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CAMVAP 1997 Annual Report

Contents

LETTER FROM THE CHAIR

1997 OPERATING STATISTICS

ORGANIZATIONAL STRUCTURE AND GOVERNANCE

1997 Board of Directors

David Adams; Lynne Arling; Adrian Bradford; Judith Budovitch;
Al Dwyer; Christopher Ferguson; Larry Johnson (Chairman); Wm. (Bill) McArthur;
Pierre Millette; James Savary

Member Organizations

The Governments of:

British Columbia; Alberta; Saskatchewan; Manitoba; Ontario; New Brunswick; Nova Scotia; Prince Edward Island;
Newfoundland and Labrador; Yukon Territory; Northwest Territories

Association of International Automobile Manufacturers of Canada
Canadian Automobile Dealers Association
Canadian Vehicle Manufacturers'Association
Consumers'Association of Canada

Staff

Stephen Moody (General Manager)
Arlene Weijers (Administrative Assistant)

Canadian Motor Vehicle Arbitration Plan
235 Yorkland Boulevard, Suite 109
North York, Ontario M2J 4Y8

http://camvap.ca

For CAMVAP consumer information call the provincial administrators at 1-800-207-0685

For CAMVAP administrative information contact head office at:

Phone: (416) 490-0615
Facsimile: (416) 490-1680
Email: info@camvap.ca

Copyright 2000, Canadian Motor Vehicle Arbitration Plan

Cet rapport annuel est egalement disponible en francais.

Cars
"I am pleased to report that in 1997 CAMVAP achieved its highest ever levels of program activity, field performance and customer satisfaction."

 Letter from the Chair

Delivering on the Promise

Since its inception CAMVAP's goal has been "to provide vehicle owners and manufacturers with an easily accessible dispute resolution process that is fast, fair and friendly". To achieve these objectives we continue to focus on our core activities. These are, firstly, the soundness of our arbitrations and, secondly, the effectiveness of our field administration.

I am pleased to report that in 1997 CAMVAP achieved its highest ever levels of program activity, field performance and customer satisfaction. The details, including year over year comparison data, are in the Operating Statistics section of this annual report. Overall program activity and, particularly, initial enquiries are good measures of accessibility. Field performance is measured by time to complete cases that are opened by the provincial administrators and by the results of the consumer surveys conducted by MarkTrend Research Inc. Customer overall satisfaction ratings are a sound measure of performance against the fairness and friendliness objectives.

Our success in 1997 was built on the skills, hard work, smart work and teamwork of all our stakeholders. These include the provincial and territorial governments, the vehicle manufacturers and their dealers, the consumers associations, the six provincial administrators, the 144 arbitrators across Canada, and our head office staff. Together these groups are CAMVAP. Their people are central to our success. CAMVAP could not function without the continued commitment and support of all of them.

On behalf of the Board of Directors - and our customers - I wish to express our sincere thanks. Well done team!!!!

 1997 Significant Activities

Completion of Operational Review

In 1994, the CAMVAP Board of Directors committed to an all-encompassing review after two full years of operation. The intent of the review was to assess our performance against the stated objectives and against stakeholder expectations of the program. As indicated in our 1996 Annual Report, completion of the CAMVAP Operational Review by Clark Henning was to be a major focus in the 1997 calendar year. The final report was submitted to the Board of Directors in August, 1997 and, by the end of November, the Board had completed its initial review of the recommendations. The report identified 99 actions to improve the present-day efficiency and effectiveness CAMVAP and to take advantage of opportunities to strengthen the program and position it for future growth. As anticipated, many of the recommendations focused on the program's core activities including field administration, arbitrator selection and training, conduct of hearings, and the format and content of internal and external communications.

Implementation of Operational Review Recommendations

Since receiving the report, the Board of Directors consolidated the recommendations by the program's core activities of administration, arbitration, provincial administration and communications and then prioritized each recommendation based on its potential contribution to improved performance against program objectives and/or cost effectiveness. The high priority recommendations are being implemented on an expedited basis. Several recommendations affecting the arbitrators, provincial administrators, and consumer communications were implemented prior to December 31, 1997. (Others were released in the 1st quarter of 1998.) Early indications are that the changes made are showing a positive impact on operating results. A key recommendation was to establish a formal arbitrator performance review and evaluation program to be conducted at arms length by an "outside" agency. Work on this task commenced in the Fall. (The arbitrator quality control program was implemented effective June 1, 1998.) Extensive discussions continue with all CAMVAP stakeholders (governments, manufacturers, consumer associations) on the implementation timing and format for the remaining recommendations . The Board of Directors considers it prudent to carefully and strategically plan the timing and sequencing of major changes to the program in order to avoid overwhelming the system and to permit a complete and accurate evaluation of their impact. In summary, the 1997 Operational Review has identified important opportunities for CAMVAP to improve its performance and meet or exceed its core objectives. The ongoing challenge is to implement the remaining recommendations in a timely, cost effective and orderly manner and to monitor their impact carefully. The Board of Directors accepts this challenge on behalf of all CAMVAP stakeholders. An overview of the report summarising the recommendations and the implementation process will be prepared and made available on a request basis in the fall of 1998.

