premium 10 years ago, which was founded in 2000 by Jack Yepremian, who had more than 25 years’ experience in the collision industry, Balyan said he had no body shop experience.
“I was in finance before entering the auto body world,” he said. “When I joined forces with Jack, I started by getting a seminar in Bodyshop Management Essentials from Masters School of Autobody Management, which taught me the fundamentals of how a body shop is supposed to be run.”
In the past three years, the I-CAR Gold shop has upgraded the majority of its equipment, including a new Blowtherm downdraft spray booth with air speed, which increases the air velocity up to four times when compared with traditional ventilation systems, a Blowtherm mixing room, Global prep stations, a Pro Spot i5 smart welder, and a Car-o-Liner frame machine and measuring system.
The shop has had 20 percent growth in the past two years, which Balyan said is the result of its OEM certifications, lower cycle time, increased marketing, customer referrals, being members of Certified Collision Group and Assured Performance, and participating in the Advanced Production Solutions (APS) program from BASF.
“Being a part of Assured Performance and Certified Collision Group opens your eyes to what’s outside of your four walls,” he said. “The Collision Industry Conference (CIC) and other meetings where you see the bigger picture besides just body work pushes you to achieve great training and understand that the sky is the limit.”
The average RO is about $4,900 and the shop writes roughly 90 ROs per month. Both the average RO and the number of cars have increased, he said.
“Given our current non-DRP status, we tend to have a lot of downtime waiting on inspections and supplements,” Balyan said. “By implementing some APS processes our key-to-key time has decreased from 29 days to 14 days.”
The L-shaped shop has 20 employees, a 15,000-square-foot production area, a 30,000-square-foot storage facility, and 25 bays, one dedicated to mechanical repair by an ASE-Certified technician, and two I-CAR trained estimators who use CCC One.
Balyan said the lack of qualified technicians is probably on the minds of most body shop owners. Before looking into hiring new talent, shop owners should evaluate if the need is actually labor based or it’s because of not having proper SOPs in place.
“Limiting turnover is the first step that we took to not face this issue,” he said. “Taking care of your employees is the first step and determining what everyone’s needs and expectations are. We also have an internship program to train inexperienced employees to create a pool of eligible personal when needed.”