Posted on 03 May 2013 by Neilson
Congress is considering legislation that would change U.S. patent laws to make it easier for aftermarket automobile part manufacturers to develop replacement parts and in turn, drive down the cost of repairs.
The Promoting Automotive Repair, Trade and Sales Act of 2013 amends U.S. design patent law to reduce the exclusivity period car companies hold on design patents for collision repair parts from 14 years to 30 months. During the 30-month window, other suppliers could test, research and develop parts on a not-for-sale basis, according to a summary of the PARTS Act.
The current 14-year design patent law prevents aftermarket manufacturers from making or selling external collision repair parts, allowing auto manufacturers to charge more for replacement parts. Backers of the PARTS Act have said the existing patent laws increase repair costs and auto insurance premiums by limiting consumer choice and crowding out competition. The bill is similar to legislation introduced during the last Congress that ultimately failed to gain traction among lawmakers.
The bipartisan bill was introduced in the Senate by Sen. Sheldon Whitehouse, D-R.I., and Sen. Orrin Hatch, R-Utah. The House version was introduced by Rep. Darrell Issa, R-Calif., and Rep. Zoe Lofgren, D-Calif.
"With the average sticker price of a new car now exceeding $30,000 and repair costs continuing to rise, hardworking American families deserve access to as many repair part options as possible," Issa said in a statement. "The PARTS Act will not only increase consumer choice therefore reducing aftermarket costs but encourage innovation and competition among other after-market parts manufacturers."
The American Insurance Association has come out in support of the bill.
Melissa Shelk, vice president for federal affairs for the AIA, said in a statement the PARTS Act was "essential to maintaining a vibrant and competitive consumer marketplace for quality automotive repair parts."
State regulators have long grappled with questions about how aftermarket parts should be covered by insurers.
Most recently, new California state rules giving automobile body shops greater control than insurers over establishing repair estimates using aftermarket parts have the Association of California Insurance Companies concerned the change ultimately will result in higher premiums for customers. ACIC Vice President Armand Feliciano said his organization was considering a legal challenge to the new rules to keep them from being implemented.