On the first Tuesday of November, 2012, voters in Massachusetts overwhelmingly approved a ballot initiative called “Right to Repair.” The Right to Repair law promises access to diagnostic, service and parts information for car owners and service stations/independent repair facilities (IRFs). Perhaps it’s not surprising that manufacturers (OEMs) opposed the measure, claiming it adds cost, complexity and uncertainty to the already fragmented environment of automotive service and support. OEMs claim that:

• Costs will increase as OEMs must standardize and reveal more vehicle data to ensure compliance with new laws throughout the life of a vehicle
• Complexity will increase as OEMs must open up additional channels of support to IRFs that are not necessarily “trusted” by the OEM
• Uncertainty will increase as OEMs lose the visibility they get from dealers about how vehicles are behaving in various environments, which raises warranty, performance and liability concerns

Consumers may see new car prices increase to accommodate OEM costs associated with Right to Repair compliance. This is especially true when considering that certain aspects of Right to Repair are retroactive to the 2002 model year and all aspects are fully imposed on 2018 vehicles.  (Click here for another view on the impact of Right to Repair.)

While the margin of victory for Massachusetts’ Right to Repair law was huge, 86% in-favor and 14% opposed, the fact it was passed isn’t surprising given that the name sounds so patriotic, Right to Repair. After all, to vote “no” sounds like you’d be voting against choice and Americans cherish their freedom of choice above almost all others.

The Right to Repair law is more complex than the title makes it sound, however now that the law has passed the difficulty of OEM compliance is irrelevant because failure to comply carries some very expensive penalties. Therefore the challenge for OEMs is to figure out the most cost-effective way to comply with Right to Repair.

The most pressing task for OEMs is to figure out how to get the required service and parts information up on the web, in a way that makes it accessible to IRFs while also protecting their intellectual property. To this end, an electronic parts catalog (EPC) that combines diagnostic, parts and repair information integrated with ecommerce and order management technology would do the trick. Such a solution would allow IRFs to access required information and also open up a new revenue stream for OEMs where IRFs are directed to a nearby (or preferred) dealership to procure the parts they ordered. In this way, OEMs could actually augment their franchised dealer’s parts business by expanding their role as a distributor.

The use of single sign-on (SSO) for the EPC would improve tracking of IRF access to ensure Right to Repair compliance and also automate many aspects of parts procurement. One area of interest might be the ability to download electronic control unit (ECU) and programmable control module (PCM) software updates/revisions, which are often tracked with unique part numbers, and then to help the IRF automatically upload those revisions into the vehicle. Throughout this process, franchised dealers could expand their business as regional consultants and training facilities for the IRFs working on the OEM’s vehicles.

Finally, an online EPC can collect a lot of data about who is accessing the web-based system and what problems, parts and documents are being researched the most – including an analysis of pricing requests/quotes. In a very short period of time this becomes a treasure trove of information about the OEM’s vehicles and Big Data analytics can be employed to reveal even deeper insights about warranty, performance and liability concerns.

Clearly the Massachusetts’ Right to Repair law is ushering in dramatic changes for the way OEMs support dealers and IRFs alike. However OEMs that view Right to Repair as an opportunity, rather than an obstacle, can find themselves ahead of their competitors in more ways than one.

In October, Enigma was a guest speaker at the ATA e-Business Forum and delivered a presentation about tablets on the tarmac, which focused on helping aircraft mechanics get the information they need while out on the flight line. But the story of tablets is applicable to any industry where technicians must work in remote, restricted or challenging environments.

Tablets promise higher productivity for just about everyone involved in aftermarket service and parts: technicians, inspectors, engineers, parts managers, planners, etc.  Tablets promise that maintenance tasks will be performed faster and more accurately, which will decrease mean time to repair (MTTR), increase first time fix (FTF) rates and reduce no fault found (NFF) events. The problem is that it takes more than tablets to deliver on those promises. For companies to realize these benefits, the tablet-wielding workforce must also be rewarded for their achievements, otherwise any efficiency gains might get spent on longer lunch breaks. Furthermore, industries that rely on organized labor may run into contractual issues before they get buy-in from mechanics and engineers. And so tablet promises come with some strings attached.

