Volume 10, Issue 5 - September/October 2008
In the following pages, you’ll find the highlights from this lengthy interview. For video coverage, please visit the AGRR Studio at www.agrrmag.com/studio.
Lubner on Cash Pricing
Lubner described common cash prices as “uneconomical, for what we are expected to do for that price, properly installed glass with properly trained technicians, making sure [the vehicle] is safe and ready for people to drive away.”
“Once cash prices are above insurance prices, that [will be] a proper reflection on the service that we provide,” Lubner said. “That’s what we see around the world, and I don’t see why it should be different in the United States.”
Lubner on Fuel Prices
“I think weather has a bigger impact, though it’s much shorter and a little sharper,” he said. “Miles driven are dropping, statistics are there, and the market size around the world will decline. Now I think as an automotive glass company, you then have a choice: do you become a victim of circumstances, or do you actually try to take the future into your own hands?”
Feeney on Duplicate Positions
“That’s probably the most difficult part of an acquisition like this, because there are redundancies, and what we committed to all the associates was to tell them within the first 60 days, no later than 60 days, the finality of what we’re going to do,” he said.
Diamond Employee Says “Transition is Going Smoothly”
Decker says that the transition is going smoothly.
“You’ve seen a lot of people who’ve grown up with this organization, some that have been here for 20 years,” he said. “It’s difficult, yes, but the transition is going smoothly.”
Duane Hromada, vice president of field sales for Diamond Glass, echoed this sentiment.
“I think we know what we did, we know what we were a part of and it’s time to move forward. I think you’re going to find that people want to be a part of it,” he said.
Garth Beck, vice president of field operations for Belron US, also was on-hand.
“I think our intent is to welcome the Diamond team as part of the family at Belron US,” he said. “Everybody’s really excited as we go forward, and now the work begin
Lubner and Feeney on Industry Associations
“And, if you want my simple solution, there should be one. There should be one body representing this industry, and it should be a body that represents the industry, rather than represents interest groups, and that would be something that Belron would support,” Lubner said. “But we’re not going to be putting our necks out, to start, for example, inventing pricing strategies, only to then be given a hard time. It’s just not going to happen.”
Feeney was asked to comment on whether he agreed with Lubner’s assessment.
“I would hope [the industry’s unity] is fixable, but it requires people to really lay down some of the personal issues they have and put the industry’s wellbeing far ahead of their own personal well-being, and in my experience with our industry, we haven’t done that yet,” Feeney said.
Lubner on Belron’s
He also noted that promoting windshield repair is a crucial part of the company’s strategy.
“Our objective is to keep the average costs as low as possible, and repair is certainly a way to do that, and, so, yes, most of the advertising is around repair,” Lubner added.
Feeney on What Diamond Does Better
Lubner on the
“I don’t have to tell anyone what a tough market the U.S. automotive market, as well as the OE market, is right now, and a business with the size and complexity of PPG—I think it was going to be difficult to attract industry buyers, so a private equity buyer was the way to go,” he said.
As for what the future will hold, Lubner predicted the possibilities— but like the rest of the industry, is not sure what will come of the Kohlberg & Co. purchase of the business (see page 20).
“Private equities are going to find a way to make a return, and I suspect that they will look at all options,” he said. “They will look at every possibility—breaking it up, combining it, diversifying it … ”
Feeney on Industry’s Negative Focus
“Most people tend to focus on the negative, instead of the possible and positive about what bringing two companies that were very successful in their own way together can mean not only to all the 9,000 associates that now work here and that we take very, very seriously, but also to the industry as a whole, and how they can, as strange as it may sound, how they can benefit from this too,” he said.
Lubner on the Possibility of Plastic Glazing
“I’m simple on these things,” he said. “If plastic windshields were invented tomorrow, and they put them into every vehicle tomorrow, by the time that filtered into the automotive replacement glass market, I’ll be dead, so I don’t need to worry about it.
“Work out the numbers—you know what the breakage rates are,” he said. “It’s not going to happen tomorrow and it’s not going to happen to every single vehicle … ”
Lubner’s Thoughts on the Coming Year
“Everywhere you look, and we’re seeing this around the world, [there are] cost increases from everyone of our suppliers. Labor’s going up. Fuel’s going up,” he said. “We do a lot of mobile. We do nearly 50,000 mobile jobs a week now … so I think it’s going to be a challenging time.”
He added, “Having said that, from a Belron point of view, because we’re committed to this industry, we’re going to continue investing—we’re going to continue investing in people, training, tools, branding [and] developing our leaders, because these things don’t last forever and we’re going to be strong coming out of it.”
Feeney on 24/7 Auto Glass Service
“Everything about doing what’s right for the customer Belron’s helped us to
see in a slightly different way, but it really
was two companies coming together
with similar beliefs, and so we
were always around extending
hours,” he said.