Who’s looking out for your best interests?

By Steve Saltzgiver

Recently I took my personal car into a well known national vendor to get the brakes repaired. This experience reminded me why I’m such an advocate of using an outsourced maintenance contractor to reduce vehicle costs. Many agencies tell me they cannot afford the fees charged by outsourced contractors (like ARI) to help them manage vehicle repairs. My usual response through the years has unequivocally been, “You can’t afford not to!” Why?

Simply put, with few exceptions repair shops are not looking out for your agency’s best interests when it comes to repairing vehicles. Using a contractor increases the likelihood that your agency will not pay any more than absolutely necessary for vehicle repairs and service.

How can a contractor guarantee this?
Easy, because you pay the contractor to work for you and it’s in his best interest to save your agency money! It has been said, “He who represents himself in court, has a fool for a client”. The same logic applies to the average person trying to navigate through the complex repair process when dealing with shrewd, fast-talking, and merciless repair vendors. Few people would place themselves on the mercy of the legal system without the benefit of having a seasoned lawyer or legal advocate by their side. Likewise, contractors employ trained and certified technicians capable of speaking the complex lingo spoken by automotive professionals. In essence, a contractor acts as your personal advocate (on retainer for a monthly fee) to ensure your best interests are always served.

Why is this important?
These are difficult economic times and unfortunately many vendors are motivated by profit to serve their own selfish interests. Countless repair shops bank on the fact that the average person knows very little about the vehicle repair business. Consequently, vendors aggressively engage in an unfair tactic fleet professionals call, “upselling”.

Upselling is simply a practice where a vendor tries to take advantage of a consumer’s ignorance when it comes to basic knowledge of car repair. This generally takes place in the form of self-serving recommendations to purchase unnecessary parts and services to enhance their profit margins. Often times these recommendations urge customers to repair unreported complaints (discovered by the mechanic) under the guise they are doing you a big favor and looking out for your safety.

As an example, you respond to a promotion like, “free brake inspection” or you simply take your vehicle in for a specific problem and they provide you with a laundry list of problems needing attention like, ball joints, struts, shocks, and so forth. This is especially true when someone does not (or cannot) challenge each repair recommendation provided by these unscrupulous repair shops.

How do people fall prey to these upselling tactics?
Think about this…Most of us have experienced firsthand sitting in a waiting room full of customers waiting for our vehicle to be serviced, then prancing confidently off the shop floor, the mechanic shows up in the waiting area with an air filter for us to inspect. As this is happening several questions run though your mind.

How do I know if the air filter is bad?
When was the last time the air filter was changed?
Does it really need to be changed now?
What if I don’t change the filter?

There you are right in front of the other customers and now you have to act like you know what you’re doing. The pressure is on! If you cannot answer these seemingly simple questions you probably do what most people do and tell the mechanic to go ahead and change the air filter. As you submit to this common upselling tactic, thinking you are erring on the side of wisdom and caution you just increased your agency’s repair bill by about $25 dollars.

When you have fleets as large as the States these upselling tactics really add up to a lot of unnecessary expenses. (e.g. 20,000 vehicles x $25 = $500,000) Especially when you consider the average state vehicle travels about 12,000 miles and each may encounter at a minimum three air filter inspections a year.

How can your agency put the brakes on unnecessary vehicle costs?
My recent brake experience demonstrates why it’s important to level the playing field by having someone on your side when making difficult repair decisions. I have been in the fleet management business well over twenty years, starting out as a mechanic and then moving into fleet administration. Sufficed to say, I have a fair amount of experience dealing with vendor tricks of the trade. This being said, like most I don’t have time to repair my own vehicles. So consequently, I take my cars to repair shops like everyone else. With one exception, I’m usually armed to do battle with vendors when confronted with this upselling ruse.

Back to the brake story
My wife reported the truck was making a grinding noise as she applied the brakes coming to a stop. Immediately, my fleet experience tells me that this means the brake pads (and rotor) need to be replaced. So like anyone, I drove the truck over to a well-known vendor advertizing to repair brakes for $99 in most cases. By the way, the words “in most cases” are really legal jargon required by the consumer protection agency, which means $99 is not very likely.

