[House Hearing, 108 Congress]
[From the U.S. Government Publishing Office]



REPAIRING THE 21ST CENTURY CAR: IS TECHNOLOGY LOCKING THE CONSUMER OUT?

=======================================================================

                                HEARING

                               before the

                            SUBCOMMITTEE ON
                COMMERCE, TRADE, AND CONSUMER PROTECTION

                                 of the

                    COMMITTEE ON ENERGY AND COMMERCE
                        HOUSE OF REPRESENTATIVES

                      ONE HUNDRED EIGHTH CONGRESS

                             SECOND SESSION

                               __________

                           SEPTEMBER 22, 2004

                               __________

                           Serial No. 108-120

                               __________

      Printed for the use of the Committee on Energy and Commerce


 Available via the World Wide Web: http://www.access.gpo.gov/congress/
                                 house


                               __________

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                    ------------------------------  

                    COMMITTEE ON ENERGY AND COMMERCE

                      JOE BARTON, Texas, Chairman

W.J. ``BILLY'' TAUZIN, Louisiana     JOHN D. DINGELL, Michigan
RALPH M. HALL, Texas                   Ranking Member
MICHAEL BILIRAKIS, Florida           HENRY A. WAXMAN, California
FRED UPTON, Michigan                 EDWARD J. MARKEY, Massachusetts
CLIFF STEARNS, Florida               RICK BOUCHER, Virginia
PAUL E. GILLMOR, Ohio                EDOLPHUS TOWNS, New York
JAMES C. GREENWOOD, Pennsylvania     FRANK PALLONE, Jr., New Jersey
CHRISTOPHER COX, California          SHERROD BROWN, Ohio
NATHAN DEAL, Georgia                 BART GORDON, Tennessee
RICHARD BURR, North Carolina         PETER DEUTSCH, Florida
ED WHITFIELD, Kentucky               BOBBY L. RUSH, Illinois
CHARLIE NORWOOD, Georgia             ANNA G. ESHOO, California
BARBARA CUBIN, Wyoming               BART STUPAK, Michigan
JOHN SHIMKUS, Illinois               ELIOT L. ENGEL, New York
HEATHER WILSON, New Mexico           ALBERT R. WYNN, Maryland
JOHN B. SHADEGG, Arizona             GENE GREEN, Texas
CHARLES W. ``CHIP'' PICKERING,       KAREN McCARTHY, Missouri
Mississippi, Vice Chairman           TED STRICKLAND, Ohio
VITO FOSSELLA, New York              DIANA DeGETTE, Colorado
STEVE BUYER, Indiana                 LOIS CAPPS, California
GEORGE RADANOVICH, California        MICHAEL F. DOYLE, Pennsylvania
CHARLES F. BASS, New Hampshire       CHRISTOPHER JOHN, Louisiana
JOSEPH R. PITTS, Pennsylvania        TOM ALLEN, Maine
MARY BONO, California                JIM DAVIS, Florida
GREG WALDEN, Oregon                  JANICE D. SCHAKOWSKY, Illinois
LEE TERRY, Nebraska                  HILDA L. SOLIS, California
MIKE FERGUSON, New Jersey            CHARLES A. GONZALEZ, Texas
MIKE ROGERS, Michigan
DARRELL E. ISSA, California
C.L. ``BUTCH'' OTTER, Idaho
JOHN SULLIVAN, Oklahoma

                      Bud Albright, Staff Director

                   James D. Barnette, General Counsel

      Reid P.F. Stuntz, Minority Staff Director and Chief Counsel

                                 ______

        Subcommittee on Commerce, Trade, and Consumer Protection

                    CLIFF STEARNS, Florida, Chairman

FRED UPTON, Michigan                 JANICE D. SCHAKOWSKY, Illinois
ED WHITFIELD, Kentucky                 Ranking Member
BARBARA CUBIN, Wyoming               CHARLES A. GONZALEZ, Texas
JOHN SHIMKUS, Illinois               EDOLPHUS TOWNS, New York
JOHN B. SHADEGG, Arizona             SHERROD BROWN, Ohio
  Vice Chairman                      PETER DEUTSCH, Florida
GEORGE RADANOVICH, California        BOBBY L. RUSH, Illinois
CHARLES F. BASS, New Hampshire       BART STUPAK, Michigan
JOSEPH R. PITTS, Pennsylvania        GENE GREEN, Texas
MARY BONO, California                KAREN McCARTHY, Missouri
LEE TERRY, Nebraska                  TED STRICKLAND, Ohio
MIKE FERGUSON, New Jersey            DIANA DeGETTE, Colorado
DARRELL E. ISSA, California          JIM DAVIS, Florida
C.L. ``BUTCH'' OTTER, Idaho          JOHN D. DINGELL, Michigan,
JOHN SULLIVAN, Oklahoma                (Ex Officio)
JOE BARTON, Texas,
  (Ex Officio)

                                  (ii)




                            C O N T E N T S

                               __________
                                                                   Page

Testimony of:
    Cabaniss, John, Chairman, National Automotive Service Task 
      Force, Director, Environment and Energy Association of 
      International Automobile Manufacturers.....................    61
    Cardwell, Lynne, Chief Executive Officer, Car Care Center, on 
      behalf of Coalition for Automotive Repair Equality, 
      Automotive Aftermarket Industry Association and CARQUEST 
      Tech-Net Professional Auto Service Center..................    65
    Dana, Greg, Vice President, Environmental Affairs Alliance of 
      Automobile Manufacturers...................................    56
    Donovan, Edward C., Director of Technical Services, AAA 
      Automotive Technical Services..............................    47
    Haas, William J., Vice President, Service Repair Markets for 
      the Automotive Service Association.........................    42
    Merrill, Bob, Horsepower Auto Care, National Federation of 
      Independent Businesses.....................................    53
    Scaler, Dave, Director, Mechanics Education Association......    11
    Seyfer, Donald L., Seyfer Automotive, Inc....................    49
Material submitted for the record by:
    Dingell, Hon. John D., letter dated October 5, 2004, to Hon. 
      Deborah Platt Majoras, requesting views for the record, and 
      response to same...........................................   118
    Retail Industry Leaders Association, letter dated September 
      22, 2004, to Hon. Cliff Stearns............................   114
    Service Station Dealers of America and Allied Trades, 
      prepared statement of......................................   115
    Tire Industry Association, prepared statement of.............   116

                                 (iii)

  

 
REPAIRING THE 21ST CENTURY CAR: IS TECHNOLOGY LOCKING THE CONSUMER OUT?

                              ----------                              


                     WEDNESDAY, SEPTEMBER 22, 2004

              House of Representatives,    
              Committee on Energy and Commerce,    
                       Subcommittee on Commerce, Trade,    
                                   and Consumer Protection,
                                                    Washington, DC.
    The subcommittee met, pursuant to notice, at 2:06 p.m., in 
room 2322, Rayburn House Office Building, Hon. Cliff Stearns 
(chairman) presiding.
    Members present: Representatives Stearns, Upton, Shimkus, 
Bass, Bono, Issa, Otter, Barton (ex officio), Schakowsky, 
Gonzalez, Towns, Green, McCarthy, Strickland, and Dingell (ex 
officio).
    Staff present: Chris Leahy, majority counsel and policy 
coordinator; David Cavicke, majority counsel; Brian McCollough, 
majority professional staff; Shannon Jacquot, majority counsel; 
Will Carty, legislative clerk; Jonathan Cordone, minority 
counsel; and Ashley Groesbeck, minority research assistant.
    Mr. Stearns. Good afternoon, everybody.
    I wish we had a little bit more seats for all of you, so we 
will work it through here.
    For most of us our car is an absolute necessity for our 
busy lives providing a safe and efficient means of going from 
point A to point B, whether that is the grocery store or 
grandma's house. Cars are also used for personal expression, 
usually expressed as horsepower. And for some simply a 
practicality. But when we have a breakdown, and that is a 
disabled car--no matter how fast or how practical this can mean 
major disruption for all of us.
    When we lose our wheels, many of us go straight to the 
local garage and dealer technician or mechanic, as I remember 
calling them, to get us back on the road. I believe that a 
consumer has a right to choose that mechanic and shop that does 
the service on and repairs on his or car.
    When one considers that from 1980 until the year 2004 the 
number of light-duty cars and trucks in the United States has 
almost doubled to over 220 million vehicles with Americans 
spending about $38 billion a year on auto care and repair, it 
is clear that these consumer choices are big business, very big 
business in a very competitive market.
    The 21st century family car in our driveway is no longer 
just engine wheels, chrome and steel. Today's car is probably 
the most sophisticated piece of machinery we own and has on the 
average 15 on board computers that rival the computing 
horsepower that the Apollo Space Craft used for the moon 
landing. To tackle those repairs and service jobs today's 
automotive technician, not unlike a NASA engineer, is a well 
trained specialist armed with the latest in high tech tools and 
gadgetry. Gone are the days when a monkey wrench, timing light 
and firing orders from your repair manual were all you needed 
to handle that occasional stall or sputter.
    The use of computers in cars became more common place after 
passage of the Clean Air Act in 1990. This law required for the 
first time the computerized engine and system management known 
as on-board diagnostic systems, OBD, be integrated into a car 
in an effort to regulate and improve air quality.
    The OBD system originally was designed to monitor certain 
engine and transmission events that could worsen air quality, 
such as an engine misfire. Record them and ultimately alert the 
driver to have his or her car serviced. The driver is usually 
alerted by a check engine light or malfunction indicator lamp, 
MIL. And so when the car is serviced the auto technician uses a 
device known as a scan tool to harvest the recorded data 
through a port in the car, not unlike downloading data from 
your desktop onto your PDA.
    These data are typically codes known as fault codes that 
tell the technician what system or component is malfunctioning.
    Since the introduction of OBD in the 1990's car 
manufacturers have begun integrating systems other than 
admissions into their car computer networks. Today safety 
systems such as antilock brakes and convenience systems such as 
antitheft alarms are all part of the electronic network of a 
car's brain. All of this complexity makes a diagnosis and 
repair of car problems a very technical and sometimes capital 
intensive business that requires the right training, the right 
tools, and the right data.
    The problem we are focused on today relates to access. 
Access to the complex and sometimes expensive tools of the 
trade and the critical data that now acts as a key and the 
Rosetta Stone for diagnosing problems and servicing your 
automobile.
    Those advocating Federal legislation, particularly many in 
the aftermarket service repair and parts industry, claim both 
the tools and codes are at best hard to track down and at 
worst, not readily available for all but the car and the truck 
dealers. In contrast, the car manufacturers and others involved 
in the aftermarket service and repair industry say that the 
tools and data have been and are accessible with virtually all 
of the relevant information currently provided over the 
Internet. So there continues to be a real difference of opinion 
about the current state of affairs and the ability or inability 
to access to the tools and data necessary to service and repair 
our modern cars and trucks.
    I think the following questions attempt to summarize our 
subcommittee's focus today:
    Are scan tools available to independent repair shops and 
the general public? If so, are these the same tools provided to 
the car dealers? Are they prohibitively expensive?
    Are the fault codes and other diagnostic data available to 
independent repair shops in the general public? And if so, why 
are there reports of tools showing ``code undefined.''
    If there is a problem with the tool and data availability, 
how extensive is the problem?
    Are there currently lawsuits or complaints to the Federal 
Trade Commission?
    What is their quantifiable impact on small independent 
repair shops in terms of lost business, and what is the 
quantified economic impact on unsatisfied customers?
    Are there legitimate public health and safety concerns that 
should be considered if we allow access to safety, emissions 
and security systems on cars and light trucks? Obviously, is 
there a chance to tampering?
    Are there legitimate risks to the intellectual property 
invested in the programs and technologies that are used in OBD 
and other diagnostic systems?
    And finally, my colleagues, will Federal legislation 
provide a solution to this ongoing issue or are there current 
programs at the Federal/State level with adequate enforcement 
available.
    I would like to thank our witnesses for coming here and 
taking their valuable time to join us. And we look forward to 
your testimony and presentations.
    And with that, I recognize Ranking Member Schakowsky for 
her opening statement.
    Ms. Schakowsky. Thank you, Mr. Chairman.
    As you know, the opportunity to make opening statements has 
long been recognized by the Committee on Energy and Commerce on 
a bipartisan basis as a member's right. And I appreciate the 
opportunity this afternoon to make an opening statement. 
Nonetheless, this right which is vital for the minority in 
Congress and to our democracy was unfairly denied by Chairman 
Barton on Wednesday, September 15, at the full committee markup 
of House Res. 745, the resolution of inquiry into Vice 
President Cheney's secret energy task force.
    Chairman Stearns, as I have said on a number of occasions, 
the manner in which you have lead this subcommittee have been 
nothing if not curious and respectful. And although we disagree 
on a number of issues, you have worked with me and with Ranking 
Member Dingell to ensure that the minority has had a voice in 
the happenings of the subcommittee. That is why I must say that 
I was surprised and disappointed to hear that Ranking Member 
Dingell's request for just one witness from the Federal Trade 
Commission was denied.
    The request for this particular witness was not a partisan 
or political request. The divide on the topic of today's 
hearing, how technology changes in the design and maintenance 
of cars have affected both the consumer's right to choose 
repair shops and independent repair shops themselves, is not a 
divide on partisan lines. In fact, I may not have agreed with 
what the FTC would have had to say if a representative of the 
agency was allowed to testify, but because the FTC would be 
affected by any legislation we may decide to undertake, I 
believe that an FTC witness should be here to share the 
agency's knowledge and perspective on the issue.
    Because of our history of cooperation and because we do 
have a number of other stakeholders here today, I find the 
decision to deny Ranking Member Dingell a witness to be quite 
unnecessary. Having said that, I do look forward to hearing 
from the witnesses who are here today.
    Many of the technology changes in car design and 
maintenance have made cars safer and more environmentally 
sound. The changes have truly been advances. However, they have 
also created new challenges for the consumer and for 
independent repair shops. Consumers are finding that they 
cannot take their cars to the repair shop of their choice. 
Repair shops are finding that they must refer their customers 
to dealers for repairs they cannot do. Those experiences are 
not because the mechanics are not capable, but because they 
cannot get the information they need or they cannot get the 
information they need in a timely fashion to make the necessary 
repairs.
    I believe that the manufacturers of motor vehicles sold in 
the United States should disclose the information necessary to 
service or repair vehicles to car owners, repair shops and to 
the Federal Trade Commission. I believe that this information 
should be available while protecting industry trade secrets and 
intellectual property so that car owners can go to the repair 
service of their choice.
    Some of the witnesses here today will say that the sharing 
of information is already occurring and that the auto makers 
and independent repair shops have been working together 
voluntarily. While I believe that there have been some positive 
changes since this issue came to light a few years ago, thanks 
in large part to the late Senator Paul Wellstone's prodding, I 
believe there is still room for improvement.
    We need to ensure that the information provided to the car 
owners and independent repair shops is easily accessible, 
accurate, timely and not priced out of reach.
    Again, I do look forward to hearing the ideas of our 
witnesses on this issue.
    It is unfortunate that the Majority has denied us the 
opportunity to hear the Federal Trade Commission's perspective 
today.
    Mr. Stearns. Thank the gentlelady.
    Mr. Upton?
    Mr. Upton. Well, thank you, Mr. Chairman.
    As Representative of the great State of Michigan, the 
birthplace of the automobile and as Co-Chair of the Auto 
Caucus, I am glad to have the opportunity to exercise oversight 
over matters of the industry itself.
    The auto industry is a driving force in the economy of 
every State creating an estimate 6.6 million jobs direct or 
indirectly and providing over $240 billion in payroll 
compensation every year. It is appropriate that our committee 
and this subcommittee keep an eye on the critical engine of 
commerce.
    When it comes to the auto industry and the legislative 
process, I am of the mind set that less is more. I look at all 
the work that is being done in the area of alternative fuel 
vehicles without congressional mandate, and I know that this is 
a market drive rather than regulatory, and I think that is how 
it ought to be.
    When the concern was first expressed about repair issues 
and consumer fairness, I was pleased to see that the auto 
industry came to the table, stepped up to the plate, with a 
voluntary proposal to deal with the issue. It has been little 
over a year and my understanding is that this voluntary effort 
is working very well. The auto companies are already providing 
the same repair information to independent repair shops that 
they supply to their own dealers. Auto makers make available 
the same service and training information related to vehicle 
repair as is provided to franchised dealers and the same 
diagnostic tools related to vehicle repair that are provided to 
franchised dealers.
    Progress has also been made with regard to tool information 
availability for the aftermarket industry. I am told that the 
auto makers are making factory tools available to independent 
repair ships and/or providing information to the Equipment and 
Tools Institute so that third parties can develop diagnostic 
tools with the same capability as factory tools.
    And finally, auto makers are making training materials 
available either through their websites as an 800 number to 
ensure independent technicians throughout the country have 
access to all needed service, repair and training materials.
    I look forward to hearing an update on the progress of that 
voluntary agreement and availability of tools to perform 
necessary auto repair.
    As Chair of the Subcommittee on Telecommunications and the 
Internet, I am also aware of how evolving technology can 
revolutionize an industry. That often means that an industry 
can wide up on the bleeding edge of technology. With that in 
mind, I am also interested in hearing how proprietary 
information on parts can be protected so that we protect 
consumers against counterfeit parts.
    And finally, I am curious just how widespread that problem 
actually is. I certainly have not hear from any of my 
constitutes about it. And although the statistics on post-
warranty repairs would indicate that a huge number of repairs, 
over 75 percent, are done at independent stops rather than at 
dealers. So that if you think that there really is a big 
problem, you would think that we would hear about it.
    Thank you, Mr. Chairman, I look forward to the hearing and 
appreciate the time that our witnesses are committing to us. I 
yield back my time.
    Mr. Stearns. I thank my colleague.
    And now the distinguished ranking member of the full 
committee, Mr. Dingell also from Michigan.
    Mr. Dingell. Mr. Chairman, your courtesy to me is much 
appreciated, and I thank you for recognizing me and for 
recognizing all members for opening statements.
    We had a very unfortunate experience in this committee last 
week, which I am pleased to see is at least not being repeated 
today. And, of course, I will continue to maintain an active 
interest in seeing that committee rules and their 
interpretation properly reflect the traditions of this 
committee, and that members are permitted to be heard on 
important matters of national concern.
    On another procedural matter, I regret that we will not be 
hearing today from the Federal Trade Commission, despite my 
request that the FTC be allowed to offer its views. Therefore, 
minority members are delivering to you this afternoon a letter 
pursuant to Rule 11 of the House of Representatives requesting 
at least 1 additional day of hearings on the subject of today's 
hearing.
    I am not altogether sure I can understand or explain why 
the leading Federal consumer protection agency was not invited 
to a hearing on the availability of automobile repair 
information. Moreover, the proposed legislation on this matter 
sponsored by our good friend and chairman, Mr. Barton, and Mr. 
Towns would give significant new authority to the FTC. Without 
an understanding of the position and views of that agency on 
the powers to be given and whether they are in fact needed or 
whether they would be adequate, it would be hard for us to come 
to a clear judgment as to what it is this committee ought to do 
with regard to the legislation.
    Members and the public are entitled also to hear from the 
FTC on this entire subject.
    Despite my misgivings with regard to the FTC's absence, I 
am pleased that we are holding this hearing today, and I thank 
you for it, Mr. Chairman. H.R. 2735, the Motor Vehicle Owners' 
Right to Repair Act of 2003, was reportedly introduced to help 
small independent repair shops. There are, however, questions 
surrounding this legislation which I am hopeful our witnesses 
will be able to help us understand.
    For example, why is the most vocal and well funded 
supporter of the bill, the CARE Coalition, primarily composed 
of and funded by large corporations, many of which sell 
inexpensive replacement parts from overseas?
    Moreover, why does the leading trade association 
representing independent service shops for whom this 
legislation was supposedly created oppose the bill?
    These are questions which peak my curiosity, as I am sure 
they will anyone who looks at these matters. And I know that 
you will want to have answers to these questions, Mr. Chairman.
    The issue is not as simple as it may appear. The publicly 
stated objectives of this legislation are laudable, indeed. 
Consumers should be able to choose who repairs their 
automobiles. It is not, however, the bill's stated objectives 
with which I am concerned. It is the means through which this 
legislation seeks to achieve its stated objectives and the 
consequences, whether intended or not, that give me real pause.
    It is possible to help the consumers and to assist 
independent repair shops without jeopardizing the rights of 
automobile manufacturers and suppliers. Independent service 
stations across the Nation have joined with the world's 
automobile manufacturers to create the National Automobile 
Service Task Force. This task force has designed a 
nonlegislative means through which the objectives of the bill 
can be and are being achieved. I am told that independent 
service stations are now receiving the information they need to 
repair all makes and all models of motor vehicles.
    No one should expect that an undertaking of this magnitude 
is going to be perfect from inception. There will be errors and 
there will be flaws. This requires communication, perseverance 
and, most importantly, the willingness of all stakeholders to 
succeed. It is, I think, therefore a matter into which this 
committee should be going, and I commend you for your 
leadership.
    To the current members of the task force I say continue to 
work diligently. Keep us appraised of your progress. To those 
who are intent upon criticizing the goodwill of others, I 
suggest that you use a portion of the vast resources you have 
spent on multimedia presentations and high priced lobbyists to 
help the task force achieve a real victory for consumers and 
independent repair shops. This, I believe, can be much better 
done by cooperation amongst the parties than it can by us 
enacting legislation unless there is extraordinary reason 
therefore.
    Mr. Chairman, I look forward to hearing from our witnesses, 
and I look forward to a more thorough and complete examination 
of this issue in the near future.
    And I thank you for the recognition.
    Mr. Stearns. I thank the distinguished ranking member. And 
we have your letter, and we will certainly look at it 
carefully.
    Let me ask you as a suggestion, what happened if I offered 
unanimous consent to allow the subcommittee members to submit 
questions to the Federal Trade Commission for their answers? 
Would that be acceptable to you as a alternative approach.
    Mr. Dingell. Does my good friend direct these questions to 
me?
    Mr. Stearns. I do, indeed. And I recognize the gentleman.
    Mr. Dingell. If the Chair would yield to me. I think that 
is a splendid idea, and I would of course actively avail myself 
of this.
    When we commenced the process, however, Mr. Chairman, of 
trying to get the views of an agency like the Federal Trade 
Commission on a question as complex as this, it may be that the 
answering of those questions will leave us with more questions 
than we have when we start. And I appreciate what I am 
satisfied is a genuinely good faith effort to meet my concerns, 
but the FTC is the agency that will be designated to engage in 
the enforcement of this matter. And I have no idea what they 
are going to say, but if there is something to be said on the 
enforcement and other judgments and a critique of the 
legislation, certainly the agency selected by the statute to 
address this and the principle consumer representative 
organization inside the Federal Government I believe should be 
here. Because I think all the members would want----
    Mr. Stearns. I respect your years of experience. So I am 
taking that to assume you would like an unanimous consent?
    Mr. Dingell. I really would, Mr. Chairman.
    Mr. Stearns. Okay.
    Mr. Dingell. I say this with both respect and affection.
    Mr. Stearns. No. I understand.
    By unanimous consent so ordered that all the members will 
be able to submit questions to the Federal Trade Commission.
    With that, the gentleman from New Hampshire.
    Mr. Bass. Thank you, Mr. Chairman.
    This is an interesting hearing. Clearly, as my friend from 
Michigan Mr. Dingell said, it is more complex than it appears 
to be at first. There are issues of safety and competitiveness 
involved, as well as good consumer oversight.
    As one who is familiar personally with the problems that 
car owners face when they try to make repairs to systems that 
cannot be handled by any other entity than a dealer, I think it 
is important to seek to achieve an appropriate balance so that 
modern automobiles can be repaired and maintained safety 
outside of the dealership structure to help keep the cost of 
maintenance down while at the same time assuring that the 
motoring public is safe.
    This is an excellent hearing and I look forward to hearing 
the views of our witnesses here today. And I thank Chairman for 
holding it.
    Mr. Stearns. Mr. Issa?
    Mr. Issa. Thank you, Mr. Chairman. And thank you for 
holding this hearing.
    I am not a co-sponsor of the bill. I am here to decide 
whether or not this piece of legislation is necessary. But I do 
have an obligation to express two things.
    First of all, many people on the committee know that I have 
a long history in the aftermarket industry designing 
manufacturing for the automobile. First of all, I have no 
financial interests any long in any company that is involved in 
that industry. So, hopefully, that puts aside any questions of 
conflicts.
    However, in my 10 years on the Board of the Consumer 
Electronics Industry and my 20 years of manufacturing for the 
auto companies, I have personally witnessed a reluctance and a 
continued reluctance by the auto companies to provide in an 
expeditious fashion any technology that would allow anyone to 
develop a product in competition or even in addition to the 
auto companies with rare exceptions. So I come here today with 
concern that what I have observed for 20 years in the business 
and, as I said, about a decide on the board of the major trade 
association does tend to make me believe that there is a 
possibility that the auto companies deliver but do not deliver 
in a timely fashion, and certainly make very effort to not 
deliver in a predelivery of vehicle to anyone other than to 
their authorized dealers.
    Having said that, I am not signed on the bill. I look 
forward to finding out whether this particular piece of 
legislation is the best solution and, of course, whether or not 
the problem is sufficient is sufficient to justify a mandate of 
a Federal agency. But I come here with a history that I wanted 
to make sure I disclose.
    And thank you, Mr. Chairman. I yield back.
    Mr. Stearns. I thank the gentleman.
    The gentleman from Texas, Mr. Green.
    Mr. Green. Thank you, Mr. Chairman.
    I would like my full statement be placed into the record.
    Mr. Stearns. My unanimous consent, so ordered.
    Mr. Green. I want to thank you for allowing this 
opportunity to give opening statements today. I think my 
colleagues from both sides of the aisle have a great amount of 
respect for the legislative processes. I am glad to see it 
being upheld here today in light of our last week's events.
    I would like to thank the Chairman and also Congressman 
Towns for their leadership on this issue. About 2 months ago I 
met with about 20 repair shop owners from my own district 
asking me about the legislation. And since then we have 
received probably a lost of about 100 shops in the district I 
represent in Houston.
    I have a pretty blue collar district and I grew up working 
on cars. And my constituents still do. And we have a lot of 
shade tree mechanics. And I guess my concern about it is that 
today the technology has changed.
    When I was growing up, I would go pay $35 for a Chelton 
manual to be able to see how I repaired my vehicle. But 
nowadays with everything else, you have to have a computer 
program or whatever. And my concern is if someone purchases a 
vehicle or a computer or anything else, they ought to be able 
to have someone that they want to repair that, and they ought 
to have the ability to get the information to do it.
    Now, granted, auto dealers or auto manufacturers make it 
and they have a proprietary right to the information. But they 
ought to make it available just like I have to pay, at least in 
the 1970's, $35 which was a lot of money then for a book. But 
today I know it would be a lot more. But the goal I think is 
simple to make sure that the manufacturers provide this to not 
only my constituents, but also the folks that may be hired to 
repair those vehicles. And I would hope that they would be able 
to get a reasonable amount of money to compensate them for 
that, but also make sure that folks could repair their cars.
    And with that, Mr. Chairman, I will not take my whole time 
and put the full statement in the record.
    Thank you.
    [The prepared statement of Hon. Gene Green follows:]

