Despite the long wait, the controversy, and the occasional irate bleating of consumers, Ontario’s fledgling emissions testing program hasn’t turned out to be all bad.
With a million vehicles under its belt, Drive Clean statistics portray a business impact that is neither astounding nor unwelcome. This is not out of step with other Inspection/Maintenance (I/M) programs, such as B.C.’s AirCare.
While the Drive Clean program will eventually cover virtually all of the province’s five million light vehicles, it is in only its first phase and encompasses only the major vehicle populations of the Greater Toronto Area and Hamilton-Wentworth (about 2 million vehicles). The program is based on private sector participation and approved emissions testing facilities at existing businesses, such as garages and car dealerships. These approved testing centers subjected more than one million vehicles to tests from January 1, 1999 to February 6, 2000, and in that time, more than 175,000 vehicles failed the initial test, for a failure rate of 15.7%.
That failure rate is important because it is significantly less than the failure rate of 20% which had been estimated for the program initially. And it is the failure rate which determines much of the parts and labor sales which can be directly attributed to such programs. Nevertheless, the failures, combined with some preemptive work ordered by nervous car owners, has built some significant growth in certain product categories.
“It’s all positive. The program has been good for the environment, the installer and the jobber,” says Jack Ricketts, owner of Oshawa, Ont., jobber The Partsman. He was very active from the early announcements of the program in getting himself, his staff, and his customers abreast of the program’s details, as well as striking up a series of monthly advanced diagnostic clinics that continues today. One of Ricketts’ customers was the first accredited Drive Clean Test and Repair outlet in the region, the home riding of MP Norm Sterling. Sterling was environment minister throughout the program’s development and long delays leading up to its eventual introduction in 1999.
Ricketts says that it is hard to do a precise year-on-year comparison–he has made significant investments in inventory in the past year–but he is convinced that the effect is measurable.
For example, because of the program, he began a campaign of getting ignition and tune-up parts cabinets into some of his better customers’ bays. To satisfy customer needs, he also brought in a second line of parts. Even with the added offering, he still boosted his purchases–and sales–of his initial line by 25%.
He also doubled his exhaust business, and catalytic converter business went off the scale.
“If we look at the 15% increase in our business over the year, a good percentage would be attributed to Drive Clean. And we’ve picked up a number of new customers because we’re training, too.”
Ricketts says that getting those ignition cabinets into Drive Clean locations has also turned some “C” customers into “B” customers.
On average, those approved test and repair and test-only locations checked an average of 31,000 cars and light trucks per week. Determining the average number of tests per outlet is somewhat variable, though, and serves as a lesson for any business estimating the business potential during the early days of a program.
For example, though notices for testing went out starting January 1, the program didn’t really hit its stride until April 1–that’s right, April Fool’s Day–after which you could no longer renew your vehicle’s registration without a Drive Clean sticker. Vehicle registrations in Ontario are renewed the month of the owner’s birthday, so even if your car was of the “even-years” being tested–a 1986 model for example–but your birthday was in February, you’re not going to have it tested until the next “even testing year,” 2001.
However, the average number of vehicles tested per week shot up from about 10,000 in March of 1999 to about 28,000 in April. Add in the re-tests for failed vehicles and these numbers become about 12,000 and 34,000 respectively.
The number of vehicles tested per week held fairly steady at about the 30,000-plus level from April to September (the most recent data available), dropping a bit below 25,000 for the months of July and August. The number of testing outlets did not remain constant, however, which had an important effect on the per-station averages. In March, there were 400 Drive Clean facilities, making for an average of 25 initial tests per week. In April, the number of facilities expanded to 550, but the number of vehicles being tested had increased more, boosting the average to approximately 50 per facility per week. At some facilities, backlogs ensued, leading to cries in the popular press for the program to be scrapped and license extensions to be granted. Notably, the ministry held its ground.
And it’s a good thing, too, for a number of additional facilities must have already been in the process of getting set up. In fact, by May there were nearly 700 facilities on line, rising to more than 900 by September. Assuming that no more than about 120 of that number were repair-only facilities (there are currently about 130), the average number of tests per shop per week had dropped to about 30. Add in the average number of re-tests due to vehicles failing initial tests and you have about 34 vehicles being tested per week.
