Motorists to get more protection next year

Consumers will have more choice when they buy a car or have it serviced from 1 July.

One of the major changes will be that consumers can have their cars serviced wherever they want without losing the warranties.

This is one of the provisions in the final Guidelines for Competition in the South African Automotive Aftermarket, which were drafted by the Competition Commission to increase consumer choice and participation by smaller companies.

The guidelines want car manufacturers, known as original equipment manufacturers (OEMs), to acknowledge and not impede the choice of consumers of where to service, maintain and repair their cars, regardless of whether the service provider is an approved dealer or an independent service provider (ISP).

In addition, the guidelines are aimed at unbundling maintenance and service plans when a car is sold by making it clear what the price of the car is and how much of the price is made up of the cost of the service and maintenance plan.

Consumers can then choose if they want to buy the maintenance or service plan to make servicing more affordable and improve competition. They will then also be able to choose original or nonoriginal spare parts to be fitted by a service provider they choose, who do not have to be an approved dealer, motor-body repairer, or ISP during the in-warranty period.

The guidelines also makes provision for OEMs to adopt measures to support and promote market entry for new motor-body repairers, preferably those owned by Historically Disadvantaged Individuals (HDIs).

Another important change will be that OEMs and independent third-party providers will have to transfer a service and maintenance plan to a replacement car when the insurer writes it off and if there is no replacement, the consumer must be able to cancel the plan or be refunded for the balance.

The guidelines were prepared in terms of section 77 of the Competition Act to provide practical guidance to industry players on how to adopt pro-competitive measures in the automotive aftermarket and promote greater participation of small businesses, as well as historically disadvantaged individuals in the market.

The guidelines also make provision for consumer safety, a dispute resolution process and a self-monitoring mechanism by industry stakeholders.

“These guidelines are aimed at removing restrictions imposed by OEMs on car owners regarding service providers for service and maintenance, as well as replacement parts.”