Auto Service World
Feature   June 1, 2009   by Andrew Ross

A Big Win For Right To Repair -Now What?

Canada's House of Commons Votes 278 to 17 to Send Bill C-273 to the Next Stage

The battle for a level playing field in automotive service has been waging for many years, and car dealers have often held the upper hand in terms of consumer confidence.

But when the shift to sophisticated computer controls came without accompanying access to tools and information, the independent service provider found himself in a slow spiral that held the potential to sap his ability to conduct repairs efficiently and, in some cases, finish the repair at all.

An increasing number of cases where independents had to tow vehicles to the nearest dealership simply to “flash” a computer or reset a code, using equipment not available at any price to the Canadian aftermarket (particularly when that access existed in the U. S.), eventually caused the industry to cry foul.

In the beginning, repeated attempts to forge a voluntary agreement in Canada similar to the one in the U. S., operating under the National Automotive Service Task Force (NASTF), failed to even get a written response by automakers, never mind get them to the table.

Some believed that a voluntary agreement could still be possible, namely groups under the National Automotive Trades Association umbrella (mostly independent service provider and collision repair associations); while others, most notably the Automotive Industries Association of Canada, a much larger group encompassing service provider associations, service chains, retailers, wholesalers, warehouse distributors, and parts and supplies manufacturers, opted to pursue legislation.

Those efforts led to the introduction of Bill C-273 this January by Windsor MP Brian Masse (NDP)–the so-called Right to Repair Bill, whose progress through the parliamentary process has been thoroughly documented in this magazine. The run-up to the vote generated more than 10,000 letters to MPs from both consumers and industry and culminated in a surprisingly positive 278-17 vote by MPs this May, sending it, as expected, to the Industry, Science and Technology committee for review.

Why Going to Committee is a Big Win

It is this move that is least understood within the aftermarket. Yes, the bill passed its first hurdle, garnering much more support than anticipated–but the successful vote only allows it to be sent for review by committee.

Some from within the aftermarket have characterized that as a defeat of sorts.

Scott Smith, legislative liaison at the AIA, says this couldn’t be further from the truth.

“It is quite a stunning victory, but it is a victory to send it to committee, not to pass the bill. It doesn’t mean that we have a law–but it does mean that we have an audience.”

In fact, it was always anticipated that the bill would end up in committee.

Early this year, just after the bill was introduced, Smith told me that the vote was one thing; getting it through committee was a perhaps tougher job.

“I am not sure that a private member’s bill ever moved through to third reading without going to committee. I’m not sure if it has ever happened.

“Generally this is the process. They look at it for constitutional issues, whether the legal instruments are appropriate. Are the appropriate regulatory tools available? Are the appropriate enforcement tools available? That’s what we need to sort out at committee.”

And this is where the bill may face some of its fiercest opposition, some of that coming from the aftermarket itself.

In the run-up to the vote, prompted by a letter from Industry Minister Tony Clement, automakers, their association representatives, NATA, and, yes, the AIA, finally sat together to discuss the possibility of forging a voluntary agreement, thereby making legislation unnecessary.

The result of that meeting was, in short, that the AIA did not see anything from automakers to abandon the legislative approach, while NATA signed a Letter of Intent with the Association of International Automobile Manufacturers of Canada (AIMC), the Canadian Vehicle Manufacturers Association (CVMA), and the Automobile Dealers Association.

Proponents say a voluntary agreement has the flexibility that a legislative approach does not. In one way, this may seem like a reasonable solution, but with a bill already before the House and the push to get that LOI in place prior to a vote in the House, it was only delivered the day of the last scheduled debate, two days before the vote–which gives it the appearance of an attempt to head off legislation, rather than create an alternative industry solution.

In any case the point is moot, considering the vote’s outcome.

Still, work continues on the voluntary agreement.

“From our perspective, we are going to continue developing the voluntary agreement,” says NATA executive vice-president Dale Finch. “We have the Letter of Intent with the OEs and they are committed to the process. We are continuing on to finalize the voluntary agreement.”

In the U. S., voluntary agreement drives the availability of information–NASTF is an aftermarket-OE body overseen by the Automotive Service Association–and by all accounts has worked well, though groups in the U. S. also continue to pursue Right to Repair legislation. (Notably, Right to Repair legislation exists in Europe, leaving Canada as one of the few major markets without wide access to repair information.)

Finch says a key justification for continuing to develop that voluntary agreement is the potential for the bill to die if there were an election, if it is rejected wholly by committee, or if it dies in a third vote. Finch also maintains that agreements such as that indicated by the Letter of Intent to create a voluntary agreement, shouldn’t be dismissed out of hand.

“There are people out there who say that [the automakers] aren’t bound to anything [by the agreement], but the car manufacturers work integrally with Industry Canada all the time. They can’t just walk away.”

He says that should a voluntary agreement come to pass, and should a signing company walk away from it, there could always be the potential for lawsuits, though he is careful not to make that sound like a threat. His, and NATA’s, approach, he says, is a collaborative one, not adversarial.

