Statehouses are latest battlefield in longtime war between automakers and aftermarket

Automotive trade groups plan to lobby for state legislation in 2019 that would require repair facilities to follow OEM-prescribed procedures to fix cars and trucks.

The statehouse campaign represents a new front in an old battle that pits manufacturers of original-equipment parts against aftermarket parts makers and auto insurers, with lobbyists for body shops in the middle of the conflict.

"We plan to proactively push this in five to 10 states next year," said Wayne Weikel, senior director of state government affairs for the Washington-based Alliance of Automobile Manufacturers. "This is something manufacturers have been concerned about for years."

A law that took effect in Rhode Island this year mandates that when a shop uses original-equipment parts in collision repairs, "no insurance company may require any repairer to use repair procedures that are not in compliance with the recommendations of the original equipment manufacturer."

Laws in at least four other states also limit the use of aftermarket parts for repairs paid for by insurance companies.

Weikel told Fixed Ops Journal that his group expects to work on next year's legislative effort in concert with the Automotive Service Association, which represents repair shops. He insists that the campaign "is not an attempt on our part to mandate more OEM parts. This is just on the procedures."

The Auto Care Association challenges Weikel's assertion, claiming the automakers' lobby seeks to force repair facilities to use original-equipment parts. The association represents parts makers and distributors, auto parts stores, service and repair shops and importers.

Tom Tucker, director of state affairs for the association, says that following automakers' repair procedures is "not an issue."

"The [OEM is] always going to recommend a procedure, and recommend their parts," Tucker said in an interview.

Advocates on each side cite a U.S. district court case arising from a 2013 collision that seriously injured a Texas couple. The lawsuit resulted in a $42 million verdict in October 2017 against a Dallas dealership collision center and the driver of the other vehicle.

"That really got the attention of the industry," says Darrell Amberson, president of operations for LaMettry's Collision Inc., a collision-repair chain with nine locations in the Minneapolis-St. Paul area.

The plaintiffs in the case, Matthew and Marcia Seebachan, filed a separate complaint in federal court against State Farm Mutual Automobile Insurance Co. They alleged a deposition in the original case showed that the insurer "forced" John Eagle Collision Center to use adhesive rather than welds to fix a Honda Fit that the Seebachans later bought and that was involved in the crash.

The less-expensive fix using adhesives, which failed in the collision, was "in violation of the OEM requirements," according to the complaint. In a formal response, State Farm denied that it "dictated" how to repair the car.

"Defendant denies that it coerced or enticed any body shop to not follow vehicle manufacturers' procedures, cut corners, take safety shortcuts, or do anything that jeopardizes members of the motoring public," State Farm said.

The Seebachans' lawyer, Todd Tracy of Dallas, said his clients resolved their dispute with State Farm in October "to the satisfaction of all parties." He did not provide details.

Weikel calls the Eagle Collision case a "watershed" moment that "galvanized" automakers and the collision repair industry to strengthen repair procedures, independent of what kinds of parts are used.

"This seems like it's the norm," Weikel said of the collision verdict. "This is how repairs are done across the industry. This is a problem."

Opponents of the new Rhode Island law, which took effect in July, say it is one of the most restrictive statutes in the country limiting use of aftermarket parts in repairs. It says that insurers cannot require aftermarket parts without an owner's consent for vehicles less than four years from the date of their manufacture.

It also states that "an insurance company that specifies the use of aftermarket parts in a repair must notify the owner in writing, and that a body shop may not use aftermarket parts without getting the owner's written consent." The law does not cover glass repairs.

The Auto Care Association opposed passage of the law. It said in a column in a Rhode Island newspaper that the law gives automakers a "monopoly" on parts used in insurer-paid repairs, and "padded the pockets" of "a select group of body shops."

"The original manufacturer is always going to recommend the use of its own higher-priced parts and try to eliminate the use of affordably priced, quality recycled and aftermarket parts, thus taking hard-earned money from consumers' pockets," the association's column said.

The Property Casualty Insurers Association also opposed the bill. "There isn't a manufacturer out there that does not recommend or specify the use of their own original-equipment parts," Frank O'Brien, the association's vice president for state government relations, told Fixed Ops Journal.

The Alliance of Automobile Manufacturers, the Auto Body Association of Rhode Island, and the Rhode Island Automobile Dealers Association support the law.

Jack Perkins, executive vice president of the dealers association, calls the group's endorsement of the measure a way of looking out for its customers' interests.

The law, he says, "gives consumers more say in what type of part or body parts" are used in a repair.