Your Car Insurance Company Hates Earl Stewart Toyota's Body Shop

Now, Let Me Tell You Why

This article was written by Alan Napier, my Body Shop manager. I’ve owned and operated body shops for over four decades…at one time I owned five! I’ve never had a body shop manager as qualified as Alan and never had one that put the customer first 100% of the time the way Alan does.  By putting the customer first, I mean considering the customers needs above those of the insurance company that pays us for repairing the customer’s car. Please read what Alan has to say carefully:

So, you had an accident and called your insurance company to report it and things seemed to be going pretty smoothly….. Then you told them you were taking your car to Earl Stewart and everything started getting weird…. The claims adjusters’ demeanor inexplicably just changed…. And NOT for the better!! Suddenly they’re telling you they that have a perfect shop in mind for you that will get your car in and out in a hurry and the whole process will be effortless for you. Yep, it’ll be such a great experience, you’ll be GLAD you had an accident. You thank them politely and tell them you’re just more comfortable repairing your vehicle at Earl Stewart, where you bought the car and know and trust the people.

 Now it seems like the adjuster is downright angry with you and the real pressure tactics start!! They start making vague yet ominous sounding statements about Earl Stewart Toyota, almost as if they’re letting you in on a dirty little secret….. “We can’t guarantee their work….” “We’ve had problems with that shop….” “They charge more than we allow for repairs and you will have to pay out of pocket…” “If you take it to our shop, you won’t have to wait for an adjuster…” “They ignore our estimates…” The list goes on and on, but, they’re planting their seeds of doubt…. And now you’re concerned and thinking “Earl Stewart Toyota must have done something to cause this hostility by my insurance company…”, after all, your insurance company only has your best interest in mind…..

Well, you’re right, we DID do something to cause your insurance company to hate us and I’d like to tell you what….. We actually had the audacity to tell your insurance company something that they’re not used to hearing…. “NO!!” and they reacted like any spoiled 3 year old would who’s never heard the word before.

But wait, you’re still “in good hands” right? Wrong!! Your insurance company will instruct “their” repair facility to install untested aftermarket crash parts on your vehicle, even knowing that these parts can absorb crash energy differently and affect the timing of your air bag deployment, resulting in possible death and serious injury.

 Here’s the really crazy thing…. The insurance company’s “approved” repair shop will do it!! Do you see what’s going on here? Everybody’s making out like Jesse James!! The insurance company is saving money, the body shop is making money, and you? You’re getting scammed!! Your insurance company has been provided with countless documents, provided by the vehicle manufacturers that state that these “cosmetic crash parts” are actually “designed and tested as part of the overall vehicle and may help send impact energy to the SRS sensors. In addition, some of these parts may help GM, Chrysler, Ford, Toyota,  for Nissan vehicles comply with several Federal Motor Vehicle Safety Standards (FMVSS) including hood intrusion in the passenger cabin, preservation of proper door operation following a collision and proper airbag function.

You may be thinking “Well, if these parts are that bad, surely there’s a law against using them without my permission…” You’re right again!! Florida statute 626.9743 states “An insurer may not require the use of replacement parts in the repair of a motor vehicle which are not at least equivalent in kind and quality to the damaged parts prior to the loss in terms of fit, appearance, and performance.” Sounds like an open and shut case, eh? The law doesn’t say “if the insurance company believes they’re the equivalent”. It doesn’t say anything about “if the insurance company hopes they’re the equivalent”. The insurance companies need to prove these cheap parts are the exact equivalent to the original factory parts to be in compliance with the law or stop mandating their use. Right? I thought so too….

So, I wrote a letter to the Florida Office of Insurance Regulation!! Went right to the top, straight to Commissioner Kevin McCarty (well, his office anyway…. he’s got “people” for that…). After much arm twisting via the Florida CFO’s office, the FL OIR begrudging agreed to “investigate” our concerns. After a couple of months, we received their response “We have concluded our investigation and found no violation of the Florida Insurance Code.”, and my favorite part…. “Generally speaking, the burden of proof that an aftermarket part is not of like kind and quality or as safe as an OEM part rests with the one making that assertion, as opposed to one having to prove that the aftermarket part is of like kind and quality and as safe as OEM.” Huh?? That one left me scratching my head. Why have a consumer protection law at all then? Your insurance company can mandate the usage of any part they desire, so long as it looks the same. Nobody really complains though because, as they say, “dead men tell no tales…”The jury’s still out on this one, but rest assured WE WILL NOT USE AFTERMARKET PARTS TO REPAIR YOUR VEHICLE.! (p.s. Also check out Title 49, Chapter 301 Subchapter II Sec. 30122 "Making Safety Devices and Elements Inoperative" in the Federal Code-you can Google it).

