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Dealing with Auto Transport Damage

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Dealing with Auto Transport Damage
Dealing with Auto Transport Damage

Worldwide, auto shipping claims are mostly sent electronically. Certain guidelines and standards have been developed to speed up the process of handling them. The purpose of the following guidelines is to give those handling these situations the information they require to check, record, and then transmit the car’s damage. The following paragraphs will explain this process.

Short History

A series of codes describing various forms vehicle damage were created by the AAR (American Association of Railroads) during the 1970s. The MVMA (now defunct) would update them in the 1980s. They were updated once more in 2003, so they would describe the accessories and models operating today more accurately. 

The meeting where this was decided was attended by inspection companies, railroad owners, carriers, and car manufacturers. They aimed to standardize and update the codes in the auto industry, so damage prevention and claim settlements could be handled more effectively. The MVMA/AAR codes are the result of that meeting.

The group chosen to increase the usage of these codes and to promote them on a global scale was the AIAG-EGG. In 2007, the European Car Transport Group approached the organization to allow the codes’ application outside of the US. So they may be used in Europe and later globally, the codes were revised by the 2 organizations. 

The global damage codes

During a vehicle’s transport, whenever it changes hands from one party to another, it must be immediately checked for missing parts or damage. The damage codes must be noted and accurately detailed. For them to be introduced into the claims system of the manufacturer and/or shipper, they must be manually recorded either in data terminals or added to delivery receipts.

Some manufacturers may provide manuals containing photographs that show certain types of damages and damage areas. Each code is made out of 5 digits. The first 2 are the damage area code, 3 and 4 are the code for damage type, and the 5th digit signifies the severity of the damage. For example, a 10123 code will signify damage to the front left door in the form of a scratch of at most 15 cm though not smaller than 3 cm.

The left and right sides of the car are the same as the driver’s. If one area has multiple damages of the same type that aren’t related to each other, the codes will be noted separately on the same panel.

Non-transport damage

This standard was created by the AIAG-ECG to help inspectors check if a certain exception is related to transportation or not. Although requirements from the OEM are superior, these auto handling and inspection provisions are meant to build common standards for the auto industry. Regardless if the following damages are or are not noted, carriers cannot be held liable:

  • Any paint damage to the exterior of the car due to fluids or fallout from the environment, unless there’s solid evidence indicating that the carrier was responsible.
  • Level 1 dents (in terms of severity) to sheet metal, without damage to the paint or proof of forced entry, abrasion, or a physical impact, except if it’s present on the front left door or the manufacturer’s policy identifies it.
  • Moldings, protrusions of the sheet metal, decals, emblems, panel misalignment, or weather stripping due to installation or plant issues.
  • Missing decals, emblems, moldings, or others if there isn’t evidence supporting their installation.
  • Chrome or paint foreign material, blisters, peeling, sags, or runs.
  • Glass cracks caused by under molding if there is no evidence of an impact.
  • Small damages to painted areas that are covered by shipping film if the film has no clear signs of abrasion or impact.
  • Missing items from a package provided by the plant if it’s sealed.

Conducting inspections

Regardless of the environment, vehicles must go through an impartial inspection conducted either by an agent from a third party or by a service provider. The service provider can still be held liable even after this procedure is completed. 

The responsibility for gathering and sending the exception information belongs to the inspection personnel. Pictures must also be included. If the party that receives the car claims it is damaged, the previous party is accountable until he can prove his innocence with inspection information that was previously documented electronically.

The first step in any inspection is the verification of the VIN plate. The inspector must first inspect the car’s exterior by walking around it from around 3 feet away. He must check the car’s undercarriage, the fascias of the rear and front’s underside, the wheels and the tires, as well as the vehicle’s exhaust pipes. The automobile must not be touched, nor wiped or rubbed in order to clean it.

Mirrors can be used for the inspection. If there isn’t enough space between the car and its surroundings, you should not walk around it, to avoid making contact. 

Sharp objects or clipboards containing clips made of metal should not be used in an inspection. No markings must be left on the car. You can outline damages using temporary stickers, so they’re more visible when taking pictures, but you must remove them afterwards.

