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Car Service, Maintenance and Repair - UK - December 2015

OVERVIEW
What you need to know
Scope of this report
EXECUTIVE SUMMARY
The market
Sluggish performance from servicing, maintenance and repair market
Figure 1: UK car servicing, maintenance and repair market, by value, at current prices, 2010-20
Average expenditure suffers a decline
Figure 2: Average expenditure on servicing, maintenance and repair market, by value, at current prices, 2010-15
Expansion in car parc presents opportunities
Figure 3: UK car parc (new and used car registrations), 2010-15
Companies, brands and innovation
Independent garages are the most important channel
Figure 4: UK car servicing and maintenance: channel share by value, 2015 (est)
Advertising expenditure represents a small share of revenues
Figure 5: Recorded above-the-line, online display and direct mail total advertising expenditure on car servicing and maintenance, by service type, 2011-15
Service innovations dominate activity
The consumer
Second-hand cars are preferred
Figure 6: Vehicle ownership, August 2015
A significant percentage of cars in ownership are over six years old
Figure 7: Age of car driven, August 2015
Two thirds of car owners take personal responsibility for maintenance
Figure 8: Responsibility for maintenance and servicing, August 2015
Under £500 annual expenditure is typical
Figure 9: Amount spent on maintenance and servicing, August 2015
Most maintenance is undertaken at a service or a MOT
Figure 10: When car is serviced, August 2015
Role of DIY and others varies depending on work to be undertaken on car
Figure 11: Where car is serviced, August 2015
Quality of service is most important factor sought
Figure 12: Importance of factors when maintaining or servicing a car, August 2015
Split opinions towards the internet
Figure 13: Interest in use of internet comparison websites, August 2015
What we think
ISSUES AND INSIGHTS
Dealing with an underperforming market
The facts
The implications
Benefitting from the growing car parc
The facts
The implications
Women represent an opportunity
The facts
The implications
THE MARKET – WHAT YOU NEED TO KNOW
Revenues suffer fall then rebound
Annual expenditure down at £260 per vehicle
UK car parc sees expansion
Older vehicles now make up a greater percentage of the market
MARKET SIZE AND FORECAST
Revenues prove sluggish despite strong economic growth and new car market
Figure 14: Best- and worst-case forecasts of car servicing, maintenance and repair market, by value, at current prices, 2010-20
Figure 15: UK car servicing, maintenance and repair market, by value, at current and constant prices, 2010-20
SEGMENT PERFORMANCE
Around £260 per year is spent on servicing and maintenance annually
Figure 16: Average expenditure on servicing, maintenance and repair market, by value, at current prices, 2010-15
Car repair costs around the UK
Figure 17: Average car maintenance servicing and repair costs in the UK, by region, 2015
Distance travelled for car servicing
MARKET DRIVERS
New and used car sales remain buoyant…
Figure 18: New and used car market volumes, 2010-15
...driving up size of the car parc
Figure 19: Total UK car parc (new and used registrations), 2010-15
Older vehicles benefit from expansion in the car parc
Figure 20: Age structure of the car parc in years, 2012, 2013 and 2014
Interest in vehicle replacement likely to fall in the coming three years
A fall in distance travelled is also evident
Figure 21: Trips, distance travelled and time taken, 2004-14
Service intervals and MOTs are important times for scheduled maintenance
Figure 22: When car is serviced, August 2015
Many motorists have a laissez-faire attitude towards faults…
…as well as delaying on repairs
Interest in DIY depends on type of work involved
Other factors influencing the market
KEY PLAYERS – WHAT YOU NEED TO KNOW
Independent garages account for over half of all revenues
Revenue growth good for many of the larger specialists
Improvements taking place at a site level to make them customer-friendly
Outlet numbers suffer a fall
Advertising represents a small percentage of revenues
MARKET SHARE
Independents garages dominate market
Figure 23: UK car servicing and maintenance: channel share by value, 2015 (est)
COMPANIES AND SERVICES
Many operators see good revenue performance
Figure 24: Leading autocentres’ turnover, 2010-15
Profitability is proving more of a challenge
Figure 25: Leading autocentres’ operating profits, 2010-15
Dealer market is dominated by big groups
Figure 26: Top ten main dealership groups in the UK, by turnover, 2014
Investment in facilities
Highlighting key safety issues
Service plans offered by the leading vehicle manufacturers
Figure 27: Leading vehicle manufacturers’ servicing plans, 2015
Price plays a major part in choosing where maintenance/servicing is undertaken
CHANNELS TO MARKET
Total number of outlets are in decline
Figure 28: Aftermarket outlets for sales of replacement parts 2010, 2012, 2014 and 2015
Independent garages dominate in terms of outlet numbers
Franchised dealers and fast fit outlet numbers stabilise
Figure 29: Top 10 tyre and exhaust fitting centres, by number of outlets, 2012, 2013 and 2015
Autocentre sector dominated by Halfords
