What's Your Engine Oil Telling You?

Analyzing the oil in your car is like sending a sample of your blood to the lab — it reveals an astonishing amount of information about the inner workings of your engine without invasive surgery. By reading the results of the analysis, you can fine-tune the intervals between oil changes and discover problems — such as a leaking head gasket — before they cause more expensive damage.

You might even consider analyzing the oil from a car you are considering buying. Currently this is popular with airplane, boat and heavy equipment buyers, but at least one company may soon offer this as an option for used car shoppers as well.

Test-Driving Oil Analysis
We sent two samples of engine oil to Blackstone Laboratories in Fort Wayne, Indiana, to see what we could learn about a 2000 Mitsubishi Galant with 80,000 miles on its four-cylinder engine. The first sample was oil that had been used for 3,000 miles. The second sample was taken right after an oil change at a Jiffy Lube.

The 3,000-mile oil still had plenty of life left in it, according to the lab results. Blackstone recommended we try increasing the oil change interval to 5,000 miles and send another sample for analysis at that point. Furthermore, the report said the wear metals in the oil were within normal levels, meaning that the engine was not in immediate danger of breaking down. By detecting specific wear metals in the oil, experts can tell which engine parts might be in danger of malfunctioning.

Since the purpose of oil is to lubricate, clean and cool the engine, a TBN (total base number) is used to measure the deterioration of the oil by assigning a number that is usually between 0 and 8. The TBN of the 3,000-mile oil was 3.7. The Jiffy Lube oil was 7.6 indicating it had been barely used.

"Even if the TBN is 1, it doesn't mean the oil isn't doing its job," said Ryan Stark, president of Blackstone Laboratories. "But it does reveal the rate at which the additives are being used up."

Oil Analysis, a Growing Business
Stark said that his company, which employs six analysts, gets about 20 new customers a day and does between 40,000 and 50,000 reports per year. A single analysis costs $22.50 but discounts are available for multiple analyses. Blackstone can also analyze transmission fluid and other engine fluids to look for possible problems.

Many other laboratories offer engine oil analysis, but Blackstone's reports are user-friendly, and the turnaround is quick. Within days of our mailing in two 4-ounce samples, the results were e-mailed to us.

"We've had customers who were changing their oil every 3,000 miles and now they've gone to every 10,000 miles because of our reports," said Stark. "But we're conservative. If the oil looks good at 3,000 miles we recommend increasing the frequency by 2,000 miles and taking another look at it."

A Used-Car Buying Tool?
A Long Beach, California, company that provides pre-purchase inspections for private parties is breaking new ground by planning to offer engine oil analysis to private-party used car buyers.

"With an oil sample test, which essentially is the DNA of a car's engine and transmission, we can detect any excessive conditions that can lead to serious mechanical problems down the road," said Alliance Inspection Management Vice President of Sales Eric Widmer.

If the oil sample result meets industry standards, a limited warranty will be offered to the buyer. Edmer said this was the first time an inspection service has used this method to qualify a buyer for a warranty. It would, Edmer points out, provide a level of confidence for used-car buyers shopping for a reliable car.

Stark said that some of Blackstone's customers have sent samples from cars they were considering buying but it's far more common practice with buyers of airplanes, boats, motorcycles or even jet skis.

How To Take an Engine Oil Sample
We took the Mitsubishi samples by sliding under the car, unscrewing the oil filter and draining the oil into a glass jar. The jar was sealed securely, wrapped in padding and Fed Exed to Blackstone.

Taking a sample in this manner is messy, and you can burn your hand on the hot oil filter. Instead, you'll want to use a vacuum pump that takes a sample through the dipstick opening. Such a pump is available from Blackstone or other oil analysis labs.

Oil Analysis for Do-It-Yourselfers
Car owners who enjoy changing their own oil will find oil analysis an inexpensive test and easy to perform as part of engine maintenance. It helps consumers tailor their oil change intervals and experiment with the benefits of different oils such as synthetic blends. Furthermore, some people might try it as a used car shopping tool next time they are looking for a reliable car.

Then again, there is the pure love of knowledge that such a test provides. For a gearhead, that's an end in itself. "For years and years no one knew when to change the oil, so they went with three months and 3,000 miles," Stark said. "Now, we can provide a service that's a good value to people so they really know what's best for their engine."