This raises an interesting question, “Do tablets offer any benefits that are independent of workforce cooperation?” In a word that benefit is “visibility.” Tablets offer visibility into the parts, processes, products and people involved in service and parts decisions – visibility into how people approach maintenance tasks and visibility into why some are successful and others are not. Tablets allow the collection and analysis of “big data” straight from the field (i.e. at the point of service). Such passive data collection provides insight to part selection, purchasing and service processes, and to problems with training and product quality, without being a burden on the workforce.

Despite all the hype about tablets improving maintenance and repair, the real opportunity is less about service productivity and more about sales strategy. Tablets provide the necessary link to understand aftermarket parts and service workflows. By exposing bottlenecks, inconsistencies and missed opportunities, companies can fully optimize their parts strategy and streamline service offerings. And that represents a much higher value than simple mobility.

Pump Train at NY's Cranberry Street tunnel. Photo courtesy of MTAPhotos. Creative Commons.

Super Storms Deliver a One, Two Punch

At the end of October, hurricane Sandy brought devastation and ruin to the shorelines of New York, New Jersey and parts of Connecticut. A short eight days later, a nor’easter named Athena compounded the troubles of already weakened communities still reeling from Sandy with heavy, wet snow and rain.

As a result, hundreds of thousands of residents experienced power outages from the one, two punch of the super storms rolling through the Northeast. Gas shortages and rationing due to inoperable filling stations and/or sold out gas inventory created multi-hour waits for drivers wanting to refuel vehicles. Tree blocked streets and flooded transit tunnels further complicated movement throughout the region.  The destruction was extensive.

Tragic personal loss and distress underscore the recovery efforts, which are still underway to bring relief to local communities. Linemen from power companies across the country were called in to restore power, volunteers set up aid stations to distribute water and cleaning supplies and the National Guard stepped in to offer assistance.

Trouble for New York and New Jersey Rail Transits
In addition to great personal injury, the area’s infrastructure took a crushing blow with New Jersey Transit and New York Metropolitan Transportation Authority experiencing some of the most severe damage. According to NJ.com, “The hurricane storm surge flooded the tunnels for the first time in their 102-year history.” Bloomberg reported that “Its rail operations center was flooded, ruining the computers that control the movement of trains and their power supply, as well as the backup power and the emergency generator. Downed trees brought down overhead wires on track powered by electricity.”

The same Bloomberg article posted that “The Newark-based agency had 23 percent of its rail cars and 35 percent of its engines damaged or ruined by Atlantic superstorm Sandy, said Nancy Snyder, a spokeswoman. The agency hasn’t determined how many, if any, can be repaired, she said.”  

The damage could have been worse, but luckily it wasn’t thanks to the preventative efforts of the NJ Transit Authority workers. “There would have been more damage to rolling stock had New Jersey Transit not moved trains from flood-prone areas to higher ground ahead of the storm, Snyder said.”

The Long Road to Repair and Recovery
Unfortunately rail car repair or replacement may take longer than anticipated. A Canadian paper reported that Bombardier, a rolling stock supplier to NJ Transit had extended an offer to help in whatever way they could. Then on November 1, Bombardier union workers went on strike, after being without a contract for over a month, dashing hope for a speedy delivery of 100 multi-level New Jersey transit cars currently on order.  

The damage to rails, tunnels and rolling stock could have a long-term impact that lingers long after the super storms have moved on. Flood damage, track restoration and rail car repair may turn into a capital expense that takes years to recoup. And with more super storms predicted, “Major U.S. East Coast transportation agencies hit by super storm Sandy may face "substantial" costs to beef up defenses against flooding and other severe weather in coming years and will likely need to issue more debt to do it” according to a report by Reuters.

Meanwhile New Jersey rail commuters are growing more frustrated reports NorthJersy.com, despite the fact that “NJ Transit acted quickly to create a bus and ferry service to fill in gaps left by train service that has been largely crippled by storm damage. Those lines that have been restored are offering only limited service, resulting in overcrowding.”

