September 30, 2025
The automotive collision repair industry is undergoing significant transformation. Shifts in accident rates, insurance dynamics, and consumer behavior are reshaping how collision professionals approach their work. In a recent discussion, industry experts Mike Anderson and Cheryl Driggers dove into these changes, offering a thorough analysis of current trends, the driving forces behind them, and actionable strategies shops can adopt to thrive in this evolving landscape. This article captures the key takeaways and provides fresh insights on how shop owners can adapt to the "new normal."
The collision repair industry is not what it was five years ago - or even one year ago. Advances in vehicle technology, changes in consumer behavior, and economic factors like rising insurance premiums are presenting both challenges and opportunities. To remain competitive, shop owners must reevaluate long-standing practices, embrace customer-centric approaches, and leverage industry data to make informed decisions. This article distills expert insights and practical strategies to help shop owners navigate these shifts with confidence.
Accident frequency and insurance claim volumes have been steadily declining. The reasons behind this are multifaceted:
With higher insurance deductibles and the fear of premium hikes, more consumers are choosing to pay for repairs out of pocket. Reports indicate that 40% of insured drivers involved in accidents now opt to pay out of pocket rather than file a claim. For shops, this shift opens up opportunities - but only if they deliver a customer experience that encourages trust and loyalty.
Insurance companies are increasingly totaling vehicles at lower thresholds, sometimes as low as 35-45% of a car’s value. Factors driving this trend include high salvage values and an aging vehicle fleet, with the average age of cars in the U.S. reaching 14.7 years. While this trend can reduce repair opportunities for shops, it reinforces the importance of pursuing high-quality repair work that justifies the cost of saving a vehicle from being totaled.
A recurring theme in the discussion was the importance of building strong relationships with customers. Cheryl Driggers emphasized the power of active listening and personalization. Collision shops should:
To remain top-of-mind for potential customers, consistent marketing efforts are essential. Grassroots marketing strategies, such as participating in local events, partnering with dealerships, and maintaining strong online reviews, can help shops stand out. With the average driver only experiencing an accident every 18 years, being memorable is critical.
As out-of-pocket payments rise, many shops are embracing third-party financing options. Services like Sunbit and Synchrony allow customers to break down repair costs into manageable payments, often with interest-free periods. This approach removes financial barriers and makes customer-pay work more accessible.
Connected car technologies and telematics systems are becoming increasingly important. OEMs like General Motors, Volvo, and BMW are leveraging accident notification systems that direct customers to certified repair shops. Shops need to stay ahead by pursuing OEM certifications and preparing for the rise in EV repairs. Additionally, investing in ADAS calibration capabilities remains crucial, even as insurance companies scrutinize these costs more closely.
Insurance companies are under pressure from rising costs, particularly due to "nuclear verdicts" (lawsuit settlements exceeding $10 million). While this has led to tighter control over claims and growing use of AI-driven change requests, shops must remain diligent in defending proper repair procedures.
Shops should help customers understand the potential long-term financial impact of filing insurance claims, such as premium increases of up to 57% after an accident. Educating customers about these implications can often guide them toward paying out of pocket, which benefits both the customer and the shop.
ADAS systems work. While this is great for preventing accidents, it reduces the volume of repair work. Shops must shift their focus toward:
OEMs are increasingly selling vehicles directly to consumers, bypassing traditional dealership networks. This trend makes it imperative for shops to position themselves as trusted service providers for both collision repairs and maintenance. Shops that establish partnerships with OEMs for EV servicing and telematics integration will have a competitive advantage.
The collision repair industry is at a turning point, but change always brings opportunity. Shops that adapt to evolving customer needs, embrace technology, and focus on education and marketing will not only survive but thrive in the "new normal." By rethinking traditional practices and prioritizing the customer experience, collision centers can position themselves as trusted, future-ready leaders. The road ahead may be different, but it’s full of potential for those willing to innovate and adapt.
Source: "On the Road with Mike Anderson | Adapting to Collision Repair Industry’s ‘New Normal’" - Autobody News, YouTube, Aug 12, 2025 - https://www.youtube.com/watch?v=tC4Ab9PRCws
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