Consumer Survey Results

Beginning in mid-1995, all consumers who apply and qualify for CAMVAP arbitration are surveyed by Mark Trend Research Inc. to ascertain their satisfaction with the key operating elements of our program . The 1997 calendar year survey results were very positive with the best ever customer satisfaction ratings in many of the core areas of our business. In particular, the Provincial Administrators continue to achieve top marks on all seven of the measured areas. New high levels of satisfaction were reached in the critical areas of "being professional", "timely set-up of hearing", "being knowledgeable about the case" and "being easy to reach". The CAMVAP Arbitrators are evaluated on six elements; "being professional", "being courteous"; "being prepared for the hearing", "being helpful", "being knowledgeable about the case" and "being fair". Combined excellent and good ratings on all six of these elements were at record high levels. The combined "excellent" and "very good" overall rating of CAMVAP and its processes was at 67% up only slightly from 65% in 1996. While only a small change, this sets a new high for this all important measurement of customer satisfaction with CAMVAP. Our objective for the "overall satisfaction" rating is 70%. We believe that some of the Operational Review recommendations already implemented will help us to achieve it in 1998.

New Policy Directives

In the fall of 1997, the Board of Directors issued three new policy directives. These directives were designed to address issues of concern to consumers relating to buy-back awards (calculation of the dollar amount), technical inspections, exchange of documents prior to the hearings, and the use of pre-hearing teleconferences. Some of the improvement in the customer survey results can be ascribed to these directives.

Process Timing

In 1997, the average time to complete all CAMVAP arbitrated cases was 59.8 days. This was 10.2 days better that our objective of 70 days, 6.7 days better than our 1996 results, and represents our best ever performance in this critical area. Seventy-six per-cent (76%) of all 1997 cases were completed within the objective timing of 70 days - also a best ever performance level. There is a positive correlation between time to complete a customers case and the satisfaction levels with other elements of the programs. Our performance in this critical area contributed significantly to the record high ratings for overall program satisfaction.

Focus and Objectives for 1998

A main focus for the Board of Directors in 1998 will be to finalize its discussions and decisions with respect to the Clark Henning Operational Review. We anticipate that the majority of the recommendations selected for implementation will be in place by 1998 year end. CAMVAP has contracts (operating agreements) with all participating vehicle manufacturers regarding their participation and financial support of the program. All of these contracts come-up for renewal in 1998-99 and will be renegotiated as they come due. Each Provincial Administrator operates under a two-year fixed term contract with CAMVAP. Contract renewal for all Provincial Administrators will occur in 1998. The Board of Directors has determined that a third two year term should be offered to all of the Provincial Administrators . A key element of our success in 1997 was our communications strategy. The Directors regularly review and access external and internal communications. Two changes will be made in 1998. One will be an update of our Rules and Agreement for Arbitration form to reflect changes resulting from the operational review. A second will be to conduct a series of meetingsbetween the Directors and major stakeholder groups (consumer associations, manufacturers, arbitrators and provincial administrators) to ensure the program continues to meet all their expectations.

Financial Review

Expenditures for 1997 were $725,100. This was $171,900 under the approved full year budget of $897,000. This was CAMVAP's fourth consecutive under budget performance. The Board of Directors appointed Richter, Usher & Vineberg, an accounting firm headquartered in Toronto as CAMVAP's accountants for 1998. Their 1997 audit report indicating CAMVAP was operating on sound financial basis was reviewed and approved by the CAMVAP Members and Directors at the Annual General Meeting held on April 26th, 1998.

In Summary

1997 was both a challenging and a successful year. Our customer survey and case timing results indicate that CAMVAP is "delivering on the promise" to provide our customers with an arbitration program that is fast, fair, friendly and easily accessible. We look forward to further improvements in our performance against our core objectives as we continue to implement recommendation arising from the 1997 Operational Review. We hope you will find this - our fourth annual report - informative and easy to understand. Your comments and suggestions on the report or on the on going operation of CAMVAP are invited. I assure you they will be given careful consideration. In conclusion, on behalf of myself and the CAMVAP Board of Directors, I wish to express sincere thanks to all those who contributed to making 1997 our best ever year.

