Car Periodical Inspection Non-Market Strategy

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UNIVERSITY
 OF
 BATH
 
 
  FULL
 TIME
 MBA
 2012/13
 

 

 

BUSINESS
 AND
 THE
 GLOBAL
 CONTEXT
 
 
 
  PERIODICAL
 CAR
 INSPECTION
 IN
 COLOMBIA:
 A
 NON-­‐ MARKET
 STRATEGY
 THAT
 NEEDS
 POLISHING
 
 
 
 
 
  ELIAS
 ALBERTO
 MARUN
 

 
 

 
 
 
NOVEMBER
 18,
 2012
 

 
 
 

WORD
 COUNT:
 1617
 
 


 
 
 

 

ELIAS
 ALBERTO
 MARUN
 

 
 

Periodical
 Car
 Inspection
 in
 Colombia:
 A
 non-­‐market
 strategy
 that
 needs
 polishing
 
 
  I.
 Background
 and
 Nature
 of
 the
 Problem:
 
Periodical
  Car
  Inspection
  (PCI)1
 is
  a
  test
  of
  automobile
  safety,
  roadworthiness
  aspects
  and
  exhaust
  emissions
  required
  for
  most
  vehicles
  used
  on
  public
  roads
  in
  Colombia,
  created
  and
  regulated
  by
  a
  national
  uniform
  regulation.
  The
  PCI
  test
  certificates
  are
  currently
  issued
  in
  Colombia
  by
  309
  specialized
  facilities
  of
  both
  private
  and
  public
  nature
  located
  around
  the
  country
  that
  have
  been
  authorized
  by
  the
  National
  Quality
  Certification
  Agency
  (-­‐ONAC-­‐
  for
  its
  Spanish
  acronym)
  and
  the
  Ministry
  of
  Transport
  to
  perform
  the
  periodical
  test.
  As
  stated
  by
  Mr.
  Juan
  Manuel
  Pinilla,
  a
  major
  supplier
  of
  the
  industry2,
  “PCI
  regulations
  are
  the
  result
  of
  an
  arduous
  lobbying
  process
  promoted
  by
  a
  group
  of
  automotive
  industrials
  and
  environmental
  protection
 groups
 that
 was
 carried
 out
 during
 the
 late
 90’s
 and
 has
 evolved
 across
 the
 years”.
 
 
  Initially
  cars
  were
  only
  tested
  for
  exhaust
  emissions
  carried
  out
  in
  some
  public
  garages
  and
  maintenance
  centres
  but
  since
  2002,
  due
  to
  the
  entry
  in
  force
  of
  a
  more
  comprehensive
  regulation,
  the
  mechanical
  and
  technical
  tests
  were
  introduced
  and
  nowadays
  vehicles
  are
  subject
  to
  tests
  involving
  brake,
  lights,
  suspension
  system
  and
  visual
  check.
  These
  new
  requirements
 rendered
 the
 current
 exhaust
 emission
 test
 garages
 insufficient
 and
 lead
 to
 the
  creation
  of
  a
  new
  industry:
  the
  Automotive
  Diagnose
  Centers
  (ADC),
  a
  specialized
  type
  of
  facility
 designed
 solely
 to
 perform
 the
 new
 comprehensive
 test
 employing
 high
 tech
 devices.
  High
  demand
  and
  scarcity
  of
  ADC’s
  during
  the
  first
  years
  made
  the
  new
  industry
  entrants
  thrive
 and
 the
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