Before the car is delivered, make sure you remove any notes and other inspection details still on or inside the automobile. So the car’s shipment isn’t delayed, the inspection shouldn’t take more than 3 minutes.

Unless the transit film is dangerous to people or to the vehicle, it should stay on. Its wrap guard must be disposed of carefully if you do decide to remove it.

If you find the wheel film to be loose, then you may want to remove it and then either put it in the car’s trunk or dispose of it yourself.

If the seals are intact on the doors or trunk, you should leave them closed while inspecting the automobile. Of course, you can check the interior and the trunk for missing objects or damages if there are no seals or if they are broken.

The car’s rear: The hatchback or deck lid area must be verified, as well as the upper filler, roof, rear end panel, rear lamps, and the glass window. The inspector should then take a step back to see the car’s rear entirely. Check the exhaust system, the bumper’s underside, the lower filler panel, the bumper strips/guards, the exhaust system, and the car’s exhaust pipe.

The car’s sides: Going from the back of the car’s passenger/driver side, you should carefully inspect it. Afterwards, check the car’s side in its entirety by taking a couple steps back. You must verify the fender, rocker panel, the doors’ lower parts, the quarter panel, the rims, and the tires. The moldings and panel edges need further scrutiny when you get to the doors. The hood and the front windshield will have to be checked as well.

The car’s front: Every part of the car’s front must be inspected, such as its splash panel, the bumper’s underside, and the filler panel. When doing this, avoid touching the car. Finally, get a clear view of the car from a few steps back while checking the roof and windshield too.

Inspecting the car’s interior: According to the Key Placement Policy of the OEM, make sure every key is present. If you find exceptions in the cockpit area of the driver, including the upholstery, carpets, center console, seats, headliner, and trim panels, note them.

If you see any boxes or bags, they must be sealed. If you can obtain information on their contents, check them against the label/shipping document.

Inspection procedures at interchange locations

Sometimes, the car cannot be delivered directly to the customer and must change carriers along the way. The place where this switch occurs is the interchange location.

The timeframe for the inspection is either a single business day or one agreed upon by the 2 involved parties. You cannot inspect the vehicle on one day, and transmit that it was inspected on another. 

All parties involved in this process must be notified of exceptions. Based on the requirements issued by the OEM, the parties must transmit all inspections. If some locations do not comply with inspection procedures, you must notify the OEM.

In case the operator of the facility where the inspection is conducted has stricter policies, the providers that will be impacted by this fact must receive written notification. The car’s flow must not be impeded by a stricter policy.

Picking up a car from a mixing or distribution center 

Every exception must be noted by the driver on an electric device or a load sheet. The data will then be sent to the yard representative that was designated for the project, to a security officer, or to the operator of the facility. Unless the incoterm or contract defines a clear first or last rest point, the liability for the vehicle will go from the initial service provider to the next. 

A yard representative, security officer, or facility operator must identify every automobile that enters the premises, so all damages are noted quickly. If the representative does not notify the right carrier, he/she will be held responsible.

Inspections on rail

In cases where the railroad has not contracted the loader, an agent of the receiving party must perform the inspection. The role of the inspection is to note damages as a result of loading. It will be used for identifying and then correcting clearance issues or tie downs which may lead to damages. This way, problems can be fixed before the railcar is moved.

At the destination point, the inspection will be conducted by the railroad. They may also organize an FPR inspection (first point of rest), though it will have to be done through an independent party. 

The inspector must document all damages and take photographs while the car is in the chocks. You will need a VIN plate and damage photos from behind the car, of the end doors of the rail car, as well as of the railcar number. All of this is done to prove that the car had yet to be unloaded.

Final inspection at delivery

If the car is delivered during usual working hours, the party that takes the automobile can inspect it, and then note on the electronic device or delivery receipt any exceptions. To enable the recording of the car’s condition, the provider has to provide an electronic device or a delivery receipt in multiple copies. 

The writing on the original/copies of the damage form or delivery receipt must be legible. The provider that’s delivering the car must make sure the delivery device/document contains the right coding for any noticed damage.

A receipt for the delivery must be dated and signed by the service provider that delivers the car as well as by the one receiving it.