LONG BEACH, CA (June 15, 2009) –Alliance Inspection Management, Inc. (AiM), today announced an agreement with Ford Motor Credit Company to assume nationwide responsibility for floorplan audits at dealerships with wholesale financing from Ford Credit and to conduct lease-end inspections of vehicles financed through Ford Credit. Ford Credit employees previously handled these functions.

 As part of the agreement, approximately 110 current Ford Credit employees will be offered fulltime positions with AiM later this summer.  The influx of new workers will increase AiM’s total number of employees from its current 500+ to more than 625.  Both current AiM employees and the new hires will be cross-trained to work on all AiM accounts. 

 “We are very pleased that Ford Credit has selected AiM for these very important activities,” said Jim Yates, president & CEO, AiM.  “They align nicely with our existing business and give us the unique opportunity to add experienced employees who will make AiM stronger for all of our clients.”

Ford Credit’s employees will be merged into the overall AiM workforce along with the culture they’ll bring from their Ford experience.  AiM management believes both groups can learn from each other and make the combined workforce smarter, more efficient and more capable. 

“Our vision for AiM is to be an industry-wide partnership that allows all of our customers and partners to better manage their portfolios as positive contributors to bottom line profits,” said Yates.  

AiM has conducted more than 50-million vehicle inspections since it was founded in 2005.  It brings an OEM’s financial perspective and customer focus to its growing list of automotive, transportation and financial clients and has modernized the inspection industry with cutting edge technology that delivers consistent process-driven results.

AiM was founded on the premise that the industry needed an employee based inspection and audit company that could deliver consistent, quality work on time for customers and dealers.   AiM’s nationwide workforce embraces technology to deliver process driven accuracy and consistency with an emphasis on customer satisfaction.  Its significant growth in only four years is a testament to its goal of revolutionizing the vehicle inspection industry.

No piece of car buying advice is more often ignored than this: Have a mechanic inspect a used car before you buy it. Why do buyers plunk down thousands of dollars on a car with little more than an around-the-block test-drive and a glance under the hood? Three reasons deter car buyers from taking this vital step:

• Most consumers don't know that good used car inspections are readily available.

• Many car buyers don't want to pay the extra money for an inspection.

• Some people anticipate a hassle prying the car away from a dealer or private party.

With a little planning, the inspection process can be as fast and revealing as a Hollywood exposé.  If the inspection report is clean, you can buy with confidence. If it unearths a checkered past, you can back away or negotiate a lower price in line with the cost of repairs.
 

Most sellers will let you take the car for an inspection or have a mobile inspection performed at their home. If the seller hesitates, you might want to consider the words of America's Car Show host Tom Torbjornsen: "You have to wonder what they're hiding."

The Vital Pre-Purchase Inspection

Experts agree that used cars must be inspected before the final negotiation for purchase. The ordinary car buyer, even if mechanically savvy, really can't do it justice. Torbjornsen explained, "A stem-to-stern inspection, if it's been done right, can tell you if you're about to buy a great used car or step into a nasty set of problems."

Torbjornsen recommended having the inspection performed by a mechanic you've built a relationship with. The car should also be test-driven over a predetermined route that includes hills, bumps and potholes to pick up suspension problems and reveal engine performance issues.

Jim Yates, president and CEO of Alliance Inspection Management, said his company of 500 mobile inspectors, currently inspecting auction and off-lease vehicles, will soon be offering mobile inspections for private-party car buyers nationwide.  He said using a third-party inspector will build what he called the “trust factor.”

“There is so much information on the Web about every type of car,” Yates said.  “But what about that specific [Chevrolet] Malibu?  Someone has to verify not just what’s wrong with the car, but also what’s right with it.”  He added that a seller can also proactively have a car inspected and volunteer to provide the results of a condition report.  “If you are the seller, does it enhance the sale to attach a condition report?” he asked.  “I think it does.”  eBay Motors – a Game-Changer

Remote car buying was pioneered by eBay Motors, which allowed a buyer in Boston to bid on a car in Los Angeles. But in that case, how could they know if the seller had truthfully described the vehicle? The online giant teamed with SGS inspections which will go to practically any location and do a thorough examination of the car for $99, said Danny Chang, senior manager for eBay Motors.

