Hurns in my opinion flatly lies on this issue when he asserts that “blind tests” have established that these parts are not inferior to Original Equipment. In fact the “organization” he holds up as the arbiter of the fitness of these parts- CIC the Collision Industry Conference has stopped doing “fit tests”. Largely because their wholly unscientific results on a very limited set of vehicles were being held up as “proof” of the parts’ fitness for a particular purpose – an assertion with which the CIC takes exception. Additionally the spreadsheet that CIC themselves produced of fit test data details the AM parts as wholesale “losers” in the “competition”. Beyond that when CIC was conducting the tests their membership was made up of a considerable amount of insurers and those who serve their interests.
I in fact have an evidenciary e-mail from the leadership of CIC, Lou DeLisio, ultimately the man who saw fit to terminate the “CIC fit test program”. This copy was forwarded by Karen Fierst who was and perhaps still is the envoy / lobbyist for a contingent of aftermarket parts manufacturers from Taiwan. I’d be glad to forward it to you for publication.
The GM parts study was the most scientific and comprehensive of comparisons thus far and proved beyond a shadow of a doubt the inferiority of the AM parts tested. The testing included irrefutable data regarding all aspects of the parts including metallurgy analysis.
The Government Accounting Office produced a study which was unfavorable to AM parts as well. Among other things the GAO points out an absolute lack of a recall process to insure the safety of consumers.
Most State’s administrative codes that address such issues call for the subject parts to be “at least equal in terms of fit, quality and performance” a standard that in my experience has yet to be achieved.
That said, insurers have no business at all attempting to force third party claimants to accept substandard parts such as these. Consumers and plaintiffs attorneys alike are coming around to keying on the difference between first and third party claims. The insurance industry ought to learn that they are only there to write checks in third party circumstances. In first party situations if they choose to properly and formally exercise the “repair” option available under the payment of loss provision, so be it. At that point they also carry an equitable portion of the liability, all of it.
The days of mixing the options available under the “payment of loss provision” to the benefit of the insurer but to the detriment of the insured are drawing to a close. Manipulating the contract against the consumer in this way is simply consumer fraud. Don’t go hiding under the DOI’s skirts either, as do not regulate consumer fraud, each state’s Attorney General does that.
I’ll close with a courtroom paraphrase from Barney Schultz, lead counsel in the Avery/Snider v. State Farm 1.2 billion dollar aftermarket parts suit. “Your honors, we don’t repair cars, we pay to have cars repaired.”
Wade Ebert
American Auto Body
Springfield IL
cc: Tennessee Department of Commerce and Insurance
Office of the Attorney General Tennessee
PCI is trying to fool both the Department of Insurance and the insurance buying public. The truth is that premiums are based on the market value of the car (WITH original factory parts) and when loss occurs, it is the insurer that reaps a financial windfall at the policyhoder’s risk and expense.
although theses parts have there place in the market. Insurance companies commonly use them on newer and expensive vehicles to suit there own agenda, they are NOT quality replacement as the name may imply.
Mr. Hurns has apparently forgotten, or more likely chosen to ignore the entire Avery v State Farm case (Illinois). In this landmark court case, expert after expert testified that aftermarket parts are “catgorically inferior”.
1. FIT
a. Aftermarket parts generally do not fit the same as their Original Equipment Manufacturer – parts made by the vehicle manufacturer (OEM) counterparts – aftermarket parts are typically “reverse engineered” (an OEM part is used to make a mold, then that mold is then used to make the aftermarket parts) or the aftermarket parts are produced using old stamping dies and equipment. These dies are worn beyond the manufacturer’s acceptable tolerances and often sold to aftermarket companies.
This would be a most difficult claim to demonstrate and substantiate in that it would essentially entail test-fitting the aftermarket parts in question. Without such exhaustive testing, how can an insurer justifiably claim these parts are in fact “equivalent” or “equal to” the OEM counterparts ?
2. QUALITY
a. Aftermarket parts are generally produced using different (cheaper) alloys (combinations of different types of metals). These alternative alloys have been tested and found to be inferior to those utilized in production of OEM parts.
b. Welds used to secure aftermarket panels together (inner and outer portions of a composite panel) are typically smaller, with less penetration, and are often found in fewer numbers.
c. The quality of the primers used on aftermarket parts is generally inferior to that of OEM parts, and the film thickness is typically substantially less.
d. General Motors replacement parts information states in part: “Application of additional rust-inhibiting materials is not required and none is recommended.” Aftermarket parts, through the lack of anti-corrosion materials, necessitate this additional procedure.
e. Test after test have shown these parts to be inferior in gage (thickness) as well as composition of metals.
Aftermarket parts are lighter than their OEM counterparts – how can they possibly be “equal” in terms of quality if they are thinner ?
