Discussion document on restarting Irish automotive aftermarket

Donie Dillane, the Managing Director of the Top Part Motor Factor Group, has published a discussion document with with a view to restarting the Irish automotive aftermarket.

Dear Reader, 

I believe right now our country’s leadership is doing a magnificent job in steering all of us through these turbulent times in conjunction with our front-line heroes and the general public’s attitude of putting our shoulder to the wheel.

Everybody is to be commended for their trojan efforts. The next steps are to get our people back to work and our economy working again. Against the backdrop of a sector which has bounced back from the recession to account for well over 40,000 of the 45,000+ auto industry jobs in Ireland.

It is in this context; I believe that the following views and suggestions need serious consideration. In particular the aftermarket trade accounts for the majority of jobs in the auto industry. Garages, tyre centres, and car sales service outlets are at the heart of our communities in terms of transport for the majority. These are supported by aftersales businesses such as body shops, parts suppliers, tools, equipment and service suppliers and more that encompass all areas of the country. This discussion document has been compiled with input from companies and individuals from the automotive aftermarket.

A. The immediate restoration of all NCT and VTN testing

This is necessary for several reasons. The number one reason being the safety of all vehicles left unused for longer periods of time can show serious defects in terms of braking, steering, tyres and other critical components.

Environmental issues will arise particularly in terms of diesel vehicles where CO2 emissions need to be checked and rejuvenated to protect from unnecessary over production of environmentally damaging emissions.

Restoration of both testing systems will help in keeping the national fleet both safe and as environmentally friendly as possible. It can restore quite a number of well needed jobs particularly in rural areas and can be used to set a template for less vital industries to return to operation later.

The inability of the NCT centres to return to full operation at this stage is counterproductive.  It adds on-going hardship for people having to return again to complete the test but having to pay.

The use of protective gloves and masks by test centre staff in conjunction with social distancing at the reception and vehicle hand-over areas is all being practiced safely by other businesses. A disposable plastic seat covers could be provided to testers if required by them.

If the NCT centres are unable or unwilling at this stage to fix this problem, I suggest that a clear alternative exists to sub-contract out this testing to the VTN centres, who are well capable and willing to provide the additional and equally vital testing service.

B. A reduction on the VAT element of the repair business is required to allow for a competitive advantage for legitimate repair shops to compete with the resurgence of the black economy due to the higher levels of unemployment across all sectors. Supporting the legitimate auto aftermarket trade over the black economy option in this way should actually have a positive net gain for the Exchequer.

C. A proper return to work support scheme in terms of subsidies for full time workers and a renewal of a workable and more effective apprenticeship scheme to attract the younger generations to view this as a career.  A review of the government training agencies to promote upskilling and online courses for existing workers within the sector and also outside of work hours to make it more accessible to smaller operators. A restoration of a supported redundancy scheme to allow business to down size and survive rather than go into liquidation because of the lack of funds to pay redundancies .Due to partial return of the workforce a continuation of the various covid wage supports to enable a gradual return to full business

D. A more equitable distribution of body repair work by insurance companies to avoid the huge consolidation to a few operators, which is ongoing within this segment of the industry.

E. A long term proposal for a licensing of all garages in light of both the safety and environmental demands of today’s complex vehicles. The growth in hybrid and electrically powered vehicles and soon to be added to by the arrival of the fuel-cell/hydrogen power. This should be looked at akin to gas boiler or the electrical trades.

F. Again for the safety of drivers, passengers and all road user, a support for the supply of only approved and certified parts for use on all vehicles. The temptations of the use of part worn tyres and scrap parts needs to be discouraged and testing is the easiest way to achieve this

G. A review and implementation of the number plate legislation to allow for the tracking by both gardai and other bodies of the legitimate production of plates and a national log of the same.

H. Production of a full checking system for all second hand vehicles imported into the state in terms of previous history by organisations such as Cartell before the vehicle can be registered or NCT certified.

I. A relaunch of the right to repair legislation to create public awareness of their rights to decide what competent repairer they can choose to repair their vehicle. In addition to the safety consequence, it will also provide consumers with their rights and options.

J. A scrappage scheme needs serious review before being considered due to unforeseen consequences it would have for the motor industry as a whole.

– The negative effect on the current values of second-hand stock by already under pressure car dealers.

– The limited environmental costs versus gains which would accrue, compared to previous scrappage schemes.

– The creation of a large obsolete fleet problem for all spare parts stockists within the system.

– The creation of unnecessary credit pressures at a time of financial strain. We do not have a vehicle manufacturing base within our country so it would negatively impact on the national balance of payments at this time.

Finally, over a three-year period, it would bring no advantage to the Exchequer, as it just brings forward sales that would happen naturally in the following couple of years.

Thank you for taking the time to read this discussion document. I hope you feel you can support all or some of the proposals contained within it. Please feel free to liaise with other stakeholders as to their opinions. I earnestly request that you bring these solid suggestions for consideration to the relevant parties before the relaunching of our key industry after the current lockdown.

With regards

Donie Dillane
Managing Director
Top Part Group