Capitol concerns: Dealers travel to Washington to drum up support for Right to Repair, small business health care
The passage of Right to Repair legislation is essential to the future of independent tire dealers and garage owners.
That was the rallying cry of more than 300 representatives from the automotive aftermarket who traveled to Washington, D.C., last month as part of the 2007 Automotive Aftermarket Legislative Summit.
The delegation included several independent tire dealers and tire dealer association representatives who believe that auto manufacturers have placed a lock on critical vehicle diagnostic and repair data that will put thousands of independent tire and auto repair facilities out of business.
"There is no question in my mind that the original equipment car manufacturers have an agenda to strangle us," Steve Craven, president of Craven Tire & Auto, an eight-outlet dealership based in Fairfax, Va., told Modern Tire Dealer.
"The tire dealers we represent are being cut out," said Ken McCune, executive director of the Indiana/Illinois Tire Dealers Association (IITDA).
The timing of the summit coincided with the re-introduction of the Motor Vehicle Owners' Right to Repair Act (H.R. 2694) into the 110th Congress.
In May 2006, an earlier version of the bill, H.R. 2048, passed through the Subcommittee on Commerce, Trade and Consumer Protection.
Progress on H.R. 2048 stalled later in the year when Rep. John Dingell, a representative from Michigan who opposes Right to Repair, "went on the attack," said Paul Fiore, director of government affairs and business development for the Tire Industry Association (TIA).
Dingell, who also chairs the House Committee on Energy and Commerce, "acted like a prosecuting attorney in most (Right to Repair) hearings... grilling our witnesses.
"He put down the hammer through his Democratic committee members and said, 'There's no proof that this is a problem.' And we lost our Democratic committee members. That was followed by a change of leadership in the (November) election."
However, Right to Repair legislation has gained momentum at the state level. Bills have been introduced in seven states: Florida, Maine, Massachusetts, New Jersey, New York, Nevada and Oklahoma. Hearings have been held in some of those states.
If states start to pass their own Right to Repair laws, Congress will almost have no choice but to take action, according to Fiore.
"It's an interesting new Congress. Right to Repair is a strong bi-partisan issue. If we can start with (the bill's) co-sponsor list from last year, I think we have a chance. And if we have any kind of good fortune, we'll get something going in the Senate this time around."
The odds in favor of Right to Repair succeeding at the federal level will be even greater if supporters frame it as a consumer rights issue, said Aaron Lowe, vice president for government affairs for the Automotive Aftermarket Industry Association (AAIA).
"If independents go away, repairs not only won't be convenient, they won't be affordable. This bill will make sure there's a level playing field and that the car owner is in the driver's seat."
Auto dealerships are attacking independent tire and repair shops "from all sides," according to Craven. "They're coming at us from the tire side. They're coming at us from the parts side. In doing that, they can single out who they're going to give information to and who they're not. We need complete access to information and it has to be reasonably priced.
"Technology is driving everything... by excluding independent aftermarket repair shops, OEMs are in effect stealing the whole market.
"This is an attempt to create a monopoly. Ultimately, Congress is going to have to do something about it."
Small business health care reform was another hot button during the Automotive Aftermarket Legislative Summit.
"Small businesses need serious relief when it comes to health care," Amanda Austin, manager of legislative affairs for the National Federation of Independent Business, told summit attendees.
In the last two Congresses, the House of Representatives approved bills that would establish association health care plans. Neither received serious Senate consideration.
A bill that would give small businesses access to the same medical insurance providers that federal employees use was introduced during the 109th Congress. But the bill, the Small Employers Health Benefits Program Act, stalled later in 2006.
"Both sides (of the House) wanted more time to debate small business health options," said Austin. "Then you had the elections in November. Both sides were clearly nervous" about tackling the issue.
Meanwhile, the small business health care reform debate is filtering down to state legislatures.
Lawmakers in California, Massachusetts, Tennessee and Illinois are "looking into the situation," Austin noted. "The question is how we will pay for it. Will we pay for it on the back of business? This is a huge issue. Eventually it will bubble back up to the federal level."
TIA's Fiore doesn't expect any federal action in the near term. "If health care gets postponed again, I won't be surprised. It's a mammoth undertaking. In the long run a lot of issues need to be worked out.
"If we were to shape a health care bill now, I don't think anybody knows what it would look like."
