Thank you, Mr. Chair.
I am grateful for the opportunity to address the committee this afternoon concerning Bill C-273.
My name is Marc Brazeau, and I am the president of the Automotive Industries Association of Canada. With me is Scott Smith, our director of government and industry relations.
AIA is a national commercial association that represents the automotive aftermarket industry of Canada, a $16.7 billion industry that employs more than 410,000 Canadians. The industry is comprised of companies that produce, distribute and install parts, accessories, tools and equipment for the automotive sector. In addition to its members that are spread out among 18,000 establishments and subsidiaries, AIA Canada encompasses more than 7,000 service and auto repair shops that are directly affiliated to our members.
I am here to present AIA Canada's position on the matter of access to maintenance information, training and tools by the automotive aftermarket in Canada, in other words by the people who do the maintenance and repair work on your vehicles.
I am also here to set out the Automotive Industries Association of Canada's position with regard to the situation surrounding Bill C-273, also known as the “right to repair“ act.
I will be very clear. AIA does not believe that the adoption of the Bill is necessary. An agreement has been negotiated between the vehicle manufacturers and the aftermarket, and AIA has expressed its wish to participate by signing this agreement.
It has been a long road to get to where we are right now. With the indulgence of the committee, I would like to provide a brief explanation of how we arrived at this point and why we believe that legislation is no longer necessary.
In 1996, onboard diagnostics capabilities for emission systems was mandated in the United States for all vehicles 1998 and newer. The system is referred to as OBD II.
The platforms designed by the car companies to meet the requirements of OBD II have allowed the evolution of electronic repairs or software-based repairs. Industry lexicon refers to those software-based repairs as “flash downloads”. The term “flash downloads” can refer to a variety of procedures that can relate to the updating or recalibrating of the vehicle's computer or control modules, or to the initializing of various newly installed parts. Access to this flash download information is not available to the aftermarket from all car companies, nor are the factory-specific tools and training required to service modern vehicles available from all car companies.
As technology and the utility of the OBD II platform evolved as a key component of the repair process, so too did the urgency for the aftermarket to have access to this information. On late model vehicles there are many repair procedures that are not possible to complete without access to Reflash software. In a February 2006 report commissioned by AIA, DesRosiers Automotive Consultants estimated that the loss of business to the aftermarket should access to information remain unresolved could be as high as $4 billion by 2010.
The issue of access to information was addressed first in the United States through what was referred to as the Arizona Project, an attempt to legislate access to emissions-related repair information in the state of Arizona. Ultimately this resulted in regulations under the Clean Air Act, which mandated vehicle manufacturers to provide emissions-related repair information to the automotive aftermarket and the general public over the Internet.
In the context of a parallel process, vehicle manufacturers and representatives of the aftermarket have structured an alternate voluntary approach for the distribution of vehicle maintenance information. The agreement relating to the standards led to the creation of an organization called the National Automotive Service Task Force.
While it impacts businesses, the right to repair is fundamentally an issue of consumer choice. The aftermarket consistently ranks high in consumer satisfaction in an annual survey by J.D. Power and Associates. Our goal has always been to protect the businesses that provide that consumer choice.
The issue is worldwide, and references to the right to repair issue exist in Europe, the United States, South America and the Caribbean.
AIA identified access to OEM service information, tools, and training as a priority issue for its members in 2004. A coalition of industry stakeholders agreed on a path forward at the time that focused on securing industry consensus and the voluntary distribution of information for fair market value compensation.
From 2004 to 2006, AIA and its partners tried to engage vehicle manufacturers in a dialogue with a view to establishing in Canada an organization similar to the NASTF, the National Automotive Service Task Force. Despite numerous attempts at launching a dialogue, including a letter from the then Industry Minister, Maxime Bernier, the vehicle manufacturers did not recognize the existence of a problem nor follow up on our wish to arrive at a voluntary solution.
In 2007, Bill C-425, a private member's bill, was introduced in the House of Commons by the member of Parliament for Windsor West, Mr. Brian Masse. Due to the lack of progress with a voluntary solution, the concept of a legislated solution was endorsed by AIA and its partners. After the federal election in the fall of 2008, Bill C-425 was reintroduced to Parliament as Bill C-273, in January 2009. As no progress had been made on a voluntary solution up to that point, AIA and its partners fully endorsed Bill C-273 and asked all members of Parliament to consider its merits.
In April 2009, the Minister of Industry, Hon. Tony Clement, issued a letter to the vehicle manufacturers asking them to consider the creation of a voluntary option to resolve the differences within the automotive industry. On April 29, AIA participated in a meeting with the vehicle manufacturers, their associations, and other aftermarket representatives. This meeting terminated in an expectation to sign a letter of intent that made demands that AIA could not agree to at that time.
Although AIA did request to be included in the discussions regarding the formulation of an agreement, AIA did not participate in the creation of the CASIS document.
No matter how this agreement finally came to be, it rests on the central principle that the information, training and tools are to be made available to the aftermarket in a format that is compatible with that used by the vehicle manufacturers' authorized dealerships. This is what we had been asking for since 2004.
During a meeting between AIA and the signatories to the agreement, on October 15th, the reactive architecture of the agreement was expressed in the form of an interpretation guideline that clarified a fundamental concern of AIA with regard to the agreement. It is this gesture that convinced AIA of the agreement's validity.
To conclude my remarks, I offer the following.
AIA believes the most expedient and reactive way to manage access to information is through the committed structure provided by CASIS. We also believe that because of the commitment demonstrated by the signatory parties, that legislation is no longer necessary. AIA looks forward to a more collaborative and open partnership within the automotive industry, particularly with the Canadian Vehicle Manufacturers' Association, the Association of International Automobile Manufacturers of Canada, and the National Automotive Trades Association.
I would like to take this opportunity to thank all members of Parliament, as well as the committee members, for their indulgence and their assistance over the past years in raising the awareness of this issue. I would like to particularly thank Mr. Brian Masse for his courage and passion on this issue and for helping bring this to a fair and workable conclusion.
Mr. Chairman, those are my remarks.