And he wants people to understand that even though the legislative avenue is being pursued, efforts for a voluntary agreement have not been curtailed.

“We’d like to get everybody to understand that we have the Letter of Intent, and we are working away on an agreement.

“Our proposal is a little more comprehensive than NASTF’s. We have definitively asked that the collision sector be recognized by the manufacturers, and they understand that it is a big part of their business.”

He says, too, that he does not feel animus toward the AIA.

“[Association president] Marc Brazeau and the AIA have done a fabulous job with this bill. They did an awesome job in bringing this to Canadians’ attention and I really appreciate that.”

However, NATA’s official communiqus surrounding the issue have not always reflected this respectful tone.

“Be careful what you ask for” was the warning of a NATA release opposing the pursuit of a purely legislative solution, following the vote on the Right to Repair Bill. The release also contained a passage stating that NATA represents “just the grass roots repairers and not companies who manufacture and distribute knock-off parts.” That last term has, to put it mildly, raised the ire of many in the aftermarket. It is a phrase that, Finch says, he would take back if he could. And, to his credit, he says that the impact of that term was unanticipated, unintentional, and that he was making amends with members of the AIA board.

But none of this changes the fact that Finch, along with NATA, the CVMA, the AIAMC, and individual automakers are not only going to continue to pursue a voluntary agreement, but work vigorously to convince the Industry, Science and Technology committee that the Right to Repair Bill is not necessary and to scrap it.

“It’s just our belief. We loo
k at things differently. I’m not going to go and start a fight about this. We’re just looking for something that will protect the industry going forward,” says Finch.

Taking Action: What Now?

Come this fall, those supporting the legislative approach will be watching closely what happens to the bill in committee, since it will play a huge role in what actually happens to the legislation next. Potentially, it could be so drastically changed that it does not accomplish the goal of the bill, and it gets killed altogether.

The various groups watching the issue will all be making proposals, from NATA and the car companies, to the AIA, the CAA, the Canadian Association of Retired Persons, and, no doubt, others.

Providing the bill gets through committee and back to the House for third reading, it would still have to pass a vote. After that, it goes to the Senate, which is critical.

Though the timelines of the Senate are indeterminate, once a bill gets to the Senate, it won’t die if an election is called, only be delayed.

So the big battles that await the bill are in committee and in the House, to get it to the Senate, and of course ultimately to get it signed into law. The biggest threat is an early election, which would derail the whole process.

AIA president Marc Brazeau says that even though there is a long road ahead, getting the bill to this point is a big step forward. He is particularly pleased with the degree to which the consumer press has picked up on the issue.

“It means that the issue of Right to Repair is resonating with people, and [given] the fact that we are facing the closure of a number of dealerships, there is a greater need to ensure that there is access to repair information in the aftermarket.”

He says that while those who have been working inside the aftermarket for a solution may see it as a critical industry issue, the importance of consumers’ attention to the issue should not be underestimated.

“It’s critical at this point. At the end of the day, Parliamentarians are out there listening to consumers, what their constituents are saying, and taking action where action is required.

“Consumer reaction, consumer interest in the issue, is certainly helping us drive government to take action.”

And the opposition?

“We’re not expecting those groups to back off. We expect they will continue to push for a voluntary agreement. The car companies [say they] prefer that avenue, but we have been denied [access] at every opportunity.

“Our position is that we feel that the bill is before Parliament and it has been before Parliament since January. We believe that this is the process that needs to be followed. To not do that would be a terrible thing.

“At the end of the day, if the car companies are serious about solving the issue, why are they scared of the legislation? They will have their opportunity to make their pitch and provide their feedback and that is what we expect the car companies to do.”

In the few short months between now and when the Right to Repair Bill goes before the committee, Brazeau says there are important actions to be taken.

“I would encourage all stakeholders to take the opportunity to contact their MP. The MPs will be recessing and not returning till late September. This is a great opportunity to engage their local member of the government, and tell them that the best way to fix the problem is to create a level playing field in the automotive service market.

“MPs look to reach out to their constituents every summer; this is an ideal time for the aftermarket industry to deliver that message. When those MPs return to Ottawa, they will have a greater appreciation for the importance of this bill.”

As this is being written, the Liberals are talking of an election being forced this summer. And, while the wisdom of insiders say that one before next spring is not likely, an earlier call is not an impossibility.

This would, of course, kill the bill and every other bill currently before the House. For the record, the AIA’s Smith says that, because the Right to Repair Bill has made it so far in the process, if an election were to come, the chance of the bill being reintroduced again is very good.

Whether you are on the legislative side of the debate, or believe that a voluntary agreement would fill the void in tools and information in a way that you may be more comfortable with, the issue is on the radar with the industry, the public, and politicians like never before.

And whether the bill succeeds in the House this time around, has to be reintroduced again later, or whether a voluntary agreement continues and succeeds, there is no denying that whatever the near future holds for the Right to Repair issue, there is no going back now.

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