AUCTION TEAM OUTLINES STANDARD

LAS VEGAS - Someday all auto auctions and perhaps even the entire auto industry will be using a standardized set of vehicle inspection criteria and processes.

A committee of the National Auto Auction Association (NAAA) is working to devise such standards that would eventually streamline and simplify the overall vehicle re-marketing system.

"We're all looking for inspection information that is accurate, consistent, accountable, actionable and timely," says committee member James D. Grogan, president and COO of AutoVIN Inc., a vehicle information reporting company. "We want to ensure that inspections are done the same way across the board."

Although the committee has proposed a standardized paper form for condition reports, its focus is on an electronic version.

"The electronic condition report is one we're up to our necks in right now," says Larry Brasher, president of Auto Auction Services Corp. "It's an extensive project. We've made a lot of progress but it's still in flux."

Mr. Brasher says the role of his committee is to define the scope of information that needs to be collected from inspectors and come up with a standard format for collecting and communicating that information.

"The key to adopting a standard is developing and training people to adopt that standard universally across the industry," says Mr. Brasher.

Mr. Gragan adds, "Condition reports are the end result, but condition reporting is the process. Standardization can only be driven by processes. Technology can ensure that processes are followed."

The committee has outlined a standard vehicle grading system, into which various pieces of information would be entered. That grading system includes a calculation of the cost to repair the vehicle.

"The key word is calculating rather than estimating," says Mr. Grogan. "We need to utilize technology and databases to give inspectors standard costs, pricing and quotes."

The grading scale the committee is proposing is:

* 0.0 = a salvage vehicle.

* 1.0 = a vehicle in very poor condition requiring more than $2,000 in repairs.

* 2.0 = a below-average vehicle that needs less than $2,000 in repairs.

* 3.0 = an average that will require $500 in reconditioning.

* 4.0 = a very clean vehicle with less than $300 in damage.

* 5.0 = a near-new vehicle with less than $150 in damage.

"These numbers are pretty speculative at this point," says Mr. Brasher.

Each vehicle would have two standardized grades, a before reconditioning grade and post-reconditioning grade, say the committee members.

"We feel that this will help evaluate the reconditioning that ought to be done on a vehicle and help make a better call on how much recon a person would want to do on the vehicle," explains Mr. Brasher.

Among the factors that will go into the inspection and grading process will be body panels and exterior parts, structural integrity, glass, wheels and tires, upholstery and interior parts, mechanical, fluid levels and detail.

"A vehicle could be a 5 in all categories except it could need tires, which would make it something like a 4.8 before-recon grade," says Mr. Brasher. "After the tires were replaced it would be a 5.0 vehicle."

The ADT Automotive Technical Center in Nashville, TN, recently began conducting training sessions on condition report writing and frame and structural damage policy standards on behalf of the National Auto Auction Association.

The training classes were presented to the NAAA Standards Committee late last year by ADT. The committee approved the formats and in January began promoting them.

The curriculum consists of a two-day course on condition report writer certification and a one-day course on frame technology and technical aspects of the frame and structural damage policy standards.