  Prepared Statement of Hon. Gene Green, a Representative in Congress 
                        from the State of Texas

    First, I'd like to thank the Chairman for giving us the opportunity 
to make opening statements today. I think many of my colleagues from 
both sides of the isle have a great amount of respect for the 
legislative process and I'm glad to see it being upheld here today in 
light of last week's events.
    I'd also like to thank the Chairman and Congressman Towns for your 
leadership in bringing attention to the issue of auto repair.
    It was about 2 months ago that I met with 20 repair shop owners 
from my district asking me about this legislation and what Congress 
could do. Since then, I have received a list of almost 100 shops in my 
district voicing concerns over having access to information that would 
enable to repair today's high-tech automobiles.
    Like most large cities in the United States, Houston has as many 
independently owned repair shops as we do shade-tree mechanics. 
However, with the level of technology used in today's automobiles, the 
shade tree mechanic is often led to their nearest repair center which 
is most often an independent shop.
    When I got my first car, I was able to buy a Hanes or Chilton 
manual that showed how the car could be repaired. These manuals 
included wiring diagrams, clock times to adjust the timing, and torque 
specifications for everything from the lug nuts on the wheels to the 
bolts securing the engine block.
    Things have changed and computer systems in newer vehicles control 
everything from Air bag deployment to emissions.
    I'm supporting this bill because I'm concerned about the consumer. 
If my constituents own a newer model car or truck, they should be able 
to take it to their local mechanic to be repaired. High tech advances 
shouldn't make repairing your vehicle at a neighborhood shop out of 
reach.
    The goal of this legislation is simple: auto makers should be able 
to supply information to local repair shops so those shops can repair a 
vehicle. However, auto makers should also be fairly compensated for 
this information due to their investment in developing and engineering 
the cars and trucks in the first place.
    I understand the Alliance of Automobile Manufactures and the 
Automotive Service Association are working towards this goal through 
the National Automotive Service Task Force. I hope you continue your 
efforts to resolve these issues regardless of what happens with this 
legislation. It's important for consumers and small businesses alike.
    Thank you Mr. Chairman and I yield the balance of my time.

    Mr. Stearns. I thank my colleague.
    And the gentleman, Mr. Otter.
    No statement.
    [Additional statement submitted for the record follows:]

 Prepared Statement of Hon. Joe Barton, Chairman, Committee on Energy 
                              and Commerce

    Mr. Chairman, thank you for holding this important hearing today on 
the complex issue of information availability and access to auto repair 
information.
    I have some indication after reviewing the testimony of our 
distinguished panel, that there are very strong opinions about the 
degree of progress that has been made in terms of information 
availability and access for independent repair shops.
    Let me say before we evolve into a contentious debate that I have a 
wonderful General Motors plant in my district, in Arlington, TX. And, 
like most Members, I have local dealers I hear from occasionally. So 
this is not a constituency whose views I have failed to hear on the 
underlying legislation referenced in the testimonies of the witnesses 
here today. And so we are clear, I am not out to harm the technological 
advances made each day by our automakers or give away their trade 
secrets.
    I have been involved in this issue since August of 2001, solely on 
the principle that I believe consumers need to have choice in auto 
repair, whether foreign or domestic, and they should be able to choose 
where they have the vehicle repaired and whether they choose 
aftermarket replacement parts or Original Equipment Manufacturer (OEM) 
parts.
    Since introducing this legislation, I have been openly working with 
all parties to facilitate an agreement that would negate the need for 
legislation. However, let it be said, that we are here today discussing 
progress made on a voluntary industry agreement chiefly because of a 
hearing that was held by Senator Dorgan in July 2002. That hearing, and 
the fear that the late Senator Wellstone's companion legislation would 
be moved, persuaded the automakers (the Alliance and AIAM) to broker a 
deal with a smaller group of service providers, known as ASA--whose 
members are with us today.
    Though, the Alliance, AIAM (the international automakers) and ASA 
declared the problem was solved, this agreement did not alleviate the 
primary concern of a larger group of aftermarket repair folks, known as 
the CARE coalition. Their concern is that this is a voluntary agreement 
and not enforceable. Rather, there is no recourse if the automakers 
decide not to continue supplying information. They along with AAA, 
NFIB, The Retail Industry Leaders Association, and the 60 Plus Senior 
Citizens Association support the legislation.
    This voluntary agreement, reached in September of 2002, set a 
deadline of August 31, 2003, when all information necessary to 
diagnose, repair and service vehicles for both emissions and non-
emissions related repairs would be made available in the same manner 
and to the same extent as it is to franchised dealerships.
    The automakers, I believe, have been acting in good faith, but 
acknowledge that this is a mammoth undertaking, and possibly have not 
to date managed to get all the information to independent repairers. I 
have, from the automakers' task force (NASTF), an On-Board Diagnostic 
Scan Tool Table from September 9, 2003, that shows the spotty 
availability of scan tool information based on the efforts of 
individual automakers to get it out there. While I do not doubt their 
good faith efforts to do so, it is not clear that the Alliance and 
AIAM--which are trade associations--can ``voluntarily'' compel these 
companies to do what is in the agreement. In other words, what is the 
recourse for independent repairers and consumers, or the penalty for 
the automaker, if it is not done?
    I appreciate the efforts the automakers have made to use the NASTF 
process as a conduit for independent repairers and the various 
automakers, however, it is simply not practical and not realistic to 
think that a consumer is going to wait 8 to 15 days (based on NASTF's 
best and average response time) for an independent repair shop of their 
choice to get the adequate information to repair their car. Sure, they 
may eventually get the information--but if the customer has already 
gotten tired of waiting, it is a moot point. We all know as consumers, 
when our car breaks, we want it fixed and back within a day or two. I 
question why it takes so long, and why independents have to go through 
this process--when dealers do not. In my opinion, this does not fully 
meet the voluntary agreement requirements.
    The issue today is access and availability. It is NOT about gaining 
proprietary information, as some suggest. I personally take issue with 
some of the testimony exploring that notion. That argument is easily 
resolved by reading my legislation. But more so, I believe that 
argument keeps parties entrenched and distrustful of one another. If 
legislation is to be negated, agreements have to be improved and 
enforced. Automakers comply with the EPA rule that requires similar 
information for emissions related repairs, and it is written in a way 
that does not require them to release proprietary information. It 
states: ``Information for making emission related repairs does not 
include information used to design and manufacture parts, but may 
include OEM changes to internal calibrations, and other indirect 
information . . .''
    I believe the same could be true for non-emissions repair 
information.
    I am interested in brokering a solution today, as I have been since 
the beginning--some three years ago. I want to echo the comments from 
the 2002 Senate hearing . . . I want a solution that satisfies all 
parties or I will reluctantly move legislation. I know from personal 
dealings that my legislation would have been done away with had there 
been some coming to the table on the issue of private, third-party 
arbitration and dispute resolution--which did not involve the potential 
for litigation. But the Alliance felt that they could never get all 
their companies to agree to that.
    So, instead of questioning my motives and those of others here 
today, I suggest we look at ways to reach a more lasting solution. It 
is easy to see why 9 of my colleagues on this Subcommittee, and 21 
Members of the Full Committee support the underlying legislation.
    The reason is simply that we want to know that as car technology 
advances more each day, the relevant information for aftermarket repair 
shops remains accessible, is provided at a reasonable cost, and is 
current. The EPA has already done this for emissions related repairs. 
The framework is there to protect proprietary information, and the same 
could work for non-emissions information.
    Fear of Congressional action has gotten us to where we are today, 
and I commend automakers that have improved availability and access. 
Let's work together to see that it continues and can be improved upon 
to the extent that legislation is truly not necessary. I remain open to 
ideas to do so.
    Thank you all for your participation today. And thanks to Chairman 
Stearns for holding this hearing.

    Mr. Stearns. With that, we will move right to our witness. 
And I would say to my colleagues and to the panel, we have two 
presentations before we start the opening statements. Mr. Dave 
Scaler, Mechanics Education Association in Maplewood, New 
Jersey and Mr. William Haas, Vice President Service Repair 
Markets Automotive Service Association.
    I welcome both of you. And, Mr. Scaler, you are first. So 
your presentation, we look forward to seeing it.

    STATEMENT OF DAVE SCALER, DIRECTOR, MECHANICS EDUCATION 
                          ASSOCIATION

    Mr. Scaler. Mr. Chairman, members of the committee, it is a 
great pleasure to be here today to share some experiences that 
we have----
    Mr. Stearns. You might just pull the mike a little closer 
to you, just for those in the back.
    Mr. Scaler. Is that better?
    Mr. Stearns. That is better.
    Mr. Scaler. My name is Dave Scaler. I am the Director of 
Mechanics Education Association in New Jersey. We are a support 
center for independent repair shops throughout the country 
providing telediagnostic support, onsite troubleshooting as 
well as training.
    I just want to share with you very briefly some experiences 
that we have in the best that I can in the brief time that we 
have, encapsulate some of the difficulties that we are having 
in getting real people's cars fixed.
    This presentation is called ``Real People, Real Cars, Real 
Problems In the World of Using OE Websites.'' Essentially 
everyone of these situations is a customer of ours that has a 
problem that we tried to address by fixing it through use of 
the equipment tools and information we currently have 
available.
    The first care is 2000 Dodge Neon. The problem with the 
car, it has a check engine light on, a federally mandated 
light. There are over 50 different reasons this light could 
come on.
    In this particular case, we followed the Chrysler factory 
procedures which is available on the web. That procedure tells 
that this car has an oxygen sensor problem. And we follow 
through the procedure. One of the options on the bottom 
suggests that the control unit or the engine controller could 
be faulty. In this particular case, that is what is faulty. In 
order to replace that controller, what is required according to 
the factory service information found on the website, is the 
use of the factory Chrysler tool. Very fortunately, we own the 
factory Chrysler tool with the latest updates and were able to 
continue with the process.
    So at that point when we look at the factory tool, and this 
a screen shot from the factory diagnostic tool, it tells me if 
I replace the controller on this car, that the engine will not 
start unless I perform or enter a PIN number into the computer.
    Now, right there it tells me on the next slide, it says 
enter PIN, personal identification number and contact Chrysler 
for this number. So, of course, the number is right on the 
tool. We called Chrysler, and unfortunately Chrysler was unable 
to provide that PIN number to us. They said they can only 
provide that to the dealership.
    So in this case it was particularly disappointing because 
one of our technicians that worked for us owns the car. So in 
this case we have paid for the subscriptions, we have bought 
all the factory necessary equipment, we have the vehicle owner 
repairing the car and we still could not complete the repair 
because of the fact that I needed a PIN number.
    So you can see while on the surface, particularly for those 
fixing cars, it may appear that a lot of there. But all that 
needs to be missing is one of step of the process and the 
repair cannot be finished.
    The solution to this is often viewed in this example, which 
is a 1998 BMW. It failed the federally mandated I/M program for 
states that are non-attainment.
    In this particular case, this is a 1998 car. It is 
important to note these are not all brand new vehicles. This is 
years of history here.
    This is a SAE code made by EPA for secondary air or air 
pump problem. So the car fails inspection, in this case in New 
Jersey, for this problem.
    We go the BMW website. Here I punch in the number for the 
code, it gives me a description, which is good. I am pleased 
with that. When I go to find repair documentation for it, it 
suggests that there are no documents found. I go through every 
page that I can of the repair information there. I cannot find 
any repair information, meaning a procedure to fix this car. So 
I complain to BMW, and this is basically a copy of an email to 
BMW suggesting what I am looking for. The BMW's response to me 
was P code information is found on the website. Now, I've just 
spent a tremendous amount of time looking for it, they are 
suggesting that it is there.
    So once again I feel well it must be me. I go back and try 
again. I still cannot find it after literally hours and hours 
of looking. So I complained to NASTF, which is coined the 
solution to the problem.
    This is my confirmation to NASTF of the problem. This is my 
complaint showing documenting exactly what I was looking for 
and in hopes that they can clarify this, and obviously 
confirmation of that.
    I get an email from Mr. Haas to my left here, who I have 
known for a long time, I was very pleased to get that email. He 
suggest that he is going to send this to BMW and take a look at 
it and we are going to be able to straighten this out. And 
knowing Bill, I was very pleased at that.
    As time went on, I got additional emails and while I was a 
little disappointed in this particular one that the email got 
reduced to not a problem with the BMW but the Scaler complaint, 
in this case I was well aware that the other leader members of 
NASTF were aware of my complaint. So at least in that respect, 
that was good.
    Bill came back and asked me, you know, is it not there, is 
it something you cannot find, are you are the right website? Of 
course I was, so I replied to him. ``The complaint is that it 
is not on the website. I have searched every corner on the 
site, on and off for days (literally) and it is not there. 
There are descriptions but no troubleshooting procedures. I can 
access the website. I have sent them emails.'' And once again 
essentially I am being told that it is okay.
    Now BMW responds, and this is important to me. It says 
``Mr. Scaler, you recently submitted a complaint through the 
IATN and the NASTF.''
    And they post it, because I did complain in November of 
last year, and that is important. I am a member of NASTF and 
last year in November at the meeting it was the understanding 
that we needed to give them time. So my complaint in November I 
let slide. I recomplained again. And they are giving me the 
same answer. And that answer is, the information is exact same, 
is at the BMW website.
    It is important to note that I know it is not there, but 
once again I am being told that it is. It is very important to 
note at the bottom that this email is always, every response to 
me, is copied to every leader of NASTF as well as to me. BMW 
attaches the email they saved from me in November suggesting it 
is there.
    I tried to help them understand, so I send a reply, and 
this is a copy of my reply explaining exactly what I am looking 
for, and I copy every leader of NASTF to try--and this is the 
third time now that I have been told, and I know it is not 
there, that it is there. So I am trying to clarify that 
particular situation.
    Once again BMW comes back with a public announcement that 
says ``We provide the exact same information'' and everything 
is there. And I am very disappointed at this point that no one 
else has tried to access it other than me, and this is the 
third time I am told it is not there.
    So at this point I decide to let them know where the 
problem probably lies. So I suggest to them that perhaps, and I 
copied everyone here also, that the problem may be that it is 
not there and I need a special tool in order to get.
    Well it is very important to note that BMW acknowledges 
this, and this time after the fourth time, this is the only 
time they acknowledge it without copying the rest of the 
people. And it says: ``Mr. Scale, I believe you are correct.'' 
After four times of being stonewalled, ``A connection to the 
vehicle is needed to identify the problem,'' which means that 
the information was not available in order to get it. And 
needless to say, I was very disappointed and I have other 
examples of that.
    And, again, I am trying to be brief in order to bring us 
through.
    Just so you know, it did say that if I have a tester, I 
could do this. And my subscription, which was $20, has now 
become $15,800 at the time, which is now $18,900 if I want the 
tool to connect to get the federally mandated repair procedure 
for this vehicle. While I am okay with that, because in all of 
my scenarios I am willing to spend whatever it takes, 
unfortunately I have been told that there are certain pieces 
that I still cannot get which I will address in later 
testimony. But this is where we run into some of the problems 
what is coined as ``the solution.''
    And finally where I will leave this in order to be brief, 
is that it is very important to note that there are often times 
two different levels of service information. In the case of 
Ford, I will use as prime example there is the Motorcraft 
website for the Ford aftermarket. Along with the Ford 
Motorcraft website there is also fmcdealer.com. The technicians 
at the Ford dealers use fmcdealer.com to repair vehicles, not 
motorcraft.com.
    I can tell you from very technical experience, and that is 
important because realize while I am a technician, I still 
repair cars, and many people that are auditing this do no 
longer fix cars. And this site is where I go now to fix cars. 
Unfortunately, I had to make arrangements with friends, because 
I am not allowed in here. As you can see, it is a secured 
website not to be accessed but anybody but Ford or technician 
at Ford. And the information that I use currently today to fix 
many cars, including programming of vehicles, I get from this 
website and I cannot get from the Motorcraft website. So once 
again we have two different playing fields on this issue.
    [The prepared statement of Dave Scaler follows:]

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    Mr. Upton [presiding]. Thank you.
    Now Mr. Haas.

