WASHINGTON—President Biden signed a wide-ranging executive order taking aim at—among other things—the right for consumers to repair products themselves or have it repaired by a third party.
The goal of the order, "Promoting Competition in the American Economy," released July 9 by the White House, is to encourage competition among several industries by limiting "unfair" practices by large companies.
"For decades, corporate consolidation has been accelerating," The White House said in a statement. "In over 75 percent of U.S. industries, a smaller number of large companies now control more of the business than they did 20 years ago. This is true across health care, financial services, agriculture and more."
A lack of competition drives up prices for consumers and also drives down wages for workers, the White House claims. The executive order includes vehicle manufacturing, as well as other consumer and trade products such as tractors, cellphone and other consumer electronics.
The order notes, for example, in agriculture, a tractor company blocking a farmer from repairing his own tractor. Elsewhere, the White House said, technology and other companies—like cellphone makers—imposing restrictions on self and third-party repairs, making repairs more costly and time-consuming, such as by restricting the distribution of parts, diagnostics and repair tools.
The Motor and Equipment Manufacturers Association and the Automotive Aftermarket Suppliers Association applauded news of the order. In a joint statement, the organizations said they have been advocating on behalf of the industry in Washington and urging the administration and Congress to act on this issue, including additional legislative direction for statutory authority.
"We look forward to working with the FTC to protect safe, affordable and equitable motor vehicle repair for American consumers and applaud the president for taking action," AASA President Paul McCarthy said. "Consumer choice and competitive markets are essential to the success of the automotive aftermarket, and today's executive order makes it a federal priority."
In May 2021, the FTC submitted a report to Congress identifying anti-competitive repair restrictions, parts limitations and inaccessible software, especially in the vehicle manufacturing and mobile phone repair and maintenance. The report said "there is scant evidence to support manufacturers' justifications for repair restrictions."
The FTC findings are in lock step with what AASA and MEMA have been advocating for on behalf of the aftermarket, the organizations said.
"We applaud the president for taking this step, which will help ensure safe and affordable transportation for consumers over the life of a vehicle," MEMA CEO Bill Long said. "The industry must align behind repairabilty, as it supports brand and resale values, economic equity and customer satisfaction over the lifetime of a U.S vehicle fleet that averages over 12 years old. We pledge to work closely with the administration, Congress and all industry stakeholders to address these issues."
Eric Sills, AASA vice chairman and CEO of Standard Motor Products, Inc., which employs about 2,400 people in eight states, said the order "paves the path for a bright future for the entire automotive aftermarket."
"More importantly, without these rules, American consumers would have limited repair options," he said. "Through this executive order, the administration has made a strong statement that consumer access to quality vehicle repair must be protected," Sills said.