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Hey everyone,
Collision operations aren't something we've covered much before, but the data from Mitchell's Q1 report caught my eye. This edition is a snapshot of what we're watching.
But if you're running collision centers and have a perspective worth sharing, we'd love to dig deeper.
— CDG
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MHEV repairable collision claims hit an all-time high in Q1: They’re up 25% year-over-year in the U.S. and 33% in Canada.
Gas vehicles total out at nearly twice the rate of EVs: 22.89% vs. 11.90% across all collision claims, though newer ICE vehicles (under 6 years old) close the gap significantly, at 12.91%.
Corina Straub Diehl built an 11-center collision operation: It feeds parts gross, recon, and total loss leads back into the same group, and the model applies well beyond collision.
(Source: Mitchell International / CDG Podcasts)
Mild hybrids (MHEVs) are getting into accidents at a record rate, but few collision shops are set up to handle hybrid-specific repairs.
More people are driving mild hybrid vehicles, aka cars that use a small battery to assist a gas engine, improving fuel economy without needing to plug in.
They're more affordable than full EVs, easier to own, and automakers are leaning on them to hit fuel economy targets. So the fleet is growing quickly.
Why this matters: More mild hybrids on the road means more mild hybrid accidents.
In fact, repairable MHEV collision claims hit 5.69% of all claims in the U.S. in Q1.
That’s an all-time high, up 25% from a year ago.
In Canada, that growth is even sharper, up 33%.
The challenge: Hybrid repairs require specific equipment and trained technicians. But many collision shops, including some dealer-owned operations, are still building toward that capability.
NOTE TO DEALERS:
Our read is that hybrid-certified technicians aren't easy to come by. OEM training takes time, and the experienced ones are already in high demand.
So… if there's ever been a case for growing your own, this is it.
The dealers investing in apprenticeships and OEM training programs now are the ones who'll have the capacity when the volume peaks, and based on where claim frequency is heading, that's not far off.
Total losses present a recurring customer acquisition moment worth creating a process for.
Across all ICE vehicles, roughly 23% of collision claims result in a total loss, which is nearly double the 11.90% rate for BEVs.
That said, the gap narrows considerably for newer ICE vehicles, which total at 12.91%, closer to the BEV rate.
What this means: Across gas, hybrid, and electric vehicles, total losses are happening every month in dealer collision centers.
When that happens, the customer's car is gone, they need a replacement, and they're already standing in the facilities of dealers with collision operations.
WHY IT MATTERS:
These are recurring moments where a customer needs a vehicle and is already connected to the facility.
Having a clear handoff to the sales floor (more on this below) is the difference between capturing that or not.
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When I came across this Mitchell data, I couldn't help but think of Corina Straub Diehl, President/CEO of Diehl Automotive Group, a 24-rooftop, billion-dollar operation with 11 collision centers across Pennsylvania and Ohio.
She was recently on the CDG Podcast, and while she doesn't dig into hybrids or EVs specifically, the model she's built (franchise parts flowing to in-house collision centers, total loss customers handed directly to the sales floor, recon running through the same facility) maps almost exactly onto what the data is pointing at.
Here are her dos and don’ts worth considering:
Do: Supply your collision centers from your own franchise parts inventory at full margin.
At Diehl Automotive, parts flow from franchise stores to its collision centers, and the margin stays in the group.
"Let's talk about my 13 franchises and a parts. So, I'm supplying parts to all of my collision centers, right? And they aren't really discounted. Okay, let's start there. I'm servicing my customers... We have the demand."
Corina Straub Diehl
Here's what that means in practice: When a vehicle comes into one of Diehl's collision centers for repair, the parts needed to fix it are ordered from Diehl's own franchise stores, at full price. The repair revenue stays in the group. The parts gross stays in the group.
And what would otherwise be two separate transactions (a collision repair and a parts sale) becomes one closed loop where Diehl captures both sides.
Given what we covered on hybrids and EVs, that loop is even more valuable as the volume of complex, OEM-parts-dependent repairs grows.
Do: Build a process for connecting totaled customers directly to your sales floor.
Diehl averages roughly 10 totaled vehicles per month across its collision centers. Each one is a customer who just lost their car and needs another one. Corina's team is directed to act on it immediately.
"If you think about how many cars get totaled, let's say on an average, we might get 10 throughout our collision centers a month. Now, take those customers and our managers are directed immediately, and we give them loaners to introduce them to the closest GM for the closest store. Right? So if the car's at the Robinson Collision Center, we're going to have the GM from there reach out to see if we can help them. And we will cross-sell, of course."
By the numbers: Ten totaled units/mo across 11 centers is 100+ of those moments per year… each one a customer already in the building, already without a vehicle, already in need of one.
Don’t: Treat recon and collision as two separate cost centers.
Diehl's collision centers handle used car reconditioning for the group. Same facility, same team.
CDG: “These collision centers, I assume, also do your used car reconditioning?”
Diehl: "Absolutely. Absolutely."
Her reasoning: Recon is a cost at most stores. Routing it through a collision center that's already staffed and equipped turns a standalone expense into shared overhead, and keeps the clock moving on used units.
Diehl's collision operation is a masterclass in connectivity.
Nothing operates in isolation, and every touchpoint feeds into the next.
The greatest part? Any dealer who maps their current operations and asks "where are we letting value walk out the door between departments" is doing the same exercise.
Collision just happens to be where Diehl found the most room, and where the data suggests a lot of other operators haven't looked yet.
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