December 2019 European Car Distribution Handbook 2019

The European Car Distribution Handbook (ECDH), published by ICDP, has monitored manufacturer sales and service networks in Europe on an annual basis for over 20 years.  Currently ECDH covers 40 brands in 38 markets and is the only European-wide resource on franchised dealer networks.  The continuous data gathering process, established in direct collaboration with the manufacturers, enables us to track the trends of sales and service networks by different type of operator, brand, brand type or market, and helps to assess the changes required to address the many pressures on the sector including the need for customer-orientated omni-channel networks and a declining trend in aftersales volumes. 

As every year, we have tracked the number of main dealer sales outlets, i.e. those operated by OEMs, importers or retailers but excluding sales agents.  Even with the inclusion of two new brands and two new markets in the dataset, in 2019 the total number has not changed dramatically year-on-year, remaining at roughly 52,000, with declines since 2009, slowing from 2014 onwards as markets recovered from the Global Financial Crisis.  Over the 2009-2019 period, we saw a reduction of around 16%, and a similar change in all aftersales outlets, which remain higher in absolute terms at around 96,000. 

ECDH data proves that there are wide variations in sales and service network density by market and brand, including some brands growing against the trend of fewer sales and service outlets.  This implies variations in efficiency measured in new car sales per main dealer, which continue to grow but are still on average only 331 – much lower than other regions including Brazil, China and the US.  These relatively low throughputs put financial pressure on dealers, and indicate that some markets and brands are more “overdealered” than others, indicating that the future scale of change will vary by market.

Overall, we continue to see a requirement to reduce traditional networks substantially whilst adapting them to omni-channel customer needs.  In our view, this will go along with fewer main dealer outlets, greater separation of sales and service networks, as well as more variety in sales and aftersales format types.  Especially in aftersales, there remains the challenge of serving a growing parc at an acceptable (and unchanging) drive time, so we anticipate the changes to be less significant unless new formats such as mobile technicians are adopted widely.  In general, the number of total customer touchpoints might actually increase, with a greater variety of format and scale. 

This webinar included subsets of data from our European Car Distribution Handbook 2019 and earlier versions for trends, and provided our view on the future development of manufacturer sales and service networks.