by If you have ever found yourself needing to have your car repaired, you know the headache that comes with it. Both the manufacturer and insurance company have strict regulations on where you can send your car. In most cases, these workshops can quote you substantially higher than what you could be quoted locally. This might soon be coming to an end, however, based on the outcome of an intense investigation.
A report was released by the Sunday Times that indicated that the Competition Commission will be clamping down on “Approved” workshops. They have invited manufacturers, insurers, part-suppliers, and salvages to attend a summit to be held in March to discuss the issue.
CLICK BELOW to read a comparison between buying parts from a private garage versus a car dealership.
The Competition Commission Is Investigating Complaints From Motorists, Workshops, And Associations
The Commission’s concerns were raised due to excessive complaints from the public over excessive pricing structures from approved workshops. Not all are motorists are being affected, but it is stifling competition in the industry. Deputy Commissioner of the Competition Commission, Hardin Ratshisusu is currently investigating the claims from motorists, representative associations, as well as the workshops.
Currently, manufacturers and insurers warn motorists that should they take their car repairs to non-approved workshops, they are at risk of losing their warranty. The main concern is the use of non-genuine parts that could possibly damage your car. The practice of “Approved Workshops” was introduced in 2003 according to Len Smith, Chairman of the South African Auto Repair and Salvage Association.
Director of the National Association of Automobile Manufacturers of South Africa, Nico Vermuelen disagrees with the complaints. He claims that it is unreasonable and impractical to expect car makers to guarantee repairs and parts provided by third parties. They claim that they have the best interests of the customer at heart. They insist that they are, instead, safeguarding the brand value and keeping motorists’ safe. Vermeulen argues that repairs under warranty, or maintenance plans, usually do not come out of the customer’s pocket.
Insurers on the other hand claim that their hands are tied on the matter. They claim that it is due to the manufacturers threatening to cancel warranties that they, too, encourage motorists to make use of approved workshops.
Complainants Claim That 95% Of The Approved Workshops Are White-Owned Businesses
Many workshops affected, like panel beaters, are claiming that the industry is dominated by an “old boys club”. They are simply excluded from the market. The Commission is concerned that 95% of Level 1 BEE-Accredited businesses cannot share the market with approved workshops.
A panel beater from Ladysmith is one of the complainants. His application to Toyota was rejected despite meeting the strict requirements set out by the carmaker. He claims that a workshop in the area, owned by a white man, was, however, approved. The manufacturer counters that the requirements are strict in order to protect their brand and the customer.
The Summit in March will host speakers from various countries, including Russia, to advise on a solution to the debate. Russia, the EU, France, China, and the US have all introduced regulations aimed at controlling non-competition in the industry. The Commission will, thereafter, make a decision on the matter.
