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How SA’s new automotive code of conduct could kickstart the economy
South Africa is grappling with a recession, but a new automotive code of conduct could lead the way in showing how the country could create stronger, more long-term inclusive growth.
In September 2017, the Competition Commission of South Africa published an historic first draft of a new Code of Conduct for the South African Automotive Industry.
Ordinarily, such a development may be easily overlooked amid the busy workload of the Commission. But this Code of Conduct could potentially usher in groundbreaking changes for players in the automotive aftermarket, South African car owners and even the broader economy.
This is because the proposed Code of Conduct will empower car owners with the right to repair or service their vehicles at a provider of their own choice, without voiding their warranties.
Today, car owners in South Africa are typically locked into using a vehicle manufacturer’s repair shops and parts because of embedded motor or service plans. South Africans are powerless when it comes to choosing where their vehicles can be serviced or maintained.
Level of free choice
Organisations such as Section 21 company Right to Repair South Africa (R2RSA) – which was founded by the Motor Industry Workshop Association (MIWA) and represents 2 500 independent workshops and automotive aftermarket distributors, parts manufacturers – want car owners in this country to have the same level of free choice.
Already, South Africa’s Competition Commission has travelled a long way in hearing this call with its proposed draft Code of Conduct that received a final round of feedback and submissions on September 11 2018.
The latest draft of this Code seeks to address competition constraints in the automotive aftermarket industry by, for instance, ensuring that “independent service providers can undertake in-warranty service and maintenance work and in-warranty motor-body repairs”.
The Code also seeks to widen “the pool of approved service providers who can undertake in-warranty service and maintenance work, in-warranty mechanical repairs, and in-warranty motor-body repairs.”
Another key part of the Code is that there should be “no unfair restrictions on the sale or distribution of original spare parts; allowing greater consumer choice in choosing suitable spare parts for repairs and maintenance of their motor vehicles”.
The draft Code will also be unique, in a global sense, as it has a strong transformational element to it by pushing for historically disadvantaged individuals to own more dealerships and other business in the local automotive sector.
Original Equipment Manufacturers (OEMs) will have to promote the entry of historically disadvantaged individuals into their networks of service by, for instance, the subsidisation of capital, facilities, tools, equipment and training.
While the code will be voluntary, the likes of R2RSA will monitor and flag any transgressors.
Overall, these proposals are expected to create a more level playing field in the aftermarket sector and provide a much-needed boost for the 8 000 independent workshops in South Africa, which employ thousands of South Africans.
If we want an economy that is creating jobs, then we really have to support Small to Medium Enterprises (SMEs), such as the thousands of independent workshops scattered across the country.
Studies by the International Finance Corporation (IFC) have shown that SMEs account for more than half of all formal jobs worldwide.
This is why efforts by R2RSA and the Competition Commission in respect of right to repair could become an example of how South Africa is able to open up its economy and make it more inclusive.
AA (Automobile Association)
The Automobile Association of South Africa, often abbreviated AA is an automobile association that has been operating in South Africa since 1930. It is a non-profit organisation providing services to its members such as roadside assistance, technical and motor-related legal advice. It also maintains liaison with government departments to influence decisions, either by lobbying or making formal representations on behalf of motorists.
RMI / MIWA
Here are the associations which fall under its umbrella…
ACRA (Automotive Component Re-manufacturers’ Association)
ACRA represents component re-manufacturers involved in the re-manufacture of safety-critical components and radiators, an ever-growing industry in which keeping abreast of change is crucial for business owners.NAZA (Number Plate Association of South Africa)NAZA supports the imposition of a national standard for number plates, as well as for legislation to govern their manufacture, embossing practice and protocol. NAZA members adhere to a strict code of ethics in ensuring their part in eradicating corruption within the sector.
NAZA (Number Plate Association of South Africa)
NAZA supports the imposition of a national standard for number plates, as well as for legislation to govern their manufacture, embossing practice and protocol. NAZA members adhere to a strict code of ethics in ensuring their part in eradicating corruption within the sector.