Now I’m not naïve, I knew going in that I would probably need new brake pads, a new rotor and perhaps a few other minor parts which would make the actual repair cost somewhere in the neighborhood of about $200-300 dollars. However, about an hour later I received the dreaded phone call from the mechanic with grim news about the total cost to repair my truck. The confident mechanic said, “Mr. Saltzgiver the total estimate to repair your truck is going to be about $875 dollars”.

As I digested this news, he proceeded to explain reasons why I needed to spend this excessive amount of money to fix my truck. His inspection found the left front brake assembly was metal-on-metal consequently the rotor had been damaged beyond repair (I knew this). Further, he stated, “because the left front rotor had been damaged –by calipers hanging up- I recommend the right front and both rear rotors be replaced to ensure proper balance and wear in the braking system. In addition, he said since all four brake calipers were hanging up he strongly urged each be replaced to prevent premature failure of the newly installed brake pads. In addition, he proceeded to advise me that the brake fluid should be flushed, all four seals be changed and wheel bearings be repacked.

Now is the moment of truth! You can’t simply bluff your way through this process if you don’t have vehicle repair experience. These technicians know it! So your choice is to take the easy way out (since it’s state money anyway) and tell the technician to go ahead with the repairs he recommends.

Back to the story
First, what the mechanic didn’t know is I had the benefit of history on my side and I knew about every repair that occurred over the life of my truck. (Contractors like ARI have the vehicle history on their side as well) My truck’s odometer was over 75,000 miles and still had the original brakes with no significant problems, which indicates the calipers probably did not cause any premature brake pad failure. (i.e. 75,000 is a lot of miles for brake pads) Having knowledge about the car business on my side, I started the negotiation process by asking several “what if” questions.
What if I don’t replace all four rotors?
What if I don’t replace the four calipers?
What if I don’t repack the wheel bearings?
What if I just replace the damaged rotor?
What if I take it to your competitor? What would they charge?

Long story short
By the time I finished the negotiation process the original estimate of over $875 dollars had been whittled down to a little over $240, which as mentioned previously was about what I expected to pay in the first place (for brakes pads and rotor). By challenging the mechanic this ends up a total cost-avoidance savings of about 400%. Had I been current on my mechanic skills, I may have negotiated an even lower price, but I was satisfied this was probably the best I do under the circumstances and approved the work to be done.

Knowing the repair business
These exact encounters with repair shops happen every day. So, when you operate a large fleet of vehicles (like the states) this is why you need an experienced advocate in your corner to look out for your best interests. Certainly a contractor (like ARI) isn’t perfect and can’t prevent all upselling. However, they can catch the lion’s share which results in an overall reduction in your agency’s total fleet repair budget.

Next time you are faced with this repair decision-making challenge, I suggest you consider my personal experience as a fleet professional and consider the real value of having an expert handle repair negotiations in the future. This is especially significant when it comes to something as vital as brake repairs where someone’s safety is involved. The age old adage is applicable in this situation, “sometimes you have to spend money to save money!” Outsource contractors have proven time and time again that they can save significant repair dollars by aggressively negotiating with vendors.

Why does this matter?
This is important after all when it applies to government, because bottom line we are all taxpayers and we are really the ones paying for these exorbitant repair bills incurred on state operated vehicles.

Last year the State’s maintenance management contractor (ARI) helped avoid over $555,335 dollars in unnecessary repairs through negotiations, denials and good will adjustments. These efforts amounted to a cost-avoidance averaging $112 dollars per vehicle annually. Coincidently, the fee to place a single state vehicle on the ARI program was $111 dollars, not counting the $22 per month in average savings for administrative cost-avoidance.

Final thoughts
Several years ago an automotive company by the name of Fram Filter ran a series of television commercials showing a mechanic replacing a blown car engine (i.e. $5,000 major repair) resulting from not replacing an inexpensive oil filter. This mechanic asserted that this could have been avoided had an the filter been changed timely. Their slogan was simple, “You can pay me now, or pay me later!”

This still applies. Isn’t time you leave complex repair matters to experts who are skilled and motivated to save your state agency money?

End