  STATEMENT OF WILLIAM J. HAAS, VICE PRESIDENT, SERVICE REPAIR 
         MARKETS FOR THE AUTOMOTIVE SERVICE ASSOCIATION

    Mr. Haas. Good afternoon. Mr. Chairman, subcommittee 
members, and I appreciate your invitation to make this 
presentation at today's hearing on House Resolution 2735, The 
Motor Vehicle Owners' Right to Repair Act. I am the Vice 
President of Service Repair Markets for the Automotive Service 
Association.
    ASA is the oldest and largest trade organization in the 
automotive industry with the distinction of serving only those 
businesses that perform service and repairs for the motoring 
public.
    After a vehicle is out of warranty consumers prefer 
independent shops to the alternatives 74 percent of the time. 
As for the confidence that consumers place in independent 
repair facilities, I would like you to consider this: In the 
J.D. Powers and Associates, Service Usage and Retention Study 
independent shops rate exceptionally high in customer service 
satisfaction. When compared to 56 alternatives, they beat out 
every aftermarket chain, mass merchandiser and the OEM 
franchises. You can imagine how proud I am to work for and 
represent those small businesses. Families that are living the 
American dream.
    I have an extensive background in the automotive industry. 
Prior to joining the staff of ASA my career included 26 years 
as an automotive technician, shop manager, shop owner and 
automotive instructor. I have successfully tested and been 
certified by the National Institute of Automotive Service 
Excellence since 1976. I have also completed the required 
courses to earn my accredited automotive manager designation 
from the Automotive Management Institute.
    It is a special honor for me to be here today as I was also 
a witness in the July 2002 for the hearing on Senate bill 2617, 
the Motor Vehicle Owners' Right to Repair Act of 2002. The late 
Senator Paul Wellstone from Minnesota introduced Senate Bill 
2617 because he believed in fighting for the small guy and 
equal opportunity. At that time the Automotive Service 
Association came to Congress with a strong message that 
independent automotive repair businesses were in trouble. Those 
entrepreneurs were challenged to have a future continuing to 
provide for the needs of America's motoring public.
    After the Senate subcommittee heard all of the testimony, 
Subcommittee Chairman Dorgan of North Dakota closed the hearing 
with an important message for the automotive industry. I will 
quote Senator Dorgan: ``Let this hearing stand as an expression 
of concern that this problem be resolved. It can be resolved 
legislatively by us passing legislation here in Congress, or it 
can be resolved through the negotiations and the determination 
that were described here today. I would agree with Senator 
Wellstone that if progress is not made or if we face a 
circumstance where we are discovering independent shop are 
systematically being frozen out of the information, I think 
that Congress will take a hard look at passing legislation of 
the type Senator Wellstone has introduced.''
    In the testimony I provided for the Senate in July of 2002 
I was able to provide very clear cases of auto makers that were 
prohibiting the release of information or restricting access 
that prevented independent repairers from having the same 
capabilities as their counterparts in the franchised 
dealership. My testimony include specific situations with 
several major auto manufacturers. Fortunately, for the 
automotive service industry I cannot cite those examples today.
    My testimony in 2002 also illustrated the infringement on 
consumer choice. When an independent repair shop was not able 
to perform a diagnosis or repair because of the limitations 
created by the auto manufacturer, independent shops had no 
alternative other than refer their customer to the franchised 
dealer. And now I must tell you that such an anti-competitive 
environment no longer exists.
    As a result of the Senate hearing, ASA and the auto makers 
discussed what could be done to satisfy the needs of 
independent repairers and ultimately resolve the problem. 
Through negotiation and determination, ASA and the associations 
representing all of the major automobile manufactures reached 
an agreement in September of 2002. The ASA/OEM agreement 
specifies that auto makers will make available to independent 
repairers the same service information, training and tools as 
are available to their franchised dealers.
    The decision to exercise the agreement with the auto makers 
was unanimously approved by the ASA Board of Directors. Twelve 
individuals from: Pittsburgh, Pennsylvania; Laguna Hills, 
California; Mankato Minnesota; Milwaukee, Wisconsin; 
Brookville, Ohio; Augusta Georgia; Lubbock, Texas; Tallahassee, 
Florida; Dublin, California; Chino, California; Raleigh, North 
Carolina, and; Eugene, Oregon that were elected by their peers 
to represent them. Twelve individuals that understand and face 
the same daily challenges as anyone who owns and operates an 
independent automotive service and repair facility.
    Those 12 individuals are representative of over 115,000 
businesses that have an average of five service bays, five 
employees and annual sales of approximately $1 million.
    You should find great comfort in knowing that the solution 
to this problem came from within the industry by the people who 
live and work in it everyday. I want to point out to you that 
you will see those people here today, and there is a good 
reason. The owners and technicians of those shops are home, 
they are busy, they are at work servicing their customers' 
vehicles because the information, the training and the tools 
that they need are available.
    All of the automobile manufacturers service information 
websites were launched by April 1, 2003. This was far in 
advance of August 31, 2003 date that was set forth in the ASA/
OEM service information agreement. These websites allow anyone, 
automotive service professional or a vehicle owner to access 
the information, training or tools necessary to diagnose and 
repair the complex systems in today's automobiles. Access to 
the websites is subscription based and subscriptions may be 
purchased for a short, mid or long term period.
    The average cost of a short term subscription is $18.50. 
When one consider the incredible amount, the volumes of service 
information produced by an automobile manufacturer every year, 
it appears that the subscription rates to access all the 
information for all models for multiple years is more than 
reasonable.
    You should also be aware that the OEM website is not the 
only place that the independent repairers access service 
information. Auto makers continue to license the use of service 
information to third party information providers, companies 
like Motor publications, ALLDATA, which is owned by AutoZone 
and Mitchell1, which is partly owned by NAPA.
    Regardless of whether a shop decides to purchase the 
information directly from the OEM or a third party information 
provider, it has a cost. In fact, the cost to purchase the 
first Motor manuals in 1927 was $3.
    The National Automotive Service Task Force was identified 
in the ASA/OEM agreement to continue to provide a forum for the 
industry and aftermarket to resolve service information issues. 
Established in October of 2000, the NASTF is a voluntary effort 
among the automotive service and repair industry, the equipment 
and tool industry and the automobile manufacturers.
    As a side note, the cooperation demonstrated by the 
automobile manufacturers participating in NASTF weighed heavily 
in ASA Board of Director's decision to execute the agreement 
with the auto manufacturers.
    As you might expect, nothing is perfect and on occasion 
someone may encounter difficulty finding the information that 
they need. NASTF makes a complaint process available for the 
automotive industry for these situations. The NASTF service 
information committee----
    Mr. Stearns. Mr. Haas, I am going to ask you summarize. We 
are trying to keep everything within 5 minutes. Now your 
colleague had about 8 minutes, so you are over eight----
    Mr. Haas. I apologize, Mr. Chairman.
    Mr. Stearns. No, I understand. I mean this hearing is a 
long time in coming, so now is your chance. But if you do not 
mind, if you can, just sort of summarize so we can get Mr. 
Donovan and everybody else.
    Mr. Haas. Sure. Be happy to.
    Mr. Stearns. I do not want to lose the members here.
    Mr. Haas. Okay. I think what is important is that NASTF 
does have a complaint process. I can show you quickly there is 
a report from 2003 the complaints that were received and the 
responses by the manufacturers. Here is what we have to date in 
2004. And this is a recent NASTF complaint, this just took 
place on September 14th. This was a complaint that was filed by 
a shop. They were looking for a specification at an Nissan 
website and they could not find the information they needed. 
This was the response they got from Service Technical 
Publications that refunded their money.
    This was a response from Nissen that showed them exactly 
where the information, it explained where to find the 
information that they were looking for. And if you were to go 
to the Nissen website, which this is their homepage, and go 
into their website, the upper most photo gives you exactly the 
information that that particular shop was looking for that day.
    And is often times the case, it is not always necessarily 
that the information is missing. We might not find it where we 
expect to find it.
    So I would summarize in saying that, you know, the process 
that we have is working. We have every indication that it will 
continue to work. We understand that it is far from perfect, 
but I think you will find that all the parties that are 
dedicated to NASTF want to see this be successful.
    [The prepared statement of William J. Haas follows:]

 Prepared Statement of William J. Hass, Vice President, Service Repair 
                 Markets Automotive Service Association

    Good afternoon Mr. Chairman and committee members. My name is Bill 
Haas and I appreciate your invitation to make this presentation at 
today's hearing on H.R. 2735, the Motor Vehicle Owner's Right to Repair 
Act. I am the Vice President of Service Repair Markets for the 
Automotive Service Association. ASA is the oldest and largest trade 
organization in the automotive industry with the distinction of serving 
only those businesses that perform service and repairs for the motoring 
public. After a vehicle is out of warranty consumers prefer independent 
shops to the alternatives 74% of the time. As for the confidence that 
consumers place in independent repair facilities, I would like you to 
consider this, in the J.D. Powers and Associates, Service Usage and 
Retention Study independent shops rate exceptionally high in customer 
service satisfaction when compared to 56 alternatives they beat out 
every aftermarket chain, mass merchandiser and the OEM franchises. You 
can imagine how proud I am to work for and represent those small 
businesses. People that are living the American dream.
    I have an extensive background in the automotive industry. Prior to 
joining the staff at ASA in 2000 my career included 26 years as an 
automotive technician, shop manager, shop owner and automotive 
instructor. I have successfully tested and been certified by the 
National Institute of Automotive Service Excellence since 1976. I have 
also completed the required courses to earn my Accredited Automotive 
Manager designation from the Automotive Management Institute.
    It is a special honor for me to be here today as I was also a 
witness in July 2002 for the hearing on Senate bill 2617, the Motor 
Vehicle Owner's Right to Repair Act of 2002. The late Senator Paul 
Wellstone from Minnesota introduced Senate bill 2617 because he 
believed in fighting for the small guy and equal opportunity. At that 
time the Automotive Service Association came to Congress with a strong 
message that independent automotive repair businesses were in trouble. 
Those entrepreneurs were challenged to have a future continuing to 
provide for the needs of America's motoring public. After the Senate 
Subcommittee heard all of the testimony Subcommittee Chairman Mr. 
Dorgan of North Dakota closed the hearing with an important message to 
the automotive industry. I will quote Senator Dorgan, ``let this 
hearing stand as an expression of concern that this problem be 
resolved. It can be resolved legislatively by us passing legislation 
here in Congress, or it can be resolved through the negotiations and 
the determination that were described here today. I would agree with 
Senator Wellstone that if progress is not made or if we face a 
circumstance where we're discovering independent shops are being frozen 
out of the information systematically, I think that Congress will take 
a hard look at passing legislation of the type Senator Wellstone has 
introduced.'' End quote.
    In the testimony I provided for the Senate in July 2002 I was able 
to provide very clear cases of automakers that were prohibiting the 
release of information or restricting access that prevented independent 
repairers from having the same capabilities as their counterparts in 
the franchised dealership. My testimony included specific situations 
with companies like BMW, Daimler Chrysler and American Honda. 
Fortunately for the automotive service industry I cannot sight those 
examples today.
    My testimony in 2002 also illustrated the infringement on consumer 
choice. When an independent repair shop was not able to perform a 
diagnosis or repair, because of the limitations created by the auto 
manufacturer, independent shops had no alternative other than to refer 
their customer to the franchised dealer. And now I must tell you that 
such an anti-competitive environment no longer exists.
    As a result of the Senate hearing ASA and the automakers discussed 
what could be done to satisfy the needs of independent repairers and 
ultimately resolve the problem. Through negotiation and determination 
ASA and the associations representing all of the major automobile 
manufacturers reached an agreement in September of 2002. The ASA/OEM 
agreement specifies that the automakers will make available to 
independent repairers the same service information, training and tools 
as are available to their franchised dealers. The decision to exercise 
the agreement with the automakers was unanimously approved by the ASA 
board of directors. Twelve individuals from Pittsburg PA, Laguna Hills 
CA, Mankato MN, Milwaukee WI, Brookville OH, Augusta GA, Lubbock TX, 
Tallahassee FL, Dublin CA, Chino CA, Raleigh NC, and Eugene OR that 
were elected by their peers to represent them. Twelve individuals that 
understand and face the same daily challenges as anyone that owns and 
operates an independent automotive service and repair facility. Those 
twelve individuals are representative of over 115,000 businesses that 
have an average of five service bays, five employees and annual sales 
of approximately one million dollars. You should find great comfort in 
knowing that the solution to this problem came from within the industry 
by the people who live and work in it everyday. I want to point out 
that you will not see those people here today and there is a good 
reason. The owners and technicians of the BEST shops in America are at 
work. They are busy servicing and repairing consumer's vehicles and 
they are able to do that because service information, training and 
tools are available.
    All of the automobile manufacturers service information Web sites 
were launched by April 1, 2003. This was far in advance of the August 
31, 2003 date that was set forth in the ASA/OEM service information 
agreement. These Web sites allow anyone, automotive service 
professional or a vehicle owner to access the information, training or 
tools necessary to diagnose and repair the complex systems in today's 
vehicles. Access to the Web sites is subscription based and 
subscriptions may be purchased for a short, mid or long term period. 
The average cost of a short-term subscription is $18.50. When one 
considers the incredible volume of service information produced by an 
automobile manufacturer every year it appears that subscription rates 
to access all the information for all models for multiple years is more 
than reasonable. You should also be aware that the OEM Web site is not 
the only place that independent repairers access service information. 
Automakers continue to license the use of service information to third 
party information providers, companies like MOTOR publications, ALLDATA 
which is owned by AutoZone and Mitchell1 which is partly owned by NAPA. 
Regardless of whether a shop decides to purchase the information 
directly from the OEM or a third party information provider it has a 
cost. In fact the cost to purchase the first MOTOR manuals in 1927 was 
three dollars.
    The National Automotive Service Task Force was identified in the 
ASA/OEM service information agreement to continue to provide a forum 
for industry and aftermarket to resolve service information issues. 
Established in October of 2000 the National Automotive Service Task 
Force is a voluntary effort among the automotive service and repair 
industry, the equipment and tool industry, and automobile 
manufacturers. As a side note--the cooperation demonstrated by the 
automobile manufacturers participating in NASTF weighed heavily in the 
decision of the ASA board of directors to execute the ASA/OEM service 
information agreement. The willingness of the automakers to engage in a 
process of identifying concerns and working towards solutions for those 
problems has earned them the trust of the independent repairer. As you 
might expect nothing is perfect and on occasion someone may encounter 
difficulty finding the information that they need. NASTF makes a 
complaint process available to the automotive industry for these 
situations. The NASTF service information committee monitors complaints 
submitted to NASTF. The complaint is forwarded to the automaker for 
their investigation and they are asked to respond directly to the 
complainant. The complainant is notified that the complaint has been 
received and they can expect a reply directly from the automaker. They 
are also asked to notify NASTF if they are not satisfied with the 
response from the automaker for any reason. During 2003 NASTF received 
eighty-eight complaints and automakers have responded to all of them. 
You can see on the slide that sixty-seven percent of those complaints 
were logged against a single automaker of which thirty-one were 
submitted during a nine day period. That particular automaker was Volvo 
and the problem was compounded by the fact that the nine days was the 
start of the Christmas holiday. As quickly as possible Volvo's 
technical staff worked to investigate, resolve and then respond to each 
individual complaint. The eventual outcome led to a NASTF meeting of 
Volvo representatives and the owners of nine independent Volvo repair 
specialists. That meeting started the dialogue that continues today and 
offers independent Volvo specialists a forum to have their issues 
addressed.
    From January 1, 2004 through last Friday, September 17, 2004 NASTF 
has received thirty-three complaints. Automakers have already provided 
responses to thirty-one of those. Allow me to show you the most recent 
complaint that was submitted to NASTF and how the process worked. A 
shop in Tukwila, Washington submitted this complaint on September 14, 
when the shop was not able to find a torque specification for replacing 
a cross member. Service Technical Publications, the company that 
maintains the site for Nissan processed a credit for the subscription 
on Sept. 15 and on Sept. 16 Nissan contacted the shop to apologize for 
the inconvenience and provided the shop with directions on where the 
information was located on the Web site.
    All of this was accomplished quickly because the automaker just 
wanted to do the right thing. It did not require regulation or 
oversight of a government agency. This is a system that can work and is 
working. I am optimistic that until such time that independent 
repairers present evidence to Congress that the ASA/OEM service 
information agreement has failed our industry will not incur the burden 
of regulation that will result in delays and increased costs for small 
businesses.
    I will close with one more example of what is being accomplished 
through our voluntary and cooperative efforts. At the start up of NASTF 
there were four committees established. They are service information, 
training and education, tools and equipment and communications. This 
year NASTF established a fifth committee. After members of NASTF had 
two meetings with the locksmith community to discuss their concerns 
with reproducing keys and unlocking vehicles for consumers it was 
apparent that NASTF could provide locksmiths with a forum to work 
directly with the automakers and a vehicle security committee was 
established in July. As all NASTF committees are co-chaired by a 
representative of the aftermarket and a representative of the 
automobile manufacturers. I believe the issues locksmiths face will be 
well represented as one of the co-chairs of the committee is the 
government affairs representative for the Associated Locksmiths of 
America.
    Mr. Chairman there are two kinds of people in the world. Those that 
solve problems and those that make problems. I believe the majority of 
people in the automotive service and repair industry are problem 
solvers. As you can see the problems that the service and repair 
community have experienced have been, and continue to be, addressed by 
people that engage in a process of solving problems. Having said that 
it is clear that this legislation is NOT necessary. So if there is more 
to H.R. 2735 than access to service information, training and 
diagnostic capabilities, I hope this committee will discover what it is 
and expose it for what it really is.
    I appreciate your attention and I am available for questions. Thank 
you.

    Mr. Stearns. I thank the gentleman.
    Mr. Donovan, AAA Automotive Technical Services for your 
opening statement.

     STATEMENT OF EDWARD C. DONOVAN, DIRECTOR OF TECHNICAL 
          SERVICES, AAA AUTOMOTIVE TECHNICAL SERVICES

    Mr. Donovan. Good afternoon. I am very pleased to be here 
this afternoon on behalf of AAA to discuss our support of H.R. 
2735.
    AAA, who is a member organization of over 47 million 
members, strongly supports the Right to Repair Bill for three 
important reasons: Consumer choice, vehicle safety and the 
right of car owners to own the information generated by their 
automobiles.
    My name is Edward Donovan, and I serve as Director of 
Technical Services for the Mid-Atlantic region of AAA. I have 
worked with consumers for over 25 years helping them manage one 
of their largest and most needed assets, their automobile. 
Throughout my career I had the opportunity to repair vehicles, 
direct a vehicle fleet repair group, manage our customer 
relations division and oversee a large scale operation of 
independent repair facilities for AAA. I know the firsthand the 
importance that consumer placed on having a trust service 
advisor to help them.
    Mr. Chairman, technology has made the cars we drive 
smarter. A car can tell you when it is time for an oil charge, 
whether your tire pressure is too low, or identify an impending 
problem with your breaks before there is a critical safety 
breakdown, before you have to call AAA from the side of the 
road.
    Now if you will for just a moment, imagine you and your 
family are traveling on a Saturday afternoon. The dashboard 
light comes on warning of a malfunction with the antilock 
breaking system. The technology you, the vehicle owners have 
paid for, is now paying off by identifying a potential problem.
    You go into the local shop and the technician checks the 
car and discovers the problem. But the problem is in a system 
that only a dealership can address. Not because the dealership 
technician is more skilled, but because the independent 
technician cannot acquire the information required to accurate 
diagnose and repair the system. You find out that the nearest 
dealership is 25 miles away, and it will not be open until 
Monday morning. What should you do? Is it safe to pack your 
family in the car and continue driving to your destination? 
Should you have your vehicle towed, and then what? You may be 
risking your families' safety, but maybe not. It might just be 
a simple fuse. At that point you have wasted and delayed your 
outing for the unnecessary trip to the dealership.
    Mr. Chairman, why should only some people be able to obtain 
repair information while others do not have access to it? AAA 
believes that when you drive off the lot with your vehicle, you 
the consumer own the information to have it repaired correctly 
at the repair facility of your choosing. That is not to say 
that AAA is here today to say that motorists should not have 
their vehicles serviced at a dealership. Quite the contrary. 
Many of our members enjoy the relationship and service offered 
by our dealerships, and many dealerships receive the AAA 
approved designation because of the outstanding service they 
provide.
    We are simply saying that motorists should have a choice. 
Today you have heard compelling testimony regarding the parts, 
diagnostic tools, intellectual property and websites and how 
the necessary information is now available to all technicians. 
However, while progress has been made, we still have a long way 
to go. The information available on the websites is difficult 
to navigate, costly and incomplete. In the end, consumers end 
having to go to a second facility or paying for unneeded 
repairs because technicians are trying to satisfy a consumer's 
automotive need without the required information available. We 
must resolve this problem to provide consumers with the 
complete quality repair service that they deserved after paying 
for the vehicles.
    When Congress deliberates over these important issues, AAA 
only asks that you remember that the consumers who rely on 
their vehicle everyday to get to work, to care for their family 
and our future, support Right to Repair.
    Thank you for your opportunity.
    [The prepared statement of Edward C. Donovan follows:]

  Prepared Statement of Edward C. Donovan, Director of Automotive and 
                  Technical Service, AAA Mid Atlantic

    Good afternoon, Mr. Chairman and members of the subcommittee. I am 
very pleased to be here today on behalf of AAA to provide testimony in 
support of H.R. 2735, the Motor Vehicle Owner's Right to Repair Act. As 
you may know, AAA has advanced the interests of car owners for over 100 
years, and currently represents more than 47 million members, or one 
quarter of all US households.
    My name is Ed Donovan. I am the Director of Automotive Technical 
Service for AAA Mid-Atlantic, the local AAA affiliated club. AAA 
strongly supports the Right to Repair bill for three important reasons: 
consumer choice, vehicle safety, and the right of car owners to own the 
information generated by their automobiles. The measure before you 
today will ensure that motorists receive the kind of service that is 
best suited to meet their particular needs.
    Members look to AAA for advice and assistance on a variety of 
automotive-related issues. We offer guidance regarding the proper 
maintenance and servicing of their vehicles, finding quality repair 
facilities, and shopping for a vehicle that best meets their needs. Our 
goal is to take some of the mystery out of finding, buying, operating 
and maintaining a vehicle.
    Consumers are often uncertain about how to communicate with repair 
providers. Study after study reveals that consumers find automotive 
repair and maintenance stressful. Having confidence in a trusted 
service technician goes a long way to alleviating that stress.
    Technology has made the cars we drive today smarter. A car can tell 
you when it's time for an oil change, whether your tire pressure is too 
low, or identify an impending problem with your brakes--before there is 
a problem or critical safety breakdown. Before you have to call AAA 
from the side of the road.
    Now imagine traveling on a Saturday afternoon. The dashboard light 
comes on warning of a malfunction with the anti-lock brake system. You 
stop at the first service station and ask the technician to fix the 
problem. The technician checks the vehicle and discovers the problem is 
in the electrical system on which only a dealership can perform the 
necessary repair--not because dealer technicians are more skilled, but 
because the independent technician cannot acquire the appropriate 
repair information. Then you find out the closest dealership is 25 
miles away, and it won't open until Monday morning. Is it safe to keep 
driving the car? Is it safe to drive the car to the dealer and wait 
until Monday or should you get a tow truck? Can the dealer service the 
car on Monday, or are they already booked up?
    Your weekend is likely ruined, and you learn first-hand a little 
known fact--not every repair facility can service your vehicle because 
the technician does not have access to the needed repair information.
    That is not to say that AAA believes motorists should not have 
their vehicles serviced at a dealership. Quite the contrary, many of 
our members enjoy the relationship and service offered by dealerships. 
We simply believe that motorists should have the choice, and that 
safety and consumer confidence is best served by having this choice.
    AAA believes that when you drive off the lot with your car, you, 
the consumer, own more than just the vehicle; you should control the 
information the vehicle generates so that it can repaired by a trusted 
service advisor of your choosing--whether it be at an independent 
facility or a dealership. The diagnostic information should not be 
accessible only by the dealerships.
    The members of this panel are keenly aware of how a downturn in the 
economy or recent increases in gasoline prices directly impacts the 
wallets of your constituents. In tough economic times, repairs can be 
put off as household expenses are prioritized, often exacerbating the 
initial mechanical problem. If motorists do not have an adequate choice 
of repair facilities, they may not be able to gain a second opinion or 
would have to return to a facility that provided unsatisfactory 
service. Many must juggle expenses on a fixed income, and others are 
faced with economic challenges that demand competitive prices for parts 
and labor. Let's face it--some people simply cannot afford to go to the 
dealership for every repair.
    Lower cost doesn't mean lower quality if all service technicians 
have the information necessary to diagnose and repair problems. 
Consumers have a right to high quality repairs as well an opportunity 
to seek a second opinion. They should not be compelled to use service 
facilities that have previously delivered poor service.
    AAA knows that buying a vehicle is a major investment for consumers 
and for families. It's what keeps us mobile and what we hope will keep 
us safe. Let's allow consumers to protect that investment and maintain 
choice for safe, reliable, and enjoyable operation of their automobiles 
by supporting the Right to Repair bill.