ERA (Engine Remanufacturers’ Association)
ERA represents motor engineers who re-machine, rebuild and re-manufacture engines in South Africa. ERA members promote the reuse of engines, parts and components in a manner that is green and
sustainable. ERA members create employment and skills development opportunities, directly in their own machine shops and indirectly through suppliers to the industry and component manufacturers.
VTA (Vehicle Testing Association)
The VTA represents private vehicle testing stations that are committed to operating within the law in accordance with the Road Traffic Act and the relevant SANS standards. In this highly regulated environment, the association represents the interests of its members at government working groups and is committed to enhancing the reputation of the industry in all the spheres.
MDA (Motorcycle Dealers’ Association)
MDA represents members who are motorcycle dealers – these members benefit from an extensive array of value-add services and products such as commercial insurance, labour legal assistance and representation, consumer dispute resolution, and a strong relationship with the Association of Motorcycle Importers and Distributors.
SADFIA (South African Diesel Fuel Injection Association)
SADFIA members operate fully equipped pump rooms aimed at providing cost-effective service solutions for owners of diesel powered vehicles seeking fuel injection system testing, repair or replacement.
MIMA (Motor Industry Manufacturers’ Association)
MIMA members are Parts, Equipment and Component Manufacturers and suppliers to Original Equipment Manufacturers and the automotive aftermarket that exports into Africa and other countries in the world.
SAMBRA (South African Motor Body Repairers’ Association)
SAMBRA is an active leader in the motor body repair industry and consolidates, communicates and regulates repair standards in the motor body repair industry. SAMBRA ensures the provision of technical and business skills training that meets the demands of the industry and instils confidence in consumers and industry stakeholders.
MIWA (Motor Industry Workshop Association)
MIWA, the largest association within the RMI, strives to keep its members informed about the ever-changing auto repair industry, thereby ensuring that vehicles are repaired to acceptable standards designed to make them perform better and safely on South African roads.
SAPRA (South African Petroleum Retailers’ Association)
SAPRA represents and promotes the interests of petroleum retailers in South Africa and fosters strong relationships with the Department of Energy, oil companies, banks, financial institutions and other stakeholders that have an impact on the sustainability of the service station industry.
MPEA (Motor Parts and Equipment Association)
MPEA represents South Africa’s auto part traders, including wholesalers, retailers and independent operators in the replacement motor parts industry. Genuine replacement parts are available at accredited MPEA spares outlets at affordable prices, backed by the manufacturer’s warranty.
SAVABA (South African Vehicle and Bodybuilders’ Association)
SAVABA members are professional, certified and regulated vehicle body builders in South Africa who manufacture commercial vehicle body applications (tanker, coal, refrigerated trucks and trailers) and bus bodies (commuter and tourist type). Members manufacture using the latest equipment and highly trained staff to ensure strict compliance with SABS standards and other legal specifications.
NADA (National Automobile Dealers’ Association)
NADA represents the interests of business people who own or operate new vehicle franchise dealerships and qualifying used vehicle outlets. NADA is committed to the image enhancement of the retail motor business, facilitating the interface between dealers and OEMs/distributors, building relationships between dealers and customers and bringing relevant industry issues to the attention of government.
TDAFA (Tyre Dealers’ and Fitment Association
The TDAFA is the only representative body for tyre dealers nationally. The association works on all issues relevant to tyres and the fitment industry. Strategically, the TDAFA is positioned as an intermediary between government, the tyre industry and consumers and is recognised by government and industry leaders as the legitimate voice representing tyre dealers.
MIWA is the largest trade association under the Retail Motor Industry Organisation. We are the collective voice of Independent Aftermarket workshops, directly representing over 2400 businesses nationally.
MIWA not only represents the general repair shop sector but also brake and steering specialists, auto electricians, driveline and transmission specialists as well as vehicle accessory centers.
MIWA members offer the correct repair equipment and appropriately trained staff to ensure that work is carried out in a professional and competent manner.
A major focus of MIWA is to educate the motoring public on how best to protect themselves against sub standard work. MIWA members are categorised as either accredited or graded workshops. These levels of accreditation positively influence the motoring public in their decision on where to have their vehicles repaired.
As such, MIWA accredited members identified by the RMI Code of Conduct will benefit and the industry as a whole will rid itself of those repair establishments which are not up to standard.