Chairman

T.L. Johnson

Chair of the Board
Cars
"The 1997 calendar year survey results were very positive with the best ever customer satisfaction ratings in many of the core areas of our business."
Cars
"Seventy-six percent (76%) of all 1997 cases were completed within the objective timing of 70 days - a best ever performance level."
Cars
"While the number of claim forms returned is down by 8.2% from 1996, the number of cases fully arbitrated is up by 6.5% from 309 in the previous year to 329."

Cars
"The six CAMVAP provincial administrators received 8,089 consumer enquiries in 1997 ... a 20% increase over the 6,759 enquiries received in the previous year."

 1997 Operating Statistics

 Highlights

The six CAMVAP provincial administrators, with offices located in Halifax, Toronto, Winnipeg, Regina, Edmonton and Vancouver (with a sub-office in Victoria), received 8,089 consumer enquiries in 1997. This reflects a 20% increase over the 6,759 enquiries that were received in the previous year. 1,202 claim forms were mailed to consumers with 414 claim forms being returned as applications to commence the arbitration process. While the number of claim forms returned is down by 8.2% from 1996, the number of cases fully arbitrated is up by 6.5% from 309 in the previous year to 329. An additional 62 cases resulted in settlements at the hearing between the consumer and the manufacturer. In these "consent" cases, the agreement between the consumer and the manufacturer becomes the arbitrator's award. An additional 52 cases were settled between the consumer and the manufacturer prior to an arbitration hearing being held. 26 cases were withdrawn by the consumer or were ineligible for arbitration.

 CAMVAP Cases Processed

Consumers continue to learn about CAMVAP through many sources. The program's communications strategy has been to work with all organizations where a consumer may go for assistance. The chart on page 7 shows that this process of referrals to the program is working. More than 150,000 single-page consumer brochures were distributed in 1997. The consumer brochure is distributed in the small claims and civil courts in 11 of the 12 Provinces and Territories where the program is offered. In addition, 50 copies of the brochure were distributed to each of the, approximately, 2,400 dealer members of the Canadian Automobile Dealer Association in the participating Provinces and Territories.

 How Consumers First Learned about CAMVAP

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CAMVAP Cases Processed

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 Number of Concerns by Vehicle Component

In 1997, there were 191 passenger vehicles, 54 minivans, 42 light trucks and 42 sport utility vehicles that were the subject of CAMVAP arbitrations. An analysis of each award is made to determine the total number of concerns by vehicle component. In total, there were 659 concerns identified for the 329 arbitrated cases and 62 consent award cases. Engine, transmission and exterior complaints remain the top three areas of concern as in all previous years.

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 Representation at CAMVAP Hearings

Based on the 329 arbitrated cases, the consumer appeared alone in 182 hearings, was accompanied by a family member in 129, and by a lawyer in 4 cases. Consumers brought witnesses in 14 cases. Manufacturers representatives attended alone in 223 cases and were accompanied by the dealer in 22 cases and by a technician in 84 cases. There is notable shift in the manufacturer's representation over 1996 as technicians from the servicing dealer have taken over from having the owner of the dealership or the service manager in attendance. Comparatively for 1996, the manufacturer and dealer appeared in 89 cases and technicians appeared in only 8 cases.

 Summary of CAMVAP Awards

The chart below summarizes the 357 awards made by the CAMVAP arbitrators in the 329 fully arbitrated cases (more than one award can be made in a specific case). In addition to these awards, a further 79 awards were made in the 62 cases where the consumer and the manufacturer reached a settlement at the hearing and the arbitrator issued a "consent" award. The range of consent awards includes 3 buybacks, 31 repair orders, 9 reimbursements for repairs, 9 orders for use of courtesy vehicles while repairs were being done, 5 trade assists, 2 cash allowances, 4 awards for out of pocket expenses, and 16 awards for various types of warranty considerations.

 Arbitrated Cases

When the arbitrated cases and consent awards are considere d together, 49 buyback awards were made for a total of $904,199.10 with an average vehicle value of $18,453.04. When the three replacement orders are also factored in, the combined cost of buybacks and replacements is about $960,000. There were 57 orders for reimbursement for repairs totalling $64,377.26 with an average of $1,129 per case. 31 or 7% of the 391 arbitrated and consent award cases involved leased vehicles.