What It Costs, What It Covers

Nearly all auto service facilities — from chain repair stores to dealerships to independent garages — offer some type of pre-purchase inspection. We found that the going price is about $100, roughly the cost of an hour's labor for a mechanic. Most repair facilities will give a quick description of the number of points in the inspection and how it is conducted. In most cases, however, the findings of inspections are not guaranteed.

“One of the biggest problems in private-party transactions is setting expectations,”  ates said.  “With a good inspection, you know what you are getting.”  Automotive experts agree that a good inspection serves several functions:

·         Verifies the equipment, or options, on the car

·         Confirms the condition level of the car

·         Reveals hidden problems with the body, frame or engine

·         Finds engine codes that can reveal engine problems

·         Builds confidence in the value of the vehicle

Many major problems that can be spotted by a good inspector include:

Frame damage — If the frame shows damage it indicates the car has been in a serious accident. Unless it has been repaired correctly, the car's wheels might not track properly, causing the vehicle to pull to one side and eventually leading to tire damage.
 

Poor previous repair work — This could range from sloppy bodywork to improper installation of modifications.
 

Smoker's car — If a car is being purchased remotely, via eBay for example, the seller could disguise the fact that someone has smoked in the car. Smoke gets into the vehicle's headliner and upholstery, and it is impossible to remove the smell.
 

Flood-damaged car — A vehicle history report can red flag a flood-damaged car unless its title has been falsified. If that's the case, then it's important for an inspector to check for signs of water damage.
 

Mobile or Garage Inspection? 
Many people will be faced with the choice of having a mobile inspector look at a car or taking the vehicle to a local mechanic. While it's most important to get a qualified inspection, each method offers its advantages and disadvantages.
 

A mobile inspection is fast and convenient. The inspector comes to your home or office and performs the inspection on-site. An inspection report is printed out on the spot and given to the buyer or seller. Inspectors also photograph any damage and take shots of the vehicle from different angles.
 

Inspections done by your local mechanic, or the service department of a dealership specializing in that brand of car, are performed with more specialized equipment. Primarily, the car can be put up on a lift and the underside of the car examined for fluid leaks.
 

Test-Driving the Inspection Process
We thought it would be interesting to have an Edmunds.com test car, a 2005 Volkswagen GLS TDI, inspected to see what was uncovered. We took the car to Long Beach Autohaus and paid $108 for an inspection that lasted about an hour and a half. We watched as the mechanic, Mac, combed over the car and explained the points he was checking.
 

Mac's inspection found a minor oil leak but he chased it to its origin and determined it was not severe. He also said our car needed tires and a brake fluid flush and will soon be due for an expensive timing belt change. "It's a good, clean used car," Mac told us at the conclusion of the report. "But the price seems a little high given that you will need work on it soon."
 

Alliance Inspection Management (AIM) inspector Andy Gutierrez inspected our Jetta in a parking structure. Although he didn't have a lift, he conducted a six-point frame inspection to make sure the car hadn't been in a serious accident. His report included detailed photos of various scrapes and scratches which would be very useful if we were buying the car remotely. Additionally, he pointed out areas in the right rear-quarter panel that had been repaired by a paintless dent remover. Although AIM hasn't yet announced pricing, similar inspection services charge about $100.
 

Final Thoughts
While no inspection is guaranteed to find every flaw in a used car, a trained eye can help you avoid serious problems. Given the fact that thousands of dollars are at stake, an hour of your time and a hundred dollars is good insurance against the unknown.

SAM CASARELLA was in Queens, poking his nose under the hood and trunk floor of a white 2005 Infiniti G35x with a yellow deodorizer in the shape of a Christmas tree hanging from the rearview mirror.

As an inspector for Alliance Inspection Management, Mr. Casarella was giving the car a final checkup that many drivers of leased cars dread: the turn-in inspection. The Infiniti was near the end of its three-year lease, and the leasing company, the Nissan Motor Acceptance Corporation, had hired Alliance to make sure the car was in good shape.

The expectation is that when a lease expires the car will be returned in good condition, without excessive wear and tear. If the car has anything beyond minor damage, the lessee may have to pay for the repairs. That could be a few hundred dollars for a small dent or a few thousand for severe accident damage.

