Quality Parts Coalition: Charge to Preserve Competition in Collision
Parts Industry Continues

Consumer Federation of America Provides Testimony on Capitol Hill
in Support of Automotive Design Patent Repair Clause

WASHINGTON — Keeping prices fair and the automotive collision parts marketplace free by adding a “repair clause” to United States design patent law is critical to preserving consumer choice, according to testimony yesterday by the Consumer Federation of America (CFA) and fellow advocates for consumer rights before the U.S. House Subcommittee on Courts, the Internet, and Intellectual Property.

A repair clause will ensure that the manufacture of and sale of alternative collision parts for the purpose of repairing an automobile is not considered an act of infringement. The repair clause will ensure freedom of consumer choice and the continued availability of affordable auto body parts simply by maintaining business as usual. On the other hand, a monopoly on replacement parts threatens the future vitality of an entire
industry and many thousands of jobs.

Consumers save up to $1.2 billion each year by having the freedom to choose replacement parts for their vehicles. Direct competition between an original equipment manufacturer (OEM) part and a high quality alternative part guarantees that the cost of the quality alternative part is considerably less. The existence of competition in the marketplace ensures that the OEM part is more readily available at a lower cost than parts
without competition.

But over the past five years, the award of design patents to major automobile manufacturers has grown to about 20 to 25 percent of the total U.S. patents awarded to those manufacturers. As the number of design patents obtained by the big car companies skyrockets, so will the price of those parts if they continue to enforce their patents against alternative suppliers of collision parts.

“Car companies have hijacked design patents to curb competition,” said Eileen Sottile, executive director of the Quality Parts Coalition. “With a monopoly in place on individual replacement parts, car manufacturers can demand higher prices, which will encourage the insurance companies to ‘total’ more vehicles and ultimately raise premiums. The CFA and other consumer rights groups agree with the Quality Parts Coalition that
consumers should not be forced to pay the price of the big automakers’ monopoly.”

There is a solution available. The recently adopted European repair clause preserves car company design and prevents vehicle competitors from copying specific design items on the vehicle, but allows consumers the freedom to repair their vehicles with a choice of parts.