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NAMA REPORT INCREASE IN CONVERSION RATES

NAMA REPORT INCREASE IN CONVERSION RATES

The National Association of Motor Auctions (NAMA) has published its most recent car auction data report covering the month of February 2017.

The report shows that overall in February that average selling value decreased -4.8% from £5,296 to £5,041 while average mileage went up by 2.3% to 66,811 and the first time premium was £74.

Louise Wallis, Head of NAMA commented, “Wholesale activity in February was buoyant. It was clear that the excess volumes experienced in January had largely washed through auction centres. “Whilst there was no shortage of stock, demand led to an increase in conversion rates” she added.

“The following weeks will see large numbers of part exchange vehicles enter the market following the plate change in March. The car demand should allow these vehicles to be absorbed by the market as they are brought to supply dealer forecourts to fulfill consumer demand. We look forward to seeing what the rest of the first quarter of 2017 brings.”

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RMI UNVEILS NEW VOICE FOR BODYSHOP SECTOR

RMI UNVEILS NEW VOICE FOR BODYSHOP SECTOR

The National Association of Bodyshops and Vehicle Builders and Repairers Association have merged brands to become a ‘single voice’ for the UK’s independent crash repair sector.

Formerly known as RMI Bodyshops (NAB & VBRA), the National Body Repair Association (NBRA), enters the sector with a new rebrand and focus to tackle an agglomeration of issues expected to affect its members in coming years.

Jason Moseley, Executive Director at RMIF, will head up the new division. “The RMI Bodyshop Division for the first time ever has one voice representing the bodyshop repair industry”, he said. “One thing that we hear in the market is consolidation. My view and the view of the NBRA is quite possibly that over the next 10 years, two thirds of revenues from repair could come from four big consolidated bodyshop groups and potentially in the end we could see those groups performing virtually all the insurer paid repairs. Acquisition is all part of this consolidated picture and that’s exactly why the NBRA has reflected on what we need to do and the services we need to provide that is changing”.

The partnership also seeks to challenge ongoing problems with data protection, the Connected Car as well as enticing younger generation technicians into the industry to tackle these models.

Roger Collins, Chairman of the NBRA, concluded. “It’s vital as part of our change we are the centre of change, discussions and negotiations because it’s undoubtedly going to change the market”.

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NFDA JOINS CALLS FOR ROAD IMPROVEMENTS

NFDA JOINS CALLS FOR ROAD IMPROVEMENTS

Potholes are concerning says NFDA

Potholes are ‘concerning’ warns NFDA

The National Franchised Dealers Association (NFDA) has urged the Government for substantial investments in UK roads focussing particularly on the increasingly worrying problem of potholes, expansion and development of motorways and improvement of road connectivity. A recent study commissioned by FairFuelUK and published by the Centre for Economics and Business Research (CEBR) has confirmed that the condition of UK roads is ‘highly concerning’.

The need for the Government to invest in road maintenance, development and connectivity, was one of the main points outlined in the NFDA’s Budget submission to the HM Treasury. We are pleased to see that recent figures* confirm the importance of the issue”, said Sue Robinson, Director of the National Franchised Dealers Association (NFDA).

Robinson continued, “Figures from a recent study have highlighted the issue of UK roads and it is vital that the Government takes this evidence into account.

“Congestion is one of the most serious problems related to the state of roads in Britain and traffic levels are expected to increase. In order to allow the automotive industry and the whole UK economy to continue to flourish, the UK needs a faster and safer transport network.

“Positively, the Department for Transport has recently acknowledged the issue and announced further investments, but additional well targeted measures should be put in place.”

Despite the establishment of a ‘pothole fund’, most garages report that they are changing more springs than ever before.

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COMMA EXTENDS PLANT WITH NEW LAB FACILITY

COMMA EXTENDS PLANT WITH NEW LAB FACILITY

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New lab space for Comma

Oil brand Comma has opened a new laboratory facility for product development and testing, situated near its blending plant in Gravesend, Kent.

The extension comes as part of a multi-million pound investment programme from parent company Moove, in an attempt to maintain Comma’s competitiveness for automotive lubricant, coolant and brake fluid testing. “There is no let-up in the pace at which vehicle manufacturers are introducing new specifications for the engine and gear oils for their latest models, and in many cases, upgrading existing specifications”, said Mike Bewsey, Sales and Marketing Director at the firm.

