Future routes to market for independent parts distributors

RHbw

Publication Number: Management briefing 142/17

Author: Rene Herrmann

Date: August 10, 2017

Tags: Parts, Aftersales, Channel strategy

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Across the major European market, total aftermarket volumes are in decline, as a result of a variety of pressures including longer service intervals, improved vehicle reliability, a levelling and even a fall in the annual distance we are driving individually, and the introduction of new vehicle and powertrain technology.  Our research indicates a 6.5% fall in total volumes for the EU-5 markets (France, Germany, Italy, Spain, and the UK) since 2009.

The aftermarket business is shared between the OEM-franchised dealers and workshops, and the independent aftermarket.  Workshop numbers in both the franchised and independent sectors have been falling too – from 110,000 in 2004 to 94,000 in 2014 in the case of true independent repairer (IR) outlets, although this decline now seems to have levelled off in most markets.  But at the same time as losing overall numbers, the independent aftermarket has actually been gaining market share in recent times, and now holds the majority position in each of the EU-5 markets except Germany.

The independent aftermarket is served by a whole ecosystem of parts suppliers and distributors, who themselves have been going through changing times.  This briefing looks at recent trends in the parts distribution sector, and considers how the routes to market for operators might evolve in the future.