COLUMBUS, APRIL 30The mysterious Chicago Auto Glass Group (CAGG) revealed both itself and its proposed plans for new pricing schedules for the auto glass industry during a seminar at the Independent Glass Association (IGA) annual convention here.
The system is broken, said Wes Topping, president of Elite Auto Glass in Denver, Colorado and a founding member of the group in reference to the NAGS List Pricies currently used for most commerce in the auto glass industry. There are too many R parts and wholesalers and manufacturers cannot make an adequate profit under the current system.
Topping said the CAGGs system is going to be based on true, net acquisition costs from manufacturers if we start there, we shouldnt have any R parts. Our formula is very open and everyone can see how we get the pricing.
Reaction from those in the audience was one of skepticism, with most voicing concerns about the ability of the group to see such new pricing formulas utilized by the insurance industry, but others applauding the group for its attempt to do something about the industrys pricing problems. Why would insurers ever want to switch from NAGS for something developed by the auto glass industry? asked one.
CAGG members have been meeting for approximately a year to develop a new pricing program for which they hope to gain widespread acceptance and members say they have had expert antitrust lawyers involved right from the beginning. Members include:
In a time-deprived segment, Carl Ostdiek, president of Henderson Glass, explained the pricing formulas. AGRR magazines glassbytes.com will publish more details of the pricing formulas early next week.
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