Competition Commission Looks into Car Servicing
What’s the Deal with the Competition Commission and Car Servicing?
- As a car owner you have the right to have your car serviced where you wish
- The car service workshop must be accredited
- They realise the current anti-competitive situation is inflating car service prices
- The CC wants to invite smaller enterprises in so that consumers can pay less
- Smaller service providers can work on cars still under warranty
- The Draft Code of Conduct invites submissions on the Code from automotive industry people
It’s a mentality thing; many people do believe that they have the right to have their car serviced at the workshop of their choice. And this not jeopardise its warranty. They simply accept that these big dealerships are the only ones with the appropriate skills to do a proper job.
Manufacturers of cars will generally recommend that cars be serviced regularly – at the suggested mileages intervals. However, even if you don’t stick to the suggested mileage time for a service, a yearly check up will certainly ensure that your vehicle runs smoothly and safely.
A Word from the Competition Commission
What does The Competition Commission say about car servicing? They are a statutory body in South Africa who have the power to investigate and also control business practices to try and bring about equity and efficiency in the economy.
The mandate of the Commission is to promote and maintain competition in South Africa and to promote education and advice on the application of the Act.
Now they are intervening in car servicing, saying that up until now Original Equipment (OE) manufacturers have monopolised the automotive industry, denying smaller workshops the chances to repair vehicles.
This anti-competitive situation simply means inflated prices for consumers. Also, extended warranties means consumers have no choice but to use the dealer for repairs. They also have to pay up whatever the dealer charges. Basically consumers aren’t able to have their vehicle repaired wherever they want, and the CC wants to change this.
Allow Smaller Car Servicing Enterprises In
The Competition Commission wants to open this sector to small, medium and micro enterprises. Until now large companies have agreements with some of the dealerships for motorists to service their cars. This means motorists aren’t able to take their cars to those smaller players in the market. They have no choice but to use the dealerships and to pay far more than they should.
The Competition Commission has said it will be a victory for small, medium and micro enterprises. That is because the market opened up. They have gazetted a Draft Code of Conduct which is available for public comment.
The intended outcomes of the Commission’s Code of Conduct include enabling those small service providers to be able to provide auto-body repairs, and services to cars still under warranty.
An Invitation to Express Views
The Commission has published its Draft Code of Conduct and is inviting submissions on the Code from all automotive industry people, consumers as well as other interested parties. The deadline for these submissions is 3 November 2017.
Please direct submissions to Mr M. Rubushe, and hand them in at the Mulayo Building, Block C, 3rd Floor, The DTI Campus, 77 Meintjies Street, Sunnyside, Pretoria. There is another address – Private Bag X23, Lynnwood Ridge, Pretoria. You can also email your submission to MziwodumoR@compcom.co.za.
Fair Competition is Being Encouraged
You should have the right to choose where you wish to repair your vehicle, and now this code of conduct will give SA motorists more choice. The idea is to promote fair competition in the automotive industry.
Now key players can become signatories of the Code. Should this Code of Conduct become law there are ways in which the industry could be affected. Dealerships won’t be be allowed to set prices that have been co-ordinated between them and independent service providers. It’s going to mean that if you own a VW you will no longer have to take it to a VW dealership.
Whatever your views‚ the Competition Commission wants to hear from you. Currently, for an OEM’s warranty on a car to remain valid‚ the owner must have their vehicle serviced at an ‘approved’ dealership.
Now, the proposed legislation is to allow consumers to choose to have their car which is still under-warranty, serviced at any accredited service station they want and save themselves a pocketful of money at the same time.
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