3. PERFORMANCE
a. Crash Testing
1) Motor vehicle manufacturers subject their vehicles to crash testing in an effort to comply with federal safety regulations. CFR 49 571.219 sets specific requirements for windshield zone intrusion (hoods) and section 581.5 sets similar standards for bumpers.
Aftermarket parts are not/have not been, subjected to the same stringent testing – in fact, the only case of an aftermarket part EVER being crash tested that I am aware of was ONE hood. How can anyone claim that a product is in compliance if the part has not been rigorously tested ?
b. Corrosion Resistance
1) Most American vehicle manufacturers conducted salt spray corrosion tests in the mid-late 80’s that clearly showed aftermarket parts to be inferior with regard to corrosion resistance.
2) Most, if not all, original equipment parts either have a zinc-based primer applied to them or are galvanized. Current aftermarket Material Safety Data Sheets clearly indicate that aftermarket parts are not protected with zinc-based anti-corrosion primers, nor do these MSDS’s indicate the presence of galvanization. Zinc/galvanizing is a critical factor in anti-corrosion properties of sheet metal parts.
c. Restoration of Value
1) One of the aspects of OEM parts that is often not considered is that they partially restore the pre-loss value of the automobile – more so than aftermarket parts do. Prospective purchasers typically will not knowingly pay as much for a vehicle repaired with aftermarket parts as they will for one repaired with OEM parts. While this may not be a factor typically considered when reviewing “PERFORMANCE” of a part, it is nonetheless something that is “performed” by OEM parts that is NOT performed by aftermarket parts.
4. WARRANTY
a. Insurers frequently proclaim that they warranty these parts for as long as the consumer owns the automobile. Obviously, this “warranty” is nullified upon transfer of ownership, unlike the warranty offered by most OEM.
1) Any damage to or failure of a Ford part caused by the installation or improper performance of an imitation part is not covered under the Ford new vehicle limited warranty or any other Ford warranty.
2) Toyota vehicle factory warranties transfer when repairs are completed with new Toyota Genuine Parts. The use of used salvage and/or imitation/counterfeit parts is not covered by the Toyota transferable limited warranty on such parts and all adjoining parts and systems which are caused to fail or rust by those parts.
3) This warranty only applies to Authorized Genuine Subaru Replacement Parts and Accessories purchased from an Authorized Subaru Dealer located in the United States. Every owner of the car during the warranty period shall be entitled to the benefits of this warranty. If the car is sold or otherwise transferred during the warranty period for the part or accessory, it is recommended that the new owner be given proof of purchase documents for the part or accessory.
4) However, the warranty on Genuine Nissan replacement parts, Genuine NISMO S-tune parts, and Genuine Nissan accessories installed in a Nissan or Infiniti vehicle while the vehicle is covered by a Nissan warranty, which would have covered the part had it been installed in the vehicle at manufacture, will not end before the end of that warranty.
5) MOPAR replacement Sheet Metal Panels (outer panels) are warranted against defects in materials or workmanship which cause perforation (inside-out rust-through only) for 7 years/unlimited miles. Panels, which prove defective, will be repaired or replaced at the option of DaimlerChrysler Motors Corporation. This warranty does not cover corrosion due to fire, accident, vehicle abuse, owner negligence or vehicle alteration; corrosion caused by sand, hail, airborne fallout, chemicals, salt, road hazards or stone damage; or surface paint deterioration or corrosion (other than inside-out perforation). This warranty covers the cost of both parts and labor for the replacement of outer-panel sheet metal parts, if an authorized Chrysler, Plymouth, Dodge or Jeep? dealer or its authorized agent installed the part(s). Parts only are covered, if the parts were sold over the counter.
6) General Motors replacement parts assume the balance of the new vehicle manufacturer’s “bumper-to-bumper” warranty when installed at an authorized dealership. This warranty remains intact for the duration of the new vehicle warranty regardless of ownership.
In 1999 Consumers’ Reports, the most unbiased of all companies conducting testing on these parts, did an in-depth study of these so-called knock-off parts and found them to be inferior in nearly every aspect. More recently General Motors conducted scientific testing of these parts and found them to be inferior as well, and while not as unbiased as Consumers’ Reports, the results were the same. Ford conducted a similar study, although the results have been challenged as “biased” and “misleading”. However, the only testing that proclaimed these parts to be equivalent was conducted by a company that is heavily influenced by the insurance industry. Again, this disputes the claim of “equality” as far as “quality” and “performance” are concerned.
With these facts exposed, how is it permissible for insurers to mandate the use of these inferior parts ?
Furthermore, why are insurance companies not being prosecuted and penalized for violating the promises they made consumers in the contract of insurance ?
Whether it is a tort action (third-party claim) or a loss covered by the contract of insurance (policy) is not the issue – the issue is that insurers are mandating parts that are quite frankly, “categorically inferior”.
