The lucrative and perils of fake auto parts business
Counterfeiting is a growing issue that cannot be ignored. Based on the 2019 data, it is estimated that the volume of international trade in counterfeit and pirated products amounted to as much as USD 464 billion, or 2.5% of world trade. In a study commissioned by the International Chamber of Commerce’s (ICC) Business Action to Stop Counterfeiting and Piracy (BASCAP) and the International Trademark Association, it is estimated that the total global economic value of counterfeiting and piracy could reach $2.3 trillion by 2022. Counterfeit products can be found in many forms, including auto parts. Trade in fake automotive is lucrative, even claimed to be more profitable than illegal drugs.
The perils of fake auto parts
Some counterfeits are homemade or produced by local manufacturers. Most fake auto parts in Indonesia are made by local manufacturers with poor technology that ignore safety and security standards. Spare parts that are often faked are oil filters, air filters and brake pads. These counterfeits are found in marketplaces and sold in brick-and-mortar shops, including legitimate shops, sometimes packed together with original ones.
The fake parts not only cause financial losses for the government, but also put people’s safety in danger. Take brake pads as an example. This part is among many that are frequently counterfeited. Fake ones are frequently composed of materials that have a detrimental impact on stopping ability, which definitely put people’s safety at risk.
Not only do fake parts put people at risk, they are also the absolute sources of consumer confusion. These illegal products can be the ultimate reason for the decrease of consumers’ confidence in brands.
Efforts to fight counterfeits
To eradicate counterfeit products is basically to protect assets and consumers. This effort can be carried out comprehensively through anti-counterfeiting programs, including prevention, detection, investigation, and enforcement, which involve many stakeholders.
The take down activity is one form of investigation and enforcement that has been carried out by many brands. The COVID-19 pandemic has resulted in a significant increase in online purchases of counterfeit automotive parts. E-commerce giants such as Amazon are not spared from the illegal trade. With take down activity, brands can ensure that products advertised online are sold by entitled parties and do not violate applicable laws.
Integrity Asia has experience working with related parties such as online marketplaces, social media platforms, and relevant government agencies in efforts to take down sites or pages that promote products deemed to violate applicable laws, including intellectual property.
Contact us for more information about our anti-counterfeiting program.