The good news for the motor sector is that despite the tough economic times facing South Africans more independent workshops are opening their doors with a growing number of these being black owned. On the downside, if there isn’t change in terms of allowing these workshops access to fair competition in the market, they will not be open for long.
“There is great potential for real transformation which will lead to economic growth in this sector particularly,” says Gunther Schmitz, Chairman of Right to Repair South Africa (R2RSA). He explains that current exclusionary practices mean SMEs are being driven out of business. “If there is no change, it’s likely that in five years workshops will no longer be able to service vehicles.”
Pieter Niemand, Director of the Motor Industry Workshop Association (MIWA), says from July 2016 to August 2018 over 230 black-owned workshops have become MIWA members. This is out of a total of 520 workshops that joined during the same period. “This is encouraging. The majority of our members are small businesses. We believe it is our mandate to create and promote a culture wherein member businesses will meaningfully participate in transformation which will enable inclusive growth and employment for all.”
He adds that the regulatory environment poses huge challenges for small business as the application of laws is unpredictable resulting in businesses losing focus on growth. “This situation has a major impact on current businesses and relief of this regulatory burden will create opportunities for assistance and support to new black businesses entering the industry.”
As an affiliate association of the Retail Motor Industry Organisation (RMI), he says MIWA needs to ensure the sustainability of black businesses entering the industry by providing mentorship, training and enhancement of the skills system. “Equal opportunities will achieve and maintain a competitive economy ensuring all members remain sustainable. However, we believe strongly that only through change in respect of the right to repair will the economy open up for these workshops and make this more viable,” he says.
Sisa Mbangxa, Chairman of the African Panel beaters and Motor Mechanics Association (APMMA) agrees. “Over the years there has been a good response from entrepreneurs to government’s call of Vukuzenzele - the creation of jobs, the eradication of poverty, and sustainable development. The number of businesses in the automotive repair sector increased immensely. The objective was and is still to create decent jobs and fight back frontiers of poverty. Some previously disadvantaged individuals went to financial institutions to acquire loans to start or open automotive repair workshops.”
Unfortunately, he explains, only to find out later that the grass they thought was green was in fact yellow. “They can’t work on cars that are in warranty and are insured vehicles. They can't even work on government vehicles due to red tape, monopoly and unfair competition in the automotive industry. We believe that with the introduction of Right to Repair in South Africa the previous disadvantaged artisans or workshops will be able to compete fairly with the historical advantaged workshops.”
He says this will assist these workshops to have more work and thrive. “Right to Repair will also assist our government in addressing Radical Economic Transformation. Decent and sustainable jobs will be created and will bring back human dignity to currently impoverished communities.”
Previously disadvantaged individuals’ workshops will have access to technical information from workshops and branding where necessary. “Another serious challenge that needs to be addressed as a matter of urgency is the lack of infrastructure in the townships and rural areas, skills upgrades and so on. APMMA has called upon the industry and government to assist in this regard.”
Schmitz says the implementation of the proposed code of conduct for the automotive industry will open the way for more previously disadvantaged individuals to own dealerships and other businesses in the sector. “Currently aftermarket repairers are being denied access to codes, tools, information and parts. In addition, it is financially inaccessible for many to become accredited service providers for Original Equipment manufacturers (OEMs). OEMs may argue that the safety of the driver will be compromised because of parts quality and skills of repairers, and that warranties are standard across all industries. Our response is that parts are manufactured by suppliers not OEMs and the aftermarket is highly skilled. The inaccessibility to information is inhibiting repairs, not skills. Just because warranties are standard across industries in SA does not mean they should not be challenged. In Europe and the United States warranties are handled differently.”
“Ultimately, we need to create jobs and sustain them. We need transformation and empowerment. The time for change is now,” he concludes.