But who determines the cost and what would be considered “beyond normal” wear and tear? That’s where lease inspections can become mystifying, because it’s up to the inspector, the parameters of the lease agreement and the guidelines of the leasing company. And those rules can differ from company to company, although many try to make the process easy to understand. 

Click here for the rest of the story: http://www.nytimes.com/2008/07/13/automobiles/13INSPECT.html

Jim Yates, president and CEO of Alliance Inspection Management (AiM), has been named a finalist for the Ernst & Young Entrepreneur Of The Year award in the Greater Los Angeles area. 

AiM is the premier new and pre-owned vehicle inspection company in North America that combines breakthrough technology with deep industry experience to provide a trustworthy, independent bridge between buyers and sellers.  The company offers a comprehensive range of vehicle inspection services to verify the condition of new, off-lease and fleet vehicles at vehicle assembly plants, rail yards, ports, customers’ homes, dealers and auctions.  AiM annually conducts more than 10 million vehicle inspections.

“Although AiM was founded less that three years ago, I’m proud that our management team and our 400+ employee inspectors out in the field have delivered on the promise of providing timely, consistent and accurate vehicle inspection reports with a focus on customer satisfaction,” said Yates.  “Being named an award finalist by Ernst & Young underscores the great work everyone at AiM is doing and validates our unique vision for the vehicle inspection industry.”

Executives were selected as finalists from an original pool of 70 business leaders representing companies in the Greater Los Angeles area.  Winners will be announced June 24 at a gala event at the Beverly Hilton Hotel.  AiM is the only automotive-related company among the 18 finalists.

“These finalists are the best of the best, embodying the unique spirit of entrepreneurism,” said Brian Ring, Ernst & Young Entrepreneur Of The Year Program Director for the Greater Los Angeles area.  “They positively impact our region in a major way, through jobs, community growth and development and innovation.  Ernst & Young is proud to salute them.”

AiM’s achievement comes as no surprise to its growing list of business partners, including Chrysler Corporation, Nissan North America, General Motors Acceptance Corporation (GMAC), Tokio Marine, Union Pacific, CSX Transportation and several major rental cars companies

“We have plenty of vendors already…what I want are Strategic Partners,” said Peter Grady, Director, Fleet & Remarketing Operations, Chrysler Corporation.  “We think AiM is that kind of partner.”

“AiM has successfully built a bridge between internet buyers and sellers which facilitates successful used car transactions,” said Bill McIver, National Director Remarketing Sales and Business Development, General Motors Acceptance Corporation.  “They have demonstrated the ability to inspect vehicles from the on-line buyer's point of view.  This helps us sell more vehicles over the Internet with greater buyer satisfaction.  Their ability and dedication to standing behind their inspections brings trust to the marketplace and allows buyers to bid with confidence knowing the vehicle has been represented accurately.  We view AiM as an integral business partner in our ability to grow our Smartauction platform.”

Greg Thibault, Vice President Fleet Disposal, Avis Budget Group, Inc. noted that, “Avis Budget Group selected AiM for vehicle inspection services from a very talented field of inspection service providers and they have exceeded their commitment to provide a high level of service and quality for our company.”

And the 2nd largest licensee for National Car Rental added its own evaluation of AiM.  “It is rare in today’s technology driven world that you find a company that not only exceeds your expectations, but does it with a joyful ‘Human’ exuberance,” said David J. Pilcher, Executive Vice President, Arelco Inc. dba National Alamo. “Since doing business with AiM, I have had the pleasure of dealing directly with both front line folks as well as all the company leadership.  In every encounter, it is obvious that these people really enjoy what they do and they do it very well.  This does not happen by accident.  It can only be fostered by great leadership.  Gee…what a novel idea!  One that will never come from a micro processor.”

David M.Wheeler, Assistant Vice President Damage Prevention Services, Union Pacific Corp., said “AiM’s commitment to the new car industry has been consistent with their motto to ‘deliver on the promise’.  They are a great partner in regards to damage prevention and claim reduction and we look forward to continuing and expanding our relationship with them.”

An endorsement from CSX Transportation rounds out the list of business partners congratulating AiM on its selection as a finalist in the Ernst & Young “Entrepreneur of the Year” award program. 

