The European Aftermarket of Tomorrow
THE THREE CS – CONSOLIDATION, COMPETITION AND COOPERATION
The automotive aftermarket in mature markets such as Europe is often characterised as a ‘battleground’ where the car manufacturer backed OEM sector including their dealers and parts distribution channels slug it out in some type of trench warfare with the independent sector, a more diverse group of independent repairers, parts distributors and parts manufacturers. For decades they have fought for market share, encroaching onto each other’s territory, looking for opportunities to build defences or gain ground through technical and commercial innovation and regulations that favour their respective positions. In reality there has been a long-standing balance of power between the two sides, and changes have been gradual, influenced in part by the fact that changes in the parc itself take many years to work through, and business and private customers’ behaviours change slowly.
Now, a number of new pressures have emerged that will affect all aftermarket players, and these cannot be addressed simply by small changes within the existing business model. Trying to maintain ‘business as usual’ will create financially unsustainable positions for many players in all sectors – manufacturer and independent, repair and maintenance and crash repair. They will be forced to find new solutions that allow them to meet the challenges ahead, and this will include some consolidation through M&A whilst others exit, and both cooperation and continuing competition to support the changing market needs in a way that meets the needs of all stakeholders.
Drawing on over 25 years of experience exclusively focused on the sector, in this report the ICDP team reviews the pressures and potential solutions, before going on to present our vision of the Aftermarket of Tomorrow, and our assessment of what this will mean for different players across the sector.
ICDP members can download the report directly below.
The report is also available to non ICDP members, if you would like to receive a copy, please send an email with your contact details to ICDP’s Project Office projectoffice@icdp.net