Friday, June 24, 2011

Fixing it Right and Right to Repair Are in Fundamental Conflict - David Carlisle

The issues beneath Right to Repair are quite complex and completely unappreciated by car owners. Brackertz took a look at one argument of the Right to Repair coalition, which postured that the “US lags behind Europe in protecting small business and competition.”

Brackertz concluded “Europe is different from the US. You can’t conclude from Europe’s experience that the US will be OK with Right to Repair legislation. In the end, the end-customer suffers… because higher cost structures are passed on to consumers and because lower workshop profitability means fewer workshops from which to choose.”

To say that the U.S. is behind on this fundamental consumer “right” is without merit. But, the allegation remains and customer perceptions have been distorted.

Let’s get back to basics on this one. The fundamental question is “How do service technicians know what to do when it comes to motor vehicle repair?” I’ve been studying this question for about 27 years. The chart “Simplified Six Part Story of Why We Have Great Cars & Trucks in the United States” summarizes the answer to this question and is important to understand before voting in sweeping Right-to-Repair legislation.

OEMs do not design cars and trucks with perfect knowledge of how they will break. Their repair knowledge and expertise is developed by examining data to figure out what went wrong and how to make it right. The OEMs get a lot of data on warranty repairs that occur during the first 3-4 years of a vehicle’s life. They get more data from parts sales (assuming that they only sell replacement parts when something does not work), Telematics (e.g. OnStar), and technical hotlines. In addition, many OEMs collect data on customer pay repairs. All of this data sits inside a quality management system. Hundreds if not thousands of engineers and technical staff comb through this data for answers to key questions:
  • Are there any failure patterns that are outside “normal” wear and tear?
  • Do any of these patterns involve critical safety systems, such as airbags, steering, brakes, and acceleration?
  • What parts and components are at fault?
  • Do certain parts need to be redesigned and superseded?
  • Do certain vehicles need to be recalled?
  • Do we need to send out a technical serviced bulletin that allows service technicians to check out possible problem vehicles in the shop?
  • Do we need to develop special training programs for some of these troublesome repairs?
  • Do we need to develop new or revised procedures for the technical hotline and customer relations staffs?
  • Do we need to develop new tools for some repairs in order to reduce repair times and costs?
  • Do we need to update PROM chips and diagnostics systems to better catch these now more predictable failures?
  • Can the next generation product engineers learn anything from all this data so they can make better cars and trucks in the future?
When we buy our cars and trucks and drive them down the road, most people have no concept that all this is happening behind the scenes. The more robust the data is inside those OEM quality management systems, the better our cars and trucks are built and serviced. Today, we have great cars and trucks as a consequence of this.

Right to Repair lobbyists want a lot of what they already get (I will talk about this next week), but most critically, they want to shift service business away from certified dealers to independent repair facilities, and want to shift parts sales from genuine OEM parts organizations to the independent aftermarket manufacturers. They want OEMs to provide independents with everything involved in product support at the same cost and terms that they charge their authorized dealers. These lobbyists posture that this is an inalienable right much like all those other rights that we fought for from 1775 – 1783. This is certainly passionate, but is it reasonable and in the best interests of car owners? No.
  • Since there is no data flow between independent repair facilities and OEMs’ quality management systems, there is no opportunity to learn from the repairs and failures that they treat.
  • Because independent repair facilities generally use non-genuine and/or counterfeit parts, there is no opportunity to even understand parts breakage patterns.
  • Since there are no franchise requirements guiding technician training and certification, customer service standards, quality standards, and diagnostic technology, there are no fool-proof processes in place to ensure customers get the right repair at the right time with the right parts.
As dealer service market share erodes over time, the flow of repair data to the OEMs will also erode. Service and repair quality will erode in turn – this is logical and inevitable. Finally, motor vehicle quality will erode – again, this is logical and inevitable.

Bottom Line: Who cares? Our cars and trucks are fine today. My concern lies with our necessarily evolving motor vehicle technology. For example, our powertrain systems will migrate from gas to hybrid to pure electric in order to reach ever higher levels of fuel economy. Our braking systems will evolve to be more regenerative. Our steering systems will utilize more drive-by-wire technology. Our body parts will be engineered for lower drag coefficients. And, our safety systems will be infinitely more complex due to lower vehicle weights and more powerful technology. Failure rates with this evolving technology will be very small during the warranty periods – simply because electric motors and lithium batteries have less wear and tear than do internal combustion engines. “Right to repair” chokes the data flow with these technologies, and OEMs won’t even know what’s going wrong anymore. Without robust data, OEMs’ ability to identify failures, take corrective action, and incorporate improvements is severely curtailed.

To protect this feedback loop – and by extension, vehicle quality, reliability, and safety – Right to Repair legislation could, if its backers truly had car owners’ best interests in mind, propose a certified repairer model. Independent facilities who meet certain criteria, such as use of genuine parts and provision of repair information to OEMs, would be certified to use OEM repair information and technology. It’s highly unlikely, however, that this model would appeal to the driving force behind the current legislation – namely, aftermarket parts companies such as Autozone, NAPA, and LKQ – who are out to sell more parts. Ultimately, it’s the consumer who suffers.

Right to Repair legislation is a Trojan Horse, with a belly full of non-genuine parts, pushed on unsuspecting consumers by hired-gun lobbyists.

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