    Mr. Stearns. I thank the gentleman.
    Mr. Seyfer?

     STATEMENT OF DONALD L. SEYFER, SEYFER AUTOMOTIVE, INC.

    Mr. Seyfer. Good afternoon, Mr. Chairman and members of the 
subcommittee. My name is Donnie Seyfer, and I am honored to 
have the opportunity to speak to you today about auto repair.
    Mr. Chairman, with your permission I would like to quickly 
summarize the statement that I provided for you, and then make 
a few short comments that I think might help you to understand 
what goes on in independent repair facilities everyday.
    I believe that I am uniquely qualified to provide some of 
this information for you because in addition to managing my 
family's business, Seyfer Automotive, which is a AAA approved 
repair facility, a member of NFIB and we are also a NAPA 
AutoCare center, I am the business consultant and marketing 
director for 41 of Colorado's NAPA's AutoCare centers. And I am 
also the education director for 385 shops for ASA Colorado. So 
I deal with their educational issues everyday, it is part of my 
job.
    I hold the ASE Master and Advanced Diagnostic 
Certifications as well as the ASE Service Consultation 
designation, a test I actually helped ASE development. And I am 
a graduate of the Automotive Management Institute's Accredited 
Automotive Manager program.
    In addition, I have the pleasure of being in my eighth year 
hosting a call-in consumer car show in Denver that is, we speak 
to over 20,000 listeners every Saturday morning.
    I'm here representing Automotive Service Association. ASA 
represents 12,000 independent repair facilities and about 
55,000 technicians, and it is the oldest and largest trade 
association independent automotive repairers in the United 
States.
    I want to thank Chairman Barton, who is not with us today, 
but for introducing this Vehicle Owners' Right to Repair Act in 
the last Congress. The support and leadership of Congressman 
Barton and others was the catalyst for the agreement that put 
information right on my computer.
    I have four ASE certified master technicians and two have 
also the O/1 advanced diagnostic certification as well. Cars do 
not roll out of our shop unrepaired. If we choose to send a car 
to a dealership, it is usually because we cannot rationalize 
that we work on enough of them to buy that piece of equipment, 
so we simply have an arrangement with the dealership to do the 
flashing, if you will, or replacing of software in many of the 
machines. We take them for our customer, and the car is on its 
way.
    We have 1200 customers and work on about 2200 cars per 
year, so we are not a small facility but we are not gigantic 
facility either.
    The process for gaining that information through websites 
and all data and all of our sources that we use, it is not 
perfect. But because it is built by people who design and build 
cars, they are also the ones that bring us the information. It 
is not going to be perfect. It just takes some time to work out 
all the details.
    But I have had two opportunities to work with online 
information providers to correct inaccuracies on their sites. I 
did not go through NASTF because I was able to make direct 
contact with them. I contact forwarded on their OE website on a 
situation I found where there was a diagram that had been 
swapped inadvertently which would have caused me to break apart 
if I followed the torque spec that was there. I emailed them 
and said, hey I think this is wrong. I got a response back 
within 2 hours that not only was it wrong, they had already 
fixed it.
    I sent the same information to ALLDATA, because I 
referenced the two sources to find that. ALLDATA also found the 
same problem, the pages had been scanned and reversed when they 
put them in, and they fixed it. It took them a couple of days.
    In 2002 we were in a crises. Many of our shops could not 
access information, but more importantly they could not get 
hold of the scan tools to really get to the bottom of problems. 
We were able to do generic information, but not the real 
specific items that were body controls and HVAC systems, and 
engine controls and those sorts of things. Now today I own 
every factory scan tool for all the domestic models that I work 
on because 80 percent of my business is domestics. I do 
flashing and PCM reprogramming for other shops in my AutoCare 
group and we just do not run into many issues.
    There is some tools that I would love to see come to the 
market, they have not yet. I feel that being able to buy these 
tools suddenly become a real small issue. I was able to buy my 
tools from NAPA. I did not have to go to a dealer. I did not 
have the price the dealer was asking. NAPA got me a pretty 
reasonable price for them, I thought. In one case the Chrysler 
tool was 30 percent less than what the dealer wanted to sell it 
to me for.
    So if I run into an information issue where I cannot find 
it on OE website, we use ALLDATA, we subscribe to them. I use 
ALLDATA to access information. If I cannot find something, you 
can email them and say, hey, I cannot find this. Here is where 
I am at. Cannot find this information. They will have that 
information on my fax machine faster than a pizza can get 
there.
    The opponents to letting this agreement work want you to 
believe that it is expensive and difficult to access the 
information that we use to diagnose and repair our customer's 
cars. They have published statistics that I feel are skewed to 
cause fear and resentment within the industry. I ask you to 
take the time to read between the lines and encourage these 
people to remove their blinders and look at the vast amount of 
information that is available and work the system with the 
National Automotive Service Task Force and become a partner 
with them.
    The car makers have brought the goods to my shop. It is my 
responsibility as a shop owner and consumer of their product to 
advise on improvements their product needs.
    I will leave you with this thought in my willingness to 
answer any question that I can: The number of dollars that 
appear to have been spent to lobby for a law that will only 
make my information costs go up and the complexity of the 
process increase would have paid for someone in the 
neighborhood of 500,000 days of information access and would 
have kept Seyfer Automotive connected for 1369 years.
    I rest easy knowing that if this agree were to fail, my 
elected officials, you, would be able to take swift action 
because the service industry in this country had made every 
effort to make it work.
    Thank you for your time.
    [The prepared statement of Donald L. Seyfer follows:]

    Prepared Statement of Donald L. Seyfer, Seyfer Automotive, Inc.

    Good afternoon, Mr. Chairman and Members of the Subcommittee my 
name is Donny Seyfer and I am grateful for the opportunity to 
participate in today's hearing on automotive repair. I manage our 
family business, Seyfer Automotive, Inc., which was founded in 1961. We 
are now in our 43rd year of business in the Denver, Colorado area. I am 
a second generation small business owner and a ASE certified 
technician. We are members of the Automotive Service Association, the 
National Federation of Independent Business, an AAA Approved Repair 
Facility, an ASE Blue Seal of Excellence Facility and a NAPA AutoCare 
Facility. I also host a local NAPA AutoCare radio show in the Denver 
area.
    All of our technicians are ASE certified and four members of our 
staff hold the ASE Master and Advanced Diagnostic Certification. I 
write training materials used by technicians all over the country in 
preparation for the ASE Certification Tests. I have written 14 books on 
automotive repair. I am also a graduate of the Automotive Management 
Institute's Accredited Automotive Manager program.
    I am here today representing the Automotive Service Association. 
Our association represents 12,000 independent repair facilities 
nationwide employing 55,000 technicians. ASA is the oldest and largest 
trade association representing independent automotive repairers in the 
United States.
    I want to thank Chairman Joe Barton for his leadership in 
introducing the Motor Vehicle Owners Right to Repair Act in the last 
Congress. We believe it encouraged independent repairers and automakers 
to begin talking about service information availability. As we 
testified before the U.S. Senate Commerce Committee's Subcommittee on 
Consumer Affairs in July of 2002, ASA was very concerned about the 
number of repairs the independent repairer had to turn away because of 
a lack of service information. Independent repairers perform 70% of all 
automotive repairs. We estimate that our market contains 115,000 
mechanical and collision repair facilities nationwide. In 2002, ASA 
determined there were over one billion repair orders or incidents of 
service. This is the number of service opportunities when a consumer 
drives a vehicle to our business. Today, this would represent total 
sales of $131 billion nationally.
    We determined prior to the Senate testimony in 2002 that we were 
losing 15% of all incidents of service, rejected due to a lack of 
information or access to a diagnostic tool. This was an annual loss of 
over 160 million incidents of repair. This is significant in the loss 
of technician positions to our industry and the local economies.
    In 2002, ASA brought several hundred repair shop owners to Capitol 
Hill asking their members of Congress for help. Members of the House 
and Senate encouraged ASA to sit down with the automakers and work out 
an agreement that would meet the needs of the independent automotive 
repairer and the concerns of the automakers. ASA did this and in 
September of 2002 reached a written agreement with the automakers.
    The agreement with the automakers is working. The automakers 
committed to make a good faith effort at providing service information, 
tools, tool information and training to the independent repairer just 
as they do to the new car dealer. To date, they have kept their word. 
Is it perfect? No. Have we established a structure to resolve problems 
that do arise in an industry serving 224 million vehicles? Yes. The 
mechanism for addressing complaints is the National Automotive Service 
Task Force. ASA and the automakers pledged to use the National 
Automotive Service Task Force as a conduit for resolving any specific 
service information issues that arose. This is an organization open to 
the public and the media with representation from all the automakers, 
new car dealers, the aftermarket, independent repairers and the federal 
government.
    ASA, the automakers and the automotive trade press have gone to 
great lengths to educate repairers and technicians as to the 
availability of the complaint process and the National Automotive 
Service Task Force resolution procedure. ASA has a full-time staff 
person traveling the United States conducting meetings demonstrating to 
repairers how to best use the automaker Websites. To date he has 
conducted meetings in 23 states. We are committed to this voluntary, 
industry process.
    In 2003, the NASTF received a total of 88 complaints. Automakers 
have responded to all 88. Please recall that this is 88 complaints in a 
universe of over one billion repair orders. This year, through June 30, 
the NASTF has received 27 complaints and automakers have responded to 
27 of those complaints.
    Why so few complaints? Two reasons. First, repairers still use the 
same mechanism for problem-solving they used prior to the 1990 Clean 
Air Act Amendment's dramatic changes to the automobile's technology. 
Repairers use third party information providers such as: Alldata, which 
is owned by AutoZone, Mitchell 1 in which Genuine Parts has a 
significant stake and Indentifix. Parts distributors who argue there is 
a decline in service information in the aftermarket continue to 
increase their profits. Both AutoZone and Genuine Parts reported 
increases in earnings in recent publications.
    These third party information providers continue to move timely 
information into the repair marketplace. Second, because of the ASA-
Automaker agreement and the U.S. Environmental Protection Agency's 2003 
final regulation on emissions service information, the automakers' 
Websites provide the same service information the new car dealer 
receives.
    The 1990 Clean Air Act Amendments' assurance that independent 
repairers would receive the same emissions service information as the 
new car dealers sets the tone for this debate. The U.S. EPA published 
its 1990 Clean Air Act Amendments' final emissions service information 
regulation in 1995. In their own words, the final regulation was flawed 
and lacked sufficient enforcement authority. Despite the recognition of 
the flaws, it was the summer of 2003 before the EPA published a new 
final emissions service information regulation that worked.
    If we go through a contentious legislative process, a lengthy 
regulatory review and possible litigation, many independent shops will 
not survive. We see this only as a last resort.
    Our 2002 agreement with the automakers is working. If it fails, we 
will come back to Capitol Hill and ask for your help. We are 
entrepreneurs. Many independent repairers begin as technicians, then 
buy an existing shop or start a new one. As small businesspersons, we 
all share the American Dream. We believe in free markets and commit to 
you that we will not come to Capitol Hill unless we are in a crisis as 
in 2002. Your encouragement to seek an industry solution has been 
successful. Please accept our gratitude.
    Many organizations have a natural tendency to seek new legislation 
or even litigation. ASA does not represent those values. We believe in 
solving our industry problems by working them out within the industry 
if at all possible. Only if that process fails would we look to the 
government for help. This past week, we were proud to see the U.S. 
House of Representatives highlight and address the excess litigation 
occurring in our country that chokes the business community.
    The Congress' leadership and encouragement in the development of 
this agreement has resolved a serious problem for the automotive repair 
industry. Please allow this agreement and the NASTF to continue 
improving the plight of the independent repairer. Thank you.

    Mr. Stearns. Thank you.
    Bob Merrill, Horsepower Auto Care.

    STATEMENT OF BOB MERRILL, HORSEPOWER AUTO CARE, NATIONAL 
              FEDERATION OF INDEPENDENT BUSINESSES

    Mr. Merrill. Yes, Mr. Chairman and members of the 
subcommittee. My name is Bob Merrill and I own the Horsepower 
Auto Care in Windham, Maine. I am here on behalf of the 
National Federation of Independent Business whose 600,000 
members and 20,000 small automotive repair businesses just like 
mine strongly endorse the H.R. 2735, the Motor Vehicle Owners' 
Right to Repair Act. When NFIB polled its members on this issue 
in January, 2003, 77 percent of the NFIB members agreed that 
automobile manufacturers should be required to disclose to car 
buyers and repair shops information needed to repair or 
maintain their vehicles.
    My business, Horsepower Auto Care is a full service 
automotive repair facility that has been operating since 1979. 
We provide services ranging from oil changes to engine 
replacements and everything in between. I have worked on 
vehicles for more than 40 years, starting my career as a field 
service technician for Caterpillar Tractor Company. I am a 
Master ASE Technician, I have earned my accredited Automotive 
Managers Degree from the Automotive Service Association 
Management Institute. I recently named the 2004 NAPA ASE 
Technician of the year presented by NAPA Auto Parts and the 
National Institute for Service Excellence.
    The auto repair business is changing. With the increased 
use of computers and cars automobiles have become more 
complicated to service and repair. Like many shops across the 
United States Horsepower Auto Care works on many different 
makes and models of vehicles. To serve my customers I need to 
be able to repair many different kinds of cars and the current 
system of accessing repair data makes that very difficult. 
Unfortunately, it is ultimately the customer who suffers. With 
little competition in the marketplace customers are forced to 
pay whatever the dealerships charge them. If the right 
information were provided at a reasonable cost, there are 
thousands of qualified independent repair shops that would be 
able to service these vehicles and save the driving public 
serious money.
    The current voluntary system created by the manufacturers 
has no enforcement mechanism to guaranteed to the driving 
public that manufacturers are, in fact, making all repair data 
available. Even if the independent mechanics were willing to 
pay for information that is currently available, how can they 
be assured that they are really able to access all the 
information available and how can we be assured that the flow 
of information will continue? For many small repair shops a 
lack of repair data really comes down to a timeframe problem. 
We cannot tie up a customer's vehicle for several days while we 
wait to obtain repair data. This puts us in the uncomfortable 
position of having to refer to our customers to a local dealer 
who has access to all the repair data. We lose business and the 
customer loses choice.
    In my area of Maine we have a network of shops that talk 
regularly about our problems accessing repair data. I have 
pages of examples but would like to share just a few.
    A very, very qualified auto body shop in our area, 
Coachworks cannot get air bag access to the following vehicles: 
A 2002 Volvo, a 2000 Jetta, a 2001 Mercedes, a 1992 Volvo. 
These cars all had to go back to the dealer.
    One shop, Autoworks in Kittery, has spent thousands of 
dollars to purchase equipment only to find that they cannot 
perform all the functions and still must return to the dealers 
to complete the job. This shop indicated that Saab would not 
sell a factory tool to an independent shop.
    Now these are top notch shops unable to service their 
customers, a problem that should not be happening.
    Another example is Cumberland Avenue Garage in Portland. 
Tried to turn off an ABS break light on a 1997 Mitsubishi. 
After trying different scan tools and calling the diagnostic 
hotline, the car still had to go back to the dealer.
    Also State inspections are becoming a problem for us 
because our State law dictates that no warning or emission 
lights can be on. I have had to send some of our Audi customers 
back to the dealer because we could not turn off the light with 
our equipment.
    Small businesses are just asking for a system that is fair 
for all. We are not looking for a competitive advantage over 
the manufacturers or the dealers. We just want to be able to 
serve our customers and run our business.
    Thank you, Mr. Chairman, for the opportunity to testify 
today.
    [The prepared statement of Bob Merrill follows:]

Prepared Statement of Bob Merrill, Owner, The Horsepower Auto Care, on 
       Behalf of The National Federation of Independent Business

    Mr. Chairman and members of the Subcommittee, My name is Bob 
Merrill, and I own The Horsepowerautocare in Windham, Maine. I am here 
on behalf of the National Federation of Independent Business (NFIB), 
whose 600,000 members, and 20,000 small automotive repair businesses 
just like mine, strongly endorse H.R. 2735, The Motor Vehicle Owner's 
Right to Repair Act. When NFIB polled it's members on this issue in 
January 2003, 77% of NFIB members agreed that the ``automobile 
manufacturers should be required to disclose to car buyers and repair 
shops information needed to repair or maintain their vehicles.''
    My business, Horsepowerautocare, is a full service automotive 
repair facility that has been operating since 1979. We provide services 
ranging from oil changes to engine replacements, and everything in 
between. I have worked on vehicles for more than 40 years, starting my 
career as a field service technician for Caterpillar Tractor company. I 
am a Master ASE technician, and I have earned my Accredited Automotive 
Manager's degree from the Automotive Service Association's management 
institute. I was recently named the 2004 NAPA/ASE Technician of the 
Year, presented by NAPA Auto Parts and the National Institute for 
Automotive Service Excellence.
    The auto repair business is changing. With the increased use of 
computers in cars, automobiles have become more complicated to service 
and repair. Like many shops across the United States, 
Horsepowerautocare works on many different makes and models of 
vehicles. To serve my customers, I need to be able to repair many 
different kinds of cars, and the current system of accessing repair 
data makes that very difficult.
    While some data is available through the Original Equipment 
Manufacturer's (OEM) websites, the data is incomplete and extremely 
difficult to navigate. As a small business owner, I cannot afford to 
spend all my time searching through 25 different websites with 25 
different formats every time a vehicle comes into my shop. I would have 
to spend all my time in front of a computer screen instead of repairing 
cars--and this is no way to run an auto repair business.
    Unfortunately, it is ultimately the customer who suffers. With 
little competition in the marketplace, customers are forced to pay 
whatever the dealerships charge them. If the right information were 
provided--at a reasonable cost--there are thousands of qualified 
independent repair shops that would be able to service these vehicles 
and save the driving public serious money.
    H.R. 2735 is a simple, needed fix that restores the right of 
consumers to have their vehicle serviced at the repair facility of 
their choosing by requiring automobile manufactures to release to small 
businesses and mechanics any data that they provide to franchised 
dealerships or other repair shops. The auto manufacturers have claimed 
that they are making all repair data available voluntarily, but 
unfortunately, as I stated earlier, this information is not being 
provided fully nor in an accessible format.
    Furthermore, the current voluntary system created by the 
manufacturers has no enforcement mechanism to guarantee to the driving 
public that manufacturers are in fact making all repair data available. 
In reading one manufacturer's website, under Terms and Conditions it 
says that they reserve the right ``at their discretion'' to change 
these Terms and Conditions at any time.
    Even if independent mechanics were willing to pay for information 
that is currently available, how can they be assured that they are 
really able to access all of the information available, and how can we 
be assured that the flow of information will continue? Enactment of 
H.R. 2735 is crucial to ensuring that all automobile repair data is 
being made available to consumers and independent repair shops.
    For many small repair shops, the lack of repair data really comes 
down to a time frame problem. We can't tie up a customer's vehicle for 
several days while we wait to obtain repair data. This puts us in the 
uncomfortable position of having to refer our customers to a local 
dealer who has access to all the repair data. We lose business, and the 
customer loses choice.
    In my area of Maine, we have a network of shops that talk regularly 
about our problems accessing repair data. I have pages of examples, but 
would like to share just a few. A very qualified auto body shop in our 
area, Coachworks, cannot get airbag access to the following vehicles: 
2002 V40 Volvo, 2000 VW Jetta, 2001 E 320 Mercedes, and a 1992 940 
Volvo. These all had to go back to the dealer.
    One shop, Autoworks in Kittery, has spent thousands of dollars to 
purchase equipment, only to find that they cannot perform all functions 
and still must return to the dealers to complete the job. This shop 
indicated that Saab would not sell a factory tool to an independent 
shop. These are top-notch shops unable to service their customers--a 
problem that should not be happening.
    Another example: Cumberland Avenue Garage in Portland tried to turn 
off an ABS brake light on a 1997 Mitsubishi. After trying different 
scan tools and a call to the diagnostic hotline, the car still had to 
go back to the dealer.
    Also, state inspections are becoming a problem for us because our 
state law dictates that no warning or emissions lights can be on. I 
have had to send some Audi customers back to the dealer because we 
could not turn out the light with our equipment.
    We need a more common sense approach to this problem and I think HR 
2735 is the answer.
    Small businesses are just asking for a system that is fair for all. 
We are not looking for a competitive advantage over the manufacturers 
or dealers, we just want to be able to serve our customers and run our 
business. It is important to note that H.R. 2735 does not require 
automobile manufacturers to disclose any trade secrets or proprietary 
information, and does not affect their warranty agreements with their 
dealer network.
    By restoring competition to the automobile repair market, the Motor 
Vehicle Owner's Right to Repair Act would make the system more fair--
for small businesses and customers.
    Thank you Mr. Chairman for the opportunity to testify before you 
subcommittee on an issue vital to small, independent auto repair shops.

    Mr. Stearns. I thank you.
    Mr. Dana?

