Automotive Recyclers Association urges FTC to monitor OEM activities

Jan. 1, 2020
The Automotive Recyclers Association (ARA) has filed comments with the Federal Trade Commission (FTC) urging the Agency to closely monitor the activities of the automobile manufacturers to determine whether their claims are unfair and deceptive and t
The Automotive Recyclers Association (ARA) has filed comments with the Federal Trade Commission (FTC) urging the Agency to closely monitor the activities of the automobile manufacturers to determine whether their claims are unfair and deceptive and thus inconsistent with the Magnuson-Moss Warranty Act's Interpretations.

ARA's concerns center around the increasing number of statements by automobile manufacturers which seem designed to make the collision repair industry and consumers doubt the viability of recycled automotive parts.

"As their market share shrinks, automobile manufacturers have increased efforts that seem to discourage the use of recycled parts", said ARA CEO Michael E. Wilson. Statements made by a number of automobile manufacturers leave the impression not only that car warranties can be voided for using recycled automobile parts but also that recycled parts are inferior to new original equipment manufactured (OEM) parts and that consumers are at risk by using them.

"A vast majority of our members are small businessmen and women who rely on the FTC to combat these practices," said ARA CEO Michael E. Wilson. "These small businesses need the help of the FTC to ensure that they will be able to compete on a level playing field", he said.

ARA raised these concerns with the FTC earlier this year and, in response, the Commission updated a Consumer Alert entitled “Auto Warranties, Routine Maintenance, and Repairs: Is Using the Dealer a Must?” In that July 2011 alert, the FTC affirmed that "Warrantors may not claim that a warranty is void simply because a consumer has used a recycled part." " ARA appreciates the FTC’s statements in the Consumer Alert and expressed a desire for those sentiments in that Consumer Alert to be preserved and expanded in any new statement or policy," said Wilson.

ARA believes the updated Consumer Alert is a positive first step. However, the attacks by automobile manufacturers continue and the FTC needs to stand guard. For example, several manufacturers have announced "price matching policies" where they match the lower cost of certain recycled parts in an effort to encourage the purchase of new OEM parts. "Although maybe permissible on its own, when taken into consideration with past statements and other actions these activities could demonstrate an effort by automobile manufacturers to limit competition in the collision repair industry and discourage consumers from using cost effective and environmentally friendly recycled automotive parts," said Wilson.

Established in 1943, the Automotive Recyclers Association (“ARA”) represents an industry dedicated to the efficient removal and reuse of “green” automotive parts, and the proper recycling of inoperable motor vehicles. ARA represents over 4,500 auto recycling facilities in the United States and fourteen other countries around the world. With programs such as the Certified Automotive Recycler Program (CAR) and other partnerships, ARA members continue to provide consumers with quality, low cost alternatives for vehicle replacement parts, while preserving our environment for a “greener” tomorrow.

To learn more about the Association, visit ARA online at www.a-r-a.org or call (571) 208-0428.

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