BIG 3 LAUNCH INTERNET PARTS PORTAL

In a month that saw more than 10,000 workers laid off from Internet firms, a new player emerged in the increasingly crowded online parts ordering market: The Big Three.

Less than a year after DaimlerChrysler AG, Ford Motor Co. and General Motors Corp. unveiled plans to develop an electronic marketplace to connect to their suppliers, the three automakers announced another joint venture. This one is designed to link dealers with wholesale parts customers — auto repair and body shops — via the Internet.

The new company, name pending, will use technology created by Bell & Howell, the fourth player in the “new OEM parts connection,” to enable shops to import estimates into a new portal web site and send them to participating dealers.

“In essence, we like to think of it as giving our best customers the tools to serve their best customers,” says Chuck Rotuno, a former Bell & Howell executive who has been named CEO of the new Ohio-based company.

Mr. Rotuno says CollisionLink, the new company's first product, is designed to improve efficiencies for body repair shops and their OEM parts suppliers. A shop, for example, can import estimate data and digital images of the vehicle into CollisionLink, providing to the dealer all of this information — including lists of any non-OEM or salvage parts designated on the estimate.

Because as many as one-third of parts numbers in electronic collision estimates are inaccurate, CollisionLink automatically “scrubs” or validates the parts number against the vehicle make, model and identification number, says Mr. Rotuno. That improves order accuracy.

It also will enable dealers to increase parts sales, he says, by giving them an opportunity to offer new OEM parts in place of non-OEM or salvage parts listed on the estimate.

“We will be able to help dealers achieve parts and service efficiencies by developing access to a single national parts locator, with the most up-to-date and accurate inventory information.”
— Ross Tudor Global business strategy and planning manager Ford consumer services group

“In today's phone and fax process, these are parts that dealerships would never have seen,” Mr. Rotuno says. “Collision Link gives the dealers the tools they need to now bid on these parts as well. In many cases, a genuine OE part can be substituted for an aftermarket part and still be priced under the insurance company's estimate. And when that happens, everyone wins.”

A third element of CollisionLink is a “related parts” section.

“This screen suggests additional parts needed to repair the vehicle based on previous transaction history,” Mr. Rotuno says. “Think about Amazon.com. When you buy a book, Amazon will list related books other customers have ordered. CollisionLink will do virtually the same thing.

“On average, it takes 4.1 parts orders to completely repair a vehicle: the original order, plus those time-wasting supplements. The result is inefficiencies for every member of the supply chain. By using the related parts feature, CollisionLink will help reduce that number (of parts orders per repair job).”

While targeting the collision repair market initially, the new company eventually plans to support all dealer wholesale parts transactions including dealer-to-dealer and those to fleet and independent service center customers, Mr. Rotuno says.

Features to be added will include instant order notification, shipping status and order tracking, access to parts and service bulletins, training tips, and advanced parts locating systems.

“We will be able to help dealers achieve parts and service efficiencies by developing access to a single national parts locator, with the most up-to-date and accurate inventory information,” says Ross Tudor, manager of global business strategy and planning for Ford's consumer services group.

“This locator will allow dealers to quickly find the parts that their customers need to complete vehicle repairs faster,” he adds. “It also will help dealers sell their obsolete parts, freeing up capital to stock their shelves with high-demand parts.”

Like most of the other Internet-based parts ordering systems, use of the new portal will be free to the buyer; participating dealers will pay as-yet unannounced subscription or transaction fees. But Mr. Rotuno and others involved in the enterprise quickly distanced the new firm from the growing field of Internet-based parts ordering companies.

“Within the past two years, dozens of dot-coms have popped up, each with the promise of bringing a unique, internet-based solution to the automotive parts market,” GM spokesman Greg Knott says.

He adds, “Our dealers have told us their frustrations and their customers' frustrations with these dot-com middlemen… charging additional percentages but providing few solid benefits. This venture is different for two reasons.

“First, it represents the three largest vehicle manufacturers in the U.S. and the leading provider of electronic automotive parts catalogs. We have the knowledge, the resources and most importantly, the respect of existing customer and dealer bases to ensure success.

“Second, we have the bricks to go with the clicks. We have the largest OE parts distribution network, the most current OE catalog data, and OEM service information. No other players have such extensive assets.”

“At this point, the body shops are not ready for this.”
— Robert Bixler parts manager Orlando (FL) Dodge

Although Mr. Rotuno and others say CollisionLink has been well-received in pilot testing being conducted, they declined to provide the names of any participating dealers. Interviews with other parts managers, however, indicate the new venture may face a skeptical audience when it's rolled out in the second quarter of this year.

Mike Allor, parts manager for Alan Ford in Bloomfield Hills, MI, says his shop customers generally fax in estimates, which gives his department the chance to compete against any non-OEM or salvage parts listed.

Robert Bixler, parts manager at Orlando (FL) Dodge, doesn't see interest in on-line parts ordering among his customers.

“At this point, the body shops are not ready for this,” Mr. Bixler says. “I've even talked to some of my shops about this, and they don't foresee it being something they're going to use. If there aren't body shops who are willing to get involved in this, it's not beneficial to me at this point.”

Other companies' attempts to develop online parts ordering systems have been cumbersome, according to Chuck Tricoli, parts manager at Courtesy Chevrolet in San Diego, CA. But he says if the Big Three's new portal site is done well, he'll definitely consider participating.

“The idea is good,” he says. “It has a sound basis to it. My feel is that it will be something that I should look at. Will it be monetarily advantageous to us? I don't know. But I think it's probably going to be a part of the business in the future.”