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 Awards by Category

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The chart shows all award s made in the 329 arbitrated cases and 62 consent award cases. Orders to make repairs to the consumer's vehicle continue to be the most frequent remedy ordered by the arbitrators. Following repairs being completed by the manufacturer and/or the dealer, the arbitrator remains in control of the case for 90 days in order to ensure that the repairs were successfully done. Of the 136 repair orders made, only 6 cases went to a second hearing where the arbitrator heard the matter for a second time based on the consumer's claim that the work had not been done properly. Only one of those cases resulted in the award being changed to a buyback. With all 436 awards factored in, no manufacturer liability awards represents 31% of the awards made by the arbitrators. Each year, CAMVAP reports the number of awards where the arbitrator found no liability on behalf of the manufacturer with respect to all claims made by the consumer. When the results of the 329 fully arbitrated cases, the 62 consent award cases, and the 52 mediated cases are combined - 70% of the awards favoured the consumer. This is an increase of 3% over the 1996 results.

 Hearing Locations

CAMVAP hearings are held in the consumer's home com-munity. The list on page 11 shows the communities in which CAMVAP hearings were held in 1997. Consumers rate the location of the hearing room consistently high. 87% of the survey respondents rate the location of the hearing as convenient. 92% of consumers rate the timing of the hearing as convenient.

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 Case Timing Summary

Case timing is a key indicator of program efficiency that is closely monitored by the Board of Directors. In 1997, the average number of days to process consumer's claims for the 391 arbitrated and consent award cases was 59.8 days from receipt of the completed application to the arbitrator's award being released to the consumer. This result is 10.2 days better than CAMVAP's target of 70 days and 6.7 days better than 1996. 298 or 76% of the arbitrated and consent award cases were handled within the 70 day target. An additional 45 cases or 12% were handled within 90 days and 48 or 12% took more than 90 days to complete. The average processing time for cases where there was one arbitration hearing and no technical inspection was 53.9 days. Technical inspections, done by an independent third party examiner, add an additional 42 days to the timing. Work is underway to reduce this time. The 52 cases that were settled between the manufacturer and the consumer prior to a hearing being held averaged 40.9 days from receipt of the consumer's claim to notification that the matter had been resolved.

 CAMVAP's Market Research

CAMVAP has retained the firm of MarkTrend Research Inc. to track customer satisfaction with the program. The research objective is "to provide detailed ongoing evaluation of customer satisfaction to assist CAMVAP's Board of Directors in their effort to ensure they are providing the best possible consumer dispute resolution service" This research work is unique. CAMVAP has been unable to locate any similar program that continuously measures the "customer satisfaction" with a dispute resolution service. In total, over the three years of survey work, 2413 consumers who qualified for the CAMVAP program have responded to the survey. Prior to June, 1997 MarkTrend Research Inc. mailed a questionnaire to the consumer followed up by a second mailing ten days later if no response was received. Consumers who did not return the mailed questionnaire were then contacted by telephone. In June, 1997 the methodology was changed to all interviews being conducted by telephone. The response rate in 1997 was 69% and has ranged from 67% to 69% over the three years of survey work.

 Provincial Administrators Performance Rating

The Provincial Administrators are an important component to the program's success. They are rated on 7 different service quality indicators. Rankings of excellent and good in all of the categories range from 79% to 88%.

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 Arbitrator Performance Ratings

The consumer survey also rates the 144 CAMVAP arbitrators on their performance. The combined excellent and good ratings set new highs in all six areas in 1997. The findings for the six performance elements appear to be strongly connected with the outcome of the arbitration hearing. Specifically, consumers who had won their arbitration hearing, that is, those who received all or most of what they asked for, are two to six times more likely than their counterparts to have assessed the arbitrator as excellent on each of the six dimensions. The widest differential in excellent ratings between "winners" and "losers" occurs on the dimensions relating to being fair (78% versus 13%), being helpful (74% versus 24%) and being professional (80% vs 33%).

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The research objective is "to provide detailed ongoing evaluation of customer satisfaction to assist CAMVAP's Board of Directors in their effort to ensure they are providing the best possible consumer dispute resolution service"

 Overall Program Rating

The Board of Directors has set a target of 70% for the combined Excellent and Very Good responses to the Overall Rating of CAMVAP. In 1997, the result was 67%, the highest level of performance since the program's start-up. Performance against this target is strongly impacted by the results of the arbitration. 95% of those who report receiving all or most of what they ask for rate CAMVAP and the process as Excellent or Very Good. This drops to 51% for those who do not receive an award that favours them. Of note, consumers who go fully through the arbitration process rate the program quite similarly to those who do not complete the program for whatever reason. As has been noted before, rating of the program is linked to the arbitral result. 64% of those who went through arbitration rated the program as Excellent or Very Good.

