Let’s Talk About Surcharges
By Tara Taffera
There are many items to discuss in the auto glass business these days, but I want to talk about two in particular this month.
I chatted with Mark Delia at City-wide Auto Glass in San Diego, Calif., about surcharges. Specifically, the absence of auto glass shops being able to charge one—then get reimbursed by insurance—given astronomical gas prices. In fact, according to the American Automobile Association, the average cost of unleaded gas in San Diego was $5.84 on April 8, as opposed to $3.97 the previous year. In light of these rising prices, Delia inquired with two of his insurance providers and third-party administrators (TPA)—State Farm and LYNX— if they would consider reimbursing him for such a surcharge.
I reported on a COVID cleaning fee in 2020, which insurance carriers inconsistently accepted. Delia’s situation brought me back to it all.
Oh—sorry if I left you hanging there. The answer from his insurance providers was an emphatic “no.” They won’t allow reimbursement for a fuel surcharge, and you likely aren’t surprised.
“We get charged for deliveries from Mygrant [or other distributors] and must absorb the cost. [Mygrant increased its fuel surcharge to $8 per delivery in June 2021.] The same goes for supplier price increases. How long will we be able to sustain ourselves?” Delia asks.
Sadly, I don’t have an answer. And neither does Delia, as he told me, “ The cost needs to be passed on.”
That very same day, assistant editor Chris Collier sent me a notice of a price increase from SIKA. Dated February 2022, he wanted to make sure I saw it. A glass shop owner he interviewed for an article on transportation issues forwarded it to him (for that article, see page 42.)
The announcement detailed that, due to supply chain issues, the company implemented a price increase on March 1: 5.2% for all SikaTack and Sikaflex poly-urethane adhesives; and 9.6% for Sika accessory products.
An article in glassBYTEs.com on March 1, 2022, shows that Delia is not unique in his frustrations. “Last year alone—urethane went up six different times. That’s unprecedented,” says Jaymie Percival, who owns Superior Auto Glass in Dallas, Texas. Percival, a 30-year veteran, once paid $43 for a box of tubes and said the price would go up a few bucks once every year or two. “But, six times in one year? That’s ridiculous.”
And nearly every auto glass shop owner I talk to, COVID and supply chain
challenges aside, constantly laments why NAGS prices are perceived as imbalanced. Percival says NAGS pricing has yet to catch up to what auto glass shops must pay for materials. “A windshield that cost $45 a year ago now costs $60-65. And the insurance companies are not taking that into consideration,” she says.
None of this is news to you. While you may have to wait longer for your urethane and pay a higher price, consumers must pay more for everything from fast food to a new car. What is unique is that everyone seems to pass the cost to the customer, but insurance companies aren’t accounting for that—food for thought. As always, I welcome your input. Email me at firstname.lastname@example.org or call me at 540/602-3260.
Tara Taffera is the editorial director of AGRR™ magazine/glassBYTES.com.
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