Figure 30: Leading autocentres, by number of outlets, 2013 and 2015
The internet
ADVERTISING AND MARKETING ACTIVITY
Fluctuating advertising expenditure
Figure 31: Recorded above-the-line, online display and direct mail total advertising expenditure on car servicing and maintenance, by service type, 2011-14
MOT, servicing and tuning dominate expenditure
Figure 32: Recorded above-the-line, online display and direct mail total advertising expenditure on car servicing and maintenance, by service type, 2011-14
Kwik Fit tops the list of advertisers
Figure 33: Recorded above-the-line, online display and direct mail total advertising expenditure by car servicing and maintenance channel, by advertiser, 2014
Fast fit and autocentres increase expenditure
Figure 34: Recorded above-the-line, online display and direct mail total advertising expenditure by car servicing and maintenance channel, by advertiser, 2011-14
Press and radio advertising dominate
Figure 35: Recorded above-the-line, online display and direct mail total advertising expenditure by car servicing and maintenance channel, by media type, 2011-14
A note on adspend
LAUNCH ACTIVITY AND INNOVATION
Halfords invests in a new concept centre
Figure 36: Halfords’ new format autocentre in Croydon, 2015
Remote automotive diagnostics app
Free online vehicle management service
Authorising repairs remotely using camera technology
Price matching car servicing options
Oil changing cut down to 90 seconds
UK’s first extended cover for electric vehicles
Andrew Page opens customer-focused retail stores
Service plan extended to used cars
Garage compare site
THE CONSUMER – WHAT YOU NEED TO KNOW
Used cars dominate the market
Broad spectrum of vehicles of different ages
Women, young adults and high earners rely more on others
70% spend up to £500 annually on servicing and maintenance
Servicing and MOTs are common times for maintenance
DIY is limited by the complexity of the maintenance task
Quality is the most important factor sought from service providers
Mixed views towards internet comparison websites
CAR OWNERSHIP
Most car owners bought their vehicle used
Figure 37: Car ownership, August 2015
Car ownership is the preserve of older adults
London – A city of contrasts
Income impacts on owning from new or buying used
AGE OF CAR DRIVEN
Car parc shows evidence of a focus towards newer cars
Figure 38: Age of car driven, August 2015
Older adults prefer older cars
Location, employment and socio-economic status also impact on age of vehicle ownership
Strong car market boosts profile of new cars
Figure 39: Age of car driven, 2011-15
RESPONSIBILITY FOR MAINTENANCE AND SERVICING
Two thirds of drivers responsible for own maintenance
Figure 40: Responsibility for maintenance and servicing, August 2015
Women want others to assist
Many of the youngest car owners rely on someone else
Income appears to have some impact on maintenance choices
AMOUNT SPENT ON MAINTENANCE AND SERVICING
Majority spend less than £500 annually on their vehicle
Figure 41: Amount spent on maintenance and servicing, August 2015
Income plays a major part in what is spent on maintenance and servicing
Larger households spend more in certain bands
Men spend more on maintenance and servicing
Those with the newest cars tend to pay more or pay nothing at all
Interest in spending more on maintenance and servicing is limited
WHEN A CAR IS SERVICED
Specified times and MOTs are most popular times for servicing
Figure 42: When car is serviced, August 2015
Older and younger adults have different thoughts on maintenance
…as are men and women
Urban and rural car owners show different preferences
Income is an important factor in determining service strategy
New car owners prefer specified servicing
Distress servicing focuses on minimal expenditure
CHOICES WHEN IT COMES TO SERVICING AND MAINTENANCE
Complexity of job impacts on choice to undertake work
Figure 43: Where car is serviced, August 2015
Women show a strong preference for using others while men for undertaking DIY
Older and wealthier adults hone in on dealers while younger drivers have more complex preferences
Interest in DIY varies depending the complexity of the work involved
Dealers and fast fit outlets show geographical differences in popularity
Owners of new cars are wedded to the services of dealers …
…while those with older cars prefer independents and DIY
Retailer fitting services more popular with those spending large amounts on their car
IMPORTANCE OF FACTORS FOR SERVICING AND MAINTENANCE
Quality is sought by nearly all car owners
Figure 44: Importance of factors when maintaining or servicing a car, August 2015
Old and young adults have especially strong demands
Urban drivers want confidence in service providers and more!
INTERNET COMPARISON WEBSITES
Variable interest in use of comparison websites
Figure 45: Interest in use of internet comparison websites, August 2015
Age is an important factor in affecting interest
Urban drivers are also a good prospect
Wealthier car owners are ideally positioned as pioneers for this type of service
Those spending most on their cars show strongest interest in such a service
APPENDIX – DATA SOURCES AND ABBREVIATIONS
Data sources
Exclusions
Market sizing and segment performance
Fan chart forecast
Abbreviations

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