Spotlight 23 www.aftermarketonline.net JULY/AUGUST 2024 The UK’s next transport secretary must lead the way on enshrining open access to repairs data for the independent aftermarket, as well as pushing for greater incentives for SMEs to encourage investment in skills and equipment, according to Kevan Wooden, CEO of LKQ UK & Ireland. Wooden said: “As we’ve seen over the last few years, things like block exemption and MOT reform could have severely disrupted the industry if the sector hadn’t come together to keep its political advocacy both loud and proactive.” Wooden says his own views fall broadly into two camps, the first being the rights to repair and connect. “The UK’s new block exemption regulations were a huge win for the industry. But the pace at which vehicles continue to evolve means we need to enshrine the principles of open access for the independent aftermarket permanently into British laws. “We also need political support for a framework in which the aftermarket and OEMs can collaborate to create a supply chain for the repair of EV batteries. This should help to stem the tide of unnecessary vehicle write-offs and waste that’s damaging the residual value of BEVs.” The need to support small businesses is another priority. He said SMEs are the backbone of the independent aftermarket but, like many small businesses, are disproportionately affected by business rates, energy costs — where garages and bodyshops especially are big users — and the cost of disposing of waste. “And the pace of change in the automotive sector means the aftermarket’s SMEs are particularly exposed to the challenges of technological change and a skills crisis. “To support their need to invest in new equipment, such as to service ADAS vehicles as might be required in future MOT tests, as well as training, they need greater incentives through tax breaks to support the outlay required.” Wooden added: “We also need to look at the Apprenticeship Levy, which now does more harm than good, especially to larger garages. Most alarmingly, since its introduction in 2017 the number of apprentices starting in SMEs has plummeted by 49%. “As an industry of some 30,000 businesses, employing 300,000 people across every region of the UK, the aftermarket should be listened to and supported. We intend to make sure whoever triumphs in the general election gets the message.” LKQ UK & Ireland CEO shares ‘key asks’ of new transport secretary O Reforming business rates followed closely behind (32% ranked this as their first choice); O Increasing and improving EV charging infrastructure was the most frequently ranked second choice (27%). Many dealerships rated consumer demand for non-ICE vehicles for May 2024 as ‘very weak’ with 46%. Meanwhile, 44% of respondents noted they were ‘pessimistic’ for their business’ trading performance for the second half of the year. Dealerships were asked how much pressure they are receiving from their respective manufacturers to sell electric models and meet the ZEV mandate target for this year. Nearly 40% (see fig.2), responded ‘a great deal’ while 32% said ‘a moderate amount’. Respondents were also surveyed about the important issues they would like to see tackled by the new government. NFDA chief executive Sue Robinson said the survey was designed to gather members’ views about the state of the market and current challenges affecting their businesses. “The results illustrate the current challenges dealerships are facing and underscore important areas for the next government to address.” In the survey, dealerships have highlighted the sector’s persistent skills shortage, restimulating the private EV market and reforming business rates as fundamental areas which will need addressing from the next government, Robinson said. “NFDA has consistently raised these issues with the previous government. Once the election has concluded and the dust settles, it is crucial for the next government to work with NFDA and the wider industry to tackle the concerns of dealerships and consumers alike.” The survey was conducted between May 30 and June 14. A total of 51 responses were received from various franchised dealership groups across the UK, collectively representing more than 300 sites. Kevan Wooden
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