IX Conference of Independent Automotive Market

What was the year 2014 like for the automotive industry? 

Organized periodically Conference of Independent Automotive Market became an arena of summaries for the representatives of the industry and their activities, and also a place of performing discussions.  Each year one can learn more about market surveys and analysis, listen to presentations on important topics and matters for the industry and take part in interactive surveys. 

 

Motorization in Poland and Europe

Robert Kierzek - the president of Inter Cars SA. and Alfred Franke - the president of Spare Parts Distributors and Manufacturers Association presented current market statistics and invited the guests to take part in interactive surveys.  The automotive market segment is a great part of European economy.  Only in the European Union there are 242 million registered vehicles (in all European countries - 309m ).  The value of manufactured spare parts is estimated by the European organization of spare parts manufacturers CLEPA to be at the level of PLN 82bn.  Also Poland has its place in this huge business, where revenues of automotive industry come in 55% from production of spare parts.  This, according to GUS, is over PLN 59.3bn yearly.  Each year the independent sector pays a tax and social insurance to the state at the level of around PLN 12bn.  The speakers drew attention to investment done by the manufacturers of spare parts in Poland, among others, the factory of Lumag, which was built for over PLN 70m, or Delphi technological park created for over PLN 24m. 

 

Independent automotive market in Europe is heavily fragmented, as a confirmation we can take the example of income of five biggest distributors of parts on the continent (including Inter Cars among them), which amount only to 5% of total revenues of all distributors. 

 

The forecast is that the year 2014 will be favourable for distributors operating in Poland.  The answer to the question: "Are you planning investment in development of your storage and office area in the coming year?", 70% of representatives present in the room said YES.  Even more optimistic about the future are branch representatives and business partners of distributors - 88%. 

 

According to data from MotoFocus.pl, in the Q1 almost all surveyed manufacturers and distributors of spare parts recorded an increase in sales revenues, what was probably connected somehow with very poor Q1 2013.  In Q2 and Q3 of 2014 most of participants of the survey still declared an increase, but quite a big group of them admitted to reach a bit worse results.  The forecast of the sales revenues in 2015 are optimistic among manufacturers of spare parts as well as among distributors and branch owners (based on the survey performed during the conference). 

 

Among the analysis we could also find a summary of Polish market of independent garages.  They compose 92% of all garages in Poland and serve 90% of customers. 

 

Discussion about the market 

The special guest of the conference this year was the Minister of  Economy, Mr. Janusz Piechociński.  The deputy prime minister put emphasis on the need of cooperation between representatives of independent market: 

 

-"For Poland, the independent aftermarket is especially important, because on this market we have worked out a completely new quality.  Not only in services, but also regarding trade of spare parts.  (...) You are the representatives of  a fragmented environment. This environment must fight for its rights not only in Poland, but also in institutions of the European Union".

 

The Prime Minister mentioned to be counting on activity of the industry regarding formulation and presentation of propositions of changes, calculations and analysis. 

 

Vehicle Inspection Stations (VIS) problems

One of important points of the conference was a speech by Jerzy Maliński - an expert of MOVEO organization and Rafał Sosnowski - president of Motorization Technique Association.  The topic was the technical condition of vehicles in Poland and Europe.  The presenters drew attention to the need of regulation changes, which regulate operations of Polish VIS.  Currently they are operating on a free-market market basis, what leads to such pathology like promotions and gifts for drivers who do the inspection in a particular station.  Gentlemen mentioned the EU Directive 2014/45/EU, which is to improve the quality of technical inspection systems in the whole Europe.  It regulates, among other things, the question of access to information about elements of vehicles which are crucial for safety and environmental matters. 

 

The topics started by Jerzy Maliński and Rafał Sosnowski were responded by Łukasz Twardowski from the Ministry of Infrastructure and Development.  He presented information on progress in the analysis of propositions of w work group, which aim is the improvement of the quality of technical inspections of vehicles.  Solutions worked out by the group are actively supported by SDCM.  Above mentioned EU Directive is to be implemented to Polish law starting from 20 May 2017. Before it is introduced, it is a must to include and implement the solutions worked out by the group. 