Looking Ahead
Recovering from the super storm damage and fully restoring commuter service in the metro New York and New Jersey area will be a challenge. As a software supplier to DART, a major U.S. light rail transit system, Enigma understands the depth of the challenge when it comes to repairing complex equipment and infrastructure.  

Full recovery may require an extended, multi-step process. The first step is to address the immediate short-term repairs in order to restore local commuter services. Next, may be an intermediate plan to establish a resilient repair and maintenance program that is able to be at-the-ready for major service interruptions. And third may be to establish a long-term preventative plan for unexpected future weather events that could once again cripple the entire metro transit system.

Given the critical nature of transit services, the complexity of the equipment, and the fact that the location or severity of damaging storms cannot be accurately predicted or averted, it makes sense that the intermediate plan to beef up maintenance and repair operations will have the most significant impact on the ability to recover from future super storms. An integrated parts catalog like InService EPC would go a long way toward ensuring that mechanics have the information they need to quickly troubleshoot problems, look up and order the right parts, and repair affected rail cars as quickly as possible to restore service.  

Whichever path is taken and no matter how long it takes, we’re confident that the oldest and most extensive public transit systems in the world are in good hands and will once again flourish under the careful guidance of their governing organizations.

Hang onto your technician tool belts fellas, things are about to get a whole lot livelier in the medical equipment world.  

A Growing Industry

It’s no secret that the medical device industry is on the upswing.  According to Medical Device + Diagnostic Industry magazine “Today, the United States is the acknowledged world leader in medical devices and diagnostic products. With more than half of the leading global medical device companies based in the United States, the industry currently employs more than 400,000 Americans directly and 2 million people indirectly.”

They go on to say that “The recession did little to deter hospitals and other customers from purchasing medical devices, and the anticipated economic recovery will only help the industry grow further. Medical device manufacturers will continue to benefit from the aging U.S. population, while the influx of newly insured people due to the healthcare reform bill will drive up demand for devices.”  But that’s not all. Researchers at IBISWorld say that “The upward trend is expected to continue. The Medical Device Manufacturing industry is set to generate $7.9 billion in 2012, up 15.7% from 2011. Industry revenue has been growing at an annualized rate of 16.9% over the five years through 2012...”

Despite some challenges in the ease and swiftness of U.S. regulatory approval, the impending medical device tax scheduled to kick-in on January 2013, and lack of permanent R&D Tax Credit, optimism prevails due to a number of factors supporting this trend. IBISWorld reports that  “… the increasing purchasing power of hospitals, improvements in living standards and therefore demand for medical diagnoses, technology upgrades in hospitals, requirements for higher quality products and the development of China's western regions” are all contributing factors.

International interest is also playing a role in growth. The emerging markets of Brazil, Russia, India and China (also known as “BRIC”) are helping the U.S. based industry command attention on a more global scale.  In a 2012 Medical Device Industry Survey conducted by Emergo Group, the United States and the four BRIC countries were seen to have the greatest potential growth over the next five years. (chart is from the Emergo Group Industry Survey).

Great News for Medical Equipment Technicians and their Businesses

Both new and used medical equipment continues to experience strong demand. For the Biomedical Equipment Technician (BMET) and the companies and/or departments they work for, this all adds up to a very bright and busy future.  The Occupational Outlook Handbook reports that “Employment of medical equipment repairers is expected to grow 31 percent from 2010 to 2020, much faster than the average for all occupations. Employment growth will stem from both greater demand for healthcare services and the increasing types and complexity of the equipment these workers maintain and repair.”  What isn’t mentioned is who these technicians will work for.

The Medical Equipment Services Caveat

With all this upward trending, globalization and growth you might think there is no downside; that nothing can stop this medical equipment joy ride. But the fact is that if the medical services companies, who help to install, repair, and maintain this equipment don’t plan ahead, they could be caught unprepared.  

The medical equipment market is fragmented with everyone vying for a piece of this lucrative thrill ride. Medical equipment manufacturers themselves offer service contracts, while third-party service providers compete for the same contract or supplemental and/or aftermarket OEM warranty work. Companies have emerged to sell medical equipment parts, which compete directly against the OEMs for parts sales. Software companies are popping up to arm medical equipment service companies with the tools needed to compete, but they also support the in-house hospital equivalents looking to do the maintenance and repair work themselves.

