The investigative arm of Competition Commission of India (CCI) has accused the automakers of engaging in anti-competitive practices. Apparently, the companies have been withholding sales of spare parts in the free markets and the same were sold at exorbitant prices at the dealers and service centers. The report submitted to the Regulatory Agency said that these automakers were controlling the supplies thus creating demanding. This forced customers to buy the parts from dealers at high prices. The probe was done for over a year and the after market supply chain was studies in depth which included speaking to various manufacturers and open market players.
The probe began after a car buyer accused the automakers of offering their parts only through authorized dealers. Perhaps, this is an issue most of the car buyers have been facing from time immemorial. Customers were forced to buy parts from dealers at high prices as they have no other option. At times even for such high prices, customers faced long waiting periods to get those spare parts. Worst, was the case of small city customers as hardly one could find a dealer in the surrounding areas. Thus, again the customer would have to spend heavily to get the desired parts.
Companies like Volkswagen, Honda, Ford and General Motors did not comment on the accusation. They said they would comment after going through the report. However, spokesperson from Toyota said that it was definitely not an anti-competitive measure. Few spare parts are to be used only by accredited people only. Thus, this action has been taken in the interest of the customers. But, what is striking here is that this is seen only in case of newer car entrants. Established players like Maruti Suzuki, Mahindra and Tata Motors make their spare parts available in the open market. If found guilty, it may result in a ruling that would force all the players to make their parts available in open market.
Source – EconomicTimes