Naturally, there are many factors that go into determining how well these numbers reflect individual experience, but the general profile of a system-clogging rush in the initial stages subsiding to a more orderly incremental increase in business seems to be reflected in individual experiences.
“Initially it seems like we sold a lot of 02 sensors and catalytic converters, but it has tapered off,” says Rob Cazzolli of Dial Auto Parts in Toronto. “It bumped up sales a bit in sensors–02, coolant, MAP–as well as catalytic converters and EGRs,” but, says Cazzolli, sales have leveled off in part because installers are getting better at fixing emissions problems and in part because consumers are questioning work more often.
“Now a lot of people are more aware of what their rights are,” he says, referring to the fact that the initial days of the program were plagued by charges that car owners were being subjected to work unnecessarily. This backlash has caused some businesses to shy away from some repairs for fear of being accused of overselling. But, says Cazzolli, some businesses are going too far. He says that a lot of dealers aren’t really fixing the problems with the cars, but are instead selling customers other services to get them to the $200 repair cost waiver. Also, he says that the supposed absolute requirement that a car not have visible smoke is being ignored, allowing such smokers the conditional pass.
“That’s not good, but that’s what is happening.”
Mort Krieger of Barton Auto Parts in Hamilton, Ont. says that the factor determining whether a repair business has benefited fully is if it has taken the plunge and invested in the testing equipment.
While he agrees that the demand for equipment has certainly tapered off as the growth in the number of facilities doing the testing and repair has leveled off, the benefits are undeniable.
“We sold a lot of equipment. And the guys who have it are generating the business,” he says. “At first everybody was panicky, but now the guys doing the repairs are doing them pretty steadily. And the businesses that aren’t doing the testing, aren’t getting the work.”
He says that in addition to the hard-parts sales generated–“We’re selling a lot more emissions components and we’re selling a lot of gas caps”–it has helped generate a whole new category: emissions reducing chemicals. “We have car lots buying it by the case,” says Krieger.
It is estimated that the program generated $5.3 million in parts sales and $3.3 million in labor directly traceable to repairs conducted as a result of Drive Clean test failures. In addition to the hard dollars and cents of the program, the strongest benefit may yet be revealed in the improved skill level of the technicians who conduct the repairs.
The consensus seems to be that the training that technicians have been forced to seek out–both to pass the certification test and to perform emissions repairs properly and efficiently–has made them better technicians all around.
“There is a lot of capacity in our town to do Drive Clean,” says Ricketts. “Our monthly training helps the technicians get better and so does their individual experience. Plus, those who are taking courses are more apt to repair the problem rather than just mask it.”
In addition, says Ricketts, having three dozen technicians meet on a monthly basis to discuss their repair issues has led to a growing sense of community. “Just interacting with each other has done away with some of the animosity that existed.” Ricketts says that it has led to a certain degree of respect among competitors in the repair market.
Krieger agrees, saying, “Anything someone can learn is going to help them, even if they’re working on the older cars.”
It is clear that the local repair trade has really stepped up to the plate in the active Drive Clean regions. Statistics that do exist point to a system that has generated more than $8.6 million in business for participating centers, or about $8,600 per Drive Clean repair facility in the program’s first year. Plus of course, there are the testing fees. When one factors in the cost of the testing equipment, it’s hardly a king’s ransom even if it is a positive impact.
What the statistics do not show, however, is how much repair work has been done to prepare for an impending test, how many bottles of chemicals have been sold, how much work of a safety nature has been done prior to testing, and how much non-emissions work has been done while the vehicle was on the hoist.
So, while the impact of the Drive Clean program is not completely clear, and it didn’t exactly go off without a hitch, it has produced dividends for the aftermarket in terms of bottom line benefits to installers and jobbers and in terms of improving the capabilities of those in the trade.
And, in the long term, it is probably the latter which will provide the greatest benefit.
Drive Clean Facts
From January 2, 1999 to Feb 6, 2000
Vehicles passed initial test:939,170
Vehicles failed initial test*:175,420
*Includes 51,541 conditional passes issued after a retest. A conditional pass is issued when the $200 maximum limit for repairs has been reached, but the vehicle still exceeds the emissions limits. The $200 limit is only good once, allowing a two-year window to repair the vehicle or remove it from service.
Drive Clean Participation Rates
As of February 6, 2000 there were 1,021 Drive Clean Facilities.