 STATEMENT OF GREG DANA, VICE PRESIDENT, ENVIRONMENTAL AFFAIRS 
              ALLIANCE OF AUTOMOBILE MANUFACTURERS

    Mr. Dana. Thank you, Mr. Chairman and members of the 
committee. My name is Gregory Dana, I am with the Alliance of 
Automobile Manufacturers.
    There are over 220 million vehicles registered in the 
United States. To repair and service these vehicles quickly and 
properly we need the broad network of independent repair shops, 
aftermarket part suppliers and dealerships as partners. Over 75 
percent of vehicle service and repairs is performed in 
independent repairs shops. While there may always be a few 
instances where needed information to perform a particular 
repair is difficult to obtain, the vast majority of repairs 
occur without incident or problem. Based on these facts alone 
we do not understand why this bill is needed.
    Instead of Federal legislation, the Alliance and our member 
companies are working with the service industry through NASTF 
and stand ready to work today with any effected party in the 
marketplace to resolve any remaining communication issues 
surrounding repair of cars and light trucks.
    Member companies of the Alliance and AIM committed to 
provide the same repair training and diagnostic tool 
information to independent repair shops that they supply to 
their dealers. Our commitment has been honored and the industry 
has no intention to reverse these actions. It was the right 
decision for our business, but more importantly it was the 
right decision for our customers.
    As a result of our actions the Automotive Service 
Association and is 12,000 members dropped its support for 
Federal legislation for the simple reason that they are getting 
information they need to repair vehicles in a timely basis. 
Rather than spending years battling in Congress on 
relegislation, ASA recognized that a voluntary agreement and a 
regular dialog with auto makers is in the best short term and 
long term interest of its members and American consumers.
    The Alliance also had meetings with representatives of the 
Coalition for Automotive Repair Equity or CARE in an attempt to 
understand CARE's concerns and to resolve any issues or 
problems that their members may be experiencing.
    In March of 2003 the following meeting with Chairman 
Barton, CARE representatives presented six issues involving 
service information and repair. We successfully resolved all 
these issues. Additional meetings were held in May of 2003 
after which all services presented by CARE were addressed by 
the auto makers. CARE has shown no interest in continuing a 
direct dialog with auto makers or in submitting issues to 
NASTF, the cross industry task force specifically designed to 
resolve any difficulties in obtaining service or diagnostic 
tool information.
    I would like to make an offer again at this hearing as the 
automobile manufacturers and the NASTF are prepared to meet 
with the CARE Coalition or directly with aftermarket parts 
distributors who are members of CARE to address any concerns 
affecting their business. We know that a dialog directly 
involving all interested parties is the best and quickest 
method to resolving differences. If the CARE Coalition is truly 
interested in putting consumers first, they should welcome the 
opportunity to sit down with auto makers because we want our 
customers' vehicles to be repaired quickly and professional by 
anyone in the repair industry.
    In fact, Alliance members are already working to verify and 
fix if necessary the issues cited in today's testimony.
    Mr. Chairman, besides believing the legislation is not 
necessary, it would also create harm for the industry. First, 
the legislation would most likely force the release of 
proprietary information that is unrelated to vehicle repair and 
could result in inappropriate modifications to the computer 
systems that control motor vehicle emissions and safety.
    Second, with access to auto maker proprietary design and 
engineering information, aftermarket parts manufacturers could 
begin producing competing parts without bearing any of the 
costs associated with reverse engineering. This would harm the 
original equipment parts manufacturers.
    And finally, the Private Right of Action clause in H.R. 
2735, it could result in a flood of litigation on these issues.
    It is also interesting that the provisions in the bill seek 
to override existing trade secret provisions and create a new 
regime that would effectively require trade secrets created and 
protected under the laws of all 50 days either be registered 
with the FTC or else disclosed to competing firms. State courts 
would have the ultimate jurisdiction of what constitutes a 
trade secret.
    It is our view that the FTC hearing process envisioned 
under the bill would ultimately construed to require trial type 
proceedings over each and every tested trade secret, thereby 
upon a filing by the aftermarket parts industry, motor vehicle 
manufacturers will be forced to defend through formal 
adjudication any trade secrets they wish to protect. Such a 
regime invites competitors to use the FTC as a competitive 
weapon for obtaining access to manufacturer's valuable 
proprietary information. This entire process is far too 
uncertain and loose for the auto makers to have any comfort 
that they will be adequately protected.
    Thank you very much for the opportunity to speak here 
today.
    [The prepared statement of Greg Dana follows:]

Prepared Statement of Greg Dana, Vice President--Environmental Affairs, 
                The Alliance of Automobile Manufacturers

    Mr. Chairman, thank you for the opportunity to testify before the 
Subcommittee regarding H.R. 2735, the Motor Vehicle Owners' Right to 
Repair Act. My name is Greg Dana and I represent the Alliance of 
Automobile Manufacturers (Alliance), a trade association of 9 car and 
light-truck manufacturers. Our member companies include BMW Group, 
DaimlerChrysler Corporation, Ford Motor Company, General Motors 
Corporation, Mazda, Mitsubishi, Porsche, Toyota Motor North America and 
Volkswagen of America.
    Alliance member companies have more than 600,000 employees in the 
United States, with more than 250 manufacturing facilities in 35 
states. Our industry is a significant driver of the U.S. economy. 
Overall, a University of Michigan study found that the entire 
automobile industry creates more than 6.6 million direct and spin-off 
jobs in all 50 states and produces almost $243 billion in payroll 
compensation annually.
    H.R. 2735 was introduced with the stated objective of promoting the 
consumer's right to choose where his/her vehicle can be serviced. We 
are pleased to report that consumers already have this ability to 
choose and do so hundreds of times each day. As a result, it would 
appear on the surface that this legislation is not needed. But, the 
industry proponents of this legislation also assert that automakers 
intentionally use special codes and other practices to make it 
difficult for vehicle owners and independent repair facilities to 
diagnose problems and repair the vehicles. Unfortunately, these claims 
misrepresent the actual availability of repair information, tooling and 
parts. The automobile industry believes that the legislation would 
allow aftermarket parts distributors and manufacturers access to the 
proprietary information and intellectual property of the automakers 
that is NOT needed to repair the vehicle, but which would reduce the 
R&D and engineering costs involved in producing aftermarket replacement 
parts. Disclosure of automakers' intellectual property also could 
enable the vehicle performance characteristics of the operating systems 
to be altered, which in the case of emissions performance could result 
in tailpipe emissions to be exceeded. These situations undermine the 
intellectual property rights of the auto manufacturers and are 
inappropriate and competitively unfair.
    There are over 220 million vehicles registered in the United 
States. To repair and service these vehicles quickly and properly, we 
need a broad network of independent repair shops, aftermarket parts 
suppliers and dealerships as partners. Over 75 percent of vehicle 
service and repairs are performed in independent repair shops. While 
there may always be a few instances where needed information to perform 
a particular repair is difficult to obtain, the vast majority of 
repairs occur without incident or problem. Based on these facts alone, 
we do not understand why this bill is needed. Instead of federal 
legislation, the Alliance and our member companies are working with the 
service industry through NASTF and stand ready to work today with any 
affected party in the marketplace to resolve any remaining 
communication issues surrounding the repair of cars and light trucks.
    Member companies of the Alliance and AIAM committed to provide the 
same repair, training and diagnostic tool information to independent 
repair shops that they supply to their dealers. Our commitment has been 
honored and the industry has no intention to reverse these actions. It 
was the right decision for our business but more importantly, it was 
the right decision for our customers.
    As a result of our actions, the Automotive Service Association 
(ASA) and its 12,000 members dropped its support for federal 
legislation for the simple reason that they are getting the information 
they need to repair vehicles in a timely basis. Rather than spending 
years battling in Congress over new legislation, ASA recognized that a 
voluntary agreement and regular dialogue with automakers is in the best 
short-term and long-term interests of its members and American 
consumers.
    The Alliance also had meetings with representatives of the 
Coalition for Automotive Repair Equality (CARE) in an attempt to 
understand CARE's concerns and to resolve any issues or problems that 
their members may be experiencing. In March 2003, following a meeting 
with Chairman Barton, CARE representatives presented six issues 
involving service information and repair. We successfully resolved all 
issues. Additional meetings were held in May 2003, after which all 
service issues presented by CARE were addressed by automakers. But our 
success in addressing these issues has not deterred CARE from 
continuing its pursuit of legislation. In fact, despite repeated 
attempts by the Alliance and our member companies, CARE has shown no 
interest in continuing a direct dialogue with automakers or in 
submitting issues to NASTF, the cross-industry task force specifically 
designed to resolve any difficulties in obtaining service or diagnostic 
tool information.
    In recent months, it is our understanding that they have carefully 
selected issues to highlight as reasons this legislation is necessary. 
However, the CARE coalition refuses to tell the Alliance, AIAM or 
individual companies specifically what those issues are because they 
know that we will promptly work to solve any issues that they or any 
member of the service industry brings to our attention. For instance, 
in that same March 2003 meeting with Chairman Barton, testimony was 
given by the Associated Locksmiths of America (ALOA). Since that time, 
NASTF has held two special meetings with ALOA to identify the needs of 
security professionals. In July of this year, NASTF formed a new 
vehicle Security Committee to tackle the difficult issues surrounding 
release of necessary information to security professionals. The 
commitment to address the issues is there and dialogue is already 
underway.
    Therefore, I'd like to make an offer again at this hearing that the 
automobile manufacturers and the NASTF are prepared to meet with the 
CARE coalition or directly with aftermarket part distributors that are 
members of CARE to address any concerns affecting their business. We 
know that a dialogue directly involving all interested parties is the 
best and quickest method to resolving differences. If the CARE 
coalition is truly interested in putting consumers first, they should 
welcome the opportunity to sit down with automakers because we want our 
customers' vehicles to be repaired quickly and professionally by anyone 
in the repair business.
    Another claim by the aftermarket is that they are losing sales and 
business to dealerships and other competitors. In looking at recent 
financial statements by leading aftermarket companies who are members 
of the CARE coalition, it appears that they are doing quite well in the 
marketplace. For instance, Advance Auto Parts announced in February 
that the company posted its best quarterly and year-end results in 
company history. O'Reilly Auto Parts reported in July that the company 
had record revenues and earnings for the second quarter of 2004. In its 
2003 Annual Report, AutoZone highlighted its record sales, record 
earnings per share, record net income and record return on invested 
capital. It proudly stated that it is the clear leader in the growing 
do-it-yourself automotive aftermarket. CARE members own reports confirm 
that the aftermarket industry is healthy and poised for future sales 
growth. Further, the aftermarket repair shop businesses have more than 
doubled since the 1990's and project to grow throughout this decade.
    For the purposes of this hearing, it is also important for the 
Committee to be aware of an important subsidiary of the AutoZone 
corporate family. ALLDATA is a leading provider of automotive repair 
information and solutions to the automotive service industry. According 
to its website, ALLDATA is the ``world-leading provider of electronic 
diagnostic and repair information and services for the automotive 
service industry.'' The company has access to over 5,000 automaker 
manuals and Technical Service Bulletins provided to third party service 
information providers as a courtesy by some automakers. It also 
provides illustrated diagnosis and repair procedures and even has a 
goal of answering repair questions within 30 minutes.
    As I stated earlier, automakers view companies like ALLDATA as 
partners in providing repair information to consumers. The automotive 
companies enjoy a good business relationship with ALLDATA and its chief 
competitor, Mitchell. Numerous independent shops and ASA members 
subscribe annually to these services in order to obtain necessary 
information. In fact, repair shops can get almost all diagnostic 
questions answered through either of these two services. Automakers are 
not aware of any deficiencies with the data provided to these multi-
manufacturer information services. Further, if there is a need for 
additional information which ALLDATA or Mitchell may chose not to 
include on their web site, under our 2002 industry commitment, a 
technician can log on to an automobile company's web site to find the 
necessary information.
    We are pleased to report that in March of this year, EPA reviewed 
and approved the structure and pricing of the emission related company 
web sites. We have also received positive feedback regarding the non-
emission information. This is no small task. Significant financial 
resources were allocated to develop the Internet sites and keep them 
current with the latest information. There are hundreds of makes and 
models in the auto industry and the corresponding diagnostic repair 
information for each of those vehicles can involve thousands of 
diagnostic codes and hundreds of pages in vehicle manuals. There are 
also new makes and models that enter the marketplace each year and all 
of the related repair information gets posted on the web sites. In an 
undertaking of this magnitude, there are bound to be difficulties from 
time to time, but all automobile companies are committed to addressing 
such problems on a priority basis. The industry has consistently 
demonstrated it is responsive to all complaints submitted through the 
NASTF task force and has a track record of resolving nearly every issue 
in a very short amount of time.
    If the aftermarket service providers have the information they 
need, what is the real intent of this legislation? Well, in our 
opinion, the aftermarket part distributors and manufacturers, rather 
than the repair shops, stand to benefit most from the bill. First, the 
legislation would most likely force the release of proprietary 
information that is unrelated to vehicle repair and could result in 
inappropriate modifications to the computer systems that control motor 
vehicle emissions and safety. Aftermarket parts that are not quite up 
to OEM specifications could require these ``alterations'' to allow them 
to function and not trigger warning lights or systems within the 
vehicle. But the ``alterations'' also affect the operation of critical 
control systems in the vehicle--threatening warranty issues and perhaps 
even the proper performance of these control systems.
    Second, with access to automaker proprietary design and engineering 
information, aftermarket parts manufacturers could begin producing 
competing parts without bearing any of the costs of engineering the 
parts. This would short circuit the historical and customary practice 
of reverse engineering replacement parts for aftermarket use. This 
``reverse engineering'' requirement helps level the playing field 
between automakers--who invest enormous resources in the design, 
testing, and certification of parts--and aftermarket parts makers--who 
would gain a significant competitive advantage by not having to invest 
in the ``reverse engineering.''
    The proponents of the bill assert that this is not the intent and 
would not happen, but because of the ``Private Right of Action'' clause 
in H.R. 2735, there could result in a flood of litigation on these 
issues. It is also interesting that the provisions in the bill seek to 
override existing trade secret protections and create a new regime that 
would effectively require trade secrets created and protected under the 
laws of all fifty states either be ``registered'' with the FTC or else 
disclosed to competing firms. State courts would have ultimate 
jurisdiction over what constitutes a trade secret.
    Additionally, it is our view that the FTC hearing process 
envisioned under the bill would ultimately be construed to require 
trial-type proceedings over each and every contested trade secret. 
Thereby, upon a filing by the aftermarket parts industry, motor vehicle 
manufacturers will be forced to defend through formal adjudication any 
trade secrets they wish to protect. Such a regime invites competitors 
to use the FTC as a competitive weapon for obtaining access to 
manufacturers' valuable proprietary information. This entire process is 
far too uncertain and loose for the automakers to have any comfort that 
we will be adequately protected.
    Meeting today's very stringent emission and safety regulations 
requires even more design, development, testing, and certification of 
parts. This is just as true for automakers as it is for aftermarket 
part distributors. Automakers recognize it as the price of doing 
business--The CARE coalition sees it differently. Rather than putting 
their money in R&D and engineering to develop quality competitive 
parts, they now seem to be putting their money into lobbying for 
legislation and regulation in the hopes that Congress or the Federal 
Trade Commission will force automakers to turn over proprietary design 
specifications and software. Aftermarket parts manufacturers would have 
a significant savings every year in avoided costs. However, the end 
result would be a devastating blow to the intellectual property rights 
governing computer software and inappropriate modifications to vehicle 
pollution control and safety systems and the computers that control 
them. We would expect these changes to have adverse impacts on U.S. 
employment as well--since many of the aftermarket parts would be 
produced overseas rather than in the U.S. facilities currently used by 
OEM parts suppliers.
Summary:
    Key members of the independent repair community and all automakers 
agree that service issues can be resolved without the need for 
legislation. Moreover, they agree that cooperative solutions will yield 
better results in less time than legislation and regulation.
    The automobile industry stands ready to work with all affected 
parties in resolving remaining differences. We believe we are headed in 
the right direction and look forward to keeping the Committee updated 
on our progress.
    Thank you.

    Mr. Stearns. I thank you.
    Mr. Cabaniss?

   STATEMENT OF JOHN CABANISS, CHAIRMAN, NATIONAL AUTOMOTIVE 
     SERVICE TASK FORCE, DIRECTOR, ENVIRONMENT AND ENERGY 
     ASSOCIATION OF INTERNATIONAL AUTOMOBILE MANUFACTURERS

    Mr. Cabaniss. Good afternoon. My name is John Cabaniss. I 
am Director for the Environment and Energy at the Association 
of International Automobile Manufacturers.
    Mr. Chairman, I have consolidated my statement today, but I 
would like to have my full written statement entered into the 
record of the hearing.
    For the past 4 years I have had the privilege of serving as 
the Chairman of the National Automotive Service Task Force, a 
cooperative activity involving auto makers, the service 
industry and the equipment and tool industry. I have been with 
AIM since the spring of 1995. Prior to that I worked in EPA's 
Motor Vehicle Admissions program for 15 years and the State of 
Virginia Air Pollution Control program for about 10 years. I 
grew up with an automotive trades background. Both father and 
my grandfather were shop owners and technicians in Southern 
Virginia for many years.
    I have been asked to brief you today on the task force and 
its activities. The task force is a completely voluntary effort 
and takes no positions on issues. Any opinions that may be 
expressed are my own, and not necessarily those of AIM members 
companies.
    During the past decade auto makers have faced a technology 
explosion and a growing volume of information for service and 
repair. As a result, some service providers have experienced 
difficulty in obtaining necessary information. However, these 
difficulties primary involve where and how to access 
information rather than its actual availability.
    The task force originated in 1999 when the Arizona 
legislature was considering a service information bill. During 
this process it became clear a continuing forum was needed for 
dialog between parties at the national level. Thus, in November 
2000 the task force was established with the mission of 
facilitating the prompt identification and correction of gaps 
in availability and accessibility of service information 
training, diagnostic tools and equipment and communications to 
service professionals.
    The task force has made significant and sustained progress. 
Early in 2001 a website was launched to provide a ready 
reference for anyone requiring information in tools from auto 
makers. This reference is updated quarterly and broadly 
publicized by task force participants.
    One special feature is the inclusion of a complaint form 
for a technician to use if the information needed to fix the 
vehicle cannot be located. Complaints can be submitted by email 
or by fax to the Service Information Committee. Complaints are 
immediately sent directly by email to the auto manufacturer for 
prompt investigation and response directly to the company or 
individual that submitted the complaint. Complainers are 
notified that the complaint has been received and forwarded to 
the manufacturer and that they can expect a direct reply.
    During 2003 88 complaints were received involving 17 
manufacturers. To date this year 33 complaints have been 
received involving 15 manufacturers. Only two very recent 
complaints are pending.
    In addition to these complaints, individual auto makers 
report that they receive occasional suggestions about ways to 
improve content in their service document or navigation of 
their websites. Manufacturers use such feedback to continually 
improve their services.
    At a July 2002 subcommittee hearing Senator Dorgan 
challenged auto makers to work with the service industry to 
address any service issues. We took that challenge very 
seriously and within a few weeks all manufacturers agreed to 
make all service tool and training information available within 
a short time. By March 2003 all auto makers had launched 
Internet service sites available to anyone 24/7. The access 
charges are minimal. Users can have immediate access to 
practically any of these websites for 24 to 72 hours at a 
charge of $10 to $20. Frequent users have the option of 
subscribing monthly or annually.
    The success of the task force is due to the participation 
of a wide range of parties. Currently over 100 organizations 
participate in the task force and participation is growing. 
These are just a few examples of the progress being made.
    The central question being considered today is whether 
technology is locking out the consumer and independent shops. I 
believe just the opposite it true. We are using Internet and e-
business technology to provide needed service information, 
training and tools to anyone who needs it much quicker and 
cheaper today than ever before. The task force process also 
ensures a forum for identifying and addressing problems. I am 
confident that working cooperatively within the process, we can 
continue to be successful in bringing together the talents and 
resources of the stakeholders to address service technology 
issues.
    In conclusion, auto makers are completely committed to the 
task force. We believe it is the proper venue for continuing to 
address service technology issues and that it is making 
significant and sustained progress. Therefore, we believe 
legislation in this area is not only unnecessary, but 
potentially counterproductive.
    Thank you again for the opportunity to address the 
subcommittee.
    [The prepared statement of John Cabaniss follows:]

   Prepared Statement of John Cabaniss, Association of International 
                        Automobile Manufacturers

    Thank you for the opportunity to testify before the Subcommittee 
regarding vehicle service technology issues. My name is John Cabaniss. 
I am the Director for Environment and Energy at the Association of 
International Automobile Manufacturers.1 For the past four 
years, I have had the privilege of serving as the chairman of the 
National Automotive Service Task Force, a cooperative activity 
involving automakers, the automotive service industry, and the 
equipment and tool industry.
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    \1\  AIAM members include American Honda Motor Company, Inc.; 
American Suzuki Motor Corporporation; Aston Martin Lagonda of North 
America, Inc.; Ferrari North America, Inc.; Hyundai Motor America. 
Inc.; Isuzu Motors America, Inc.; Kia Motors America, Inc.; Maserati 
North America, Inc.; Mitsubishi Motors North America, Inc.; Nissan 
North America, Inc.; Peugeot Motors of America, Inc.; Societe Anonyme 
Des Usines Renault; Subaru of America, Inc.; and Toyota Motor North 
America, Inc. AIAM also represents original equipment suppliers and 
other automotive-related trade associations. AIAM members have invested 
over $20 billion in new production and distribution capacity in the 
United States, creating tens of thousands of high-skill, high-wage jobs 
across the country in manufacturing, supplier industries, ports, 
distribution centers, headquarters, R&D centers, and automobile 
dealerships.
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    I have been in my current job with AIAM since the spring of 1995. 
Prior to that, I worked in the U.S. Environmental Protection Agency's 
motor vehicle emissions program for fifteen years and for the State of 
Virginia's air pollution control program for about ten years. I grew up 
with an automotive trades background. Both my father and my grandfather 
were shop owners and technicians for many years. I grew up handing them 
tools and later using the tools myself.
    The Task Force is a completely voluntary effort. We collect no dues 
and have no support organization. NASTF itself takes no positions on 
issues. I have been asked to brief the subcommittee today on the Task 
Force and its activities. Any opinions that may be expressed are my own 
and not necessarily those of AIAM member companies.
    In my presentation today, I will briefly describe who is involved 
in the National Automotive Service Task Force, what activities are 
under way, and what progress has been made and continues to be made. 
After hearing my statement, I hope you will agree that the Task Force 
is the proper venue for addressing service issues, and that further 
legislation or regulation in this area is unnecessary and in fact may 
even prove counter-productive.
    To begin, I would point out that vehicle manufacturers consider the 
automotive service industry their partner in providing vehicle service 
and repairs to their mutual customers, the driving public. Moreover, 
automakers do not intentionally withhold service information from the 
auto service industry. To do so would be contrary to their best 
interests. Automakers want their customers to have a positive ownership 
experience, which logically includes the ability to obtain effective 
service no matter where or when their vehicles need maintenance. 
Automakers have every incentive to make sure that the auto service 
industry has the information, training, and tools needed to maintain 
and repair vehicles. Historically, 70-80 percent of vehicle service and 
repairs are performed in non-dealer shops. This level has been constant 
for many years and is not expected to change.
    During the past decade, the automakers have had to address the 
challenge of managing a technology explosion and the growing volume of 
information needed to maintain and repair more complex, modern 
vehicles. This necessitated changes in both communications channels and 
techniques. As these changes have occurred, some service providers have 
experienced difficulty in obtaining the necessary information. For the 
most part, however, these difficulties have involved questions about 
where and how to access the information rather than its actual 
availability.

