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Illegal Market of Counterfeit Auto Parts More Profitable Than Narcotics

Counterfeit Car Parts
With car manufacturers facing a shortage of parts, the demand for counterfeit parts is high. Credit: Public Domain

The steep cost of replacement auto parts — combined with a shortage of car parts — has led to a major boom in the illegal market for counterfeits. The U.S. Federal Trade Commission has valued the the counterfeit auto-part market at roughly $12 million annually, with 80% of these knock-off parts coming from China.

Florian Adt, the head of legal product intellectual property at Daimler, one of the world’s leading car part suppliers, has said that over 1.7 million counterfeit parts were discovered in 2020 alone.

The COVID-19 pandemic has lead to a dramatic rise in online purchases of counterfeit car parts. Daimler was able to remove a staggering 138,000 parts from the internet after the identification of the parts. Thats nearly triple the amount they removed in 2019, before the pandemic.

Counterfeit car products are attractive to consumers because they are typically listed at a lower price — but most individuals are unaware they are purchasing an illegal product. They simply think they have found a marked down item. Adt advises consumers to buy their parts only from reputable dealers and companies.

Counterfeit auto parts have higher profit margin than illegal narcotics

The primary motivation for selling counterfeit car parts is their incredibly wide profit margin. Daimler gleaned this information from a Unifab trade association report that found selling knockoff parts can have more of a financial return than illegal drugs.

Counterfeit parts are typically manufactured in highly illegal workplace conditions that neglect both the environment and the rights of laborers.

Counterfeit car parts are of course incredibly dangerous on the road. Although they look identical to normal parts to the naked eye of a consumer, the parts are actually of significantly lower quality and are far from the minimum legal standards.

In 2018, luxury German car manufacturer Mercedes-Benz created a video testing their genuine brake pads against counterfeits. The shocking results garnered nearly 4 million views as the company found that fake brake pads dramatically decrease a vehicle’s ability to brake — regardless of road conditions.

According to a study conducted by Red Points, over half of consumers say they would not be able to tell a fake car part from an original. The study also found that nearly 90% of those who had bought fake car parts were between the ages of 18-44, which seems to indicate that younger and middle-aged adults are more susceptible to being deceived by sellers than older people. Half of the people studied had bought a car part online in the last three months.

The Federal Chamber of Automotive Industries (FCAI), working together with intellectual property protection firm Incopro, found that 60% of car part search results link to a counterfeit seller.

“Directly endanger lives”

Thats not all: in a quarter of all online searches for auto parts, the first three websites returned were potentially linked to viruses and spam, Incopro said. One in every three websites found while searching for car parts were selling illegal, counterfeit products.

Tony Weber, the Chief Executive of the FCAI, echoed Adt’s advice for those looking to avoid the dangers of counterfeit auto parts: “The advice of the industry is that customers should only trust vehicle parts acquired through the authorized dealer network.”

“Through our Genuine is Best initiative we have seen counterfeit brake pads, wheels, steering parts, oil filters, air filters, spark plugs and bonnets. They fail, they shatter, they catch fire or they snap in half,” Weber cautioned in the press release.

He emphasized that, although counterfeit car parts are deceiving, and the experience of online shopping is one we typically associate with benign products, counterfeit parts “put road users in harm’s way. We aren’t talking about clothing or handbags here. Counterfeit automotive parts directly endanger lives.”

“People are trusting of search engine results. They click what is returned on the first page. That trust comes with an obligation for search engine operators. If any business is made aware the products on display may be dangerous, they should remove them. Failing to do this could cost lives.”





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