15th March 2017

Collusion investigation R2RC

Media release

October 2014

Collusion investigation opens way for Right to Repair

The recent announcement by the Competition Commission that it will be investigating 82 automotive component manufacturers for collusion and price fixing has sparked conversation about South Africa’s motor industry and the operating thereof.

Les Mc Master, Chairman of the Motor Industry Workshop Association (MIWA) says this is a good thing and believes this will raise awareness around the Right to Repair Campaign that MIWA has championed since 2011. The Right to Repair Campaign allows consumers to select where their vehicles are serviced, maintained and repaired at competitive prices in the workshop of their choice.

 

Just as insurers are crying out for consumers to be able to fit certified alternative parts to contain the cost of vehicle repairs without fear of losing the warranty, so too are independent workshops wanting the opportunity to repair vehicles without the warranty threat.

“South African legislature needs to follow the international Right to Repair trend which promotes South Africa’s existing consumer and competition laws. There is a need for a fair and competitive regulatory environment that enables freedom of choice for the consumers and that gives aftermarket Small Medium Enterprises a chance to stay in business,” says Mc Master.

In some instances the successful Right to Repair Campaigns in other countries have lead to the enactment of legislation which dictates that Original Equipment Manufacturers (OEMs) are required to provide the same information to the independent aftermarket dealers as they already provide to their franchise dealers. Certain Right to Repair legislation also codifies the consumers’ right to choose its preferred dealer without fear of losing their warranty.

 

“Access to information is increasingly important in an era of technological advancements. Not having access to certain information has allowed OEMs to monopolise the automotive industry by refusing to provide the requisite codes for security systems, diagnostic systems and telematics systems, but to name a few, to independent aftermarket dealers. Where the required codes are not available, the independent aftermarket dealers are precluded from repairing those vehicles which leaves the consumer with the franchise dealers as their only alternative,” explains Mc Master.

 

Both the lack of access to information and the stringent framework surrounding warranty, maintenance and service plans places OEMs and their franchise dealers with the exclusive control of that segment of the market.

 

“We at MIWA believe this imbalance needs to be addressed in South Africa as it has in other parts of the world, and we will be championing the cause. We will be following the investigation closely and welcome the dialogue it will bring between stakeholders in the motor industry,” he concludes.

ENDS

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