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AMA seeks improved pricing in insurer negotiations

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AMA Group says it has contacted all its insurer partners and advised of updated labour rates and cost impacts, and of additional charges for “imposts previously absorbed” as part of pricing negotiations.

The company says it contacted insurers in May and June, negotiations with insurance customers commenced “with strong acknowledgement of the need for improved pricing”, and discussions are ongoing.

“It is critical that we are paid fairly for the value we deliver to our insurer partners,” Group CEO Carl Bizon said in a fourth quarter activities report released on the Australian Securities Exchange.

“Insurers understand the pressures the industry is facing, and I look forward to concluding our negotiations with them, as we seek to continue our long-term partnerships which deliver value to all parties.”

AMA Group says labour constraints associated with covid, isolation requirements and other illness continue to affect productivity, and the company is increasing its apprenticeship numbers and pursuing a multi-country skilled migration program to help address shortages.

The company, which has previously advised it has closed or consolidated some sites, last week said it had decided to exit three NSW hibernated sites in Five Dock, Campbelltown and Kogarah.

It will also exit the Californian Smash Repairs operation in Botany, and will close the Gemini Sunshine site in Victoria, with team members redeployed.

“Our skilled technicians are our most precious resource. With a vast, and in several sites, understaffed, network, it is critical that our team is deployed in the most efficient manner across our network,” Mr Bizon said.

AMA Group will release its full-year results on August 23 and expects to report normalised earnings before interest, tax, depreciation and amortisation of $20-22 million. Previous market guidance was $12-17 million.