Workload delays ACCC report on farm machinery repair costs

Two-month wait on ACCC report on farm machinery repair costs

Machinery
COMPETITIVE MARKET: The Australian Competition and Consumer Commission has been investigating concerns about a possible lack of competition in the after-sales repair and servicing of farm machinery.

COMPETITIVE MARKET: The Australian Competition and Consumer Commission has been investigating concerns about a possible lack of competition in the after-sales repair and servicing of farm machinery.

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The consumer watchdog expects to release a report on its inquiry into the cost of repairing and servicing farm machinery within two months.

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An eagerly-awaited report from the national consumer watchdog on whether farm machinery buyers pay too much for servicing and repairs is expected within the next two months.

It's been almost 12 months since the Australian Competition and Consumer Commission (ACCC)raised concerns about competition and fair trading issues in a discussion paper titled Agricultural Machinery: After-sales markets.

ACCC deputy chair and agricultural specialist Mick Keogh said some team members had been diverted into producing the final report of the inquiry into markets for tradeable water rights in the Murray-Darling Basin due on February 28.

This had delayed the release of the report on the agricultural machinery after-sales market inquiry.

The ACCC's agricultural machinery discussion paper identified concerns which could be harmful to competition in after-sales repairs, service and warranty issues.

It sought feedback from farmers and contractors on whether their access to independent farm machinery repairs was limited by agreements between manufacturers and dealers.

As well, the ACCC has been investigating whether data ownership and management raised privacy and competition concerns.

When the discussion paper was launched Mr Keogh said farm machinery was expensive to buy and maintain.

COST WATCHDOG: ACCC deputy chair Mick Keogh said the commission wanted to ensure farm machinery owners had a competitive environment for after-sales repairs and servicing.

COST WATCHDOG: ACCC deputy chair Mick Keogh said the commission wanted to ensure farm machinery owners had a competitive environment for after-sales repairs and servicing.

"A number of barriers, including warranty clauses, may be preventing farmers from using an independent business to repair or service their equipment. We hear that this can result in delays at critical times," he said at the time.

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Productivity Commission's right to repair inquiry

Another issue identified in the paper was the fact that the Australian Consumer Law now did not extend to farm machinery valued above $40,000.

Mr Keogh said this meant agricultural faults needed to be covered by warranty or be repaired at the owners' cost.

"Manufacturers have significant discretion as to what warranty protections are offered and how they apply and we're concerned that farmers may not be aware of these limitations," he said.

He acknowledged, however, that in an industry like agriculture, brand reputation and customer satisfaction played a significant role in ensuring ongoing business referrals.

The ACCC investigation was partly driven by the "right to repair" debate which has been occurring in the United States.

The Productivity Commission in Australia has opened its own Right to Repair inquiry where the need toprovide farmers with a more competitive market for tractor and machinery repairs has been raised in several submissions.

The Productivity Commission is investigating ongoing complaints from consumers across the board that agreements between manufacturers and their dealers along with manufacturer warranties limits competition from independent repair and service providers.

These complaints often focus on the cost and availability of repair for mobile phones, cars and household appliances along with criticism about the inbuilt "obsolescence" of many modern consumer products which rely on sophisticated electronic technology.

The Productivity Commission is due to release a draft report by next June or July.

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