Confusion reigns over parallel parts

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The term 'parallel' when referred to parts has caused confusion in the crash repair industry, with several different interpretations of the term doing the rounds. Parallel parts, as defined by Christopher Finn, head of intellectual property specialist law firm CM Finn Associates, are "The importation of genuine branded products, manufactured by, or with the authority of, the brand owner, but which have been acquired offshore". In essence this means parallel parts are identical to OEM parts in composition and branding but have been imported into the country through channels other than those normally associated with the product.
Therefore, parallel parts are physically just as good as OEM parts, because they are OEM parts. OEMs rightly point out that these parts are not usually covered by warranties and do not have the service back-up associated with non-parallel parts.
It seems however, that the term might be being used by insurers, or is at least assumed to be used by them, as a catch-all for non-OEM parts, which is an incorrect usage of the term.
There has been a lot of comment in the industry surrounding NRMA's insistence, through this magazine (Interview with Paul Pemberton, NRMA assessing and claims manager, AP&P, Jan/Feb 2001) that it only uses genuine parts. Several parties have expressed concern that NRMA may be being disingenuous when it makes this claim. In its Preferred Smash Repairer contract, its repair criteria sets out that parallel parts are the preferred option over new OEM parts on all cars if the part cannot be repaired.
AAMI has written to NRMA asking for clarification of what it understands the term to mean. The insurer has also written to all the major OEMs asking for clarification of the term. In the letter to OEMs, Ralph Johnston, AAMI national director, corporate affairs says; "We have conducted a limited survey of our own people, some repairers and automotive dealers as to the meaning of the term [parallel parts] and have found there is no general understanding. To most it is just another name for non-genuine, unbranded and/or aftermarket parts. Predictably, the source of such parts is generally felt to be the same as for non-genuine, unbranded and/or aftermarket parts". Highlighting the fact that there is much confusion in the industry over the term, Johnston goes on to say; "The prospect of the term 'parallel parts' coming to be seen as meaning another class of genuine parts but in fact, being a blanket description for any new parts other than OEM is of great concern to us".
A spokesperson for NRMA Insurance made this statement in response to the question; 'how does NRMA define a parallel part?': "NRMA Insurance defines 'parallel parts' as parts made by the same manufacturer or source as the OEM component and identical in specification and quality. They are sold through a different distribution channel to that of the original manufacturer network. We are aware that there is some confusion, different and/or loose terminology used in the parts supply and smash repair industries. We have therefore explained to our staff that by the term 'parallel parts' we mean 'parallel genuine parts'."
This statement means NRMA is using the term in its correct sense; parallel parts = OEM parts. Therefore, any repairer on an NRMA contract who feels they are being asked to use non-OEM parts by NRMA, is apparently mistaken.
If repairers have indeed been using non-OEM parts as a result of NRMA's direction to use parallel parts, then Paul Pemberton's assertion that NRMA only uses genuine parts, is not wholly true, although it is not entirely NRMA's fault if the term has been incorrectly interpreted by repairers. Now that the confusion has been highlighted however, and NRMA has acted to clear up the muddle, his claim stands more chance of being backed up. The residual argument that parallel parts cannot be termed genuine because they do not have the service back-up of non-parallel OEM parts, remains however.