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Hurns in my opinion flatly lies on this issue when he asserts that “blind tests” have established that these parts are not inferior to Original Equipment. In fact the “organization” he holds up as the arbiter of the fitness of these parts- CIC the Collision Industry Conference has stopped doing “fit tests”. Largely because their wholly unscientific results on a very limited set of vehicles were being held up as “proof” of the parts’ fitness for a particular purpose – an assertion with which the CIC takes exception. Additionally the spreadsheet that CIC themselves produced of fit test data details the AM parts as wholesale “losers” in the “competition”. Beyond that when CIC was conducting the tests their membership was made up of a considerable amount of insurers and those who serve their interests.
I in fact have an evidenciary e-mail from the leadership of CIC, Lou DeLisio, ultimately the man who saw fit to terminate the “CIC fit test program”. This copy was forwarded by Karen Fierst who was and perhaps still is the envoy / lobbyist for a contingent of aftermarket parts manufacturers from Taiwan. I’d be glad to forward it to you for publication.
The GM parts study was the most scientific and comprehensive of comparisons thus far and proved beyond a shadow of a doubt the inferiority of the AM parts tested. The testing included irrefutable data regarding all aspects of the parts including metallurgy analysis.
The Government Accounting Office produced a study which was unfavorable to AM parts as well. Among other things the GAO points out an absolute lack of a recall process to insure the safety of consumers.
Most State’s administrative codes that address such issues call for the subject parts to be “at least equal in terms of fit, quality and performance” a standard that in my experience has yet to be achieved.
That said, insurers have no business at all attempting to force third party claimants to accept substandard parts such as these. Consumers and plaintiffs attorneys alike are coming around to keying on the difference between first and third party claims. The insurance industry ought to learn that they are only there to write checks in third party circumstances. In first party situations if they choose to properly and formally exercise the “repair” option available under the payment of loss provision, so be it. At that point they also carry an equitable portion of the liability, all of it.
The days of mixing the options available under the “payment of loss provision” to the benefit of the insurer but to the detriment of the insured are drawing to a close. Manipulating the contract against the consumer in this way is simply consumer fraud. Don’t go hiding under the DOI’s skirts either, as do not regulate consumer fraud, each state’s Attorney General does that.
I’ll close with a courtroom paraphrase from Barney Schultz, lead counsel in the Avery/Snider v. State Farm 1.2 billion dollar aftermarket parts suit. “Your honors, we don’t repair cars, we pay to have cars repaired.”
Wade Ebert
American Auto Body
Springfield IL
cc: Tennessee Department of Commerce and Insurance
Office of the Attorney General Tennessee
PCI is trying to fool both the Department of Insurance and the insurance buying public. The truth is that premiums are based on the market value of the car (WITH original factory parts) and when loss occurs, it is the insurer that reaps a financial windfall at the policyhoder’s risk and expense.
although theses parts have there place in the market. Insurance companies commonly use them on newer and expensive vehicles to suit there own agenda, they are NOT quality replacement as the name may imply.
Mr. Hurns has apparently forgotten, or more likely chosen to ignore the entire Avery v State Farm case (Illinois). In this landmark court case, expert after expert testified that aftermarket parts are “catgorically inferior”.
1. FIT
a. Aftermarket parts generally do not fit the same as their Original Equipment Manufacturer – parts made by the vehicle manufacturer (OEM) counterparts – aftermarket parts are typically “reverse engineered” (an OEM part is used to make a mold, then that mold is then used to make the aftermarket parts) or the aftermarket parts are produced using old stamping dies and equipment. These dies are worn beyond the manufacturer’s acceptable tolerances and often sold to aftermarket companies.
This would be a most difficult claim to demonstrate and substantiate in that it would essentially entail test-fitting the aftermarket parts in question. Without such exhaustive testing, how can an insurer justifiably claim these parts are in fact “equivalent” or “equal to” the OEM counterparts ?
2. QUALITY
a. Aftermarket parts are generally produced using different (cheaper) alloys (combinations of different types of metals). These alternative alloys have been tested and found to be inferior to those utilized in production of OEM parts.
b. Welds used to secure aftermarket panels together (inner and outer portions of a composite panel) are typically smaller, with less penetration, and are often found in fewer numbers.
c. The quality of the primers used on aftermarket parts is generally inferior to that of OEM parts, and the film thickness is typically substantially less.
d. General Motors replacement parts information states in part: “Application of additional rust-inhibiting materials is not required and none is recommended.” Aftermarket parts, through the lack of anti-corrosion materials, necessitate this additional procedure.
e. Test after test have shown these parts to be inferior in gage (thickness) as well as composition of metals.
Aftermarket parts are lighter than their OEM counterparts – how can they possibly be “equal” in terms of quality if they are thinner ?
