SIAM criticises CCI for imposing penalty on auto companies

Auto industry body Society of Indian Automobile Manufacturers (SIAM) on Thursday slashed out at the recent order by Competition Commission of India (CCI) imposing a penalty of Rs 2,545 crore on 14 car companies over availability of spare parts in aftermarket saying it "completely ignored" safety of consumers.

SIAM also said the instance showed how government departments work in isolation with narrow mandates.

Addressing the annual convention of auto component makers ACMA, SIAM President Vikram Kirloskar said "the safety of consumers has been completely ignored by the CCI" as the current structure of spare parts in aftermarket is "just not structured" in terms of ensuring consumer safety.

Kirloskar further said the CCI order was also a "demonstration of government departments working in isolation" and each "working on narrow mandates".

He said at present the country does not have any norms and quality standards for setting up independent auto repair garages.

"There is a wide chasm between strict quality standards of OEMs and the independent free for all garages," Kirloskar said.

He further said it was premature to talk of a European style of norms for spare parts in aftermarket in India as requisite safety standards were not in place.

"If we put cart before the horse, we will be severely compromising the safety of consumers," Kirloskar said.

Last month, the CCI had slapped a total penalty of Rs 2,545 crore on 14 car makers, including Maruti Suzuki, Tata Motors and Mahindra & Mahindra, for violating trade norms in the spare parts and after services market.

While the Delhi High Court has already put on hold the CCI order imposing a fine on Maruti Suzuki, Tata Motors and M&M have said they would challenge the order.