 

Telematics

Telematics, i.e. possibility of performing satellite connections by cars and sending and receiving information is more and more often discussed matter.  Besides its unquestioned positive influence on safety of traffic, it can bring some threats for the independent automotive market.  Besides calling for help in case of an accident, the telematic system can also find malfunctions in the vehicle and direct the driver to the nearest authorized service station, in order to make a repair.  The representatives of independent garages strive to make the telematic system an open system, and the decision about performing the repair would be made by the driver himself.  Alfred Franke, presenting the matters connected with e-Call, b-Call and s-Call, paid attention to the fact that the infrastructure serving these systems shall start working on the turn of 2017 and 2018.  European Union has little time to prepare clear and fair rules, and what is even more important - effective ones, regarding the use of telematics. 

 

Working out suitable law regulations regarding telematics is supported actively by FIGIEFA organization.  A special guest of the conference was Henry Wasung, who presented the controversy around technical matters connected with telematics.  He also mentioned that the most important aim of the works on law regulations is to ensure such conditions, in which "Each driver will have the choice - to whom and what for the information about his vehicle is sent". 

 

Euro 5 regulation and independent market. 

Bogumił Papierniok - CEO of Moto-Profil company and Robert Kierzek - the President of Inter Cars, presented to the audience the problems connected with Euro 5 norm being in force in Europe.  Not everyone realizes the fact that these norms contain not only regulations on fumes emission by cars, but also other important regulations from the point of view of independent aftermarket.  According to Euro 5 car manufacturers have an obligation to ensure unrestricted and normalized access to the information on repairs and maintenance of cars to independent participants of the market.  Draft resolutions are to be available on-line. 

 

Unfortunately in practice following these regulations by carmakers is strongly disputable.  Many of them grant access to information, but e.g. not complete, available only in one language version, or on websites which are really difficult to be found.  The problem is being analysed by the European Commission but we shall have to wait for the results for some time yet. 

 

Still an emerging problem for the industry is not following the resolutions of MV BER EU regulation by authorized service stations.  In his next speech, Alfred Franke presented examples of illegal activities of Authorized Services, and also of trials in law courts which were unfavourable for car manufacturers in other countries.  Unfortunately, according to the President of SDCM, in Poland, till now respective authorities have not been observing operations of authorized services in this area. 

 

Repair Clause is a regulation adapted in Poland, whilst still not in force in many countries of the European Union.  Its lack is the reason for higher prices of automotive spare parts by car manufacturers.  According to Alfred Franke, thanks to Repair Clause, companies offering cheaper alternative spare parts can also exist on the market, and this in turn will give the customer a possibility of choosing between original parts and those of comparable quality.  An expertise of Industrial Automotive Institute proved that repairing cars using spare parts from independent suppliers is "fully effective and does not bear any dangers regarding safe use of a vehicle". 

 

Marketing campaigns and market image 

Jarosław Lewandowski - the President of Misfat Europe - presented materials on unfair advertising practices which are performed by manufacturers of vehicles. Very often they are discriminating the segment of independent repairs using unfavourable rhetoric.  Large campaigns of reach concerns influence negatively the image of independent market. 

 

Debate of manufacturers and distributors 

The culmination of the conference was common debate of representatives of manufacturers of spare parts (Paweł Hańczewski - Bosch, Sławomir Góralewski - TRW) with representatives of distributors (Robert Kierzek - Inter Cars and Bogumił Papierniok - Moto-Profil).  The debate was combined with an interactive survey.  The moderator asked a question to all guests gathered at the conference, and than asked for comments from participants of the debate.  Among discussed topics there were: threats of independent automotive aftermarket, distributor purchase groups (including discussion on new Nexus group), e-commerce and foreign distributors in Poland. 

 

source: motofocus.pl

28/11/2014