ICDP's blog

Perhaps those of us who are Brits have the best perspective on the progressive decline of the European motor industry.  To my surprise when I checked through the 1970s, there were only 12 UK car assembly plants operated by the volume and premium manufacturers at that time (i.e. excluding Aston Martin, Lotus, Rolls-Royce etc.) 

Each year, ICDP produces the ‘magnum opus’ of European distribution networks – the European Car Distribution Handbook (ECDH) that profiles the size of franchised sales and service networks for now 50 brands across 35 European markets.  The Handbook was first published in 2007, so provides a long history of the evolution of networks, with brands and markets added (and occasionally removed) to reflect our changing landscape.

It’s over forty years since the seminal book ‘In Search of Excellence’ by Tom Peters and Robert Waterman was published.  I’m probably one of the few people of my generation who have not read it, but I’ll put that down to the fact that the authors worked at McKinsey whilst I started in the mid-80s with A.T. Kearney (where J O McKinsey incidentally started his career).

The last couple of weeks in ICDP have been focused on dealer networks.  This week we published our annual update on the Top 50 European dealer groups, and we are just finalising the latest edition of our European Car Distribution Handbook (ECDH) which details the size of sales and service networks for 50 brands in 35 European markets. 

As most of you know, in parallel to my role at ICDP, I have the pleasure (and occasional pain) of leading an emerging dealer group on behalf of one of our member companies, Çetaş Otomotiv, from Turkey.

It is widely accepted that the automotive industry has never experienced so many challenges in parallel as we face today – electrification, economic downturns, new entrants, tariffs and much more besides. 

The cyberattack that shut down all of JLR’s operations at the start of September has been well-reported in the mainstream and trade press.  As with earlier attacks on UK retailer M&S or major dealer group Arnold Clark, JLR chose not to pay the ransom demand to the gang responsible, but to repair and restore the systems that had been damaged.

There’s been a lot going on over the last week or two that potentially could form the theme for this week’s blog, but there are a few pointers towards an issue which is not only topical, but has proven to be a challenge for decades across not just our industry, but many others.

As I write this, the IAA Show is on at Munich.  As at most of the recent shows in Europe over the last couple years, one of the biggest talking points is the presence of the Chinese brands in strength.

Almost ten years ago, we warned of a ‘property timebomb’ in respect of dealerships.  Our rationale was that networks were too dense, many individual dealer properties were too large and over-invested, and that the emerging omni-channel model would move the focus towards digital channels.

There was an interesting article in the Financial Times this week describing the challenges that established car manufacturers are experiencing as they try to adapt to being suppliers of software as much as hardware. 

In many parts of the industry, one of the most important questions at the moment is who (or what) are going to be the winners.  The focus for many is on manufacturers as new entrants heap pressure on the established players, but manufacturers themselves are also having to make choices as they seek to manage their investment and maximise their chances of being amongst the winners. 

Nobody won my challenge in last week’s blog asking how I might be able to create a link between Archbishop Desmond Tutu and the world of automotive distribution.

Having said a few weeks ago that I was shocked that a month had passed since my last blog, I find myself another three weeks on in a similar situation.  That does not mean that nothing has caught my attention recently, just that what has demanded my attention has unfortunately pushed the blogs down my ‘to do’ list. 

I’m slightly shocked to discover that it is a month since my last ‘weekly’ blog…  Although I know that many of you enjoy the blogs, I hope that nobody was holding their breath waiting for it to land!  It has been a hectic month – our ICDP Summer Members’ Meeting, panel slots at the Automotive News Europe Congress and the BVRLA Fleets in Charge Conference.

As most readers of this blog will know, I now wear two hats – one as the MD of ICDP, the other as the MD of Auto West London, a dealer group in the making, established by Cetas Otomotiv, a long-standing member of the ICDP research programme.

Other issues like tariffs and the march of the Chinese have been grabbing the headlines recently, but arguably the dominant issue that we should be most focused on is how the car and road transport in general should contribute to the greening of the planet. 

I’ve had a few conversations in the last couple weeks about network density.  These all related to franchised dealers, but the same questions and debates are applicable to the density of independent parts distributors and other networks.

We’re all familiar I think with the fierce loyalty that some brands can attract, one of the most notable being Harley-Davidson Motor Cycles where some owners have gone so far as to tattoo the badge onto their body, demonstrating their lifelong commitment to the brand.

We are just finalising our rankings of the Top 300 dealer groups in Europe for the 2023 financial year.