Preserve consumer choice in auto repair parts

With the Fourth of July weekend fast approaching, the busy summer driving season is hitting its peak. As you’re getting to the beach, lake, or family gathering, we encourage everyone to exercise caution and patience to ensure a safe arrival for all. But as we all know, more traffic means more accidents. And when it comes time to replace a part dented or demolished in one of those accidents, consumers are in jeopardy of losing their choice of options to repair their cars.

Preserving that choice is the intention of bipartisan legislation currently in Congress called the “Promoting Automotive Repair, Trade, and Sales Act,” or PARTS Act. Introduced by Reps. Darrell Issa (R-Calif.) and Zoe Lofgren (D-Calif.) as H.R. 1663 in the House, and Sens. Sheldon Whitehouse (D-R.I.) and Orrin Hatch (R-Utah) as S. 780 in the Senate, it would prevent car companies from depriving consumers of their right to a choice in parts to replace the “skin” of a car – the hood, quarter panel, tail light, etc. – with safe, high quality, less expensive alternatives to those made by the car companies themselves. That is a choice consumers have benefitted from for over 60 years.

{mosads}Preserving competition in the replacement parts marketplace is critical to keeping repair part prices down. Roughly 13 percent of consumers pay for collision repairs out of pocket. With increased costs, many of them are forced to forgo repairing their vehicles after they’re damaged. Moreover, if an insurance company pays for the repair, higher repair costs increasingly leave insurers no choice but to declare damaged vehicles as “total losses.” If reduced competition leads to higher prices for parts and higher premiums, all consumers lose, especially older and lower-income Americans.

Say you drive a 2013 Ford Escape and you get into an accident that smashes the left fender. You can get the part replaced with a fender made by Ford for about $309, or you can get an aftermarket part that costs around $208 – a savings of about 33 percent. The two parts look the same and are of comparable quality. Using the aftermarket replacement fender has no effect on safety. Chances are you would go with the less expensive replacement option, but even if you don’t, at least you had a choice. Without the PARTS Act, you may end up at the mercy of the car companies with no alternatives when repairing your car.

In general, parts manufactured by the car companies are 25 to 50 percent more expensive than alternative replacement parts. You start adding up all the fenders, hoods, grills and other parts and it is easy to see how consumers and insurers benefit enormously by having safe, lower-cost options. In fact, if you were to rebuild your 2013 Ford Escape entirely from Ford’s replacement interior and exterior parts, the bill would be $110,000 – almost four times the $28,515 you might have paid for it!

In addition to the existence of competition helping to keep prices low for consumers, there are other, broader economic benefits to the PARTS Act. The alternative collision parts industry employs tens of thousands of American workers in both big cities and small towns across the country – from manufacturing to distribution to repair – in all 50 states. Quality alternative collision parts are available at more than 40,000 collision repair shops nationwide.

The car companies already have about a 70 percent share of the repair parts marketplace. If the PARTS Act isn’t enacted and car companies establish a complete monopoly, consumers could see their insurance costs increase by over $1.5 billion a year. Vehicle owners without coverage for physical damage might even be forced to forgo repairing their car at all. This could make our roads even more dangerous, and would hurt consumers, repair shops and part suppliers.

The Quality Parts Coalition has joined with the Consumer Federation of America, alternative parts makers, suppliers, insurers and other groups in support of the passage of the PARTS Act, and we encourage you to write your members of Congress to support this legislation.

Since the early days of the interstate highway system, Americans have had a love affair with their cars and the open road. When a consumer invests their hard-earned dollars in a car and drives it off the lot, it’s a win for the car company and a win for the consumer. But if the car company abuses design patent laws to eliminate competition in the repair parts marketplace, then it’s a loss for the consumer. The PARTS Act seeks to preserve the choice consumers have enjoyed for decades, and that’s a cause we think is worth driving after. 

Salamy is executive director of The Quality Parts Coalition (QPC), whose members come from the automotive collision parts industry, the insurance industry, seniors and consumers. The goal of the QPC is to develop and secure a permanent legislative change to U.S. design patent law to preserve competition and to ensure the availability of quality, lower-cost alternative collision repair parts for consumers.