Table of Contents
Issues in the Market
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- Key issues
- Definition
- Abbreviations
Future Opportunities
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- New types of cars and new types of ownership
- Customer retention through experience
Market in Brief
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- Car sales hit by recession
- Costs of vehicle ownership rise
- Spending on membership falls
- Larger companies pursue affinity marketing opportunities
- Breakdown cover largely an intermediary market
Internal Market Environment
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- Key points
- Car parc falls for first time since Second World War
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- Figure 1: UK car parc and new car registrations, 2003-09
- Decline in households owning two cars
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- Figure 2: Household ownership of cars in the UK, 2004-09
- Consumer expenditure on personal transport
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- Figure 3: Consumer expenditure on personal transport compared to total consumer spending, 2004-10
- New and second-hand car sales trends
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- Figure 4: Private new car registrations and used car sales, 2004-09
- Impact of the scrappage scheme
- Car driving licence holding grows among older age groups
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- Figure 5: Number of licence holders, by age, 1975/76-2009
- Reasons for usage of vehicle recovery services
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- Figure 6: Most common types of call-out, 2010
Broader Market Environment
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- Key points
- Risk of a double-dip recession?
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- Figure 7: GDP quarterly percentage change, Q2 2004-Q2 2010
- A higher sustained rate of unemployment
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- Figure 8: Employment and unemployment, by gender, 2005-15
- Consumer spending set to recover
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- Figure 9: GDP, PDI, consumer expenditure and savings, at current prices, 2005-15
- Debt-constrained affluence
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- Figure 10: Forecast adult population trends, by socio-economic group, 2005-15
- Young families are a growth opportunity
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- Figure 11: Trends in the age structure of the UK population, 2005-15
- Third age and retired lifestage opportunities
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- Figure 12: Forecast adult population trends, by lifestage, 2005-15
- Smaller households and smaller cars?
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- Figure 13: UK households, by size, 2005-15
- Rising internet penetration
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- Figure 14: Broadband penetration, 2004-09
Competitive Context
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- Key points
- Spending on personal transport
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- Figure 15: Spending on personal transport, at current prices, 2009
- Car ownership becoming more expensive
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- Figure 16: Annual percentage change in transport costs, 2000-09
- Figure 17: Price indices of new and used cars, 2000-09
- Maintenance and fuel costs rising
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- Figure 18: Indices of personal transport prices, 2005-09
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- Figure 19: Trend in petrol and diesel pump prices, July 2000-July 2009
- Car owners using their cars less….
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- Figure 20: UK car parc and total kilometres driven, 2003-09
- ...but going on holiday in the UK more
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- Figure 21: Domestic and overseas holidays and expenditure, 2004-14
Strengths and Weaknesses in the Market
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- Weaknesses
Who’s Innovating?
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- Key points
- Green Flag launches iPhone app
- Total offers free breakdown cover
- Co-operative Insurance offers breakdown cover
- Saga launches breakdown repair protection
- TomTom launches breakdown service
Market Size and Forecast
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- Key points
- Market recovers from recession
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- Figure 22: UK vehicle recovery market, by value, 2005-15
- Forecast
- Factors used in the forecast
Segment Performance
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- Key points
- Organisation membership suffers in the recession
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- Figure 23: Segmentation of the vehicle recovery market, by value, at current prices, 2005-10
Market Share
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- Key points
- Companies maintain market share
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- Figure 24: Company shares of the vehicle recovery market, by UK membership*, 2006-10
- Recovery services pricing
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- Figure 25: Prices of breakdown recovery products for the AA, RAC and Green Flag, September 2010
- Online and voucher discounts
Companies and Products
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- Major players
- The AA
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- Figure 26: Key financials of The Automobile Association Limited, 2007/08 and 2008/09
- RAC
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- Figure 27: Key financials of RAC Motoring Services, 2008 and 2009
- Green Flag
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- Figure 28: Key financials of Green Flag Limited, 2008 and 2009
- Britannia Rescue
- Mondial Assistance
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- Figure 29: Key financials of Mondial Assistance UK Limited, 2008 and 2009
- Other companies and brands
- Own-label breakdown cover
- Car Manufacturer-branded Breakdown Cover
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- Figure 30: Car manufacturer-branded breakdown cover on new car purchases
- Affinity marketing
Brand Communication and Promotion
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- Key points
- Adspend begins to recover
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- Figure 31: UK main monitored media advertising expenditure on vehicle breakdown and recovery services, 2005-10
- Direct mail takes over from TV
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- Figure 32: Vehicle recovery advertisers spend, by media type, 2005-09 (ranked by last full year, 2009)
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- Figure 33: Proportion of vehicle recovery adspend, by media type, 2005 and 2009
- AA and RAC dominate adspend
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- Figure 34: Vehicle recovery adspend – top 20 advertisers, 2005-09 (ranked by cumulative total, 2009)
Channels to Market
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- Key points
- An intermediary market
- Internet distribution and web aggregators
- Aggregators achieve 40% penetration
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- Figure 35: Usage of price-comparison sites among aggregator adopters, September 2009
- Loyalty a rare commodity
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- Figure 36: Usage of price-comparison websites, by number of price-comparison websites used to obtain quotes/compare prices or to buy financial products, September 2009
- Aggregator users focus on price
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- Figure 37: Most important considerations when using price-comparison sites, September 2009
The Consumer – Vehicle Ownership
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- Key points
- Types of vehicle owned
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- Figure 38: Types of vehicle owned, June 2010
- Different vehicle demographic characteristics
The Consumer – Breakdown Cover Brand Awareness and Penetration
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- Key points
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- Figure 39: Statements on breakdown cover, June 2010
- Younger car owners least likely to have breakdown cover
- Older age groups most likely to have cover
- AA and Green Flag more upmarket?
- AA and RAC stronger among new car owners
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- Figure 40: Statements on breakdown cover, by ownership of new or used car/van*, June 2010
- Younger families less likely to have breakdown cover
The Consumer – How Cover Was Acquired
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- Key points
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- Figure 41: How breakdown cover was acquired, June 2010
- Breakdown cover mainly an intermediary market
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- Figure 42: Direct or intermediary purchasing of breakdown cover*, June 2010
- Smaller recovery companies more likely to sell through intermediaries
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- Figure 43: Statements on breakdown cover, by how breakdown cover was acquired, June 2010
Appendix – Vehicle Ownership
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- Figure 44: Most popular ownership of vehicle, by demographics, June 2010
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Appendix – Breakdown Cover Brand Awareness and Penetration
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- Figure 45: Most popular statements on breakdown cover, by demographics, June 2010
- Figure 46: Next most popular statements on breakdown cover, by demographics, June 2010
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Appendix – How Cover Was Acquired
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- Figure 47: Most popular how breakdown cover was acquired, by demographics, June 2010
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