February 2022

53 AFTERMARKET FEBRUARY 2022 ON THE ROAD www.aftermarketonline.net W ith a new decade still unfolding in front of us, and a host of challenges resulting from the pandemic, Brexit and more still assailing the industry, there was a lot to cover at the 2021 IAAF Conference, held in December. Taking place online again, CEO Mark Field began the event with a tribute to the resilience and resourcefulness the sector has shown over the last 12 months, and before that: “The pandemic has shown the very best of our trade, and we should be very proud of this.” Moving on from our host, it was time to hear from the speakers. First up was Quentin Le Hetet, Country Manager at GiPA who took a broad look at the future landscape, challenges and opportunities for the automotive sector and the independent aftermarket in particular. “There are four key ideas in mind for you to plan in the short-term and long- term. First, there is the car sales dynamic of the market. Cars being sold today will need to be served in the future. That dynamic is ultra-important and the first metric you should look at.” Next to this according to Quentin is the impact of new car sales on the independent aftermarket: “The car parc is ageing as people are hanging onto their older cars, and they are not being written off. In 2017 the average age of a car was 13.4 years, now it is 14 years old. This gives the aftermarket an advantage. In the UK the car parc age is relatively young, but the 0-4 years section is shrinking. This is why the sector will benefit from the lack of new registrations. This also means the work that needs doing is more technical. In the UK currently, franchised dealers are not geared towards the five-to-nine-year-old car parc. They can adapt their strategy, and they might want to take part of this. How they will do this is another question.” Then there is the changing face of vehicle manufacturers: “We have seen a big consolidation of VMs over the years. In 2000, Peugeot and Citroen merged, then in 2017 they bought Opel/Vauxhall. Then they bought Chrysler/Jeep. They formed Stellantis. They have over 20% of the UK car parc. Then there is VAG with 18% and Ford with 14% of the parc. Their scale gives them the power to invest in the aftermarket, which is more fragmented. This takes us closer to being like the market in France. “In the UK market, you have TPS owned by VW, with 100 factors through the UK. They can deliver OE parts like any other supplier, this gives them a lot of power. They have genuine parts going through aftermarket workshops. This gives them a piece of the aftermarket. Stellantis has Distrigo. They offer genuine parts, Tier 1 OE suppliers, and they also offer the aftermarket all-makes brand Eurorepar. They are also developing the ERCS garage network. If you look at Renault/Mitsubishi, the idea is to do something similar to Distrigo with Motrio. They are looking to develop The IAAF Annual Conference was even more forward-looking than usual this year, as it returned for 2021 AFTERMARKET TO THE FUTURE: IAAF CONFERENCE 2021 mobile repairs as well as fixed garages. Watch this space. Staying with the consolidation of VMs, TESLA, LUCID and RIVIAN did not exist 20 years ago, but they are worth more than GM. This is completely crazy.” This led onto Quentin’s last point, on the rise of EVs: “LUCID, RIVIAN and TESLA are only producing EVs. The disruption of the market is coming from HEVs and full EVs. There are far fewer parts in EVs. This means you need to think about how many are being sold. The PHEV split of parts to labour is closer to the ICE model than EVs. We think we will have 65% labour and 35% parts. This is why VMs like Volvo and Hyundai are trying leasing, to change the business model. Batteries are evolving almost on a daily basis, so it is very hard to understand what the business model will be for the aftermarket. We are looking at this, but these vehicles are booming.”