Mercedes-Benz has removed service plans from the prices of its new vehicles in South Africa in reaction to the Right to Repair (R2R) guidelines that took effect in the country in 2021.
These guidelines aim to promote competition and inclusion in the automotive aftermarket industry by allowing motorists to service and repair their vehicles at independent third-party service providers (ISP) without automatically voiding their after-sales agreements with the manufacturer.
While most automakers now adhere to the R2R recommendations, it doesn’t mean a customer can do what they want and expect their warranties and service plans to remain valid.
If an existing or future Mercedes customer services/repairs their vehicle at an ISP, “the service/maintenance and original warranty will not automatically be voided,” Mercedes-Benz confirmed to TopAuto.
However, if a problem occurs after the fact, “the process that will be applied is that the vehicle will be inspected to determine whether there are any adverse effects on the vehicle due to the services of the ISP or the usage of non-approved parts,” said the company.
Following this inspection, Mercedes will determine whether the original after-sales agreements shall remain in place and the subsequent repairs covered.
Additionally, the cost of servicing a car at an ISP will fall on the owner as the factory-backed service/maintenance plans are only valid for repairs done by the original equipment manufacturer.
What is Right to Repair?
The R2R guidelines were gazetted by the Competition Commission in June 2021.
The recommendations are the result of more than a decade’s worth of complaints received by the Competition Commission from ISPs and other industry participants, said legal firm Bowmans.
For the average consumer, R2R increases choice by allowing them to support their preferred ISP while also being able to source and fit original or non-original spare parts to their vehicles.
However, there are potential risks involved such as a shoddy repair job by an ISP, which could lead to the original warranty/service plans being voided and the customer having to pay for any and all future work done.
For businesses, a key objective of the new guidelines is to promote the entry and participation of small-and-medium enterprises (SME) and historically-disadvantaged persons (HDP) in the automotive aftermarket sphere.
This will be incentivised by encouraging stakeholders in the industry to facilitate:
- Increased entry, promotion, and support of SMEs and HDPs as approved dealers.
- Ensuring that ISPs can undertake in-warranty service, maintenance, and repair work.
- Dispensing of the practice of OEMs entering into exclusive agreements with motor-body repairers.
- Ensuring the fair allocation of work by insurers to service providers on insurance panels, with no service providers serving for more than five years on a panel.
Although the new guidelines do not have the force of law, the Competition Commission notes that the policy reflects what it will consider as anti-competitive behaviour going forward, though where compliance is commercially impractical, the R2R recommendations may also be individually interpreted.
Keyword: Service plans are now excluded from the price of a new Mercedes-Benz in South Africa