3. PERFORMANCE
a. Crash Testing
1) Motor vehicle manufacturers subject their vehicles to crash testing in an effort to comply with federal safety regulations. CFR 49 571.219 sets specific requirements for windshield zone intrusion (hoods) and section 581.5 sets similar standards for bumpers.
Aftermarket parts are not/have not been, subjected to the same stringent testing – in fact, the only case of an aftermarket part EVER being crash tested that I am aware of was ONE hood. How can anyone claim that a product is in compliance if the part has not been rigorously tested ?
b. Corrosion Resistance
1) Most American vehicle manufacturers conducted salt spray corrosion tests in the mid-late 80’s that clearly showed aftermarket parts to be inferior with regard to corrosion resistance.
2) Most, if not all, original equipment parts either have a zinc-based primer applied to them or are galvanized. Current aftermarket Material Safety Data Sheets clearly indicate that aftermarket parts are not protected with zinc-based anti-corrosion primers, nor do these MSDS’s indicate the presence of galvanization. Zinc/galvanizing is a critical factor in anti-corrosion properties of sheet metal parts.
c. Restoration of Value
1) One of the aspects of OEM parts that is often not considered is that they partially restore the pre-loss value of the automobile – more so than aftermarket parts do. Prospective purchasers typically will not knowingly pay as much for a vehicle repaired with aftermarket parts as they will for one repaired with OEM parts. While this may not be a factor typically considered when reviewing “PERFORMANCE” of a part, it is nonetheless something that is “performed” by OEM parts that is NOT performed by aftermarket parts.
4. WARRANTY
a. Insurers frequently proclaim that they warranty these parts for as long as the consumer owns the automobile. Obviously, this “warranty” is nullified upon transfer of ownership, unlike the warranty offered by most OEM.
1) Any damage to or failure of a Ford part caused by the installation or improper performance of an imitation part is not covered under the Ford new vehicle limited warranty or any other Ford warranty.
2) Toyota vehicle factory warranties transfer when repairs are completed with new Toyota Genuine Parts. The use of used salvage and/or imitation/counterfeit parts is not covered by the Toyota transferable limited warranty on such parts and all adjoining parts and systems which are caused to fail or rust by those parts.
3) This warranty only applies to Authorized Genuine Subaru Replacement Parts and Accessories purchased from an Authorized Subaru Dealer located in the United States. Every owner of the car during the warranty period shall be entitled to the benefits of this warranty. If the car is sold or otherwise transferred during the warranty period for the part or accessory, it is recommended that the new owner be given proof of purchase documents for the part or accessory.
4) However, the warranty on Genuine Nissan replacement parts, Genuine NISMO S-tune parts, and Genuine Nissan accessories installed in a Nissan or Infiniti vehicle while the vehicle is covered by a Nissan warranty, which would have covered the part had it been installed in the vehicle at manufacture, will not end before the end of that warranty.
5) MOPAR replacement Sheet Metal Panels (outer panels) are warranted against defects in materials or workmanship which cause perforation (inside-out rust-through only) for 7 years/unlimited miles. Panels, which prove defective, will be repaired or replaced at the option of DaimlerChrysler Motors Corporation. This warranty does not cover corrosion due to fire, accident, vehicle abuse, owner negligence or vehicle alteration; corrosion caused by sand, hail, airborne fallout, chemicals, salt, road hazards or stone damage; or surface paint deterioration or corrosion (other than inside-out perforation). This warranty covers the cost of both parts and labor for the replacement of outer-panel sheet metal parts, if an authorized Chrysler, Plymouth, Dodge or Jeep? dealer or its authorized agent installed the part(s). Parts only are covered, if the parts were sold over the counter.
6) General Motors replacement parts assume the balance of the new vehicle manufacturer’s “bumper-to-bumper” warranty when installed at an authorized dealership. This warranty remains intact for the duration of the new vehicle warranty regardless of ownership.
In 1999 Consumers’ Reports, the most unbiased of all companies conducting testing on these parts, did an in-depth study of these so-called knock-off parts and found them to be inferior in nearly every aspect. More recently General Motors conducted scientific testing of these parts and found them to be inferior as well, and while not as unbiased as Consumers’ Reports, the results were the same. Ford conducted a similar study, although the results have been challenged as “biased” and “misleading”. However, the only testing that proclaimed these parts to be equivalent was conducted by a company that is heavily influenced by the insurance industry. Again, this disputes the claim of “equality” as far as “quality” and “performance” are concerned.
With these facts exposed, how is it permissible for insurers to mandate the use of these inferior parts ?
Furthermore, why are insurance companies not being prosecuted and penalized for violating the promises they made consumers in the contract of insurance ?
Whether it is a tort action (third-party claim) or a loss covered by the contract of insurance (policy) is not the issue – the issue is that insurers are mandating parts that are quite frankly, “categorically inferior”.