Lessons Learned By Ginny Whelan ginny@araeducation.com

Sink or Swim

he information age is drowning us with an unprecedented deluge of data,” observes New York Times bestselling author and neuroscientist Daniel J. Levitin in his book The Organized Mind. “At the same time,” he notes, “we’re expected to make more and faster deci- sions. No wonder, then, that the average American reports frequently losing car keys or reading glasses, missing appoint- ments, and feeling worn out by the effort required just to keep up.” The average auto recycler also reports frequently feeling worn out by the effort required just to keep up. But somehow many have become quite accomplished at managing the information flow, and others will need to get better at it in the coming days as data becomes more important every day in our industry. Take, for example, the capability of car- makers to factory-equip their new vehi- cles with connectivity and, therefore, collect information about every aspect of the car – how and where it is driven and the health of its various parts. Managing this data information reaps untold ben- efits for OEMs, why not also for the auto recycler?

T

Why are they doing this? Missed profit potential. The amount of money that new car dealers miss out on in maintenance and collision repair after the sale of the car is staggering. The OEMs intent is to gain back that business by connecting the car to a vehicle remote diagnostic. Roger Lanelot of Strategy Analytics reports that, in the U.S., seventy percent of the profit from vehicles sold by a new car dealer is lost to OEMs, to the tune of $60 billion in deferred maintenance and $40 billion in collision repair a year. That is $100 billion in OEM total lost revenue. Almost all players in the connected car ecosystem believe that the best way to keep that ROI on the OEMs books is uti- lizing vehicle remote diagnostics. Andrew Hart, head of the Advanced

20 Automotive Recycling | January-February 2015

Research Division of SBD (an inde- pendent, technical and market research consultancy specializing in automotive security, connected car telematics and driver assistance systems) says, “The underlying reason most carmakers now want all their cars to be connected is to refocus their connectivity strategy around remote diagnostics.” Hart cites the exam- ple of BMW, which has started offering it’s proprietary eCall service in the U.S. free of charge for 10 years – effectively, for the lifetime of the car, which provides over-the-air data about the vehicle to a BMW service partner. BMW is ensuring that if the vehicle has an accident or mal- function the repair will be performed within its own network. The OEMs know that car-generated data provides important information. If recyclers want to understand the car and its parts, they also have to get into the guts of the network. To that end goal, the ARA Educational Foundation is considering stepping for- ward with its first research and develop- ment project. Project manager Ginny Whelan, working with Crashboxx Telematics’s Peter Byrne, will provide the ARAEF with a research outline to extract and retrieve the image of the crash and pre-crash data to fully understand the accident. This new level of data mining will provide value added information on the condition of part systems at the time of the total loss.

The goal in gathering car-generated data by auto recyclers at the point of inventory may enable recyclers to define a new level of performance quality for the recycled part. “Recyclers are sitting on a gold mine, a data gold mine. We have the tools to extract it, and add sub- stantial value to it, instead of turning over the Electronic Control Unit (ECU) data to accident reconstructionist, insurers, and OEMS for no compensation,” says Byrne.

The raw data from the black box (actu- ally the airbag ECU) is of limited use to a layperson. It needs to be analyzed. The tool and software for this project that can extract data from the ECU has the codes of 15 OEMs, only Mitsubishi, Hyundai, and Kia are using their own tool. More and more data brokers are seeking access to the crash data. Insurers are already increasing awareness of the data and growing use in the processing of claims. All of this confirms and underlines the business case for the automotive recyclers to get into the salvage crash data. If approved ARAEF Salvage Crash Data (SCD) pilot will be conducted among teams of ARA Gold Seal members trained to use the ECU extraction tool and collection procedures. This will pro- vide raw data delivery to Crashboxx for independent testing. In the ARAEF-SCD software development, a beta test is the second phase of testing, a sampling of the intended audience tries the product out. Beta testing can be considered pre- release testing.

Beta test versions of SCD software will be distributed to specialists to give the program a “real-world” test. Test-run recycler participants will complete a sur- vey on the time needed extract, collect and deliver the data. After the details are nailed down the design and building the database application will take 60 days. The ARA Educational Foundation is considering this project to determine how the automotive recycling parts industry can consider the benefits of a connectivity strategy and remain com- petitive with OEMs and service providers in the parts market. ■

Ginny Whelan, an ARA Past President, is Man- aging Director of the ARA Educational Founda- tion and founder of the ARA University, the leading Web-based training resource in auto re- cycling education. Visit www.arauniversity.org.