IT’S A GANGSTER’S PARADISE OUT IN THE TOWING ARENA
Q What’s the current state of play in accident towing across South Africa?
A In this hostile business space, its simply become a gangster’s paradise. There are literally thousands of unregistered slingback operators working in every municipal or rural area, where they are asking for ransom release figures to private clients, collision repair shops or insured drivers of huge sums of money that average between R3 000 up to R10 000. It is absolutely insane, and out of control.
Some 12 436 people were killed between the beginning of 2022 and May 2023, of which 5 347 were pedestrians. Legislation says that the slingback trucks can only tow damaged units up to 750 kg. However, it is not uncommon to see one of them towing an immobile 4-ton truck to hawk to a body shop owner or storage yard to get an illegal payment.
Q Tell us about current towing price increases in recent times for the accredited role players and others.
A In general terms the industry is governed by price increases from the Automobile Association and other key short term insurance companies. This for us is a major headache for the trade as the actual overall cost of towing for our operators is running at 200% plus on these CPI based increases. This year there was an informal protest, held at the AA offices in Gauteng, where disgruntled towing concerns almost caused a riot because of ongoing discontent for many and varied reasons. Major accredited operators who deliver non-drivable crashed vehicles are now being forced to wait between 60-90 days for payment. This is because of the well-known cash flow problems that are all part of collision repairer’s slow payment regime.
Major players like First Road Emergency and SATRA membership, have over the years, negotiated specialist strategic relationships that on average nominate around R3 500 per insurance trade tow inside a specific radius of the accident placement taking place.
Our market in South Africa is currently estimated to have fewer than 18% of drivers carrying insurance with approximately 12% of drivers being self-insured. It has become seriously overtraded.
Tow rates for trade tows are in many areas running at around R1 200 delivered to the client or body shop. However, because of rampant over trading and complete lawlessness, there is no common denominator on charge out rates. The complete lack of any government or municipal intervention has led to key people being murdered at accident scenes or hi-jacked by gangster towing operators, particularly in the late hours of darkness. Once again, the 2018 government enquiry has not delivered anything as of yet in the form of mandatory controls.
Q I would like to ask you about the towing structures in the provincial area of South Africa.
A As I indicated before, the AA recommended tow rates are quite low, but they offer unsustainable low rates to protect or enhance their paid-up membership, which is not realistic in many ways for profitable business for anyone concerned.
In the last decade or so, and since the body shop collision conference was held in Pretoria at the Competition Commission headquarters, there has been a large increase in previously disadvantaged concerns that have devastated the normal operations of most body shop owners and tow truck operators.
In KZN, there are several of these self-appointed towing concerns. Here these gangs have self-proclaimed towing areas and demand thousands to return your vehicle.
In Cape Town it’s a wild business. It is estimated that there is in excess of 1 000 slingbacks tow trucks patrolling the highway akin to mechanical vultures waiting for the accident to happen upon motorists who are unaware of their rights. Again, this is thug type operation where lives are being lost for the cost of a hook. It’s a disgrace!
Q Just where do organisations that operate a bona fide basis fit in to this towing zoo in accident damaged vehicles right now?
A Thankfully many of the large national companies involved in recovery and vehicle salvage have developed a modicum of sanity in the way that they operate and face all these challenges gangster intervention, with almost no police intervention whatsoever. This microcosm of motoring lawlessness is being amplified by the current accident recovery operations right across the nation, where municipalities have in many cases abandoned rotational arrangements that used to prevail on towing deals formally.
The sheer threat of intimidation that now exists must not be underestimated. Insurance executives, and other key role players in work placement live in fear with death threats common place in the towing mafia underworld. It’s completely out of control.
Q Is the South African accident rate capable of supporting all this rampant amount of towing mafia of overtrading in South Africa in the general scheme of things for the future?
A No, there is serious over trading. Unfortunately, all this bad practice from the mafia entrants is earning money which is being invested into full roll back vehicles. These wrecks in turn are being repaired at shops with little to no understanding on how to repair a modern-day vehicle with all their intricate technologies and safety systems. This is leading to sub-standard repairs, unsafe roads and even adding to the death-toll in the future when safety equipment won’t work effectively or at all. What is to be done when the police and government continue to look the other way? No one knows right now.
By “SubMariner”
Photo by Juup Shram on unsplash