The National Automotive Service Task Force
    The origin of the National Automotive Service Task Force dates back 
to 1999 when the Arizona legislature was considering a vehicle service 
information bill. During 1999 and 2000, the automakers and the Arizona 
auto service industry cooperatively investigated allegations of 
manufacturers withholding information. It soon became apparent that the 
real issue for shops and technicians was accessibility, that is, 
knowing where to get the information and tools they need. What also 
became clear was the necessity for a continuing forum for dialogue 
between parties on these issues at the national level. Thus, in 
November 2000 the National Automotive Service Task Force was 
established. The mission of the Task Force is to facilitate the prompt 
identification and correction of gaps in the availability and 
accessibility of automotive service information, training, diagnostic 
tools and equipment, and communications to automotive service 
professionals.
    At the outset, the Task Force recognized three basic realities. 
First, despite the best efforts of everyone involved, some gaps in 
service information, training, and tools are inevitable. Second, the 
rapid pace of changes in vehicle technology, which will clearly 
continue, exacerbates this problem. Third, a continuing forum for open 
communication and cooperation is the best way to address issues.
    The Task Force has made significant and sustained progress. The 
first issue the Task Force addressed was that of information 
accessibility. In May 2001, the NASTF Service Information Committee 
teamed with the International Automotive Technicians Network to launch 
an Internet website to provide a ready reference for all service 
technicians requiring service information and tools from automakers. 
This reference is updated quarterly and broadly publicized by Task 
Force participants.
    A special feature of this site is the inclusion of a complaint form 
for a technician to use if he/she cannot locate the information needed 
to fix a vehicle. NASTF complaints can be submitted electronically by 
Email or by telefax. Complaints are received and monitored by the NASTF 
Service Information Committee. Immediately upon receipt, complaints are 
sent directly by Email to the auto manufacturer for prompt 
investigation and response. Manufacturers respond directly to the 
company or individual that submitted the complaint. As part of the 
process, complainants are notified that the complaint has been received 
and forwarded to the manufacturer, and that they can expect a reply 
directly from the manufacturer.
    From January through December 2003, NASTF received 88 complaints 
involving 17 manufacturers. From January through September 20, 2004, 
NASTF has received 33 complaints involving 15 manufacturers. Only two 
very recent complaints have not received a response.
    In addition to NASTF complaints, individual automakers report that 
they occasionally receive suggestions from their website users about 
ways to improve content in their service documents or navigation of the 
websites. Manufacturers use such feedback to continually improve their 
services.
    In July 2002 Senator Dorgan held a subcommittee hearing on service 
technology issues. After hearing the concerns raised by all parties, 
Senator Dorgan challenged the automakers to work cooperatively with the 
auto service industry to address any service technology issues. We took 
that challenge very seriously and within a few weeks were able to get 
all manufacturers to agree to make all service, tool, and training 
information available within a short time frame. By March 2003, all the 
automakers had launched Internet service websites, available 24 hours a 
day, 7 days a week, where anyone can access service and training 
information as well as obtain information for purchasing factory 
diagnostic tools. To facilitate the access to these websites, the NASTF 
website www.nastf.org contains links to all the automakers' websites. 
Many other NASTF participants have included links on their own 
websites, too. The access charges are minimal. Technicians can have 
immediate access to practically any of these websites for a period of 
24 to 72 hours at a charge of $10 to $20. Frequent users have the 
option of subscribing monthly or annually. The availability of this 
electronic information is also a valuable resource for companies that 
are in the automotive information processing business. Many independent 
shops rely on such third party information providers as a primary 
source of service information and the progress of the NASTF has helped 
to facilitate this.
    The success of the Task Force over the past four years is due to 
the participation of a wide range of parties. We are fortunate to have 
a ``Who's Who'' of auto service organizations participating, including 
the Automotive Service Association, the Automotive Aftermarket Industry 
Association, the Automotive Service Councils of California, the Society 
of Automotive Engineers, the Alliance of Automotive Service Providers, 
the International Automotive Technicians Network, and the Equipment & 
Tool Institute, to name just a few. Currently over 100 organizations 
participate in the Task Force, and participation is growing. The 
complete list of participants and other information is available at the 
Task Force website and is attached to my written statement.
    These are just a few examples of the progress that is being made in 
the Task Force. In addition to the Service Information Committee, the 
other NASTF committees include the following:

 The Training Committee, which focuses on ensuring that all 
        technicians have access to factory equivalent training;
 The Equipment and Tool Committee, which focuses on improving the 
        availability of generic tools for both dealer and non-dealer 
        shops;
 The Communications Committee, which focuses on getting information 
        out to shops and technicians about the Task Force project, how 
        to obtain the tools and service information they need, the 
        progress the Task Force is making, how to get involved and 
        provide input, and how they can otherwise help; and
 The new Vehicle Security Committee, which was recently formed to 
        address gaps in access to vehicle security information by 
        automotive security professionals.
    The central question being considered today is whether technology 
is locking out the consumer and independent shops. I believe just the 
opposite is true. We are using Internet and E-business technology to 
provide needed service information, training, and tools to anyone who 
needs it much quicker, and for far less cost, than ever before. The 
NASTF process also ensures a forum for identifying and addressing 
problems. I am confident that working cooperatively within the NASTF 
process, we can continue to be successful in bringing together the 
talents and resources of the stakeholders to address service technology 
issues.
    In conclusion, the automakers are completely committed to the 
National Automotive Service Task Force. We believe this Task Force is 
the proper venue for continuing to address service technology issues, 
and that it is making significant and sustained progress in improving 
the availability and accessibility of information, training, and tools 
to automotive service professionals. Therefore, we believe legislation 
in this area is not only unnecessary, but potentially counter-
productive.
    Again, thank you for the opportunity to address the Subcommittee on 
this important issue.

    Mr. Stearns. I thank the gentleman.
    Thank you for patience, Ms. Cardwell, and we appreciate 
your opening statement.

 STATEMENT OF LYNNE CARDWELL, CHIEF EXECUTIVE OFFICER, CAR CARE 
CENTER, ON BEHALF OF COALITION FOR AUTOMOTIVE REPAIR EQUALITY, 
 AUTOMOTIVE AFTERMARKET INDUSTRY ASSOCIATION AND CARQUEST TECH-
              NET PROFESSIONAL AUTO SERVICE CENTER

    Ms. Cardwell. Thank you, Mr. Chairman and members of the 
subcommittee for the opportunity.
    I will be brief. I am mindful that the time is running and 
so many of many points have been so well covered by the 
gentleman with the video down at the end. There are countless 
examples of technicians not being able to actually drill down 
to the problem.
    But as you know, my name is Lynne Cardwell and I have been 
in the vehicle automotive repair business for 18 years. And I 
am a lady shop owner. I did not end up there looking for that. 
I ended up because my husband had a very serious car accident 
and his spine was crushed and I needed to come in and hold the 
thing together. And it worked out so beautifully that we were 
able to stay on, and we have grown to one of the largest 
independent and most reputable, I think, shops in Sacramento, 
California.
    We have an 18 bay shop. It's a large facility. It is about 
the size of a small dealership. We do not sell new cars or used 
cars, but we just work on them. And as a general repair shop, 
we work on almost every make and model; all of the domestics, 
most all of the Asians and some of the Europeans.
    But today I am here. I am a member of the Automotive 
Service Councils of California and they do have 1500 
independently owned service centers, very much like my own. I 
have also been asked to speak on behalf of the Automotive 
Aftermarket Industry Association, and they have 4400 member 
companies and affiliates who make and market equipment and 
materials, supplies and services. And they have over 45,000 
outlets and shops.
    And as a CARQUEST Tech-Net Professional Auto Service Center 
myself, I have also been asked to speak on their behalf. There 
are 3700 of those centers independently owned across the 
country.
    And the Coalition for Automotive Repair Equality also asked 
to have me speak on behalf of them. And they represent 
aftermarket suppliers that we buy from all over the Nation.
    But, of course, primarily I'm here to speak on behalf of 
our own business, because we absolutely cannot survive without 
complete and consistent service information.
    We do have a very high standard for the training that we 
require of our own technicians. We are an ASE Blue Seal 
facility, there are only three of those Blue Seal facilities in 
Sacramento.
    We are also a State certified Gold Shield smog station and 
a State certified small business. We are Tech-Net Professional 
Auto Service Center, as I said. And we're also AAA approved 
auto repair facility.
    We have 13 employees; all of our technicians save one are 
ASE Master certified technicians with a L/1 certificate. Most 
all of them are smog licensed as well.
    We process probably 5,300 cars in a year. We do about 20 a 
day. And each technician is required to complete at least three 
advanced courses per year. And our shop is very well equipped 
with the latest diagnostic equipment, the ones that we can lay 
our hands on.
    But times have really changed for us in the auto service 
industry. So much of that has been already said, I will not go 
into that too much. But the scopes and scanners and hand tools 
that used to be our stock in trade really now what we are 
needing so desperately on a consistent basis is the 
electronically transmitted repair information, and that has 
become our most important tool. And if we cannot get that, it 
is not an overstatement to say that we are out of business. 
Maybe not today or next week, but eventually and very soon 
within a matter of 2 or 3 years.
    Every time we send a customer to a dealer because we do not 
have repair information for their vehicles, we lose credibility 
with that customer.
    And the other issue that has not been brought up today, 
which I think is a huge concern to anyone in the aftermarket, 
is that good technicians will not stay where they cannot get 
the kind of information on a consistent basis that they need to 
do their jobs properly. I know that from personal experience. I 
lost one very good technician who was with us 12 years. And he 
left to go to a dealer because the service information he knew 
from personal experience was more accessible there.
    According to a poll conducted by the Tarrance Group this 
summer 92 percent of auto service retailers favor the passage 
of this legislation. And interestingly enough, 93 percent of 
ASA member shops favor this legislation.
    The Motor Vehicle Owners' Right to Repair Act would ensure 
that motorists retain the freedom to choose how and by whom 
their vehicles are maintained. Without that, car makers begin 
to achieve a virtual monopoly. I am sure no ne of us want that. 
They are not probably wanting a monopoly. We want a level 
playing field, really.
    Now we have just what the car makers feel like giving us 
today. The word that concerns me here is ``voluntary.'' I keep 
voluntary, voluntary. And while we are very appreciative of the 
efforts that have been made to date to provide this 
voluntarily, without a bill there is no force of law behind 
that bill, there is no way to enforce it. And that is a very, 
very crucial point that we must not overlook in discussing this 
bill.
    I am just about finished. I will try to be real fast.
    Mr. Stearns. Sure.
    Ms. Cardwell. If we were to subscribe to just the top 21 
auto makers' websites, it would cost a small job, any shop, 
$37,000 a year. And that is prohibitive for most small 
businesses. And, of course, the specialized scan tools are 
extra on top of that.
    So with regard to the tools themselves, there is a copy of 
a GM letter in your packet there. I think that explains GM's 
intention to crank up the cost of their data stream information 
which they feel has been severely under valued, I think that is 
their terminology, raising the price to our tool suppliers from 
which we buy our tools from $10,000 to $50,000. That is a 500 
percent increase. And I think that is unconscionable.
    If they succeed in this and other manufacturers follow 
suit, the tools the diagnostic capabilities, we need to stay 
competitive with dealers, may be completely out of our reach.
    So now we have a statement of intent by the auto makers. 
And while we appreciate the attitude and the helpful beginnings 
that that represents, it still is entirely on their terms and 
with no force of law behind it, it is impossible to enforce it. 
So they say that we should just trust them to release the 
service information voluntary; there is that word again 
``voluntary.'' But if this was really their plan to voluntarily 
release all the information and make it a level playing field, 
why are they so opposed to this bill which does that, except 
that it provides enforcement.
    I think that is probably the real reason for the objection 
is that it does provide within an ironclad enforcement 
mechanism under the Federal Trade Commission to make sure that 
all parties are carrying out their obligations to the motoring 
public. This feature is notably absent in everyone of the car 
company's paper promises. So I respectfully ask the 
subcommittee to give its full support to H.R. 2735 and let us 
continue to serve our long time customers, and at the same time 
support ourselves and our families.
    Thank you.
    [The prepared statement of Lynne Cardwell follows:]