How about used crash parts then?? Your insurance estimator will tell you “they’re factory original parts taken off of a car that’s just like yours”. Really? Was your car damaged so severely that it was deemed a total loss and ended up in a junk yard? The car they want to cannibalize to get your replacement parts was. We won’t even know if the donor car was damaged in an accident, a flood or even a fire and quite frankly, we don’t care-WE’RE NOT GOING TO USE THESE PARTS EITHER!!

Well, what about Earl Stewart overcharging for labor??? THAT sounds pretty shady….. let’s talk about it…. I recently had my lawn mower repaired and it cost me $65 per hour and having an electrician fix my air conditioning at home cost me $75 per hour (plus gas & travel time), plumbers and a/c repairmen are $100+ per hour. If you have mechanical work on your car, it’s liable to cost you anywhere from $100 to $200+ per hour, depending on the repair shop and type of car.

The insurance companies feel that $42 an hour is more than fair to have your collision damaged vehicle repaired and they won’t pay a dime more. If you want to repair your vehicle here, they will tell you that you’ll have to pay the difference out of pocket OR, well….. they know a guy…… Ironically, back in the early 70’s, when Allstate and Sears were all part of the same company, Sears wouldn’t repair your toaster for less than $12 an hour while at the same time Allstate wouldn’t pay more than $7 an hour to have your vehicle repaired. Hilarious, ain’t it? Back in the 60’s, the insurance industry running roughshod over the repair industry was so pervasive and blatant that the Kennedy Administration tackled them before they even got started on the Mafia!!! (see 1963 Consent Decree-Google is your friend) What the insurance industry is doing to the repair industry is a clear violation of antitrust laws and we are part of a class action lawsuit to try to put a stop to it. WE WILL NOT MAKE YOU PAY THE DIFFERENCE IN LABOR RATES!!

Then we get to “charging for supplies and labor operations not customarily charged for in the market area”. This basically means that because they’ve been able to badger, coerce and intimidate some repair shops into not charging for certain supplies and labor operations necessary to return your car to pre-accident condition, they should not have to pay it to anybody whether they ask for it or not. Your insurance company won’t dispute that the materials are being used or the labor operations performed, nor will they dispute the necessity. Their only problem is having to pay for it because at some point, long ago, somebody “cut a deal” to get more business sent their way and it then became the “new norm” for every shop. We will never charge for a labor operation or supplies that cannot be verified. WE WILL NOT MAKE YOU PAY THE DIFFERENCE.

Now you’re probably saying “I never get into accidents so I can’t believe I’m still reading this. Can this guy just get to the point??” and the answer is “YES! Yes I can!!” Please don’t fall victim to your insurance companies scare tactics! The top 5 insurance companies spent over $4,000,000,000 (yep, that’s $4 BILLION) last year to convince you that they’re good guys so that you will buy their product (GEICO alone spent over $1 Billion if that tells you anything). Sometimes, there’s not enough perfume to cover up a smell and not enough lipstick to pretty up a pig and this is one of those times.

 Please go to some consumer websites and check out how these insurance companies perform once you’ve had to turn in a claim (a.k.a. became an expense to them). Also keep in mind, the shops that enter into these unholy alliances with the insurance companies see them as their #1 priority and best customer and they will do whatever they are told to stay in their good graces. The insurance company feeds the shop lots of work and the shop does what they’re told to keep the repair cheap. It’s a marriage made in Hell. The repair shops that participate in this fraud are just as, or maybe even guiltier than the insurance companies. They should know better, but, it’s all about the money (insert photo of pigs at trough HERE) ;)

If you have already had your vehicle repaired at one of these direct repair shops and you’re not exactly sure how your car was repaired, bring it by with the invoice and the final estimate and we’ll be glad to take a look at it for you. If the vehicle has not been repaired properly, we’ll point out the deficiencies so that you can return to the shop for corrective repairs. If they repaired your car with aftermarket or junkyard parts, you may be entitled to higher than normal diminished value compensation. WHAT?? Your insurance company didn’t tell you that your car is worth less now and you’re entitled to additional compensation?? You might want to contact Gordon and Doner, they have a division that can handle that for you. If your insurance company has pressured you to not have your car repaired at Earl Stewart Toyota, please email me the details at alann@estoyota.com or Mr. Stewart at earl@estoyota.com and share the gory details.