While OEMs will garner the profits for their research, development and manufacturing expertise of the equipment itself, the aftermarket parts and service game has yet to yield a winner. It will be interesting to watch this race play out as the market consolidates – as all fragmented markets do – and we learn who has positioned themselves best. Who will rule the aftermarket track? Will it be service contract providers, parts companies expanding into the service function or in-house hospital technicians that will pull ahead?

Whoever it is, one thing is certain. They’re going to need a fully integrated parts catalog (diagnostics, parts and service information) to keep pace with all the new and used medical equipment that the medical equipment technicians will be working on.

According to an article in USA Today there’s a: serious shortage of skilled auto mechanics looming. The article says, “There is already competition among auto dealers in many parts of the nation to hire or retain good technicians. The bigger worry is whether there will be enough younger workers in a few years as a wave of midcareer mechanics hits retirement age. “We're finding we're going to run short of technicians in the very near future,” says Rich Orbain, manager for General Motors' Service Technical College.”

The article makes clear that the biggest risk to consumers is not for routine maintenance but rather for more complex tasks that require troubleshooting and fault isolation. Advanced diagnostic systems may tell a technician which systems have gone wrong but won’t necessarily explain why. As a result, inexperienced mechanics may resort to pop-and-swap repair procedures where they simply replace parts one-at-a-time until the diagnostic system says that all is well. The problem with this approach is cost–lots and lots of additional cost.

• For vehicles under warranty, the original equipment manufacturer (OEM) absorbs the cost of all the “good” parts that were replaced.
• For vehicles not under warranty, the customer pays.
• Replaced parts are typically tested by the OEM (or component vendor) to identify which ones are faulty and which ones have “no-fault-found” (NFF).
• Parts that can be repaired/refurbished are then sold on the secondary market.

Given the potential costs associated with a bad diagnosis, today’s master mechanic is the equivalent of a high-tech field engineer. They must have expertise around powertrain technology spanning 30 years or more, including: carburetors, fuel injection, ignition systems, turbo chargers, manual transmissions, automatic transmissions (mechanical and electronic), hybrids, all-electric and advanced diesel engines. A modern vehicle may have over 20 computer chips managing different systems, each of which uses software that must “play nicely” with other software systems. (Eliminating the key from the ignition—replacing it with a “push to start” button—is the final evidence of cars becoming rolling computers.)  

So what is to be done? According to the research, in the near future there won’t be enough mechanics with the skills required to fix cars. The complexity of modern vehicles means that small, independent service stations won’t be able to afford specialist mechanics and diagnostic tools and so more and more repair work will go to dealers or large maintenance outfits (e.g. Sears Auto Centers). But even these well-stocked locations won’t be able to hire master mechanics because they won’t exist. People aren’t choosing auto repair as a career path.

The only way to solve this problem is for OEMs to take ownership of the solution. If OEMs can find a way to simplify access to accurate service, parts and diagnostic information then less experienced technicians can still get the job done. Service and parts information is usually delivered to dealers and mechanics as a series of separate manuals and catalogs. OEMs have been playing around with electronic parts catalogs (EPC) for years but most of them outsource it to 3rd party suppliers (like ARI and Snap-on), effectively divorcing themselves from the solution. Unfortunately, 3rd party EPCs don’t have the know-how to fully integrate an OEMs diagnostic, service and parts information so dealers have a fully automated workflow—the way they do in the airline industry. As a result, pop-and-swap maintenance, NFF and warranty costs continue to increase. And the whole time this is happening, the OEM’s reputation is getting more and more tarnished.

Toward the end of the article, Jose Ramirez, an instructor at Los Angeles Trade Technical College highlights the challenge of working on modern cars, “Sure, a car's computer may spit out a ‘trouble code’ to report what system is malfunctioning. But that's not enough. It's a matter of how to diagnose that trouble code. You have to play around with it."

“You have to play around with it.” Is that really what the OEMs want their customers to hear? For those OEMs willing to take control of their service and parts market, Enigma stands ready to help.