  • If there’s an exception that’s noted but one of the parties doesn’t agree with it, both parties will have to put in comments, then date and sign the document. The paperwork alongside colored pictures will be forwarded to an OEM representative by the provider. All disputes must be handled before the driver takes the car and the delivery paper outside of the facility.
  • If both parties agree with the comments written on the receipt, both of them will sign and date the document.

After both parties have signed the paperwork, it can no longer be modified. The final destination of the automobile cannot refuse its delivery. An OEM representative should be called if this occurs. The party accepting the automobile can wash the car to help with the inspection. However, the driver must be present.

If the car is delivered outside of business hours, an STI agreement containing the facility for the final destination must be prepared by the provider that delivers it. Every VIN must be identified as it was delivered. The receipt will dated and signed by the provider. The delivery time must be noted as well as the fact that the delivery is STI. However, exceptions will not be noted by the provider. 

The party that accepts the car can inspect it and add the exceptions he notices on the damage form or delivery receipt given by the provider. According to the STI agreement or the OEM manual in shipping, there is a certain time frame during which the party receiving the automobile can notify the provider which delivers it of exceptions. He/she must use traceable means to do so, such as in writing.

Unless he can prove the damage pointed out by the receiving party has occurred before the shipment started, the delivery provider will be accountable for it (if it appears on the delivery document).

Hidden or concealed damages

A visual inspection may be insufficient to detect all damages. Some components may only be visible if the car is hoisted on a ramp. The receiving party has 24 hours to report hidden damages to the provider. Weekends and holidays are not taken into account.

Bumper damage, damage found under undisturbed protective wrapping, damage that wasn’t detected due to snow or dirt covering the car, as well as cracked windshields and scratches are not hidden damages. If your car is dirty, you can wash it in the presence of the delivery provider to get a better view.

Requirements for the inspection of ocean transports

The results of inspections must be reported to the OEM, and damages must be reported to the party in charge of delivery. The receiving party must give the shipper an electronic or hard copy document with these damages. The delivering party will then make another inspection to verify the claims using this document. Afterwards, both parties will sign it.

Any disputes between the delivering and receiving parties must be handled before sending the data from the inspection to an OEM representative. The survey can be delayed if the load volume and weather conditions are unfavorable.

Photograph standards

The committee for damage claims, composed of representatives from the Inspection, trucking, and railroad companies, as well as the OEM, decided in January of 2017 on a few standards regarding retaining and submitting photos of damaged automobiles. They’re applicable when the damage is discovered while inspecting the automobile.

If photographs are necessary, they’ll be transmitted to an OEM representative along with a damage report. They should be placed in a PDF for this purpose. The time and date when each photo was taken must be included. Along with all related files, they must be stored and readily available for at least three years.

Joe Webster
Written By:Joe Webster
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Joe Webster began his journey in the auto transport field by attending the University of Southern California (USC), where he graduated with a Bachelor of Business Marketing. 

After college, he started his career in the auto transport industry from the bottom up and has done virtually every job there is to do at A-1 Auto Transport, including but not limited to: Truck Driver, Dispatch, Sales, PR, Bookkeeping, Transport Planner, Transport Manager, International Transport Manager, Brokering, Customer Service, and Marketing. Working with his mentor Tony Taylor, Joe Webster has learned the ins and outs of this industry which is largely misunderstood. 

With over 30 years experience in the industry, we've been helping people ship their vehicles, motorcycles, RV's, heavy equipment, household goods and more across the country or overseas without a hitch. Ask us anything.

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Trans Global Auto Logistics, Inc.
3401 E Randol Mill Rd
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NO. 018191NF
CFR Rinkens
15501 Texaco Avenue
Paramount, CA 90723
NO. 013055NF
ABC Worldwide LLC
2840 NW 2nd Ave #105
Boca Raton, FL 33431
NO. 025472F
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435 Division Street
Elizabeth, NJ 07201
FMC 22206
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45 Campus drive
Edison, NJ 08837
NO. 17858N
ShipYourCarNow LLC
1160 South Rogers Circle Suite 1
Boca Raton, FL 33487
NO. 025646
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6 Fir Way
Cooper City, FL 33026
NO. 021869F
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