Rising counterfeit automotive part sales continue

The Automotive Anti-Counterfeiting Council (A2C2) says the sale of counterfeit parts is still on the rise, trending upward following the COVID-19 pandemic.

“Most of the counterfeits that we’re seeing are being facilitated through online sales,” said Bob Stewart, Automotive Anti-Counterfeiting Council (A2C2) president and GM’s aftermarket service support and brand protection manager. “The original seller of the product usually originates from the Asia area — China, Hong Kong, Taiwan — through third-party facilitators.”

A2C2 has seen a recent change in the mix of counterfeit parts coming to market. Stewart said counterfeits used to primarily be brake pads, oil filters, air filters, and other maintenance parts. Now, due to increased shipping costs, smaller components are more commonly counterfeited, such as ignition coils, key fobs, fuel injectors, emission sensors, emblems, and spark plugs.

One main part that continues to be counterfeited is air bags, which are very difficult to differentiate from legitimate ones, Stewart said.

He said that while A2C2 doesn’t conduct a lot of testing overall, they have focused on counterfeit air bag tests over the last two years.

“We wanted to observe their performance, and then we’ve done a lot of training in the air bag space with law enforcement and the collision reconstructionists at accidents to help them and make them aware of counterfeit air bags,” Stewart said. “One of the things with counterfeit air bags is once they’re deployed, it’s not that easy to tell that they’re counterfeit or not, unless you know what you’re looking for. Most of that has to be observed under a high-speed camera and slowed down to see what’s happening.”

In a video put together by A2C2, side-by-side crash tests of vehicles and air bag deployment show counterfeits fail to deploy properly compared to genuine OEM air bags.

The counterfeit bag burst apart and failed to protect the driver from a significant impact.

When it comes to legal recourse once counterfeit parts are discovered, Stewart said there are a lot of options, but it’s up to each OEM because of trademark ownership and rights.

“From Customs and Border Protection, we’ve received detention notices with images to review the product, and we can determine whether the product is suspect or not,” he said. “U.S. Customs only has the authority to determine whether it’s counterfeit and to seize it or not. We just have to provide the facts that demonstrate where it differs from the genuine product.”

There are also civil remedies, such as lawsuits, he added.

“We focus on the larger ones and the criminal,” Stewart said. “We usually send a cease and desist letter to the person importing the products.”

He added that there’s a 50/50 chance the letters will be successful at stopping the products from entering the market.

Since last year, A2C2’s recourse mission has been to educate the public and repair shops about the dangers of counterfeit automotive parts.

“Automotive parts are a little different than buying a luxury good counterfeit because luxury goods… you’re buying a cheaper product and you’re really stealing from the intellectual property rights owner, whereas automotive parts have a whole safety aspect to them and put people in danger,” Stewart said “I think a lot of people don’t realize that they’re not just putting themselves in danger, they’re putting everybody else on the road in danger.”

Stewart said A2C2 avoids identifying counterfeit products because it can be a blueprint for counterfeiters to make their products harder to find.

“We rely on a lot of the suppliers and the manufacturers and their engineers to support us and help,” he said. “They can tell by the different manufacturing techniques that have been used. The best thing to do is to know your source. Buy from a reputable source.”

However, A2C2 says there are some signs to look for:

• • Obviously undervalued shipments
  • Shipping documents that contain vague or inaccurate descriptions
  • Missing safety guidelines
  • Lack of officially licensed product logos, tags, or trademark notice(s)
  • Poor packaging condition
  • Different-than-expected aesthetic appearance (color, size, shape) compared to OE parts
  • Redundant serial numbers
  • Suspicious or redundant bar codes
  • Poor model/brand emblem fitments, attachments, and stampings
  • Poor gap/flush tolerance qualities
  • No visible manufacturer’s address on packages or labels
  • Misspellings, incorrect fonts, or incorrect logos on parts or packaging

The 2023 Review of Notorious Markets for Counterfeiting and Piracy report (NML report) from the Office of the United States Trade Representative states that air bags, brakes, oil filters, spark plugs, and other car parts are examples of products that can be particularly dangerous when counterfeited.

“[C]ounterfeit air bags and their components can cause severe malfunctions ranging from non-deployment, underinflation, overinflation to explosion of metal shrapnel during deployment in a crash,” the report states.

A report from the office this year states that trademark counterfeiting continues globally and involves the production, transshipment, and sale of fake semiconductors and other electronics, chemicals, medicines, automotive and aircraft parts, food and beverages, household consumer products, personal care products, apparel and footwear, toys, and sporting goods.

Countries of origin include China, India, Türkiye, and, recently, some production is shifting from China to Vietnam.

“Counterfeiters increasingly use legitimate express mail, international courier, and postal services to ship counterfeit goods in small consignments rather than ocean-going cargo to evade the efforts of enforcement officials to interdict these goods,” the report states. “Approximately 90% of U.S. seizures at the border are made in the express carrier and international mail environments. Counterfeiters also continue to ship products separately from counterfeit labels and packaging to evade enforcement efforts. Counterfeiters also increasingly sell counterfeit goods on online marketplaces, particularly through platforms that permit consumer-to-consumer sales.”

The SHOP SAFE Act was introduced to Congress last June to incentivize online marketplaces to improve counterfeit detection and mitigation by protecting them from civil liability if they comply with anti-counterfeiting measures. However, it didn’t move out of committee.

Thirty-nine states now have laws addressing counterfeit supplemental restraint system (SRS) components based on model legislation from A2C2. Oklahoma was the most recent state to enact the legislation.

Images

Featured image: Counterfeit key fob (left) and genuine GM key fob (right). 

Genuine A/C Delco spark plug (left) and counterfeit spark plug (right).