Ken and Stu go to Washington
The IITDA's McCune and Stu Zurcher, who chairs TIA's training and education committee, came to the summit to lobby their state representatives in favor of Right to Repair and small business health care. (Zurcher is co-owner of Zurcher Tire of Angola Inc. in Angola, Ind.)
TIA and AAIA helped the pair get a sit-down meeting with Amy Oberhelman, a legislative assistant to Sen. Dick Luger, R-Ind., at Lugar's office inside one of the Senate buildings. (Lugar was unable to attend.)
Before the meeting, Zurcher told MTD that he and McCune are "after diagnostic and repair information for our members." And both said there's a need for health care options that won't place undue burdens on small business owners.
After exchanging pleasantries with Oberhelman, Zurcher and McCune got down to business.
"Right to Repair is very critical for our industry," Zurcher told Oberhelman. "It mandates that auto manufacturers share diagnostic and repair information with independent tire dealers. Right now they're starving our dealers of information."
McCune explained that diagnostic and repair data can vary by OEM. Independent tire dealers have the ability to purchase data from auto manufacturers on a subscription basis, "but the average subscription might cost around $2,000 a year and that might just be for one manufacturer.
"Another problem is that if you talk with some individuals who subscribe, the info that the independent garage receives is not always the same as what (the auto dealership) receives. It's very limited."
McCune went on to tell Oberhelman how he recently took his wife's car to an independent garage. The facility's owner told McCune they didn't have the equipment to diagnose the problem.
McCune was forced to take the vehicle to a car dealership that had the right diagnostic equipment, and "we paid what I consider to be a large amount of money" for services that were rendered.
"When you get into a situation where there's a monopoly, prices are higher because there's less competition."
"The most critical issue is that (withholding vehicle data) will limit the consumer as to his choices," added Zurcher.
"Another huge issue for the independent businessperson is affordable health care for employees," said McCune. "I used to be a sales representative for Goodyear Tire & Rubber Co. and in my travels I discovered that one of my customers' biggest problems was finding health care. Does Senator Lugar have a position on this?'
Oberhelman replied that Lugar is sympathetic to the small business owner's position due to his business background. (Before Lugar entered public life, he helped his brother manage their family's food machinery manufacturing company in Indianapolis.)
"There's not a group that comes in here that doesn't talk about health care," she added. "The Senate in particular is having a hard time agreeing on any issue. But we're hopeful that something will gel."
McCune and Zurcher spent more than 30 minutes with Oberhelman, who said that she would relay their concerns to Lugar.
"I suspected that Senator Lugar would be supportive of health care reform," McCune said after the meeting. "It's also good to know we're not the only group out here (stumping for) health care."
Later in the day, McCune and Zurcher met with assistants in Rep. Dan Burton (D-Ind.) and Sen. Evan Bayh's, (D-Ind.) offices. Overall, McCune and Zurcher were pleased with how their meetings went.
"And it doesn't end here," says Zurcher. "We now have individuals we can communicate with. And now our members have a point of entry if they want to communicate with Senators Lugar and Bayh and Congressman Burton."
Their experience in Washington "puts a whole new perspective on what we should be doing," says McCune. "Anybody who doesn't participate when there's an opportunity like this is missing the boat."
The other side of the story: ASA says Right to Repair bill is unnecessary
Right to Repair legislation should be a non-issue, according to the Automotive Service Association (ASA).
In fact, ASA officials say the problem of diagnostic and repair information dissemination was solved five years ago when the ASA reached "an understanding" with the Alliance of Automobile Manufacturers and the Association of International Automobile Manufacturers "regarding the type of service information and diagnostic tools available to independent repairers."
They claim that under the agreement, vehicle manufacturers "committed to providing independent repair shops with the same service and training information related to vehicle repair as is available to franchised dealerships."
In an anti-Right to Repair letter sent to Congress last month, the ASA says an organization called the National Automotive Service Task Force (NASTF) exists to address gaps in service information.
"If you're a repair shop owner and you run into a problem and can't find information, you call the NASTF and they'll resolve it," says Robert Redding, the ASA's Washington, D.C., representative.
Redding says only 32 complaints were received by the NASTF during 2006, all of which were resolved. He admits that NASTF "is not a day-to-day tool. It's not something you'd use in lieu of an ALLDATA or an OEM."
However, with a mechanism like the NASTF in place, Right to Repair legislation, he believes, "is a last resort. We have not, as an industry, exhausted the non-legislative process. Is it not better to do things this way instead of creating legislation?"