“We have a long-standing, working relationship with AiM in terms of preventing damage to, and reducing claims on, new vehicles throughout our network. They have experienced professionals at the field locations, and their management team is proactive in developing new processes and systems to add value to our efforts,” said Rob Rice, Director Load Engineering & Design Services, CSX Transportation.  “They are a valuable partner for us and our relationship is growing.” 

This year, the Entrepreneur Of The Year awards program celebrates its 22nd anniversary.  Regional award recipients will be eligible for consideration in the Ernst & Young Entrepreneur Of The Year national program. 

Alliance Inspection Management Takes The Wheel Of Change

by Thyda Duong Staff Writer

Of the 15 million to 17 million new cars sold every year in the United States, roughly 10 million are inspected by one Long Beach-based company.

Since it began in November 2005, Alliance Inspection Management (AiM) has operated as a national, independent third-party evaluator of new, off-lease and fleet vehicles, inspecting cars at ports, rail yards, assembly plants, dealers, auctions and customers’ homes.

The company employs 450 people across the country – including 20 in Long Beach – and at the core of its operations is a management team well-versed in industry operations, given team members’ various backgrounds in the inspection business, at automobile companies and in the finance and information technology industries.

“We come from being a user of inspection services, and because we were frustrated with finding a good provider of that service, we actually flipped over and built one that would satisfy the needs of people like us,” says President and CEO Jim Yates, who served as director of remarketing for Nissan North America from 1998 to 2005. “It’s a unique element of our company.”

AiM’s vision, Yates adds, is to raise the quality and value of the inspection industry. “In the old days, the inspection business was an inexpensive commodity that people didn’t place a lot of value on, and because they didn’t place a lot of value on it, you couldn’t charge a very fair market price for your services,” he notes.

By creating quality condition reports and developing more efficient ways to collect and examine data, prevent damage to new cars and value the used vehicle as an asset, AiM will play a more significant role in the industry, he adds.

“I see us getting more and more involved on both the new and the used side in adding value for our customers, which will allow us to grow and become a more important part of the process,” he explains.

AiM’s rapid growth and efforts to create change in the vehicle inspection industry have not gone unnoticed; a panel of regional business, academic and community leaders has selected the company as a finalist for the Ernst & Young Entrepreneur of The Year award for the Greater Los Angeles Area. In addition, Mobile Enterprise Magazine named the company a best field-service award winner in 2007.

While the company’s main office is located in Long Beach, an equally important office is in Farmington Hills, Michigan, where the company services major customers such as General Motors and Chrysler. Smaller offices are also located in Jacksonville, Florida; Quonset Point, Rhode Island; and Mesquite, Texas.

In addition, AiM has three other companies that are part of its overall business, including its integrated subsidiary AutoComm Inc., Canadian company AutoComm Ltd. and TCM Total Claims Management, which assigns responsibility for transportation damage and carries out claims processing for manufacturers.

“Because of our inspection and footprint, we can determine where the car was damaged, [and] who had the car when it got damaged,” Yates says. “So it’s kind of an outsourced claims business, which is a growing opportunity for us as well – a natural offshoot to what we do.”

Part of the foundation of its business, however, is new-car inspection. AiM inspects vehicles at the end of the manufacturing line for quality checks and works jointly with vessel carriers, rail companies and industry to ensure quality and minimize damage during shipping and handling. It also performs inspections at dealerships for transportation damage.

During its inspections, AiM collects information on the frequency, location and severity of damage. Manufacturers are using AiM’s findings to determine how to best protect the vehicles, including where to install plastics and cushions.

“If we inspect 100 cars and we notice that 10 cars have a scratch on the driver’s-side door, there’s something going on in the process that is affecting that. So then we’ll follow that back . . . and try to figure out where that’s happening in our process so we can stop that,” Yates explains.

He notes that the levels of damage frequency change in different stages of transportation. The damage that occurs as a car is discharged off of a vessel, for instance, is very small, at roughly 1 out of 100. The opportunities for damage, he says, increase as people move the vehicles and load them onto trucks or rail cars. By the time the car arrives at the dealership, the rate is 3 in 100.

