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AAAA pursuing repairer of choice vigorously

Agreement: The Australian Automotive Aftermarket Association wants franchised dealers and independent repairers to come to an accord on data sharing.

Calls for better education for car owners on their new vehicle warranties

General News logo22 Mar 2013

THE federal government is expected to give the car industry and its franchised dealers 12 months to come up with an information-sharing scheme that is fair and reasonable for independent repairers.

If a mutually acceptable arrangement cannot be reached between the dealers and the independents, it is likely the government will pursue a regulatory model, as has started happening in the US.

The way forward will be detailed in April by assistant treasurer David Bradbury when he releases his formal response to the recommendations of the Commonwealth Consumer Affairs Advisory Council (CCAAC).

Apart from urging the industry to come up with a voluntary code for data sharing, the CCAAC also recommended that state consumer affairs offices launch a campaign to educate drivers about their car warranties.

The CCAAC has urged state authorities to tell drivers that they are able to have their cars serviced by independent repairers without voiding their new-car warranties.

On data sharing, the CCAAC said it wanted to see “significant progress” towards a voluntary scheme within 12 months. Failing that, it urged the Government to consider regulatory means of enforcing data sharing.

The council also pointed out that the independent repairers could be given access to data much earlier than that, while negotiations are being conducted, simply by opening up international websites to Australian repairers.

That would be a good place to start, according to Stuart Charity, executive director of the Australian Automotive Aftermarket Association (AAAA). The AAAA started the choice of repairer campaign in 2009.

Mr Charity said Australian repairers were presently barred from those sites when they key in the vehicle identification numbers of Australian-registered cars or Australian based credit card numbers.

“In Europe and North America, there are sites already up and running where this information is available, but if you try to key in an Australian VIN number or credit card, you get locked out,” Mr Charity said.

 center imageLeft: Executive director of the Australian Automotive Aftermarket Association Stuart Charity.

"It would be pretty easy to say the first step (to data sharing) would be to allow Australian VIN numbers and credit cards into those sites.”

That is what the CCAAC recommended, arguing that granting early access to these international website for independent repairers would be “relatively simple”.

Mr Charity said the choice of repairer campaign started by the AAAA in 2009 was not meant to grab more market share for independent repairers.

As a rough rule of thumb, franchised dealers hold about 40 per cent of the repair and maintenance market, with an emphasis on vehicles less than four years old.

The independents hold about 60 per cent of the market, mainly the older vehicles, most out of warranty.

Far from grabbing more market share for independents, the campaign was meant to maintain the status quo as cars become more complex and more dependent on manufacturer data and information.

“As vehicles get more complex, if the independents don’t get access, (dealers) will be able to hold those vehicles for longer and longer,” Mr Charity said.

“So, instead of that four-year time frame, it will sneak out to five, six, seven, eight years and all of a sudden the aftermarket is left with all the old clunkers and nothing else.”

Indeed, Mr Charity said that surveys in regions where mandatory or voluntary sharing of repair data had been introduced had shown that improved access to data for independents did not change market shares.

“In Europe there’s been regulation in place since 2002, and in the US there has been a similar style voluntary agreement for about 10 years.

“There is no evidence there has been a shift in market share,” he said.

“Basically, what’s happened is the status quo has been maintained. So, dealerships get the lion’s share of the younger vehicles service business and the independent aftermarket get the lion’s share of the four-year-plus vehicles.”

While Mr Charity was pleased that the CCAAC had recommended the industry reach a voluntary agreement on data sharing with the independents, he admitted to some frustration that there was the possibility of 12 months of tough negotiating ahead.

“This choice of repairer campaign  I’d like to take credit for dreaming it up  it’s basically been taken straight from our sister associations in Europe and North America and tailored for the Australian market.

“It’s not as if we are breaking new ground here. We are actually 10 years behind. So, that’s the frustrating part of it all.

“We have gone through all this protracted and drawn out process to really get to a point where we just sit down at the negotiating table to do something that should have been done years ago.”

Looking forward to the negotiations, Mr Charity said that the devil would be in the details.

“We still think that a mandatory code or legislation is superior to a voluntary code,” he said.

“The problem with a voluntary code is you can opt in or out whereas with a mandatory code, if you are in the industry, you are automatically covered under that code.”

He said that, although the US has had a voluntary data sharing code for 10 years, there was now a move towards regulation of the issue.

“The State of Massachusetts has just brought in a “right to repair” act. And the State of Maine has introduced one.

“In Massachusetts, the car industry, the dealers, the aftermarket all agreed on a mandatory code. They’ve had a voluntary code in the US for 10 years and they are now moving to a mandatory system,” Mr Charity said.

On the warranty issue, Mr Charity was pleased that the CCAAC had recommended that state consumer affairs offices conduct education campaigns about the status of new car warranties.

“There is a misconception held pretty widely out there that you need to go to dealerships and use genuine parts or you effectively risk warranty rejection,” he said.

“That’s not the case, under Australian consumer law  we’ve had this confirmed by the ACCC and now through the report  if you use a qualified tradesman following manufacturer’s specifications and use fit-for-purpose parts, then the vehicle could be serviced anywhere and the manufacturers  at least for manufacturing faults in the vehicle – then they have to rectify them.”

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