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Post created: 18 September 2023
In a resolute stance against the illegal trade of automotive components, the Tyre Equipment Parts Association (TEPA) recently hosted the ground-breaking “Blow The Whistle” Compliance Forum at the Automechanika event held at the JHB Expo Centre on September 7, 2023. This pivotal event brought together industry leaders to expose the grave consequences of illicit auto parts trade and promote collaboration between industry players and regulatory bodies.
Moderated by renowned investigative journalist Devi Sankaree Govender, the panel delved into the profound threats posed by counterfeit parts. As one of the proud sponsors of this initiative, AutoZone South Africa emphasised its unwavering support for the cause. For AutoZone, ensuring authenticity in auto parts goes beyond business; it’s a responsibility to the industry and consumer safety.
TEPA’s National Director, Vishal Premlall, went on to shed light on a disturbing reality: Compromised channels at the end of the supply chain have been introducing substandard, unfit components into the market, openly defying local regulations. This poses not only an economic threat but, more alarmingly, a danger to consumer safety due to the absence of traceability, technical backing and consumer recourse.
Lubin Ozoux, Chairperson of SATMC (the official industry body and trade association of local tyre manufacturers including Bridgestone, Continental, Goodyear, and Sumitomo), highlighted rising concerns such as the misdeclaration of tyre consignments and rerouting imports through neighbouring countries to evade tyre duties, environmental levies, and permits. Charl de Villiers from TIASA (Tyre Importers Association of South Africa) echoed the call for unity among industry stakeholders.
De Villiers emphasised the industry’s pivotal role in addressing these challenges, stressing the importance of collective efforts. He stated, “We need to protect not just the authenticity of the trade but also shield consumers from subpar products.”
Charl de Villiers also drew attention to a concerning issue: a pilot study by the United Nations Convention on Trade and Development (Unctad) revealed that South Africa loses a staggering $21.9 billion annually in inward flows and an astounding $40.9 billion in outward flows due to misdeclarations, undervalued invoices, tax evasion, round-tripping, and various other malpractices. Consequently, the illicit trade in automotive parts not only compromises personal safety but also significantly impacts the national economy.
Juanita Maree, CEO of the South African Association of Freight Forwarders (SAAFF), noted that only about 5% of the trade base engages in dubious practices. Yet, authorities often hinder legitimate traders by repeatedly inspecting their containers instead of focusing on this 5%. Maree stressed the importance of examining the entire supply chain to identify and eliminate illicit traders.
Dion de Graaff, CEO of AutoZone, highlighted the potential hazards of “white box” imports, or inexpensive vehicle parts. A survey by AutoZone’s wholesale division revealed that independent retailers’ sales comprised 55% unknown imported items, a figure that jumped to 70% in just nine months. De Graaff emphasised, “These ‘white box’ items come with warranties that are either non-existent or span a mere five months. The market should gravitate towards known brands that provide a warranty of 12-24 months.”
Adding to the chorus of concern, Alex Mkondo, Automotive Components Approval Manager at the National Regulator for Compulsory Specifications, reported that products worth more than R26 million failed compliance checks last year. Alarmingly, an estimated 80% of these products may be irredeemable, leading to their potential destruction.
From a consumer standpoint, Layton Beard of the Automobile Association (AA) underscored the critical importance of compliance. “For safer roads, it’s pivotal that vehicles have the right parts—genuine, compliant, and safe, rather than illicit ones that exacerbate road safety issues,” Beard concluded.
In the battle against illicit trade, compliance isn’t just the first step, it’s the linchpin. The establishment of this forum isn’t merely a tactical move; it sends a clear message to traders operating in the shadows, jeopardising both consumer safety and sector profitability.
For those with insider information on fraudulent practices in the industry, TEPA’s whistleblower hotline is ready. Let’s protect our industry, our consumers, and our collective integrity. Dial 011 886 6300 and let your voice make a difference.