Overall Rating of CAMVAP and the Process

Overall Rating of CAMVAP and the Process

 Impact of Time to Complete Case on Program Ratings

CAMVAP has found that the speed with which the case is handled is a pivotal factor to the rating of the program . Those consumers who state that their case was handled quicker than expected will rate the fairness of their award at 37% very fair or 23% somewhat fair. Those who believe their case took longer than expected who rate the program at 28% very fair and 23% somewhat fair. Similarly, those who found the speed quicker than expected rate the program as 54% excellent and 28% good as opposed to 28% excellent and 26% good.

Impact of Time to Complete Case on Program Ratings

 Organizational Structure and Governance

 CAMVAP Organization

CAMVAP is federally incorporated as a not-for-profit corporation. The 15 Governments and associations that make up the C AMVAP organization are all members with equal voting rights at the Annual General Meeting.

The members of CAMVAP are:

  • The Provincial and Territorial Governments
  • Association of International Automobile Manufacturers of Canada (AIAMC)
  • Canadian Automobile Dealers Association (CADA)
  • Canadian Vehicle Manufacturers' Association (CVMA)
  • Consumers' Association of Canada

CAMVAP is governed by a 10 member Board of Directors. The Board of Directors establishes policy and monitors the financial, administrative and operational performance of CAMVAP. There are three government directors, two Consumers' Association of Canada directors, two directors representing the CVMAmembers, two directors representing the AIAMC mem-bers and one director representing the CADA members. The number of government appointed directors will increase to four if the Province of Quebec becomes a member of the program. CAMVAP has two full time staff at its head office. The General Manager reports directly to the Board of Directors and is responsible for the day-to-day operational, administrative and financial management of the corporation. The General Manager is also Secretary to the Board of Directors and an officer of the corporation. The Administrative Assistant provides support to the General Manager and to the Board of Directors. All other services are provided by contract.

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 CAMVAP Funding

CAMVAP is fully paid for by the vehicle manufacturers through formulas that reflect each company's marketshare and past CAMVAP case experience. Each manufacturer's payment for the program is calculated one year in advance. There is no connection between CAMVAP's overall funding and any individual case.

 CAMVAP Arbitrators

The arbitrators who provide service to CAMVAP come from many different backgrounds and professions. They are completely independent. The manufacturers are not involved in their appointment to the program, their training or their case selection. The arbitrators are paid a flat fee for service for each CAMVAP arbitration they conduct. For each case, the Provincial Administrator selects three names from the roster of arbitrators who are available to hold a hearing in the consumer's home community. The three names, accompanied by a brief resume, are sent to the consumer who selects one of these arbitrators to conduct the hearing. The arbitrations are governed by the CAMVAP Agreement for Arbitration and Rules for Arbitration and the regulations set out in the various provincial and territorial Arbitration Acts.

 Provincial Administrators

The public face of CAMVAP is the six Provincial Administrators engaged by CAMVAP to deliver the program across Canada. They are responsible for receiving and responding to enquiries, processing applications for arbitration, scheduling hearings and communicating.

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 Participating Manufacturers

Chrysler Canada Ltd. Ford Motor Company of Canada Limited
General Motors of Canada Limited Honda Canada Inc.
Hyundai Auto Canada Jaguar Canada
Mazda Canada Inc. Land Rover Canada Inc.
Nissan Canada Inc. Mercedes-Benz Canada Inc.
Rolls-Royce Motor Cars (Canada) Ltd/Ltee Porsche Cars Canada Ltd.
Suzuki Canada Inc. Subaru Canada, Inc.
Volkswagen Canada Inc. Toyota Canada Inc.
  Volvo Canada Inc.

For CAMVAP consumer information call the provincial administrators at 1-800-207-0685

For CAMVAP administrative information contact head office at:

Phone: (416) 490-0615
Facsimile: (416) 490-1680
Email: info@camvap.ca

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CAMVAP 1997 Annual Report

 
 
Cars
"Engine, transmission and exterior complaints remain the top three areas of concern as in all previous years."
Cars
"Of the 329 fully arbitrated cases, (62 consent award cases and 52 mediated cases) 70% of the awards favoured the consumer. This is an increase of 3% over the 1996 results."

"There is no connection between CAMVAP's overall funding and any individual case."

Copyright 2012, Canadian Motor Vehicle Arbitration Plan
Tous droits réservés MD 2011, Programme d'arbitrage pour les véhicules automobiles du Canada.
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