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    Mr. Stearns. Thank you very much.
    I ask unanimous consent that we let the chairman of the 
full committee have his opening statement. It is bill that we 
are talking about, so I think it is appropriate and 
affirmative. So without unanimous consent, I so offer Mr. 
Barton.
    Ms. Schakowsky. Mr. Chairman, if I could.
    Mr. Stearns. Yes.
    Ms. Schakowsky. Just say in accordance with the tradition 
and the rules of this committee, I happily ask the chairman of 
the committee to be allowed to make an opening.
    Mr. Stearns. And I appreciate your affirmative action here 
and your spirit.
    Mr. Barton, you are working with those high flattery 
comments from the other side.
    Chairman Barton. Well, I appreciate Ms. Schakowsky's 
generosity. If it really is a problem, I do not have to be 
recognized by unanimous consent. I am willing to be recognized 
to ask the first 5 minute rounds of questioning.
    Mr. Stearns. You have been recognized, Mr. Chairman, and 
you are speaking on your time.
    Chairman Barton. All right. Well, I am not going to 
regurgitate my opening statement, which was put into the 
record. But I am generally going to make a statement and then 
ask one question.
    I have been involved in this issue for the last 3 years 
when some of my individual car repair shops in Texas came to me 
and talked about the difficulty of getting information to 
repair their newer model cars because of all the computer 
diagnostics that were required.
    The gentleman down at the end of the table, Mr. Dave 
Scaler, came to my office earlier this year, hooked up his 
laptop computer and ran me through a real time demonstration of 
his attempt to get some information about a particular part for 
a particular car that if I recollect properly, was currently in 
his repair shop in New Jersey and he needed to repair, and he 
could not do it. And he had gotten all the required--he had 
paid all the fees and gotten all the passwords. He had done 
everything that he could do and he spent about 15 minutes in my 
office going through the various screens and ended up not 
getting the information.
    And the Automobile Manufacturers Task Force that has been 
working with the repair shops and the auto repair parts groups 
admits that on average it takes somewhere between 8 to 15 days 
to get this information or get the parts. I do not know many 
people that are going to wait eight to 15 days. I guess if you 
absolutely have to, you will. But most of us, we take our car 
into a shop, we expect that day or the next day or maybe 2 or 3 
days depending on the backlog, our car is going to be repaired.
    And, as I said, I have been involved in this for the last 3 
years. And the purpose of this hearing is not to generate 
enthusiasm for the bill that I have sponsored, 2735 which I 
appreciate all the stickers out in the audience. But this is 
not a legislative hearing on a particular bill. This is one 
last attempt to get the manufacturing community to work with 
the repair community to solve this problem.
    You know, I did not hear the opening statements and I have 
read the testimony, although I have not gotten to hear, but 
from what Mr. Bass told me when he was here, about the half of 
the group were patting me on the back and about half the group 
were kicking me in the bottom which means that I am probably 
right on point. You know, the bill is about what it ought to be 
and we do not want to have to engage in a legislative process. 
We would rather solve this through voluntary means. But the 
facts are the facts.
    And my good friends on the automobile manufacturing side, 
some of you have dragged your feet and you have made a system 
that even when the people like Ms. Cardwell who has a very 
large shop pays the fees, buys the equipment, it is very very 
difficult to get this information.
    Nobody wants proprietary information. My God, what would 
they do with it if they had it? General Motors spends billions 
of dollars to design some of this equipment in these new models 
or Ford or Chrysler or Toyota or Mercedes; pick your 
manufacturer. No repair shop in Sacramento, California is going 
to have $5 to $10 billion if they got proprietary information 
to use it. That's ludicrous on the face of it.
    All these folks want is the ability for people that do not 
buy new cars and do not have them under warranty that buy used 
cars and have to go to the independents to get their cars 
repaired because they cannot afford a new car that is under 
warranty or go to certified dealer and pay the higher labor 
costs and all of that. They just want the ability to take their 
car in and have it repaired and inspected and looked at in a 
reasonable time period at reasonable cost. And if we can do 
that by voluntary means, so be it. But if we cannot do it by 
voluntary means, the votes are here in this committee and the 
floor of the House and I think on the Senate to pass this bill 
or something similar to it in the very near future and make it 
mandatory.
    So my question is to the manufacturing representatives what 
is it going to take to get a system that does not just look 
good on paper, but actually works in a real time basis that 
people like Mr. Scaler can actually use it after they paid the 
right fees and all of that to get the information, to get the 
parts to repair the cars in the independent shops?
    So I would ask that to--I guess we would start with--I 
would try to Mr. Dana. How about Mr. Dana? Not to pick on you, 
but----
    Mr. Dana. Feel free to pick on me, Representative Barton.
    I would like to be able to tell you that in fact we do make 
all of our information available today in an agreement with the 
ASA as we talked in previous hearing with your committee. We 
are making all that information available. In fact, let me 
point out one----
    Chairman Barton. So you dispute this 8 to 15 days?
    Mr. Dana. Yes, sir I do. These websites are available 24 
hours a day, 7 days a week. You can access them anytime, and 
you can access them for either a short period of time for a 
relatively inexpensive price or you get an annual subscription 
for a higher price.
    Chairman Barton. Mr. Scaler, do you want to respond to 
that?
    Mr. Scaler. It is our opinion, obviously, that that is not 
correct. And unfortunately most of the statements that are made 
that way are traditionally done by people that are not on the 
technical level that need to drill down to get the car done. 
Traditionally that is where on the surface it looks okay, but 
it has been our experience that the technical end is where that 
falls short.
    Chairman Barton. I have used more than my time. I will have 
some questions for the record. But I think you get my point. I 
want a voluntary solution and I want the manufacturers to work 
with the repair people so that we get this done so that it 
actually works in the real world and not just on paper.
    With that, Mr. Chairman, I yield.
    Mr. Stearns. I thank the Chairman.
    I will start with the opening questions, and Ms. Cardwell, 
I cannot resist and this is really a compliment to you. If your 
mother told you when you were 12 years old that you would grow 
up to be a CEO of a car care center, I do not think you would 
have ever believed it, would you?
    Ms. Cardwell. And she would not have believed it.
    Mr. Stearns. Yes.
    Ms. Cardwell. Nor would I.
    Mr. Stearns. No. I know.
    Ms. Cardwell. All of my friends told me when I went to work 
there, I cannot even picture you there. But things went well.
    Mr. Stearns. I am going to ask you a question, and Mr. 
Scaler when I looked at this issue about the same time Mr. 
Barton did, the Chairman, the question came up why has not one 
of the 50 States passed laws? I mean, if this is such a serious 
problem across the United States, why have not one of the 
States passed laws to do just what 2735? Why is the Federal the 
first person to ask it? Is it because you have been frustrated 
and you cannot get any States? And is it possible when you went 
to the State legislatures there was not enough justification, 
you could not convince State legislature? Because as I 
understand, you folks have tried on a State level, particularly 
California.
    So I will start with you and then Mr. Scaler, you might 
want to talk about that or anyone else, Mr. Donovan. So go 
ahead.
    Ms. Cardwell. Yes. Thank you.
    I was privileged and they would not have been able to keep 
me home from testifying on SBL1146 in California, which was 
limited only to emissions equipment.
    Mr. Stearns. Right.
    Ms. Cardwell. And that was federally mandated.
    Mr. Stearns. Right.
    Ms. Cardwell. But frankly it was not having. The system was 
not working. And in that way it is a perfect----
    Mr. Stearns. In that case it was probably a more powerful 
argument than ever before.
    Ms. Cardwell. Absolutely. Absolutely.
    Mr. Stearns. Yes. But yet you could not pass it on the 
State level?
    Ms. Cardwell. We did.
    Mr. Stearns. You did pass it?
    Ms. Cardwell. We succeeded.
    Mr. Stearns. Okay.
    Ms. Cardwell. Yes, we did.
    Mr. Stearns. Has it passed in any other States?
    Ms. Cardwell. I do not know that any other State has done 
that, but they are looking at it.
    Mr. Stearns. Mr. Donovan, do you know? No? Okay. Okay.
    Mr. Scaler then?
    Mr. Scaler. The only other one that I am familiar with was 
Arizona.
    Mr. Stearns. Okay.
    Mr. Scaler. Lost by two votes, I believe.
    Mr. Stearns. Okay. Okay.
    Mr. Scaler. But beyond that I am not qualified to tell you.
    Mr. Stearns. Well, I am just, you know, trying--because 
generally when we are up here at the Federal level, this is 
made to--it has been a battle in the States and sometimes they 
want the State preemption because they say we need one bill 
because there is 50 different State laws.
    And the other thing is if this is such a problem, why has 
not the association or anybody sued the automotive 
manufacturers? It seems like the courts could solve this 
problem, too. I am just taking the devil's advocate from the 
standpoint up here we are looking at another Federal piece of 
legislation that is going to impact everybody.
    Yes?
    Ms. Cardwell. Because I am a shop owner, I am not a 
lobbyist or a paid professional and here I did not actually 
realize, but I understand that the EPA did adopt that on the 
Federal level----
    Mr. Stearns. Oh, they did?
    Ms. Cardwell. [continuing] SBL46 was passed.
    Mr. Stearns. Mr. Dana, you know you have heard what these 
folks have said. And you have heard what the Chairman said. I 
mean, it seems to me that it would be very easy to design easy 
access to these onboard diagnostic systems. I mean, that would 
be the first step. Perhaps a USB port, something like 
computers. Something very easy. It is not so complicated so 
that the average person could go in and quickly repair a car on 
weekends.
    By golly, I ran a small business. If I had to wait 4 or 5 
hours to get information, I could not survive every automotive 
repair to go in and do that website. I mean, Mr. Scaler is 
doing yeoman service to go through and take the time. And all 
these small businesses have to do it, and Ms. Cardwell's 
business. I mean, that is outrageous that they have to spend so 
much time finding this information; make the call, do the fax, 
do the email. I mean, you know you cannot run a business and 
make any money in America. So I mean why does not the Alliance 
work as a first big step to make this a USB port, simple, just 
bingo we got it all?
    Mr. Dana. Well, let me explain if I can, Mr. Chairman.
    Mr. Stearns. Just short, please.
    Mr. Dana. There is a standardized connector on all cars 
that we worked carefully with other parties to make sure to 
design it properly so an OBD tool can be inserted into that 
port.
    Mr. Stearns. Yes.
    Mr. Dana. And you can read up problems to fix the car.
    Mr. Stearns. Yes. But then you get this thing that says 
unidentified code is needed.
    Mr. Dana. No, you do not, Mr. Chairman.
    Mr. Stearns. Well, I mean that is what he said. He says he 
could not get the code so he has got to go on the Internet.
    Mr. Dana. Can I explain the Dodge problem that Mr. Scaler 
brought up?
    Mr. Stearns. Well, I would like to keep it general. I mean, 
we have heard enough cases here, and we have even heard from 
the Chairman in his office. I mean, it seems like you folks 
could eliminate this problem, just reach out and make it easier 
for them.
    Mr. Dana. We have eliminated the problem. All service 
information from all auto manufacturers is available on 
websites today 24 hours a day, 7 days a week. You can subscribe 
to it for a short period of time, which is to repair a vehicle 
for about $20 or you can do an annual subscription.
    It is my understanding that the independent repair shops 
today rely pretty much as they did in the past on ALLDATA and 
Mitchells and other service providers who provide them general 
information on repairing most cars. If they cannot find the 
information they need in those manuals or those websites, they 
have the ability to go to the websites of the manufacturers for 
$20 or less to access information they need from that 
manufacturer's website.
    Mr. Stearns. Okay. Mr. Dana, you heard Mr. Haas say, and I 
think you said this, states that the complaints filed with 
NASTF this year have an average response time of 15 days. I 
think that is what you said. Is that equivalent to response 
time for franchise dealership? How does 15 days help a consumer 
with a car problem? Goodness gracious. I mean, how is anybody 
not have their car for 15 days? Does that make sense, that 
question? It is for you.
    Mr. Haas. Well, I think it makes perfect sense and it is 
not simply----
    Mr. Stearns. Could you go without your car for 15 days? 
Could you go without?
    Mr. Haas. No, I would not go without my car for 15 days.
    Mr. Stearns. Okay. So----
    Mr. Haas. And I do not think that people are going without 
their cars for 15 days. I think----
    Mr. Stearns. But you said in your opening statement that 
the average response time is 15 days.
    Mr. Haas. That is a response to a complaint.
    Mr. Stearns. Yes.
    Mr. Haas. So in other words when Mr. Scaler would submit a 
complaint to NASTF the average response time, and I think the 
correct number is 8 days, but I think the average response time 
is 8 days for the manufacturer to respond to that complaint. 
That does not mean necessarily that it took him 8 days to give 
him that information.
    I mean, I can also give you examples of manufacturers that 
have responded to complaints within 30 minutes.
    Mr. Stearns. No, I know. But you said----
    Mr. Haas. But the point is----
    Mr. Stearns. I am using your words which you said the 
average response time is 15 days. At least we got that from 
your statement.
    Mr. Haas. Yes. Right.
    Mr. Stearns. Those are not my words, those are your words.
    Mr. Haas. That is correct.
    Mr. Stearns. I mean, it seems like your case has got to 
fall and rise just on what you have said. And if 15 days is the 
average complaint, then the question is why and what can be 
done? And I guess another question is is this same franchise 
dealers having to wait 15 days? Probably not. But Jimmie's Car 
Garage is going to have to wait 15 days. So I think a lot of 
this hearing comes down to just your little statement there.
    Mr. Haas. Well, Mr. Chairman, I cannot answer how long a 
franchise dealers would wait for a complaint that would be 
submitted. I have no idea.
    Mr. Stearns. Yes.
    Mr. Haas. I think there are a couple of things that are 
real important here. Is that one manufacturers are doing a 
better job than they have when we started. That time of them 
responding to a complaint is shorter today than it was back in 
2000 when we started the process. So they are improving. That 
is progress. Okay.
    And I think the important point is that once an issue is 
identified with service information in a manufacturer's website 
and a complaint is initiated and it is responded to, that 
problem is solved. We do not have to go back for the next shop 
or the next consumer or the next vehicle owner and have that 
same problem where that information is still nonexistent. So 
they are solving problems.
    Mr. Stearns. My time has expired.
    The gentlelady, Ms. Schakowsky.
    Ms. Schakowsky. I have to admit to all of you, I am really 
confused by what is the problem here. Because I am hearing real 
life examples, I presume, about the inability to get 
information from some people who run independent auto repair 
shops. And then I am hearing that no, that simply is not the 
case, in my experience it really has not happened. And then I 
am hearing, I want to follow up on the Chairman's comments, 
that well it can take--yes, the information is there but it can 
take up to 15 days, maybe it is just 8 days. That seems to me 
an unreasonable time.
    I imagine that complaints are filed when you cannot get 
information. And so the result of that delay would be that 
someone is not getting the information to repair their car.
    I was also impressed with what Mr. Donovan said; this 
notion of the right of car owners to own the information 
generated by their automobiles. Do I really own my car when I 
pay it off if I do not have the right to the information to 
keep that car running? I am not talking even about dealers now. 
Do I as an owner own my car if I do not have that basic 
information?
    And finally, the confusing part that if there is not a 
problem, if the information is accessible, then what would be 
the harm in having legislation that would say that that 
information must be given? I mean, if that is already happening 
and everybody is all on the same page--oh, and let me ad one 
ore thing, Mr. Haas. You said that the people who oppose this 
legislation are not here because they are home working.
    Now, I look around this room. I do not know anybody here, 
but I have to assume that they are not a bunch of slackers. 
That they have come here, probably at either their own business 
costs or out of their own pockets to say that they are for this 
legislation and that they are hard working entrepreneurs much 
as those of you who oppose this legislation say that you 
represent.
    So I am trying to understand this division among those of 
you in the business and where the truth lies. Nobody seems to 
be willing to say that independent technicians do not have the 
right to this information. Everyone seems to agree with that. 
The disagreement is over whether or not that information is 
really available. That seems like an empirical answer ought to 
be available.
    What am I missing here? I am going to let Mr. Scaler and 
Mr. Haas gives their views, and then anyone else can chime in.
    Mr. Scaler. I think essentially what you are hearing is the 
fact of the matter is when the complaints go in, the resolution 
or viewed resolution is that the manufacturers responds to the 
complainant. Now, no one really knows, particularly on that 
side, if it was really resolved. They just know that the 
manufacturer said they have taken care of it.
    And in my case, and virtually every time I have complained 
to the manufacturer I have direct examples, many others, that 
it was not resolved or it was resolved in a way that I couldn't 
do anything about it. In one case I was told that I could have 
the equipment if I can ship the container over from Europe 
because the two in Indiana were slatted for dealership and not 
allowed for me. So, you know, at that point and in this 
particular case, it was 70 days that I waited. Then, you know, 
it becomes a point of it is almost----
    Ms. Schakowsky. But that complaint would be viewed as 
resolved?
    Mr. Scaler. Resolved because the manufacturer contacted me 
with a resolution.
    Ms. Schakowsky. I see.
    Mr. Scaler. Of course, it was not practical in any form. 
But at that point, you know, we have tried everything and at 
some point you cry uncle. And certainly the average technician 
does not go through most of the times that I go back and back 
again. I just happened to be a little more relentless at that. 
The average technician just says well I guess so----
    Ms. Schakowsky. Well explain to me then, Mr. Scaler, why is 
it that some people who seem to be in the same business as 
others are saying we do not need this legislation?
    Mr. Scaler. Quite frankly I feel it is because they do not 
fix cars. They used to fix cars. They no longer do. They have 
the same credentials as me, but when we have to do the job.
    When we submit a complaint or when I submit a complaint, I 
expect someone to be there going well first of all, it is 
probably legitimate if it is from me because I have some 
history here. And second, I was hoping that someone was 
actually trying to get it.
    In all the cases, in the example I showed you today, I was 
just told that it wasn't there. And I was convinced by all the 
parties, no one actually even checked, nobody tried to click a 
couple of clicks to see if I had. And it was just as long as 
they responded, then it was okay. And still not resolved.
    Mr. Dana. Representative Schakowsky, could I answer that 
question for you?
    Ms. Schakowsky. Okay. Sure.
    Mr. Dana. Today other deals and independent repair shops 
have access to the same vehicle information, service 
information tools, diagnostic equipment. That is the fact of 
the matter.
    One of the issues--and we are not perfect, okay?
    Ms. Schakowsky. Well, wait a minute. But that is not--I 
know you keep saying that and I keep hearing that, but we are 
given examples where they did not have access to that 
information.
    Mr. Dana. Let me give you an example. Mr. Scaler brought up 
an issue, okay. We are not perfect. We have thousands and 
thousands of pages of service information that changes every 
year, and we have made some errors.
    Ms. Schakowsky. Yes, but wait a minute. Errors, but he was 
told repeatedly that the information was available online and 
then he needed to get a PIN number. I mean, I suspect that 
there are others who could give many other examples. I am not 
saying that you should be perfect. But it seems as if this 
information is not routinely available in the same way it is to 
dealers. You are saying that is just not true?
    Mr. Dana. And I respond particularly in the case you are 
mentioning. In the case of the PIN number with a Dodge car that 
he mentioned. DaimlerChrysler was aware of the issue and is 
correcting it, okay. It was in fact a problem. DaimlerChrysler 
is correcting that problem. That was in fact a problem. It was 
an error in the software programming that did not allow the 
repair person to have the right code.
    The PIN is available to the dealership on the website, and 
the PIN is given to the owner of the vehicle when he purchases 
it. What happened was there was a mistake. DaimlerChrysler 
became aware of it. Has notified EPA and ARB, because they have 
to do that under the rules that we operate under.
    This issue could have been resolved sooner if the CARE 
representatives were a part of NASTF and worked through the 
normal complaint process and told DaimlerChrysler about this, 
we could have been working on it sooner than we did.
    The way DaimlerChrysler found out about this problem was 
that they went to the website, the same website that is 
available to the aftermarket independent repair shops and 
figure out what the problem was, and they are now fixing it.
    Mr. Stearns. All right. The gentleman from Michigan.
    Mr. Upton. Well, thank you, Mr. Chairman.
    As I listen, I appreciate the testimony, I appreciate the 
hearing as well. And I got to say that my dad was once in 
charge of service for a Fortune 100 company. And one of the 
things that his team did was develop the 800 number. They did 
it. And I know that when I call that 800 number for service as 
a consumer, I get a certain individual and I can ask questions 
and be directed to the closest repair shop. And I also know 
that there is another number that I sometimes ask for that the 
mechanics can use themselves. I think you can more detailed 
information and specifically to apply for parts and how to 
install those if they need to do it.
    And 1 day next week I am intending to take my Trail Blazer 
to my favorite mechanic in St. Joe, Michigan. I have been going 
for decades to a place called All American Shell, and they do a 
good job. And I have put hundreds of thousands of miles on my 
vehicles in the decades that I have been taking my car there.
    And I am going to ask the mechanic on Monday if they have 
ever had a problem, and I will report back what his answer was. 
I got an unsolicited fax a little bit earlier this morning 
saying from Dr. Dan's Service Station in Kalamazoo, Michigan, 
pretty big operation. He's on Stadium, which is the major road 
in Kalamazoo. And it says business owners for 20 years--as 
business owners for 20 years we have made some agreements with 
the auto makers to make available through the Internet and 
other sources the information we need to repair the newer cars. 
I feel we should give this a try before we start to change the 
laws on this subject.
    My bet is that my mechanic on Monday will tell me the same 
thing. And, again, I will report his answer. But as I listen to 
Mr. Scaler's comments and I walk through the review of your 
testimony, I am surprised that a dealer--I believe that was a 
what? Was it Volvo. What was the brand?
    Mr. Scaler. BMW.
    Mr. Upton. BMW. I am surprised that a manufacturer of that 
size would not have someone available to walk someone who is a 
professional--you versus me--through the process of how to fix 
that car. And I guess I need to ask Mr. Dana as you say that 
your service information is on websites 24/7 for less than $20. 
You think you have a pretty good system in place. Why is it 
that someone like Mr. Scaler, who I think everyone could 
identify with the description that he provided, why could not 
someone like that get that provided under the system that is in 
place now under a voluntary agreement? And I presume that BMW 
is a member of the auto Alliance, are they not?
    Mr. Dana. Yes. He should be able to get access to that 
information, Mr. Upton. Let me point out something. One thing 
about----
    Mr. Upton [presiding]. Well, hold on 1 second.
    When you, Mr. Scaler, when you described your situation in 
Mr. Barton's office, how long ago was that? This year, last 
year, 2 years ago?
    Mr. Scaler. This year.
    Mr. Upton. This year. Okay. All right.
    Mr. Dana?
    Mr. Dana. What we are hearing about in this hearing are one 
or two problems that exist, not about the millions of repairs 
that are done everyday, every year to fix cars properly. You 
can always one or two faults in any system. But the real 
important story here is that most independent repair shops, 
dealerships, everybody who repairs cars has better access to 
information today than they had in the past, can get the 
information they need to repair cars properly. But pointing out 
the one or two problems is the purpose of the NASTF. That is 
why we have the complaint form. That is how we can make sure 
that we fix all the problems that exist.
    But keep in mind that----
    Mr. Upton. How many complaints usually come in the course 
of a month?
    Mr. Dana. John's testimony had that in.
    Mr. Haas. Last year there were 88. To date this year we 
have had 33.
    Mr. Upton. Thirty-three complaints out of hundreds of 
thousands?
    Mr. Haas. Right. Actually millions.
    Mr. Dana. Millions.
    Mr. Upton. Millions. I guess it goes back to the old saying 
that is popular in our family: Was you always perfect? That's a 
pretty decent record.
    Mr. Donovan?
    Mr. Donovan. Thank you for recognizing me, Congressman.
    If I may just address it. I think that some of the problem 
is that the facilities in the industries have done as Mr. 
Seyfer have identified and said that we know that there are a 
certain amount of vehicles we cannot do. We take them to the 
dealership for the customer to eliminate the inconvenience. But 
our concern is the bottom line is who ends up paying for that? 
The consumer is the one that ends up paying for it for the cost 
in many cases.
    At some point Mr. Scaler had talked about all the hours and 
hours to find the problem. There is a cost associated with 
that. Some of it is eaten by Mr. Scaler and Mr. Seyfer, some of 
it goes to the individual customer. And that is our concern as 
we move forward.
    Mr. Upton. Well, I know my time has expired, so I yield 
back.
    Mr. Stearns. The gentleman from Michigan, Mr. Dingell.
    Mr. Dingell. Mr. Donovan, in the situation that you have 
just been describing to my colleague, you are not alleging that 
there is a failure on the part of either the dealer or the 
manufacturer to make the information that is needed by the 
independent repairman available to that independent repairman, 
are you?
    Mr. Donovan. I am not making that suggestion. I think that 
was already made by both Mr. Seyfer and----
    Mr. Dingell. You are not making it today? You are not 
making that suggestion?
    Mr. Donovan. Yes. The information as I said in my opening 
statement, that information we have come a long way in the last 
couple of years. There is a lot more information available 
today. The problem that we do have is that the information is 
costly, it is difficult to manage on the Internet as well.
    Mr. Dingell. Now, Mr. Scaler, how many complaints have you 
filed with NASTF?
    Mr. Scaler. The complaints that I have I will be happy to 
share with you?
    Mr. Dingell. How many?
    Mr. Scaler. Realistically, I have had three complaints.
    Mr. Dingell. Over what period of time?
    Mr. Scaler. Over a 3-month period of time. One complaint, 
which I just shared with you, another complaint which I waited 
70 days for the response which I can also share with you. And 
at that point got----
    Mr. Dingell. So you had three complaints. This was three 
complaints out of what size universe of transactions?
    Mr. Scaler. But, no, you do not understand something here.
    Mr. Dingell. No. You have a lot of transactions, you file 
three complaints. How many transactions were the geneses of 
those three complaints?
    Mr. Scaler. Probably a better way to----
    Mr. Dingell. Fifty thousand?
    Mr. Scaler. [continuing] put that----
    Mr. Dingell. Ten thousand?
    Mr. Scaler. Certainly. Because in the case of Chrysler and 
this example, that is every Chrysler product we work on.
    Mr. Dingell. Okay.
    Mr. Scaler. So that we continuously, we do not go back over 
and over. And in the case of BMW, it is every BMW that comes 
into the store.
    Mr. Dingell. Well, three out of all the cases that you 
dealt with, is that right? Three?
    Thank you.
    Now, gentlemen--this question to Ms. Cardwell. You are 
aware of the fact that the FTC has authority over restraint of 
trade, unfair and deceptive acts in commerce and also 
violations of the antitrust laws, are you not?
    Ms. Cardwell. I understand that.
    Mr. Dingell. Have you made any complaints or has anyone at 
the table made any complaints to the FTC about the situation to 
which you complain today?
    Ms. Cardwell. Well, I think that it is inexperience on most 
of our parts as shop owners as to how to make the complaint 
process work for you. I understand NASTF has a process. But the 
average--all of my technicians decide very quickly when they 
get onto a website, OEM or otherwise, as to whether they can 
drill down in a fairly effective way to get the information. It 
takes them a heartbeat.
    Mr. Dingell. So what you are telling me is that no one at 
this table has filed a complaint with the FTC over these 
matters?
    Ms. Cardwell. That's true as far as I have not made a 
complaint, no.
    Mr. Dingell. Now this to all the panelists here, and I 
would appreciate a yes or no or I do not know.
    To the best of your knowledge the FTC--really does the FTC 
have any expertise in defining what a trade secret is or in 
determining what information qualifies as a trade secret?
    Would you answer yes or no or you don't know, starting with 
Mr. Scaler and going through Mr. Haas?
    Mr. Scaler. I do not know that.
    Mr. Dingell. Sir?
    Mr. Haas. I do not know that.
    Mr. Donovan. Do not know.
    Mr. Dana. From my reading would indicate no.
    Mr. Dingell. Sir?
    Mr. Cabaniss. I don't know, sir.
    Mr. Dingell. Ms. Cardwell?
    Ms. Cardwell. No, sir I do not know.
    Mr. Dingell. Okay. Are you aware, and again yes or no, that 
H.R. 2735 would weaken existing laws that protect trade secrets 
of American manufacturers by instituting new processes within 
the FTC? Is your answer yes or no, Mr. Scaler, and then going 
across or you do not know?
    Mr. Scaler. I do not know.
    Mr. Haas. Yes.
    Mr. Donovan. I don't know.
    Mr. Seyfer. Yes.
    Mr. Merrill. I do not know.
    Mr. Dana. We have our expert attorney here to answer 
questions, if that is appropriate for you, sir.
    Mr. Dingell. Okay. Sir?
    Mr. Stearns. You certainly can use your counsel to advise 
you and then you could answer for the ranking member.
    Mr. Dingell. I will be happy to have the answers later if 
you wish.
    Mr. Cabaniss. Yes, it would.
    Mr. Dingell. And, ma'am?
    Ms. Cardwell. My reading of the bill it would not.
    Mr. Dingell. Okay. Mr. Chairman, those are the questions I 
have. I thank you.
    Mr. Stearns. I thank the member.
    Gentlelady from California, Ms. Bono.
    Ms. Bono. Thank you, Mr. Chairman, very much. And thank all 
of our panelists for your time today.
    And, Mr. Chairman, we appreciate the sun tan we are getting 
from these extremely bright lights.
    Mr. Stearns. I apologize for the heat here. We have asked--
the maintenance people came up and they said the thermostat is 
set at 50 degrees. So that is all we can do.
    Ms. Bono. I would just like to sort of restate some of what 
my colleagues have said. I think, too, this is a little bit 
confusing for the most part. But I was encouraged to hear 
Chairman Barton talk about a voluntary system as it currently 
is. And I think we in Washington feel is if we offer 
legislation, you will hear our footsteps and make sure you are 
doing the right thing. And that we will not need to enact the 
legislation.
    On the presentation that the first panelist Mr. Scaler did, 
I think I am a little bit--what I see here is something that we 
are plagued with as Americans any longer, and that is the 
wonderful world of the Internet.
    All you have to say to tech support to anybody longer, and 
we all shutter, because we know it is a 45 minute wait. You go 
to a website any longer, you cannot find a telephone number. 
Nobody is going to be willing to help you. As Chairman Upton 
said, is there a number at the end of the day that you can 
call.
    When you said that you went to the website, everything was 
right with the diagnostic on the Chrysler. You got to the final 
webpage that asked you for the PIN number. And I think you did 
say in your testimony, but where would that PIN be found?
    Mr. Scaler. Let me clarify. That PIN number is found in the 
tool. So in order to complete that repair, I needed to have a 
subscription to the website, I needed to own the factory tool 
which is approximately $8,000 depending on how it is equipped.
    Ms. Bono. And does the legislation that is being under 
consideration, does that address that specifically?
    Mr. Scaler. It does, because it would allow me to get that 
number, which currently I cannot get. And there is many numbers 
like that which is the final step of the repair that do not 
allow the repair to get completed.
    Ms. Bono. Well, could this be a simple fix of the 
manufacturer that it is a little bit of a reverse that the PIN 
belongs with the hardware or whatever--I do not remember what 
it is in this case. It is a gasoline engine controller.
    Mr. Scaler. In other words, when we replace the engine's 
computer, the final step is to put in the PIN number otherwise 
the vehicle will not start. Without that PIN, we have to tow 
the car away.
    Ms. Bono. But that PIN should be on your side of the 
equation, not on the----
    Mr. Scaler. That is correct. How we get that currently, 
just so you know, is negotiation with the dealer parts center. 
And depending on that, determines our success in getting the 
PIN.
    Ms. Bono. On the BMW PowerPoint here you have, it seems to 
me as I am trying to follow out, you move from in full 
disclosure--my brother is a mechanical engineer with the 
automotive industry, and some of this I have heard complaints 
of around the dinner table.
    But you ask to the P coding, you move to the next website 
and it was a 320-3I and then it says M52 I guess was the model 
number coop. But the next page you went to an M73. Is that an 
error or is that a confusing website that took you from the M52 
to M73 or are they one in the same?
    Mr. Scaler. No. Those are chassis numbers. And one things 
that shows is all the pages. What that particular section 
represents was the amount of times I went back suggesting it 
was not there and the amount of times that the response was yes 
it is.
    And, of course, the final response only copied to me was 
well, you were right.
    Ms. Bono. Except that the jump from the M52 to the M73 
seems like perhaps a little--could that be input error when you 
were searching the information?
    Mr. Scaler. No. It was not a matter of the wrong chassis 
number. It was a matter of showing the extent that I went to to 
try to find any repair information for that code.
    Ms. Bono. But if you are trying to find the repair 
information and you tell it is an M52 and an M73 comes up, 
could that not be a problem?
    Mr. Scaler. Yes, that would be a problem. But that was not 
the case and is not the case.
    Ms. Bono. Well, that is how it indicates to me under your 
PowerPoint.
    My confusion is, is again if it can be voluntary because I 
fully understand with everybody's consideration would like to 
see exactly what we are all trying to achieve here. But first 
and foremost is this just the lack of the true inter-
operability of a human being with solely numbers on the 
Internet, can you pick up the phone and call somebody and get 
the answer? And if we can achieve it in that way, it seems to 
me with a voluntary system maybe we could go a long ways. But I 
think when you say you called--I forgot whether you said BMW 
and you pointed out there was an error on the website and they 
did correct it, to me that is a little bit encouraging as well.
    Mr. Scaler. You did see, though, that ultimately it is not 
corrected. Just so you know that the $20 number you could not 
achieve that task for $20. And I think that is important. So 
that there is a significant difference. And what I think is 
important there is the fact that, again, it was four times. 
Now, quite frankly you know in that particular case I was very 
diligent. But once they come back and once I knew that no one 
on the other side was checking this, auditing it other than 
myself, then I realized that the response was always going to 
be the same. And it is the response we are hearing today, is 
that everything is there.
    Ms. Bono. I believe I am over my time.
    So thank you, Mr. Chairman.
    Thank you.
    Mr. Stearns. Thank the gentlelady.
    Mr. Gonzalez.
    Mr. Gonzalez. Thank you very much, Mr. Chairman.
    About a month and a half ago I had a meeting with members 
of the Texas branch of the Automotive Aftermarket Industry, and 
of course it is an interesting group because some are parts, 
obviously they deal it parts, the others are actually the 
repair person. And then you had another contingent that just 
basically work on parts; like what we refer to as the 
machinists and such. There was not really any agreement as to 
the need for this legislation. They pointed it out to me and 
they were telling me about. It looked like an attractive 
proposition at first blush, especially since someone by the 
name of Barton happens to be the sponsor. But I asked what is 
the need. Because the last thing that we really want to do, 
contrary to popular belief, is really pass something that is 
not necessary. And I think this is what this hearing today is 
all about, is information gathering and trying to get that 
message out.
    What I asked the members at that meeting was supply me with 
specific instances of individuals who have encountered problems 
in not having access to information to repair a consumer's 
automobile. Now I know they are busy and they have not gotten 
back to me and maybe they will. But I just have not hear 
anything. And there was disagreement as to the real need.
    I am going to break up my questions quickly, because we 
only get 5 minutes. But it is an important issue.
    You know, we all love cars. They got to get repaired. 
Consumers would like to have choice, this is what it is all 
about, it is about competition and so on.
    I guess the first question is for Mr. Donovan. A dealer and 
a manufacturer have a special relations, would you not agree?
    Mr. Donovan. Yes.
    Mr. Gonzalez. And certainly responsibilities that they 
have, and it is one obviously based on economics and other 
duties and responsibilities. Should that place a dealer in a 
special position available for more information, easier access? 
And the other thing, too, is of course their mechanics are 
trained by, my understanding is that they are trained on one 
particular product by that manufacturer. There is going to be 
more information. Should they enjoy any kind of advantage as 
opposed to those that do not have a relationship with the 
manufacturer?
    Mr. Donovan. Not at the expense of consumer's choice. We 
believe that the consumer should have the right to choose the 
repair facility that they can go to and without this, it does 
not give them that choice.
    Mr. Gonzalez. So whatever process the manufacturer may have 
so that the dealer can have easy access to the information 
necessary to repair the cars should be available to an 
individual that does not enjoy that same relationship or is 
basically paying for that same relationship?
    Mr. Donovan. Keep in mind the independents are paying for 
it as well. And what we are asking for is full access to that 
information at a reasonable price so that that cost--so that 
the consumer vehicle can get repaired at their choice of 
facility and the costs associated with that to get the 
information is passed on at a lesser amount than is sometimes 
the case, as Mr. Seyfer and Mr. Scaler allege, the hours and 
hours that are spent trying to get these cars resolved. That 
obviously has to go somewhere and our fear is that too often it 
goes back to consumer, the cost of that.
    Mr. Gonzalez. Thank you very much for your answer.
    And this one will be, I guess, to Mr. Scaler. You indicated 
you needed this PIN number, this information. If I am the owner 
of the car, and I am not sure we are talking about the same 
thing, Mr. Dana, that that is available to me in the glove 
compartment somewhere, you are my agent. Are you not authorized 
in my behalf to act on my behalf and use that information?
    Mr. Scaler. No. In the example I used, unfortunately that 
was a case where we had all the information, the equipment and 
one of my technicians was the owner of the vehicle, and still 
could not get the number even though he owned the vehicle.
    Mr. Gonzalez. All right. Mr. Dana, given that same example, 
again I mean they are my agent. I think you have indicated that 
information should be available to me as the owner of the 
vehicle.
    Mr. Dana. The owner of the vehicle gets the PIN when the 
car is bought new. It may be if it is a second hand car that 
the second owner does not know where the PIN is. But the owner 
of the car when it is bought new has a PIN that can be 
accessed, at least access that information.
    Mr. Gonzalez. I purchase the car at a later date, I do not 
know where the PIN information is, but I am the owner. Should I 
not be entitled to that information?
    Mr. Dana. Again, I will point out that the problem that was 
brought up by Mr. Scaler is one which is a real problem. It was 
a software problem. It is being fixed by Chrysler. And if CARE 
would have been a participant in NASTF and notified us through 
the complaint form system we have, we would have been able to 
start repairing this problem sooner than we are now. It simply 
was a fault of the system that needed to be fixed, one of the 
many faults we have found, but one of the few faults we have 
found in millions of cars that are repaired every single year.
    Mr. Gonzalez. Back to my basic question, though. The owner 
of a vehicles, regardless of whether they are the first owner, 
the secondary owner or whatever it is, is entitled to get 
whatever information relating to necessary repairs of the car 
from the manufacturer?
    Mr. Dana. Anyone can access these websites that has all the 
service information and diagnostic information on them.
    Mr. Gonzalez. But not based on his relationship as the 
owner of the car or anything like that. It's just Charlie 
Gonzalaz can go there and I can check out what it takes to fix 
an Explorer, even though I do not own an Explorer, as long as I 
have paid whatever fee?
    Mr. Dana. Yes, that is correct.
    Mr. Gonzalez. Okay. And the other thing, Mr. Dana, why 
would this law expose manufacturers to some sort of sort of 
proprietary infringement that you have not already experienced 
given the wide access that you have described?
    Mr. Dana. We have been dealing with this issue since 1990 
and the aftermarket parts markers who are the ones really 
behind this bill want access to our proprietary information by 
which we calibrate our vehicles. This information is not 
necessary to properly repair a car. It is simply something that 
they could use to make replacement parts more cheaply than they 
do today.
    Mr. Gonzalez. Okay. I do not think anyone here is talking 
about information that it is not necessary to repair the 
vehicle. And I am over my time, but that is an interesting area 
to leave off on.
    Thank you.
    Mr. Stearns. You want to continue, you want to answer, Mr. 
Scaler?
    Mr. Scaler. No. Unfortunately, I may have to be excused.
    Mr. Stearns. Well, you're in luck. We are getting ready to 
close down the hearing.
    Mr. Scaler. Okay.
    Mr. Stearns. I think in conclusion we finished our 
questions for all of you. And I thank you for your patience.
    Ms. Schakowsky. If I could, Mr. Chairman?
    Mr. Stearns. Sure.
    Ms. Schakowsky. Just ask, make a unanimous consent request 
for all members to be able to submit opening statements for the 
record.
    Mr. Stearns. By unanimous consent, so ordered.
    We started with the hearing with the idea of how big is 
this problem and where is this problem. And we have attempted 
to do that.
    I would ask Mr. Merrill, you are sitting next to Mr. 
Seyfer. Mr. Seyfer has indicated that he is getting all the 
information he needs. I think that was your question.
    So, Mr. Merrill, I think you indicated that independent 
repair shops account for over 75 percent of the vehicles 
repaired in the United States. And that percentage is 
increasing, is it not? I mean, there are more and more people 
repairing automobiles. Is that fair to say as a real overview 
that, you know, most of the repairs are being done by these 
independent repair shops? Seventy-five percent are done by 
independent repair shops and that number is increasing. And so 
how big is the problem and where is it? The gentleman next to 
you saying that he is not having any problems and you are 
saying there is a whole lot of people that do not seem to have 
any problem because 75 percent is being done by independent 
people. Is that an accurate statement?
    Mr. Merrill. Before I came I made a telephone call to a 
number of different shops.
    Mr. Stearns. Yes.
    Mr. Merrill. And I asked I am going to Washington, will you 
give some help and give me some ideas of what kind of problems 
you are having throughout the whole State of Maine.
    Mr. Stearns. Right.
    Mr. Merrill. And these fellows came about and they gave me 
explanations of what kind of problems they were having. The 
fact that the cost of this information, the way it is going 
right now, the way it is looking right now, is a small 
independent repair shop my size if I were to purchase 
information on these cars, I would not look at the yearly 
figure but I would look at the monthly figure. And we are 
looking at $3,800 just to have access to this information.
    So the fact that maybe the information is available but I 
do not know any shop that is in our size, and there is a lot of 
shops across the country that are the same size shop as we 
have, I do not know how they are ever going to be able to 
afford the information.
    Mr. Stearns. Yes.
    Anything you would like to add?
    Mr. Seyfer. Well, I would. You do not go to those sites 
everyday. It is not necessary.
    Mr. Stearns. Yes.
    Mr. Seyfer. Over half of my billed time--we work sort of 
like lawyers, we charge by the hour for diagnostic time. Over 
half of my billed time is in diagnostic work. We do specialize 
in diagnostic work. I do not need to hit a site every single 
day. In fact, maybe 2, 3 times a week. $20 in and out. Some of 
the manufacturers give you 3 days for that.
    Mr. Stearns. Yes.
    Mr. Seyfer. So it is just not that significant of expense. 
I am already paying for ALLDATA. That is my significant 
information expense. And training my technician is my biggest. 
I spend over $150 a month per member of my staff to train them.
    Mr. Stearns. Yes.
    Mr. Seyfer. That is my biggest expense.
    Mr. Stearns. Well, on that note I have given both sides an 
opportunity. And we try to be fair and balanced on this 
hearing, but it is not a legislative hearing. It is just really 
an oversight to see what the situation. I think it has been 
very valuable. I want to thank all of you for your time.
    And with that, the subcommittee is adjourned.
    [Whereupon, the subcommittee adjourned at 4:16 p.m.]
    [Additional material submitted for the record follows:]

