The recent publication of articles on restrictive and exclusionary practises in the motor vehicle aftermarket industry have appeared in various newspapers. The central issues are focused around manufacturers forcing vehicle owners to exclusively use approved workshops for service and repairs. The consequence and decision is to be tested at a stakeholder workshop arranged by the DTI through the Competition Commissioner’s office earlier this year.
The Collision Repairers Association (CRA), a mandated labour Association accredited as a controlling body in the auto body collision repair sector hereby make representation for understanding and surrounding the niche market of our service provider members we are responsible for.
Authorised accident damaged repair orders provided primarily by consumer chosen insurers are directed to repair facilities but at times are not considered in relation to the freedom of choice allowed by regulation via the Consumer Protection Act. This may inconvenience the customer in that the chosen repairer is not in the geographic location of either their residence or place of work and thus requiring out of the ordinary travel. At times this repairer has also been provided with volume based deals which may result in delayed cycle time of ordinary repair due to excessive workload. In addition to these initiatives the motor manufacturer approval programme may preclude a qualified, competent and capable repairer from offering in warranty repair due to the principle of too many approved repair shops in a specific location.
We at CRA are of the opinion that the right to repair, based on employed standards for safety must be afforded free competition in any area under our democratic society, to be able to offer these services based on their customer satisfaction results. The difference between in and out of warranty can be as little as one day and the focus being that specific integrity or technology does not expire simultaneously but the opportunity is now hand delivered to a repairer whom has been excluded from an approval programme due to corporate interference biased towards the geographical location of the number of repairers in a specific area. We compare this to the number of supermarkets in an area, why are limits not imposed on the consumer in light of this premise? The article made reference to possible overcharging and the financial burden placed on the consumer. We in the panelbeating fraternity are not subject to these pressures as the forced interference from authorisation afforded from insurers, who are benefiting on extreme profit ratios prevent in most instances sustainable profit rations in our member business. The implication being that investment and training in changing technology is being discarded as a base of safety and standards with an expectation of quality for the cheapest repair cost. Labour rate per hour for our qualified artisan performance is in most instances allowed at less than 70% of the value payable to a mechanical workshop for service.
With regard to transformation and empowerment of previously disadvantaged business operators the CRA has almost 50% of its members who comply with the 51% black ownership credentials but not supported by procurement opportunity. However, our focus ensures criteria to employ demographic representation in our member operations which equates to appointing staff of all races included at better than average placements of non-white staff at managerial level. Further hereto the employment of apprentices to ensure continuity of qualified artisans and thus our support of socio-economic empowerment initiatives is seldom acknowledged. Available procurement, as mentioned at low levels for previously disadvantaged black owned business is being secured through volume based deals where the operators are charging royalties on work provision which is taking the food from the mouths of these business owners striving to achieve sustainability, thus precluding them from investment and technology implementation.
Factors which need to be considered being legislation does not enforce insurance cover on vehicles operating on our roads and approximately only one in four cars carry insurance cover with an additional 8% of the registered vehicles having third party cover only. Insurers also have protocol in place to pay cash in lieu of repair which invariably places the consumer out of pocket for incorrect quantification of damage and thus having to use unscrupulous and under qualified repairers to perform accident repair. The write off threshold is also questionable at values around 50% of the market value which feeds the market to sell accident damaged vehicles on auction, to be repaired without proper manufacturer standards and introduced to daily road use with questionable levels of safety and roadworthiness. Removal of these practices would increase the pool of available repair units and together with breaking volume based deals would ensure fair distribution of work to existing businesses and thus exclude rumours of an overtraded industry.