“These investments are designed to ensure that we’re using the latest manufacturing techniques so that the quality of our products can be maintained in a scalable and efficient way, as we enter a new phase in our growth strategy”, Bewsey continued. “The investments that have taken place are on our existing blending plant here in the UK – although our product portfolio continues to be developed and expand”.

Bewsey said that Comma will begin training staff up with its latest test and quality control equipment so they can utilise the laboratory at its full capacity. He said. “As we invest in new equipment for the laboratory, we’re also investing heavily in the development of our people there, so they are equipped to use it to its full potential”.

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BODYSHOP DATA THEFT: ICO RAID HOUSE

BODYSHOP DATA THEFT: ICO RAID HOUSE

Theft of personal data is still common

Theft of personal data is still common

The Information Commissioners Office (ICO) has searched a house in Palmers Green, North London after the Nationwide Accident Repairs Services (NARS) reported illegal activity into its customer database.

NARS told investigators that its computer system had been hacked in order to obtain customer car repair estimates containing personal data.

The ICO believes that the stolen information may have been sold onto crooks that
call people who have had car crashes. “Our experience shows that unscrupulous people access personal data about car accidents to sell it on to marketing firms, who use the details to make nuisance calls”, said Enforcement Manager Mike Shaw. “We searched this house to gather more evidence as we have reason to believe that a person living at this address has illegally accessed personal information”.

NARS has confirmed the illegal activity is not emitted from a person working at the company.

Responding to the investigation, Jason Moseley, Director of RMI Bodyshops, said: “We are delighted that further actions are being taken against this criminal activity. Our trade association stands firmly in support of NARS and others for their work with the ICO”.

Theft of personal data is increasingly common as criminals find the risks are significantly reduced compared with other types of crime.

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FEBI WAREHOUSE NEARS COMPLETION

FEBI WAREHOUSE NEARS COMPLETION

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Febi warehouse is almost completed

Building is nearing completion at Markham Vale for Blue Print’s new distribution centre, which on completion, could create up to 400 aftermarket jobs.

Parent company Ferdinand Bilstein UK’s new purpose-built centre is almost 213,000 sq ft, and is built as part of a large industrial estate that also contains the Andrew Page distribution centre. The whole area is built over former mine works and is part of a plan by local government to regenerate the area.

Initial building was completed in January, with racking and a witron system being installed over the first few months of 2017. On completion, the new site will replace the former the Bilstein operation in Pontefract.

Paul Dodgson, Operations Director at Ferdinand Bilstein UK, said: “We are excited about being part of this high profile development. Initial building has finished at the Markham Vale site and we look forward to seeing things progress”.

Commercial property builder Henry Boot Developments is building the centre.

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A1 ACQUIRES NEW MEMBERS AND WAREHOUSE SPACE

A1 ACQUIRES NEW MEMBERS AND WAREHOUSE SPACE

A1's Simon Salloway

A1’s Simon Salloway

The A1 buying group has added Hinckley Motor Spares, Auto Bitz (Worle) Ltd and The Motorcraft Centre (Northern Ireland), to its motor factor membership.

The new appointments brings A1’s total to 174 members and 250 stores nationally, with further plans to increase numbers thanks to a 3,000 sq ft. extension on its distribution centre, opening in March.

Simon Salloway, Head of Operations at A1 Motor Stores, said. “The initial purpose for extending the existing 13,000 sq ft. warehouse, was to allow members to choose a single pick item across their basket spend of products; so if they only need one friction line, along with all their oil, they can purchase this at A1, instead of going through a supplier to put a minimal carriage order together”. He added: “We are now extending our original offering by putting a core range of items in the warehouse including friction and filtration products as well as paint lines and ancillary oils”.

Building work will commence in February, where the firm will start collaborating with its supply customers to move wares into the new space after completion.

Commenting on the new membership, Peter Lippett, Director of Auto Bitz said: “We’ve known about A1 Motor Stores for a while now. We sort of used them in their warehouse before, so we decided to sign-up”. He added: “The benefits of joining will allow us to receive rebates from companies affiliated with them, however, A1 is currently finalising the terms of our contract with them”.

The group also confirmed it will be exhibiting at this year’s Automechanika Birmingham show.

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THE GREAT CONSOLIDATION OF 2016

Mergers and acquisitions in the aftermarket are an opportunity as much as a threat says Nexus CEO Gael Escribe

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If there’s a word to describe the aftermarket in 2016, it must surely be ‘consolidation’ and when we bring up the topic, it’s one that animates Gael Escribe, the charasmatic CEO of the Nexus trading group. “You are right” he said. “There is a consolidation happening and it is having implications on how a distributor is treated by a manufacturer”.

