Editor's report

Motor, Nov 2003 by Lypen, John

As anyone in the business of manufacturing automotive replacement parts will tell you, imitation is not always the sincerest form of flattery. Sometimes, it's a crime.

When MOTOR was based in New York City years ago, it always amazed me to see the daily parade of knockoff goods displayed on the sidewalks outside our office. Every day without fail the street vendors would roll out their blankets and showcase the latest "Rolexx" watehes and "cashmere" scarves made out of something called "100% cashmair." And, yes, there really was a time when you could buy-maybe you still can-a bootleg copy of a newly released movie that someone made with a video camera sitting on his lap as he watched the movie inside the theater.

We'd snicker about this practice-I mean, who really thinks he's getting a $5000 watch for $25?-but the fact is it's no laughing matter. Counterfeiting is a problem that affects virtually all industries, and the automobile industry is particularly hard hit.

The Motor & Equipment Manufacturers Assodation (MEMA), along with its market segment associations, recently held an all-day conference to investigate the issues of counterfeiting, intellectual property right violations and noncompliant products in the automotive parts industiy. And much of the information presented at the conference was nothing short of astounding. Consider that:

* There is an estimated $12 billion in counterfeit replacement auto parts sold each year globally-$3 billion of it in the United States alone.

* According to the federal government, the loss of at least 210,000 auto industry jobs worldwide since 1995 can be attributed to lost revenues because of counterfeit parts output.

* The inferior quality of counterfeit parts affects both performance and safety. In the most extreme cases, fake parts have been blamed for the deaths of occupants of vehicles equipped with them.

* Since 1984, General Motors alone has broken up more than 400 counterfeiting schemes and seized and destroyed $180 million in fake parts.

* It's estimated that counterfeiting is responsible for up to 9% ($500 billion) of all annual worldwide trade.

* Counterfeiting is on the rise. The U.S. Bureau of Customs and Border Protection seized nearly $100 million in fake goods in 2002, compared to $57 million the previous year. More than 75% of all counterfeits seized last year came from China, Taiwan and Hong Kong.

MOTOR Magazine will offer an in-depth look at the subject of aftermarket counterfeiting in our January 2004 issue. Detroit Editor Tom Nash will examine the problem, consider the ways it harms everyone involved in the service and repair industry and offer advice on how to spot a fake and what action to take if you do. It's a story you can't afford to miss!

John Lypen

jlypen@motor.com