Shake-up coming for car repair sector

Australia's car companies will be obliged to sell technical data to independent workshops from July 2022, as a bill to drive competition passes both houses.

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Mike Costello
Mike Costello
Comparisons Editor
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A bill has passed both houses of Australia’s parliament compelling all car-makers to sell their repair and maintenance data to independent repairers “at a fair market price” from July 1 of 2022.

The ‘Competition and Consumer Amendment (Motor Vehicle Service and Repair Information Sharing Scheme) Bill 2021’ hit the House of Representatives on March 24, the Senate June 15, and had cleared both as of June 17.

Car manufacturers currently have the option of providing important proprietary repair information to franchise dealers only, rather than the wider repair network if they choose – though some do voluntarily sell their technical data elsewhere already.

Servicing is often a bigger source of profit for dealers than sales.

The Bill’s intent, according to Australia’s Assistant Treasurer Michael Sukkar MP, is to promote competition in the automotive sector by giving the aftermarket repairers access to all the requisite repair data that a car dealership service centre has.

“Currently, around one in 10 motor vehicles taken to repair workshops are affected by a lack of access to service and repair information,” Mr Sukkar said, adding that motor vehicle servicing and repair was a $23 billion industry here with 106,000 employees.

“When this is the case, it results in higher service costs for consumers. This is because there is little choice as to where a vehicle, particularly newer models, can be repaired safely and efficiently.”

Information related to safety and security will be made available only to individuals who have the appropriate qualifications.

Similar regulatory interventions in the European Union and the United States have made technical information necessary for repairers to service and repair cars more widely available in those jurisdictions, according to the Australian Competition and Consumer Commission (ACCC).

A maximum penalty of $10 million will apply in circumstances where data providers fail to comply with the scheme. This will be enforced by the ACCC, which said it was glad to see the changes since they mirror recommendations from its new car retailing industry market study published in December 2017.

“Under the scheme, independent Australian motor vehicle repairers will have fair access to the information needed to service and repair cars, such as software updates to connect a new spare part with a car, or information and codes for computerised systems from the car manufacturer,” ACCC Chair Rod Sims said.

“This enables motorists to shop around for the repairer that offers the best price, service and convenience, knowing they will all have access to the information needed to complete the servicing or repair.

“Previously, only car manufacturers and their affiliated repairers could be confident of getting access to important service and repair information, preventing many independent repairers from competing fairly for car servicing and repair work. This created additional costs for consumers, as well as inconvenience and delays.

“We believe the scheme provides a much fairer opportunity for independent Australian motor vehicle repairers to compete and will improve outcomes for consumers, and we welcome this important reform being passed by the Parliament.”

The ACCC’s market study alleged that independent repairers experienced continued problems accessing information needed to repair and service new cars – despite a voluntary commitment made by car manufacturers in 2014 to provide independent repairers with the same information provided to authorised dealers.

The other side of this issue – if it can be called that – are the car manufacturers themselves, which are represented collectively by the Federal Chamber of Automotive Industries (FCAI) lobby group, led by Tony Weber.

When CarExpert last spoke with Mr Weber, he said the FCAI was not opposed in principal to these reforms, though he also pointed out the the latest OEM-backed capped-price servicing plans tended to be very competitive.

“In a competitive market ‘Brand X’ wants to get a foot up providing long-term servicing at a guaranteed price [capped-price servicing], and it’s a win for the consumer,” he told us.

“We have, many years ago, changed to the view that [proprietary service data] information should be provided to the market. We’re part of a process, led by the Commonwealth Treasury at the moment, to actually supply information to the market.

“We’re working with the government, we’re working with other industry associations.

“We know the vast majority of the 17-million car fleet at the moment is actually serviced in the independent repairer network, and that has been the case for a long time. They obviously have the information to service those cars.

“If they don’t, I think there’s some interesting questions journalists could ask the independent repair sector… I believe the issue is addressed, and we will go along and work with the government to actually formalise it.”

It seems that job is now done…

MORE: Q&A with Tony Weber, CEO of the FCAI peak car-industry body
MORE: Q&A with James Voortman, CEO of the AADA dealer peak body

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Mike Costello
Mike Costello
Mike Costello is the Comparisons Editor at CarExpert.
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