Right-to-Repair Initiative on the Ballot in Massachusetts

Decades ago, there were millions of “shade tree” mechanics who could tweak, maintain, upgrade, and repair nearly every part of their car, the same way they could work on a small engine such as a lawnmower engine.  With today’s sophisticated electronic controls managing nearly every aspect of a vehicle’s operation, those days are long gone.  In fact, many cars can’t even have symptoms diagnosed and repaired by professional mechanics with $60,000-plus diagnostic equipment due to proprietary software in their own diagnostic equipment.  The result is that new-car dealers have a captive audience that can only take cars to them for some services, and that means the dealers have a lot of pricing power.

Almost everyone who has a car knows that taking your car to a dealer for service is just about the most expensive way to have your car repaired, mainly due to the uneven playing field (and also likely somewhat attributable to the glitzy facilities that most new-car dealers boast, versus the traditional dingy-but-functional garages outside of a dealer’s network.

A group of advocates for breaking this near-monopoly called the Massachusetts Right to Repair Coalition aims to change the law so that OEMs such as GM, Ford, Chrysler, and Toyota are required to “give every mechanic access to the same information and tools that dealers have access to,” in the coalition’s words.

It sounds simple enough, but there is a lot of money at stake, and dealers and the manufacturers that they represent are not going to go down without a fight.

Margins on new cars are near all-time lows, particularly in areas where there is a high density of dealers fighting one another for the same deal.  Many dealers are willing to make little or no money on a new-car deal (or even lose a little money on it) in order to make the sale and h0pefully capture the car’s service business.  Even warranty repairs and free scheduled maintenance are profit centers for new car dealerships.

More than 106,000 Massachusetts voters signed petitions to encourage lawmakers to approve the state’s proposed Right to Repair law.  Since the legislation did not pass the state legislature by a May 12, 2012 deadline, it now goes onto the November ballot as a referendum directly in voters’ hands.

A group called the Mass Auto Coalition, comprised of several auto service organizations (the ASA, New England Service Station & Automotive Repair Association, and The Alliance of Automobile Manufacturers) is leading opposition to Massachusetts’ proposed Right to Repair law.

Frankly, both sides make convincing arguments about why the law is a good idea or a bad idea.

Proponents of Right-to-Repair say that:

• Right to Repair requires automakers to sell the same repair and diagnostic information and tools to independent repair shops, consumers and franchised dealerships.
• Independent technicians have an increasingly difficult job because big car companies withhold repair and diagnostic information from them.
• Right to Repair will give you, the consumer, the right to choose where you service your car.
• Dealership repairs average 34% more than at independent repair shops.
• Right to Repair would protect 32,000 Massachusetts jobs.

Opponents of Right-to-Repair say that:

• This legislation could compromise data and codes that make today’s cars harder to steal, leading to losses for consumers and insurers alike.
• Car theft is at a 20-year low, according to the FBI. While fewer than 1 million cars are still stolen each year, that figure represents half the number of vehicles stolen in 1991.
• Experts credit new technology and increasing amounts of data, namely ignition immobilizers that block the engine from starting without a key.
• The National Insurance Bureau opposes the bill because it would compromise key codes and immobilizer information.
• The Massachusetts Police Association says that this bill “only supports crime.”

Although both sides make good arguments, it’s a little difficult to side with either, for no other reason than the vested interests that each side very obviously have.

Proponents of Right-to-Repair in Massachusetts are generally consumer advocates, tire manufacturers or sellers, aftermarket part manufacturers or sellers, and some repair shops.  Aside from consumer advocates such as AAA, it’s pretty easy to see how an aftermarket parts manufacturer would stand to benefit from the ability to produce knockoff auto parts that were previously proprietary.

Opponents of Right-to-Repair in Massachusetts are generally automobile manufacturers, auto dealers, larger auto repair facilities (who have the resources to purchase more expensive diagnostic equipment), and the UAW.  Just as with the other side in this battle, it’s easy to see why manufacturers and dealers want to maintain the status quo, why large repair shops want a barrier to entry, and why the UAW would want to maintain its exclusive role in producing some parts.  Police are also against the legislation, because opening up proprietary systems could make them easier for car thieves to compromise security.

What do you think?  Which side has the right answer?  Which side will win in November?  According to AAA Southern New England (who – you’ll recall – is a proponent of Right-to-Repair), some 88 percent of its members favor Right-to-Repair.  If this moves forward in Massachusetts, it will be interesting to see if other states follow its lead.  You know, kind of how Romneycare in Massachusetts spawned Obamacare several years later.