                        Retail Industry Leaders Association
                                                 September 22, 2004
The Honorable Cliff Stearns
Chairman, Subcommittee on Commerce, Trade and Consumer Protection
Energy and Commerce Committee
U.S. House of Representatives
Washington, D.C.

Re: ``Repairing the 21st Century Car: Is Technology Locking the 
Consumer Out?''

    Dear Chairman Stearns: On behalf of the Retail Industry Leaders 
Association (RILA), I am writing to commend the Subcommittee for 
holding today's hearing entitled ``Repairing the 21st Century Car: Is 
Technology Locking the Consumer Out?'' I would like to ask that this 
letter be placed into the official hearing record.
    The Retail Industry Leaders Association (RILA) is an alliance of 
the world's most successful and innovative retailer and supplier 
companies--the leaders of the retail industry. RILA members represent 
more than $1 trillion in sales annually and operate more than 100,000 
stores, manufacturing facilities and distribution centers nationwide. 
Its member retailers and suppliers have facilities in all 50 states, as 
well as internationally, and employ millions of workers domestically 
and worldwide. Through RILA, leaders in the critical disciplines of the 
retail industry work together to improve their businesses and the 
industry as a whole. The mission of RILA is to lead and serve the most 
successful and innovative retailers and suppliers through the delivery 
of world-class education, innovation and advocacy.
    We applaud you for bringing attention to this important issue 
through this hearing. While current automobile technology undoubtedly 
provides many benefits to consumers, we understand that the 
inaccessibility of information related to those technologies is 
preventing car owners from repairing and maintaining their own 
vehicles. It may also be preventing them from choosing their own auto 
mechanic or the parts needed to make repairs. Currently, only 
automobile manufacturers and their dealers--not independent repair 
shops or owners themselves--have complete access to all of this 
information.
    We believe it is unfair to deny consumers access to information 
about the products they purchase. In order to make informed decisions, 
consumers ought to be provided with as much information as possible 
about the products that they wish to purchase, including information 
about the proper care and maintenance of automobiles. Toward that end, 
RILA has endorsed H.R. 2735, the Motor Vehicle Owners' Right to Repair 
Act, by Representative Joe Barton. This legislation will ensure that 
car owners and repair facilities have access to the information 
necessary to properly diagnose and repair vehicles.
    While several RILA members are in the automobile aftermarket 
business--including AutoZone, Inc., AutoNation, Inc., CSK Auto 
Corporation, and PEP BOYS AUTO--the majority of our members do not 
carry auto parts. The chief reason our association has endorsed the 
Motor Vehicle Owners' Right to Repair Act is our commitment to 
improving consumer choice and access to price competitive, quality 
merchandise. H.R. 2735 is completely consistent with those goals, 
because it would give consumers who wish to repair and service their 
own automobiles access to the information they need to fully exercise 
that choice. Restricting consumer access to this vital information 
serves only to restrict competition and will inevitably lead to higher 
repair prices. It could also force drivers to forego needed repairs, 
leading to an increased number of inefficient and unsafe vehicles.
    For these reasons, we urge both this subcommittee, and the full 
Energy and Commerce Committee, to move quickly to favorably report H.R. 
2735--to the House before Congress adjourns for the year.
    Thank you for the opportunity to submit these views on behalf of 
the Retail Industry Leaders Association. If you have any questions 
about this matter, or any other legislative issue, please contact Paul 
T. Kelly, Senior Vice President, Federal and State Government Affairs.
            Sincerely,
                                          Sandra L. Kennedy
                                                          President
                                 ______
                                 
Prepared Statement of the Service Station Dealers of America and Allied 
                                 Trades

    The Service Station Dealers of America and Allied Trades (SSDA-AT) 
represent over fifteen thousand independently-owned service stations 
and repair facilities. Over seventy-five percent of our membership 
consists of repair facilities. Through direct membership and with state 
affiliations, SSDA-AT has members in all fifty states. We want to thank 
the Chairman and Members of the Subcommittee for the opportunity to 
submit testimony for the record.
    Our membership has struggled with the developments at issue here 
today for many years. They agree wholeheartedly that the inability to 
procure the information necessary to effectively and efficiently repair 
late-model automobiles must be remedied. We are well aware of the 
efforts by the National Automotive Service Task Force (NASTF) to help 
provide an efficient delivery of this information and you will hear 
detailed testimony today about the associated costs involved. Our 
membership would like it known that they find these costs to be 
exorbitant and prohibitively expensive. To add insult to injury, allow 
us to provide a telling observation. Our New York affiliate has a 
member that is considered such an expert in auto repair that his 
business does sublet repairs for six different manufacturers' 
dealerships. These dealerships allow him into their own websites and he 
has discovered that there is a distinct difference in the amount and 
quality of information about specific diagnosis and programming when 
compared to the information available at the NAST sites. Much of the 
necessary programming information is simply not available from the NAST 
sites.
    You will also hear testimony today about situations encountered by 
independent repair facilities in there attempt to perform repairs on 
1994 and newer vehicles. If current trends continue, one must ask if 
the average consumer will be left with any choice at all in deciding 
where to have their vehicle serviced. As more neighborhood repair 
facilities have the experience of correctly diagnosing a failed part 
only to find it necessary to drive or tow the vehicle back the 
dealership for programming, they will become less and less willing to 
attempt these repairs. In the worst case scenarios they don't have 
access to the information necessary to even begin a diagnosis. These 
situations are compounded by the fact that virtually every system in a 
new vehicle today (brakes, steering, ignition, etc.) has become another 
opportunity to shut out the independent repair facility by withholding 
critical information. We believe a clear distinction can be made 
between what is truly proprietary and what is not. A close reading of 
H. R. 2735 should make it clear that this is in no way an attempt to 
provide parts manufacturers with patented information. It is a genuine 
effort to ensure that consumers are able to have a real choice when 
deciding where to have their vehicles repaired.
    When one considers the nature of the landlord/supplier relationship 
that has governed service station dealers over the years in their 
dealings with major oil companies, we are comfortable in stating that 
we know what it like to exist in an inequitable relationship. The U. S. 
Congress has recognized in the past that these power imbalances do, in 
fact, exist in many industries and has responded with fair and just 
legislation. We believe that this disagreement between the automobile 
manufacturers and the independent repair facilities is a classic 
example of what takes place in an inequitable relationship. It has also 
been our experience that without the necessary oversight provided by 
legislation these power imbalances will continue and they will be 
exploited. We therefore ask for your support and passage of H. R. 2735, 
the Motor Vehicle Owner's Right to Repair Act.
    Please contact Paul Fiore at 301-390-4405 with any questions 
pertaining to this testimony.

                                 ______
                                 
          Prepared Statement of the Tire Industry Association

    Mr. Chairman, Members of the Subcommittee, on behalf of the 5,000+ 
members of the Tire Industry Association (TIA) thank you for the 
opportunity to submit testimony for the record. This hearing, 
``Repairing the 21st Century Car: Is Technology Locking the Consumer 
Out?'' is very important to the automotive industry and specifically 
the tire industry.
    TIA is an international association representing all segments of 
the tire industry, including those that manufacture, repair, recycle, 
sell, service or use new or retreaded tires, and also those suppliers 
or individuals who furnish equipment, material or services to the 
industry. The Tire Industry Association (TIA) has a history that spans 
more than 80 years and includes several name changes. Originally known 
as the National Tire Dealers & Retreaders Association (NTDRA), the 
organization gave birth over the years to the American Retreaders 
Association (ARA) and the Tire Association of North America (TANA). ARA 
changed its name to the International Tire & Rubber Association (ITRA) 
and merged with TANA in 2002 to form the current Tire Industry 
Association (TIA), which now represents every interest in the tire 
industry. The majority of TIA members are independent tire retailers 
who also perform automotive service. Our members have found it 
increasingly difficult over the years to service new vehicles due to 
the limited ``sharing of information'' from the automobile 
manufacturers. As new technology develops, this information is not 
readily disseminated outside the network of automobile dealers. This is 
why TIA fully supports the Vehicle Owner's Right to Repair Act (H.R. 
2735/ S. 2138). The House version of the bill, introduced by 
Representative Joe Barton (R-TX), currently has 113 bipartisan 
cosponsors and we urge every Member of Congress to support this crucial 
legislation.
    The Vehicle Owners' Right to Repair Act would mandate that the auto 
manufacturers--including all original equipment manufacturers (OEMs)--
provide affordable access of all vehicle service information to 
independent repair facilities. At this time the bill could not be more 
important to our members.
    On September 15, just one week ago, the National Highway Traffic 
Safety Administration (NHTSA) issued its final Tire Pressure Monitoring 
System (TPMS) rule. The Transportation Recall Enhancement, 
Accountability and Documentation (TREAD) Act passed as a result of the 
Ford/Firestone crisis in 2000 included a mandate that all new passenger 
vehicles be equipped with a TPMS. According to latest version of this 
regulation, all passenger and light truck vehicles must be equipped 
with a direct TPMS system by September 1, 2007. One of TIA's largest 
concerns with the latest TPMS ruling is that the government is ignoring 
the need of independent tire dealers and automotive service providers 
to be given the OEM information necessary to install, service, 
maintain, recalibrate and fix these TPMS systems. Our members will be 
dealing with these monitoring systems, yet there are a variety of 
different companies that manufacture them, and all are slightly 
different. TIA members will need information from the OEMs to figure 
out each TPMS system and that information is not always easily 
accessible or available. The time for passage of the Right to Repair 
Act has never been more important to the tire industry or more critical 
to our members.
    We are aware of the automobile manufacturers' agreement with the 
Automotive Service Association (ASA), promising that repair information 
and tools would be forthcoming--implying that there is no need for this 
bill. TIA, while viewing that agreement as a step in the right 
direction, sees no enforcement mechanism in the agreement and therefore 
still fully supports the Motor Vehicle Owners' Right to Repair Act. TIA 
remains concerned that without the legislation, the auto manufacturers 
could back out of this agreement at any time, forcing the industry to 
start the battle all over again from the beginning. TIA is also aware 
that many of the auto manufacturers are putting service information on 
the Internet but we hear from our independent dealer members that the 
information is not complete and still very costly. Furthermore, some 
auto manufacturers never signed the ASA agreement and therefore feel no 
obligation to provide any information to any independent dealers.
    The automobile manufacturers that signed the letter of agreement 
with ASA oppose passage of the Right to Repair Act. THIS MAKES NO 
SENSE! If these manufacturers plan to keep their end of the agreement 
and make information accessible and affordable to independent service 
providers, this legislation only backs up their commitment to the 
automotive service industry. The fact that these manufacturers oppose 
this legislation causes TIA to question their commitment to the 
agreement and forces us to keep supporting the legislation.
    Consumers deserve the right to take their vehicle to the mechanic 
of choice. They should not be forced to return to auto dealerships for 
service because independent providers do not have access to the tools 
and information they need to repair a vehicle. This is another critical 
aspect of this legislation.
    TIA urges this Committee to act on the Right to Repair Act, moving 
this important legislation on to the next level. TIA is committed to 
seeing this legislation pushed through Congress for the betterment of 
businesses performing automotive repair.
    If you have any questions about our testimony, please contact Roy 
Littlefield or Becky MacDicken at 800-876-8372.

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