U.S. House Subcommittee Holds Hearing on Federal Auto Repair Bills
Published July 18, 2023
The U.S. House Judiciary Subcommittee on Courts, Intellectual Property and the Internet on July 18 held a hearing on proposed bills in Congress regarding right to repair issues: the Save Money on Auto Repair Transportation (SMART) Act, Right to Equitable and Professional Auto Industry Repair (REPAIR) Act and Fair Repair Act.
Led by U.S. Rep. Darrel Issa, R-CA, chairman of the subcommittee and lead co-sponsor of the SMART Act, which would expand consumer access to reliable auto parts for vehicle repair, members heard from witnesses about the economic impact of expanded repair options.
“Design patents, historically, basically prevent your competitor from making a deceptively similar product," Issa said. "So much of the discussion today is…on protection that is granted by design patents. Much of what we are looking at doing is to modify, enhance or define design patents in a way in which they do not exclude six or seven or eight years later that faded headlight that can no longer be polished to be usable from costing you $1,500 to $2,500 each in order to replace something that used to be available at the auto parts store for about six bucks.”
Among those testifying at the hearing was Aaron Perzanowski, law professor at the University of Michigan and author of a white paper on the importance of right to repair through the REPAIR Act, which would provide consumers with access to their vehicle data.
In his testimony, Perzanowski said, "Repair is as old as humanity. Repair has always kept pace. But today, manufacturers are employing a range of strategies that restrict repair from their hardware and software design choices to clamp down on secondary markets."
U.S. Rep. Laurel Lee, R-FL, co-sponsor of the SMART Act, asked Perzanowski what effect he sees passage might have on insurance rates for consumers.
“If we see passage of the SMART Act, we can anticipate significant reductions in the expenses associated with auto collision repairs," Perzanowski said. "Estimates are that design patents on collision parts are responsible for about $1.5 billion in additional expenditures. We see price premiums on OEM parts, over third [party] parts, often reaching into the 40% range…Do consumers know when they buy that vehicle that the repairs are going to be that expensive? I think in most cases, they don’t. And so I think the SMART Act is a very targeted solution to this problem.”
Lee asked if Perzanowski thought passage of the SMART Act will make it easier for independent repairers to enter the market.
“In an environment where consumers are facing lower costs for repairs and fewer vehicles are being totaled…One of the byproducts here of the high prices of these replacement parts is more and more vehicles are being totaled," Perzanowski said. "So, we would see more opportunity for competition in those market places. And generally…rely on this principle that the more competition we see, the lower prices are going to be, and the higher quality is going to be, and so I think that’s beneficial.”
Also testifying was Paul Roberts, founder of SecuRepairs.org and founder and editor in chief of the Security Ledger. In his testimony he stated, "Federal right to repair legislation like the REPAIR Act and the Fair Repair Act will greatly improve the quality of life for consumers, families and communities while promoting small business and reducing e waste throughout the country."
Automotive Service Association (ASA) Board of Directors Chairman Scott Benavidez, AMAM, also testified, explaining how the agreement ASA reached with the Alliance for Automotive Innovation (AAI) ensures independent repair facilities will continue to enjoy access to the information needed to diagnose and repair issues with their customers’ vehicles.
“ASA has been a steadfast advocate for right-to-repair principles---the right of car owners and independent repair shops to access vehicle service information needed to diagnose and repair vehicles---for decades," Benavidez said. "We take this unequivocal stance because our members are on the front lines of the vehicle data access issue and have been very clear: we want to have access to the data necessary to repair our customers’ vehicles… That’s why, last week, ASA proudly announced it had reached a landmark agreement with automakers that ensures independent repair shops can diagnose and repair their customers’ vehicles without hindrance from telematics nor any other innovation.”
Benavidez also shared ASA’s concerns that the SMART Act---which would allow aftermarket manufacturers to produce and sell parts of similar appearance 30 months after the OEM part enters the market and do so without violating patent law---lacks quality and safety standards for aftermarket replacement parts.
“We can and should have a competitive marketplace that doesn’t compromise quality or safety," Benavidez said. "[Some insurers] [d]eciding to only cover the cheapest option without understanding implications for quality leaves collision shops and their customers in a tough position…[M]ore imported and other crash parts in the marketplace with limited quality standards gives insurance companies even more power to mandate that cheaper parts that may or may not meet quality expectations be installed, while leaving car owners and repairers to suffer the consequences.”
ASA said it appreciates Issa for providing ASA the opportunity to share the perspective of independent automotive repair shops before the subcommittee and for the thoughtful comments from the subcommittee members.
The CAR Coalition, a group of independent automotive parts, management and repair companies, associations and insurers committed to preserving consumer choice and affordable vehicle repair, praised the subcommittee for holding the hearing.