Industry Calls for Action from Congress to Preserve Competition, Livelihood

LAS VEGAS – As the International Autobody Congress & Exposition (NACE 2009) draws to a close, collision repairers are increasingly alarmed by the car companies’ strategy to block competition and choice in the repair parts market. This trend, demonstrated by the skyrocketing number of design patents granted to car companies in recent years, is gaining momentum, especially as they consider “new strategies” in the wake of financial turmoil. The diverse interests assembled under the Quality Parts Coalition banner are dedicated to passage of the “Access to Repair Parts Act,” legislation that would keep the industry healthy by preserving competition in the crash parts market.

In the second quarter of 2009, the percentage of repair shops reporting higher sales and earnings hit a record low. And there are more factors threatening the health of America’s collision repair industry: dealership closings, supply chain disruptions, parts shortages and increased cycle time. These lead to longer wait times for motorists and repairers when a vehicle needs repairing.

By enforcing design patents on exterior collision repair parts, the car companies stand to reap huge profits while collision repairers and customers will have fewer options to restore vehicles to their original condition. Design patents grant a car company a 14-year monopoly on a crash part. The number of design patents granted to car companies such as Honda, Toyota and Ford has more than doubled since 2005. Exterior parts now account for anywhere from 50 to 93 percent of the U.S. design patents awarded to major car companies.

For collision repairers, a crash parts monopoly would have a ripple effect on business. The supply chain would continue to deteriorate, perhaps requiring two to three weeks of wait time for parts. Higher prices on crash parts will force insurance companies to declare more damaged vehicles as “total wrecks,” resulting in less work.

“The future of the industry is at stake. Collision repairers and their customers demand choice and competition in the marketplace – the same freedom of choice and competition that has existed for decades,” said Eileen A. Sottile, Quality Parts Coalition executive director and member of the Board. “It is imperative that repairers, consumers, insurers and the aftermarket band together to stop the car companies in their tracks, to preserve our industry and stop the impending monopoly.”

With sophisticated manufacturing and distribution channels, the aftermarket can provide the continuity collision repairers need and the high-quality, low-cost parts customers demand. Adopting the “Access to Repair Parts Act” will ensure that repairers and consumers have options. Introduced in June 2009 by Rep. Zoe Lofgren (D-Calif.) and Senator Sheldon Whitehouse (D-R.I.), the bill paves the way for choice and competition in the automotive aftermarket and would bring the U.S. in line with a number of nations around the world that have adopted this approach.

Follow QPC at NACE – www.twitter.com/QualityPartsQPC and find us on Facebook (Quality Parts Coalition). For additional information, please visit www.qualitypartscoalition.com.

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The Quality Parts Coalition represents the interests of the independent parts industry, repairers, insurers, consumers and seniors. It is the goal of the Quality Parts Coalition to develop and secure a permanent legislative change to U.S. design patent law to preserve competition and to protect the consumer’s right to benefit from quality, lower-cost alternative replacement parts.