A large number of auto dealerships, seeking to sell more original-equipment parts, will adopt an Internet-based method of wholesaling collision parts this summer.
The Ford, Nissan, Infiniti and Volkswagen brands are rolling out the CollisionLink system across their dealer networks this year.
At dealerships that already use the system, parts managers such as Ken Athas of Jerry Rome Nissan in West Springfield, Mass., say CollisionLink is helping them boost revenues by converting customers from aftermarket to original-equipment parts.
"I've seen about $30,000 a month in up-sells this year," Athas says.
CollisionLink has been around for nearly five years, developed by an online parts exchange, OEConnection. OEConnection itself was created by General Motors, Ford Motor Co., Chrysler and Snap-on Inc.
Despite Ford's role in creating it, the Ford brand's dealer body had been slow to sign with CollisionLink until this year. But Bill Lopez, CollisionLink product manager, says the retail industry's current quest for more parts business has generated new interest.
Nissan dealers began signing up late last year, and more are coming this year, says Allen Childs, vice president for parts and service at Nissan North America.
Infiniti dealers are to begin rolling it out in June, and the VW brand just announced plans for its dealers to starting use CollisionLink this summer.
The Internet-based system allows dealership parts managers to make quick estimates for customers at collision-repair centers, and to manage that business efficiently. It automates the communication between dealership and customer, replacing phone calls and faxed requests so a parts manager can see immediately what parts are needed for a repair order and what the price options are.
Athas says the first benefit is order management.
"The less we can handle a piece of paper here, the less chance we have to make a mistake," says the manager, who says his shop sold $309,000 in parts last year. "And the less time we spend on an order, the more orders we can handle."
But there is a larger issue behind the system, he says: "It helps me sell OE parts."
The system's attraction is that it identifies the aftermarket parts that a collision center is planning to use and informs the dealership parts manager about any current factory price incentives on the competing original-equipment part. The automaker rebates the discounts to the parts manager by check a month or so later.
"The aftermarket part might look like a more competitive price at first," Athas says.
"But once you factor in the factory rebates, you realize the OE part is competitive, and you have an opportunity for better margin."
An OE headlight might cost $280, compared with $210 for the aftermarket version. But the same OE headlight might come with a 40 percent factory discount, meaning the parts manager has $100 or more of flexibility to work into his estimate.
"Customer satisfaction is also an issue," he adds. "People usually prefer the OE parts. They're easier to install, and customers feel better about getting them. So if I have a tool that helps me sell OE parts, that's an advantage."