Used-vehicle inspections constitute another large part of AiM’s business, and this, Yates notes, is where the real evolution is occurring.

AiM inspects roughly 500,000 used cars annually, working with several manufacturers and rental car companies – including Nissan, Chrysler and Avis – to assess the condition, mileage and overall value of a car. AiM’s inspectors integrate various technologies into their work, using Panasonic Toughbook computers, digital imaging, Web-based scheduling and logistics.

Business-to-business sales of used cars are gaining popularity in the realm of Web-based marketplaces, he adds. The shift to online sales and purchases is transforming the industry from a historically industrial business into one that is becoming closer to the consumer over time, he says.

“Web-based auctions are becoming a very, very efficient way to sell these vehicles,” he explains. “Facilitating that growth is the fact that they always needed an electronic inspection condition report. . . . We’ve got real-time technology – hardware and software – [so] that we can go out, do an inspection, post that inspection up to a Web site the same day, instantaneously. . . . And because of that, you minimize transportation shipping costs, you minimize logistics fees, reconditioning fees [and] auction fees.”

The next evolution is the rise of Web-based consumer purchases, which Yates expects to become increasingly popular over the next several years. “Consumers are getting comfortable [with] buying on the Internet, especially the younger generation. I think that it’s our obligation to help build the infrastructure that will facilitate the necessary comfort level. And once that happens, . . . it will grow very rapidly.”

LONG BEACH Calif. - Alliance Inspection Management (AiM) is pleased to be named a 2007 Mobile Enterprise Magazine best field service award winner.  AiM is in excellent company with first place winner Best Buy’s Geek Squad and another honorable mention winner Stanley Steemer International, both widely known brand names with extensive field service operations.  

AiM is a third-party automotive inspection company that handles both new and used cars. Inspecting leased cars for individuals whose leases are ending is a complex field service problem, so AiM contracted with ServicePower to deploy the company's ServicePower and ServiceMobility (developed jointly with KonaWare) routing and dispatch solution on Panasonic Toughbook CF-18 rugged laptops.

According to AiM Chief Operating Officer Robert Clucas, ServicePower's CRM tools helped determine "the where and the how many" when the company first distributed its technicians across the United States.Now, ServicePower's solution dynamically routes roughly 100 inspectors, performing around 9,000 inspections per month, and collects route progress and job status information from technicians via the GPS-enabled ToughBooks (which also provide turn-by-turn directions). If a technician is delayed, ServicePower automatically recalculates schedules and redistributes workloads to maintain inspection appointments." We're able to tell [lessees] pretty much exactly when we're going to be there," says Clucas. He also notes that ServicePower's detailed real-time reporting is a useful management tool. "It's so visual, you can see at a glance where your problems are."

"We're extremely pleased with the system; the efficiencies are far greater than we expected," adds Clucas. "We thought [technicians] would be able to do eight or nine inspections a day, but some inspectors do upward of 15, 16 or 17. It's enabled us to virtually eliminate customer complaints about not being able to get an appointment." Assuming a 20 percent increase in efficiency from the system, AiM reached a positive ROI within two months of the launch.

LONG BEACH, Calif.--(BUSINESS WIRE)--Veteran automotive executive Jim Murphy joined Alliance Inspection Management – AIM today as vice-president and Chief Financial Officer. The announcement was made by AIM CEO Jim Yates.

“We’re pleased to add Jim Murphy to our team,” said Yates. “He brings us experience and perspective from all sides of the automotive industry – from dealerships to manufacturers – and rounds out our team.”

Murphy joins AIM from AutoNation Inc. where he held various positions in Finance at the dealership group over the last five years.

Most recently Murphy was Vice-President of Finance Operations and Purchasing at AutoNation’s headquarters in Ft. Lauderdale Fla.

He holds a Masters in Finance degree from Penn Sate.

Murphy began his career at Ford Motor Co. in Dearborn, Mich., where he held ever increasing responsibilities before joining Nissan North America in 1994.

Newly formed Alliance Inspections Management (AIM) is driving change in the vehicle inspection industry.  Its mission includes increasing quality, inspector training, and IT solutions.
 
