With an unprecedented number of car brands on the chopping block, including Hummer and Saturn, insurance costs could rise for owners of those models.
The cost of repairs and parts play a key role in insurance rates. A shortage of original-equipment-manufacturer, or OEM, parts could push rates up.
“Currently, there’s non-OEM parts available, and it shouldn’t have an immediate direct impact on insurance,” said Carole Walker, executive director of the Rocky Mountain Insurance Information Association. “However, since this appears to be unprecedented in the number of lines that may be affected … in the future there may be impacts. But we’re still in a wait-and-see mode.”
Non-OEM parts are cheaper than those made directly by the original manufacturer or its partners, but not all components are available from aftermarket firms.
“Where you’re really going to run into problems is with parts that are not typically made by the aftermarket companies, such as fenders and suspension components,” said Al Oramas, president of Pro Auto Care in Denver.
Car brands have been halted before, such as Oldsmobile, but never before on this scale. General Motors has said it plans to phase out Pontiac, and the Hummer, Saab and Saturn brands will be sold or eliminated.
“There are a lot of those units on the road,” Oramas said. “We’re going to see the true effect in a couple of years when we run into the shortages of the OEM parts.”
Oramas said some companies may move to snatch up OEM inventories, tightening supplies and raising prices.
If parts aren’t available from a manufacturer, they usually can be found used, said Tim Vaughn, general manager of Colorado Auto Body in Denver.
“It’s never really been a real huge problem,” Vaughn said, adding that it’s “way too early to tell” what kind of impact the production stoppages will have.
Andy Vuong: 303-954-1209 or avuong@denverpost.com