Earl Stewart Toyota will repair your vehicle properly, per the manufacturers’ recommendations and only with new OEM crash parts. We will guarantee our paint, our workmanship AND the OEM replacement crash parts, for as long as you own your car. That’s right, I said AND THE PARTS!! The manufacturers’ warranty for replacement parts is 12 months or 12K miles. Earl Stewart Toyota will pick up the warranty after Toyota’s warranty expires, this includes parts, materials and any necessary labor to paint and install the failed part. Everything!! If we are unable to convince your insurance company to pay in full for the properly repaired property damage, with your written permission we will initiate action on your behalf to recover the funds. Ultimately, it is YOU who are responsible for ensuring your vehicle is repaired properly. You already had an accident; don’t let your insurance company force you into making a mistake.

Car Dealers Fear You!

They Believe that “BUYERS ARE LIARS!”

I ran this column about three years ago and I have received more comments from car dealers and car salesman on this one column than almost every other. I ran the same column a year ago and the comments keep coming in from car dealers and car salesmen. I’m running it again at the risk of boring some of you and I apologize in advance, but I think it’s important because I may be onto something.

The more I think about it, the more I’m convinced that the chronic dislike and distrust of car buyers for car dealers might be part and parcel of the same problem that car dealers have with customers. Think about it…maybe one of the reasons that car dealers treat you so badly is that they are afraid you are going to take advantage of them! They might be reasoning that they have to take advantage of you before you have a chance to get them. J OK, this is a bit tongue in cheek, but I honestly believe there may be an element of truth to it. Both sides are afraid to show trust to the other side first. It’s a little bit like the Israel-Palestine conflict. Maybe I can be the Henry Kissinger negotiating peace between the two sides?

I’m always amazed by the way car dealers who use deceptive advertising and unethical sales tactics rationalize their behavior by actually blaming you, their customer. The following is a direct quote from an anonymous car dealer’s email I received this morning in response to one of my recent columns in this newspaper: “I don't think you would make any of these comments if you sold fords in a non-metro market. How do you expect dealers to change when consumers think they should pay less than dealer cost for a car and then walk into any other form of retail store and pay what they are asking?? Your ideas are noble but there are other dealers who have tried 'your' methods who are no longer in business.” This dealer is saying that his customers are so ruthless and cunning that they won’t buy a car unless they can buy it below his cost and his only solution is to trick them into thinking that they are buying it below his cost, like tacking on a “dealer fee” to the price they quoted the customer. He also goes on to say that my“ideas are noble” but I can’t possibly be successful and I will go broke trying. I truly appreciate his concern and I want to assure him, if he is reading this article, that my business is doing very nicely.

This attitude is actually a prevailing part of the culture in many car dealerships. Many dealers, dealer managers, and sales people don’t trust their customers (how paradoxical!). They don’t even like their customers. A very common expression among car dealers and their sales staff is“Buyers are liars”. This means that a prospective customer will not tell you the truth about the condition of his trade-in, he will lie to you about the price he got from your competitor, and he is likely to remove those new tires that were on his trade-in when the dealer appraised it when he comes in to pick up his new car. 

There are also a lot of dealerships where used car buyers and people with bad credit are held in especially low esteem. They have nicknames for people with bad credit like “slugs” and “roaches”. Apparently dehumanizing these unfortunate members of our society with derogatory labels makes it easier to treat them so shabbily. People with bad credit are targeted with direct mail and newspaper ads making absurd promises that convince prospective customers that they can finance a car no matter how bad their credit. In some dealerships applicants are coached on how to falsify credit application and pay records. In some cases the applicant may not even know he is signing a false credit application which is federal offence. In most cases the credit is refused and the applicants are not even given the courtesy of a return phone call to tell them this. 

I don’t claim to be a psychologist (and I don’t even play one on TV), but I have read articles explaining how humans will stereotype other people in a fashion that falsely justifies their negative behavior toward those same people. We see this with racism and even in wars. If you make yourself believe that car buyers are out to take advantage of you, “buyers are liars”, you can’t feel guilty about tricking them into paying a dealer fee. If you trick a “roach” or a “slug” into coming in to buy a car on credit when they probably can’t, why should you feel guilty? After all, roaches and slugs don’t have feelings. 

