KEY POINTS:
A new agreement between AA Insurance and its approved repairers will compromise the safety of repaired vehicles if it goes ahead, some panelbeaters believe.
AA Insurance has asked the panelbeaters it uses to repair vehicles to reapply for "approval status" under new conditions that some panelbeaters say will
force many out of business and others to take short cuts.
Owen Evans of Evans European is an AA Insurance-approved panelbeater, but will not be signing the new agreement.
He expects to lose an average of two jobs a week and to have to lay off some of his 35 staff as a result of his not signing.
But he says the agreement is dangerous, as it will encourage panelbeaters to use secondhand parts because the largest mark-up they can charge on a new part is only 5 per cent.
He said the other concern was about the knowledge and equipment of cheaper panelbeaters.
Mr Evans said car manufacturers now used metals that were light, but could handle huge amounts of pressure.
But if the right welder was not used in the right way, the part could be made unsafe and that was not easy to detect.
"Whoever has the lowest price is going to get the job, and how they fix it is irrelevant to them. They [the AA] may say we're concerned about that and we'll be looking after repairs but if a chassis rail is painted and repaired it won't look any different but if you have an accident the chassis won't perform the same."
AA Insurance chief executive Chris Curtin said jobs did not automatically go to the lowest bidder, and the AA gave a lifetime guarantee on repairs.
"We would not allow a repairer to get a job that they're not equipped to handle."
Mr Curtin said no person in business was going to compromise their standards or brand to win a job.
"Every single car that comes out of that process is quality controlled and checked by our people."
He said the company checked that cars had been repaired in the proper manner.
Another Auckland panelbeater, who did not want to be named, said panelbeaters would go under.
"They're screwing us to make more profit for the AA. Does the profit get passed on? No it doesn't," he said.
"They are structuring the contract more and more in their favour to the point where a lot of us will lose our business because we cannot afford to do the work."
Mr Curtin said savings from the scheme would be passed on "in the long term".
Possible savings from the new mark-up allowances, which come into force today, would not be passed on immediately because savings do not "flow through that quickly".
Gary Waite of Colin Waite Panelbeaters said he had opted out of the scheme because the AA's depots are too far away from his Auckland City business and he could not afford to drop everything and rush over to Albany on the North Shore to quote vehicles.
He said the increased competition could affect repair qualities, and some repairers might think twice before replacing a part.