Finding a trustworthy bridge between vehicle buyer and seller continues to challenge many in the fleet industry.  As the inspection industry continues to move toward online, nontraditional transactions, many manufacturers, financial institutions, leasing companies, and daily rental companies seek an independent, third-party alternative.  Typically, these inspections are used to determine vehicle values, customer liability for excess wear and use at he end of lease term, and fleet vehicle repurchase eligibility, as well as to assign responsibility for vehicle damage (primarily transportation damage).
 
In response to this increasing demand, Jim Yates, director of remarketing for Nissan North America, Inc. from 1998 to 2005, formed Alliance Inspection Management (AIM) in November 2005. The company, based in Long Beach, Calif. — with offices in Sedona, Ariz., and Detroit — is a national, independent third-party evaluator of new and used (off-lease/ fleet) vehicles. “AIM was conceived out of the continued frustration in dealing with off-lease inspections issues, including the lack of a real, national, independent, third-party alternative,” said Yates, the company’s president and CEO. “Our mission is to be a viable option to regional inspection companies, contract (non-employee) inspectors, and auction-based inspection companies.”

AIM Acquires AutoComm to Augment Marketplace Position

After the formation of AIM, the company immediately acquired AutoComm, a new-vehicle inspections provider established 18 years ago. AutoComm offers a range of services to major auto manufacturers and transportation carriers, including data collection, data warehousing, data transmissions, claims handling, damage appraisals, and comprehensive reporting for damage prevention analysis.  According to Yates, the purchase will significantly strengthen AIM’s market presence, giving it a national footprint with more than 240 employees at 60 U.S. locations, as well as 10 offices in Canada. AutoComm performed more than 7 million vehicle inspections in 2004.  "AIM will now be able to integrate new technologies with personal service in an industry not known for either,” Yates said. “We will be able to provide that much-needed, credible bridge between the sometimes- conflicting needs of buyers and sellers.”

AIM Sets Out to Drive Change in Inspection Industry

The company’s primary mission, according to Yates, includes converting a fragmented and troubled industry. He says that the current inspection industry lacks an understanding of the remarketers’ needs, quality condition reports, detailed inspector training, appropriate customer service, and adequate IT solutions to handle real-time scheduling and data collection and reporting.  “The industry has also seen a continued high off-lease volume and a consumer and dealer shift to online sales and purchases,” he added. The company is currently expanding into the off-lease and fleet vehicle inspection business, including the Internet-based inspection business.

AIM will target three sub-areas of the used-vehicle inspection market: off-lease (pre-term) vehicle inspections, auction-related inspections, and fleet vehicle inspections. In the near future, the company plans to expand into remarketing operations, transportation management, and marshalling yard activities.

Yates Says Future of Inspection Industry Looks Promising

The vehicle inspection industry is driven by a need to value approximately 17 million new and 25 million used vehicles per year, with an asset value exceeding $750 billion, Yates estimates. As the majority of these vehicles are still covered by the new-vehicle warranty, this inspection activity focuses on the car’s physical condition. The inspection industry’s growth during the past five years, according to Yates, has been driven by customer acceptance of leasing as an alternative to purchase (estimated at more than 4 million units per year) and the subsequent increase in vehicle lease returns; manufacturer-enhanced leasing programs to support volume; consumer legislation passed in several large leasing states that dictates lease end-of-term customer rights and billing procedures; and Internet sales of used cars and the need for independent condition appraisals prior to sale/purchase.

Moving forward, Yates predicts the inspection industry’s growth over the next five years will be driven by:

• Continued consumer acceptance of leasing.
• Continued growth of Internet-based sales of used cars to dealers and consumers.
• Pending national consumer legislation (Uniform Consumer Leases Act).
• Continued movement toward third-party inspections.
• Used-vehicle certification and extended warranties.
• Customer repurchase loyalty initiatives. 

Yates also foresees that with the growth of used-vehicle sales on the Internet, the seller increasingly will be held responsible for any misrepresentation of vehicle condition.  “A true representation of vehicle condition and full disclosure of prior repairs is essential and required by law,” he said. “This is a very large opportunity for third-party inspection services that can provide consistent, electronic condition reports in a timely manner and efficiently manage an extensive mobile workforce.” Vehicle inspection is a core activity to remarketing business, and according to Yates, AIM is currently working as a credible, independent, third-party alternative to help the industry.