Letter of the President 2023

 

In 2023, the Inter Cars Group recorded record sales of over PLN 18 billion (almost EUR 4 billion) and a consolidated net profit of PLN 700 million.

 

2023 was a challenging year. As in previous years, we focused on availability, the highest possible level of customer service and the expansion of our logistics network. We opened a new part of the logistics centre in Zakroczym (now totalling over 100,000 m2), started installing a new automation system and moved numerous branches to larger premises. The market was very competitive in 2023. As a result, we saw a decline in margins and an increase in costs, resulting in lower profitability than in the record year of 2022. We are not implementing drastic cost-cutting programmes, but are focusing on maximising sales and tailoring our offer and service even more closely to the customer. We are dedicating 2024 to even better meeting the needs of our main customers - the garages. 

 

The costs of the business are carefully analysed, but we decide to optimise or reduce costs only where this does not affect customer service. In many areas we choose to make investments that will improve our competitiveness in the long term. The biggest projects of this kind are the automation of logistics. Following the introduction of robots at the European Logistics Centre in Zakroczym, we plan to introduce an automated warehouse in Romania (new facility) and to build and move to a new, larger automated facility near Poznań. We are also preparing to introduce a new WMS (Warehouse Management System) in companies outside PL.

 

In 2024, we will continue to develop the segments so that in each country, in each segment in which we operate, we will be number  1. We are not forgetting geographical expansion either. At the beginning of 2024, we launched a company in Germany, and deployments in Belgium and Albania are underway. We are planning to expand into other markets adjacent to our logistics network. We are looking closely at the Macedonia - Kosovo - Montenegro area, Scandinavia, but especially Western European countries.

 

By the end of 2023, we will be present in 19 European countries with over-the-counter sales through subsidiaries. In each of these countries, we sell in cooperation with our franchise partners. In the coming years, we will certainly continue to replace those subsidiaries that are not operating effectively and are not implementing our strategy. We export to more than 30 countries worldwide. 

 

I am sure that the coming years will offer excellent market opportunities for Inter Cars. Mobility is a basic need in today's society. Due to economic and technological uncertainties, many drivers are choosing to keep their used cars for longer. The average age of vehicles in Europe continues to rise. The proportion of independent repairers in relation to authorised repairers is also increasing. Our mission is to support the entire independent garages market. This is why we supply not only spare parts, but also garage equipment, diagnostic systems, data necessary for diagnosing and repairing a vehicle, and organise training courses together with premium parts suppliers.

 

Thanks to the activities of the Motointegrator platform and the support of fleets, we are also supplying garages with an increasing number of customers. The Motointegrator.com platform is already available to drivers in 13 countries. Under the Q-Service Truck brand, we are working with selected partners to develop mechanisms for servicing truck fleets across Europe. As far as I know, no one else in Europe offers such a service.

 

 In 2023, we also separated out a department within our structures responsible for the circular economy, which coordinates and develops the collection of waste from garages and its subsequent appropriate disposal or recycling. Many products that were once considered waste are now raw materials that can be recycled or remanufactured. Some of this work is carried out by our own remanufacturing company, Lauber, and some is done in cooperation with specialised partners. This area is expected to grow very rapidly over the next few years. 

 

Technological change and the EU's focus on electromobility are taking a breather. Sales of battery-powered vehicles have slowed down. I support evolution based on free market principles and human innovation. I do not agree with the revolution imposed by regulators. Today, it is uncertain whether the ban on vehicles emitting greenhouse gases will come into force in 2035. 

 

Whatever the dynamics of fleet change and the mix of powertrain technologies in the future, we know that it will be our responsibility to provide independent repairers with all the products, tools and knowledge they need to repair and maintain a modern vehicle. As one of the few major distributors, our strategy is to work with premium parts manufacturers. It is these manufacturers that create most of the technology and components in modern vehicles. By working closely together, we are able to provide repair and service technology for these modern components to independent repairers.

 

We were one of the first companies in the industry to adopt a decarbonisation strategy and our targets have been endorsed by the Science Based Target Initiative (SBTI). Our ESG report is also subject to a detailed review. We have made this commitment.

 

The challenge for the coming years is to listen carefully to our stakeholders: customers, employees and business partners. We are investing in our internal teams and the skills of our people to deliver the best possible service in a dynamically changing market. 

 

We want to be an innovative company that listens and is open to new ideas and challenges. We encourage a culture of open discussion. 

 

We continue to develop the activities of the Inter Cars Foundation, which last year ran another edition of the Accelerator scholarship and science programme, thanks to which technical students can develop the skills of the future by working with mentors from the founder's organisation.  The Foundation has become increasingly involved in the area of road safety, organising a nationwide grant programme for NGOs, Drogowskaz, which aims to improve safety on Polish roads. The Foundation's volunteers work to improve the environment and continue to help those affected by the war in Ukraine.  I would like to thank all our customers, employees, partners and colleagues for their comments and commitment. 

 

 

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