Competition Commission opens door to aftermarket service providers
With the hopes to offer consumers more choice and competitive prices, the Competition Commission has put forth a new act which sees aftermarket service providers compete alongside vehicle manufacturers in the services industry.
The act will allow consumers to service their vehicles at aftermarket service providers and even allows for non-original parts to be used without voiding the vehicle warranty. Vehicle manufacturers have expressed their concerns with how the new plan was formulated, this after the draft instructs manufacturers to draw up a list of requirements for shops to adhere to before they can be authorized to conduct in-warranty services and repairs. This includes repair shops that are not attached to any new car dealerships.
The draft also instructs manufacturers to train any person interested in servicing or repairing vehicles from their brand at a reasonable cost and supply those people with original parts. Vehicle manufacturers will also be required to provide authorized service providers with all technical information and operational software.
Not only does the draft allow for consumers to choose independent service providers, but owners are also allowed to choose to use generic spare parts should the original part’s warranty is expired, however, without compromising any other existing warranties on the vehicle. The draft requires from the manufacturer to notify customers that they can have their vehicle serviced outside of their brand or dealership group although they are not obliged to pay for any services or repairs conducted under a motor-plan.
One of the main concerns from vehicle manufacturers is, who takes the responsibility of parts that fails as a result of non-original spares fitted which affects those parts. Another major concern is how quality control of services and repairs will be monitored at independent services and repairs providers as sub-par parts and installations could damage the reputation of a manufacturer and even more importantly, endanger the lives of vehicle occupants.
On the other side of the argument, small business owners welcome the draft as this will create more revenue and ultimately more employment opportunities. Peter Meyers, the owner of One Spark Auto Clinic in Randburg, Johannesburg, says; “That bill should be passed as it is going to help a lot of small business owners to get more feet through their doors, it will help business owners employ more people as well as contribute to the economy of the country.”
The National Association of Automobile Manufacturers of SA (Naamsa) said in a statement that it expects a long period of public input but that the draft could change the nature and structure of the motor retail and services industry fundamentally. Although Naamsa has no objection to reforms, it did, however, accuse the Competition Commission of acting in bad faith and the proposed rules could result in the loss of billions of rands of investment in South Africa.
The draft guidelines are open to public comment until 16 March.
Link to draft guidelines: https://bit.ly/2VRaQgz
