Boyd sees ongoing stabilization in repairable claims volume
Brian Kaner, president and CEO of Boyd Group, shared with investors Wednesday that estimated repairable claims volume was flat to down 2% year over year (YoY) in Q2, and the total cost of repair (TCOR) supplied a limited contribution to same-store sales growth.
“This represents a meaningful improvement compared to the decline seen in Q2 of 2025 and points to the ongoing stabilization consistent with our long-term planning assumptions,” he said. “Against this backdrop, we generated 2.9% same-store sales growth in the second quarter with limited contribution from total cost of repair. This performance confirms continued market share gains reflecting the strength of the company’s insurer relationships, continued improvement in carrier performance, and the benefits of our 2025 regional incentive realignment.”
When asked what TCOR might look like in the second half of the year and the components that make up that measure, Kaner said he couldn’t speak much to TCOR timing but elaborated on the near-term possibilities that could lead to long-term trends.
“Raymond James hosted a really nice call with Ryan Mandell that talked about what’s happening in the near term… higher total loss rates, which as I said earlier, are kind of moderating at this point; a little bit of an increase in alternative part usage, and then in times where there’s less work in the marketplace, you have a tendency to see technicians doing a lot more repair versus replace.
“That repair versus replace can have a negative impact on the TCOR. I think more importantly than that is just the structural tailwinds that still remain behind us. If you look at the cost of repairing a vehicle that’s zero or three years or newer, it’s about $2,000 greater than the overall cost of a repair. We’re seeing now the cost of repairing a vehicle that’s in that zero-to-three-year category close to $6,000. If you think about the future of this business and you think about how that becomes the older part of the car parc in the long run, or in the older part of the cars that we’re actually repairing, you can see a place where the ticket is definitely going to continue to blend up as those cars become more of our repair sets.”
In the short term, Boyd is controlling what it can — taking market share, he said.
“We’ll continue to do that, and when price comes back, it’ll be a nice overlay on top of where we’re performing today,” Kaner said.
Kaner noted that during Q2, Boyd completed system conversion, including rebranding, at all Joe Hudson Collision locations. Boyd closed its acquisition of Joe Hudson in January.
“This marks the critical integration milestone, establishing a unified operating platform that will drive greater consistency, productivity, and margin expansion across the entire business,” Kaner said. “While the conversion resulted in temporary sales disruption, we have implemented targeted initiatives to strengthen throughput and local execution. These actions are now gaining traction and driving revenue on a more profitable foundation.”
He added later, not directly related to the Joe Hudson acquisition, that due to the “highly fragmented nature” of the industry, Boyd sees significant opportunity to expand its market share, organically and through disciplined mergers and acquisitions, “while leveraging our network scale to drive further operational efficiencies.”
Jeff Murray, Boyd’s executive vice president and chief financial officer, said Joe Hudson’s locations contributed $175 million to total sales in Q2. Gross profit increased 31% YoY to $480 million, representing a gross margin of 47.4%, up 60 basis points compared to 46.8%, he said.
“This margin expansion was driven by higher paint and parts margins supported by accelerated synergies and Project 360 cost savings, as well as increased scanning, calibration and sublet margins,” Murray said.
Kaner previously said Project 360 is meant to drive store economics, cost leverage, and customer satisfaction. According to a Q2 earnings press release, Boyd is accelerating its Project 360 and acquisition cost savings target of $140 million due to faster-than-expected gains from integrating Joe Hudson’s. It now expects $35 million from Joe Hudson synergies this year, up from the previous $20 million target.
“As a result, total cost savings expected in 2026 have increased to $65 million from $50 million, with the remaining $35 million expected to be realized ratably from 2027 to 2029,” the release states.
Operating expenses as a percentage of sales in Q2 improved to 33.9%, down from 34.8% in the prior-year period. Murray said the 90-basis-point improvement was driven by Project 360 and the Joe Hudson “synergy realization.”
Adjusted EBITDA grew 45% to $135.9 million, outpacing revenue growth. Net earnings were $1.3 million, down from $5.4 million in Q2 2025.
During the Q&A portion of the Aug. 12 earnings call, Kaner said claims environment recovery continues.
“We’re happy that it’s kind of stabilized in that zero to down 2%,” he said. “That allows us to achieve our long-term growth algorithm. …We are still seeing limited price, which is really the only downside in the market right now, so I do believe that that stabilization is here to stay.”
Kaner added that heavy inflation of insurance premiums is a driver of that.
“Insurance premium inflation, at this point, has almost turned to a deflationary category,” he said. “We talked about the impact of total losses in that taking cars out of the consideration set. In our world, total losses are essentially flat on a year-on-year basis at this point. As we see the things that we said were the drivers of the negative getting better, we continue to see the marketplace just being a much more stable environment for us to operate in.”
In response to another investor, Kaner said he doesn’t see aftermarket parts usage accelerating in the coming years. A timeframe wasn’t specified.
“I see it kind of us getting to a place where it stabilizes and then it doesn’t become a headwind; it just becomes a muted impact,” he said.
As for total loss rates in the next five to 10 years, Kaner said they have a very negative impact on consumers, noting a recent CCC report on how, and mentioned that insurers, OEMs, and repairers don’t like total losses.
“We know that from many perspectives, having a total loss event is one of the worst customer experiences that a consumer will have,” he aid. “The insurance carriers don’t like total losses. The OEMs don’t like total losses. And certainly we like to repair people’s vehicles and get them back on the road safely, so I think my view is, longer term, you can continue to believe that there might be some upward movement. I would say that I don’t expect it to be.
“If I were to peg a number to it, I would expect something in the neighborhood of three-tenths a year of movement, which really isn’t a lot. And I do think, as I said, there’s a lot of momentum to try to drive total losses down.”
A recent example Kaner said could drive total loss rates down is Rhode Island’s passage of legislation mandating an 85% total loss threshold.
“The aging car parc might put us in a position where it will go up based on the car park age, but I think there’s some other factors that are suppressing it as well,” he said.
Murray added that it’s important to think about total losses in the context of overall market size growth.
“It really is also important to understand how is it changing in relation to the total market size changing? Because even if the total loss is increasing, there could still be more cars available to be repaired in that scenario,” he said.
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