The Black Management Forum (BMF) has released a statement congratulating the Competition Commission(CC) following the publication of guidelines for the automotive aftermarkets.
New vehicle owners are currently compelled to have in-warranty service, maintenance or repair work conducted only at approved dealers or approved service providers. The proposed guidelines, which were published for public comment by the Competition Commission on Friday, seeks to transform the automotive industry. The guidelines also deal with the relationship between original equipment manufacturers (OEMs) and dealers.
Among other things, they state that OEMs must not impose rigid obligations on dealers. Dealers and financiers must now provide the consumer with details of all inclusions and exclusions in their service and maintenance plans.
The guidelines will lower barriers to entry and ensure that a greater number of black firms have an opportunity to undertake service and maintenance work, mechanical repairs and motor vehicle repairs within the period covered by the vehicle’s warranty.
“The spirit and intent of these guidelines revolve around the central tenets of the BMF of advancing transformation and opportunity to the historically disadvantaged individuals of South Africa. These guidelines spell the end to a highly monopolised industry and open a window of hope for inclusion for many black industry players,” says the statement.
Meanwhile, the National Association of Automobile Manufacturers of South Africa (NAAMSA) released a statement, following the CC’s guidelines publication that it is not in support of the guidelines arguing that they “unjustifiably impose a blunt instrument on an industry that has already agreed to self-regulate and reform”.
“On Friday morning, the commission published policy guidelines that will compel the automotive industry to implement enforceable measures that could fundamentally change the current nature and structure of the automotive retail and aftermarket value chains in the country. The proposed guidelines bring about some profound structural changes which will intrinsically remold the existing business models of all automotive multinational companies who continue to invest emphatically in the country’s economy, its workforce and its overall future growth,” says the NAAMSA statement.
BMF is questioning the above media statement issued by NAAMSA. “We ask the question, exactly what is the problem then? Is the issue the fact that the guidelines were published or perhaps this was supposed to be some secret “gentleman’s agreement” that no other stakeholder or customer was supposed to know about? This paragraph describes exactly what we want to see in the automotive industry, the fundamental change of business models is precisely what is needed to provide opportunity to previously marginalised people who are black in majority, Naamsa must therefore take us and the entire forces of transformation into its confidence on exactly what their problem is with a clear directive on what must happen in the automotive aftermarkets as directed by the guidelines, where is the “bad faith” that is being referred to,” says BMF chairperson, Mfundo Tsheketshe.
“Transformation requires urgency and clear action in the present as black people should not stay marginalised in the South African economy forever, the time of waiting for industries to “self-regulate” and to do things at their own will and leisure while tinkering with change has come and gone,” Tsheketshe continues.
BMF says the guidelines further present OEMs an opportunity to engage in meaningful economic development programs in which Small and medium-sized enterprises (SMEs) can be developed over a period to ensure that quality standards are met and exceeded in the delivery of services.
“Whilst the programs cited by NAAMSA and strides taken are most welcome, the industry body needs to appreciate the urgency in the transformation agenda and to refrain from a posture and intent that wants to gradually effect change and thereby delay the prosperous future of the majority of the South African citizenry. The guidelines are also a victory for the end user who has been limited in choice in the services of the auto industry and who will now benefit from an open and competitive market,” reads the BMF statement.
BMF implores the government to invest in infrastructure where black people’s lives, beneficiaries of the guidelines who are predominantly living in the townships and rural areas.
“State of the art repair facilities should be built in Kwa-Mashu, Kwa-Langa, Kwa-Zakhele, Qwaqwa, Ngangelizwe and many other villages and townships in our country.
That is the true measure of inclusivity and of an aftermarket that is transformed. The BMF is committed to ensuring that our economy is safeguarded while ensuring that transformation takes centre stage,” continues the statement.