What these kinds of dealerships don’t understand is that you must trust a person first before you can expect her to trust you. You have to treat a person with respect before you can expect that person to respect you. Somebody has got to go first. My experience over the past 40+ years as a car dealer is that 99.9% of my customers are good people who I can believe and trust. Those are pretty good odds and I just assume that every customer I am dealing with is part of that 99.9%. Once in a great while I get burned, but the loss from that one in a thousand that takes advantage is far out-weighted by the other 999 who respond positively to my trusting them and treating them with respect.

Translating Misleading Car Ads

In previous columns I have recommended that you avoid reading most cars ads in the newspaper and in direct mail. Most TV and radio car ads are similarly misleading. My suggestion is that you carefully choose the precise year, make, and model you want with the precise accessories and get at least 3 legitimate bids from car dealers on the Internet or, next best, at the dealerships. However, if you do find yourself perusing the large number of car ads in the local paper, here are some translations of common misleading ads. I took these straight from a local paper.

20% to 40% OFF MSRP. Never buy a car based on how big a discount you are quoted. Always calculate the price you are willing to pay based on an accurate understanding of the cost of that vehicle. Different makes and models have different markups and factory incentives can cause the true markup to vary widely. What sounds like a big discount may also pay the dealer too big a profit.

LIQUIDATION SALE. Most of the time you pay just as much for a car during a “sale” as you do without a sale. The only exceptions are factory incentives which do have an expiration date. A “sale” is what advertisers refer to as a “call to action”. They are looking for something that will motivate you to come in today, rather than procrastinate. It doesn’t seem to matter if the motivation is untrue.

UP TO $15,000 OFF. Many dealers have an additional markup on top of the manufacturer’s suggested retail price, MSRP. They commonly label this a “Market Adjustment Addendum”. This can be thousands of dollars. Discounting a car thousands of dollars means nothing if the dealer just added a “Market Adjustment Addendum” for an amount equaling or exceeding the discount.

STK#62029A. When you see a number like this next to the price of a new car, it means that that is the only car you can buy for that price. The number is the stock number for that specific car which is supposed to tell you that this is the only car at this price. Many of these ad cars are of undesirable colors and accessories. They are advertised below cost and the loss is charged to advertising if they have to sell one. You chances of buying one of these are slim and none.

CREDIT PROBLEMS ARE NO PROBLEM. This type of ad is particularly insensitive and distasteful. It is meant to attract people who have such bad credit that they think they cannot obtain financing. Unfortunately, there are people whose credit is so bad that no lender will offer them financing. These people are disappointed and embarrassed when they learn the truth that “credit problems can be, in fact, big problems”.

MINIMUM $10,000 TRADE-IN ALLOWANCE. This is just like the huge discounts. A trade in allowance means nothing if the car has been marked up high enough to offset the extra trade-in allowance.

WITH ACCEPTABLE CREDIT. This allows dealers to add a fine print disqualifier which is an extremely high Beacon score that disqualifies 99% of the car buying population. It is used in conjunction with very low lease payments or purchase payments. It is a “bait and switch” which affords the dealer the opportunity to raise your payments (and his profits) because your credit is “not acceptable”…to him.

PRICE GOOD ON DATE OF PUBLICATION ONLY. You will find this only in the fine print at the bottom of the page. This is added protection to the dealer, in addition to the stock # mentioned above, that he won’t have to sell you the car at the advertised price.

AS LOW AS or FROM. You will see this in smaller print next to a very big price and a big, pretty picture of the car. This is a further “C.Y.A.” for the dealer so that he doesn’t have to sell that car at that price.

WE’LL BEAT ANY OTHER DEALER’S PRICE OR THE CAR IS FREE. Some claims are so outlandish that I hesitate to bother warning you about them. Applying the old saying “if it sounds too good to be true, it probably isn’t” should protect most people from this kind of ad.

I could go on and on, but I hope I have already made my point. Car dealers’ ads are the absolutely worst way to decide which car you should buy and what price you should pay. When you respond to most car dealers’ ads, they are in control. You must take control and let the dealer respond to your carefully thought out and researched choice of year, make, model, accessories, and what price you offer to pay him.

Are You Buying an Unsafe Used Car?

This is a quote from an investigative reporting article in today’s (8-04-14) Wall Street Journal: 

"In 2010, U.S. regulators began investigating fires in Jeep Sports-utility vehicles. The probe eventually tied at least 51 deaths to fuel tanks that ignited in rear-end crashes. Chrysler Group LLC said the SUVs were safe but agreed a year ago to recall and repair 1.6 million Jeep Cherokees and Libertys. Almost none of them have been fixed.”

This kind of thing with recalled vehicles is not uncommon. In my 46 years as a car dealer I've observed that recalled vehicles often are either never fixed or, if they are, much later than they should be. There are lots of reasons for this. This WSJ article focused on NHTSA, the National Highway and Traffic Safety Administration. NHTSA is a typical government bureaucratic agency with a chairman who is politically appointed by the President. I've seen some real “idiots” in charge of NHTSA since they came into existence in 1970. The bottom-line is that NHTSA is just plain inefficient and often times politically motivated. This isn't the fault of the rank and file in NHTSA; it’s the fault of the higher ups. The higher up the organizational ladder you climb in any government bureaucracy, the more “political” things get. I've dealt with dedicated NHTSA members at the lower levels who are smart, competent, and genuinely concerned about your safety in the cars you drive. But they will tell you that it’s often very hard to get things done at NHTSA. In the executive suite at NHTSA, it’s not always about safety, but about politics.

The auto manufacturers are also to blame for the inefficiency of safety recalls. Recalls cost auto manufacturers billions of dollars. Look at the current GM recall because of ignitions that accidentally turn off, deactivating the airbags. This is the largest recall in history and the cost is currently at $3.48 billion for 17.3 million vehicles. It’s already been established that GM knew about this dangerous product defect ten years ago and the Justice department says they deliberately covered it up! Now that it’s been made public, what makes you think GM want to rush things?

Auto manufacturers do a very poor job of keeping track of who owns and drives their cars after the dealer sells them. The dealer is supposed to report the contact information on every new car sale, but this information is often incorrect and sometimes purposely falsified. Why would a car dealer falsify information on the buyer? Huge pressure, often financial, is put on car dealers by manufacturers to maintain high customer satisfaction scores. It’s not uncommon for a car dealer to change the contact information so that the car buyer does not receive an email, letter, or phone call surveying his level of customer satisfaction. Also, car dealers will report cars sold to fictitious people to collect cash incentives from the manufacturers. Sometimes they will also title the cars in the names of rental and leasing companies, but the car is actually still on the dealer’s lot. The car is sold later as a used car, “demo” or “executive car”, but the manufacturer has no record of the real owner and driver. Clearly recall notices never reach the real drivers of these vehicles.

The average person trades in her new car between four and five years. But many trade their cars every 3 years or even less. More often than not, they trade one make in for another. A Chevrolet dealer is not familiar with recalls on Hondas or Fords and probably won’t know if there is a recall on those cars unless he checks the NHTSA database on recalled cars. When a car dealer trades in a car, his primary focus is to get that car reconditioned, detailed and on his used car lot for sale. If it is not a used car he wants to retail, he wants to sell it to another dealer or at the wholesale auction ASAP. Dealers have a lot of cash tied up in the used cars they trade in. It’s very important for them to turn them into cash as quickly as possible. What all of this means is that checking the NHTSA database for recalls on every used car a dealer trades in takes time. It not only takes time to do the research, but it takes time to fix, especially when he has to take the car to another dealer to fix. A dealer is not allowed to perform a recall fix on cars other than the make he is franchised to sell. A non-franchised used car dealer has to take every car to another dealer for recall fixes. New York is the only state that I know of that requires dealers to verify that all recalls have been performed on before he sells it. Florida does not have such a law.

Many owners of cars that are recalled just don’t bring them in to be fixed. It’s very common for car dealers not to have the necessary parts available to perform a recall. Manufacturers also often don’t inventory enough parts to supply for a recall. It can take months before there are enough parts. Dealers also don’t always prioritize recalls because they make more money on regular maintenance and repairs. Car owners procrastinate on bringing their car in because they will be without their car for a day or even longer. Twenty-five percent of owners who actually do receive a recall notice never bring in their car. 

Before you buy a used car, or even a new car, be sure that you find out if there was a recall. You can do this yourself with the VIN, vehicle identification number, and going to www.Recalls.gov. Or you can ask the dealer who’s franchised to sell your make of car to do this for you. Of course, if you've already bought a used car, you should also check. It might save your life.