“Whatever alliance he [the distributor] is in, it has a price differentiation that is increasing between the large consolidators and mid-size players. That’s where the ‘phase two’ of the Nexus project will focus on”.

As the group was established just three years ago, we are surprised that there is a change of direction already, but it is one that Escribe is keen to talk about.

FOUNDATIONS

Founded three years ago, Nexus became established as a trading group in an arena filled by the members of groups like Temot, AAG and ATR [See December CAT – ED] Offering suppliers the chance to deal with distributors in markets that they were not currently active in, and member companies the chance to buy on a global scale gave it enough difference from the other groups to make it seem an attractive proposition for some. “Copy and paste doesn’t work,” Escribe explains, adding that there have been other attempts at starting trading groups, but simply being a ‘bonus collector’ doesn’t work. “Exposure to emerging markets is our ‘killer app’ and our big thing”.

Despite this, Escribe believes that the model that has been used over the past three years is becoming out of date. “I think the whole model has to evolve and we have to be one to generate and then to accelerate change in this old-school trading group style” he said.

“In the meantime, financial consolidators that are busy and I see that they are one more incentive for trading groups to evolve and provide our members with the right conditions to operate” he added. “My new obsession is to focus on providing our members with the economics that enable them to operate professionally and with growth plans, as they have in front of them a number of ‘consolidators’ that have emerged since 2008” he explained, elaborating:

“We will enter into central sourcing activities and migrate from listing suppliers to basically becoming a buying force. We wish to leverage the huge volumes we have to target the best price in Europe, whatever consolidator we have in front of us”. Escribe is careful not to talk about consolidated companies by name, although you only have to think of ECP and Page in the UK and WM and Trost in Germany as some of the larger examples of the year just gone.

Gael Escribe at Nexus Conference 2016

Gael Escribe at Nexus Conference 2016

FUTURE
So the question is, what can be done about changing the model CAT’s lead story from December issue that he views as being dated? Escribe says that Nexus is building a sourcing team in Hong Kong where an office has been opened. As has been an often been the case with this particular trading group, the timeframe is ambitious.

“We have a three year timescale, so I want to see some results in 2017, but in three years I want Nexus to be providing our members with the economics not only to survive, but able to pursue their growth plans” he said.

Although Escribe describes his strategy in modern business language, it seemed to us to be similar to the old buying group model, where a group of distributors would club together to get the best price out of a supplier. If this is the case, the number of suppliers that the group buys from must surely decrease in order to get the best collective price. This is not necessarily the case, Escribe assures us. “We will increase our compliance ratio that our members have with suppliers, that is essential. We have over 60 suppliers that are supporting us and that is where we are going to maximise our volumes”.

An increase in volumes means in turn suppliers will be leaned on to provide a more attractive price, something that Escribe does not deny. “Of course I’m going to ask more of suppliers – that’s logical” he says, as if he was surprised we asked. “By obtaining more, the numbers of Nexus will keep on growing. That’s the theoretical mechanics that will be our obsession for the coming years”.

BREXIT IMPACT
Moving parts around the world is well and good, but here in the UK Escribe is of the opinion that the referendum result will be felt in the aftermarket. “Brexit will have implications, let’s be clear” he said. “By having potentially less central European logistics in the UK, it might give a bit less comfort to UK distributors when they are leveraging the logistics side of the manufacturers”.

Escribe refers to one manufacturer that has a historic base in the UK, but he tells us it has taken the decision to re-locate to the Continent. We’ve been unable to confirm if this is the case with the company concerned, but Escribe believes this will be the first of many. “Unfortunately, that’s a perception I’m receiving” he told us.

“It will probably be bad news for the smaller and mid-size players who were relying on the high level service they were getting from those manufacturers. It’s an opportunity for Nexus and Parts Alliance, but I won’t make a final conclusion yet as it’s too early”.

While it might be an opportunity, we wondered if the Parts Alliance would have to change its business model. As you’ll see in the news section of this issue, the PA has started some sort of clean-up operation, with traditional brands including GMF being liquidated on paper. Nexus is not a member of the PA of course – in fact the opposite is the case, but we ask if the PA has a plan for change anyway. If Escribe knows, he keeps his cards close to his chest. “I think Parts Alliance over the past year has had a plan and that was to gain more leadership in the UK” he says simply, adding that it might have to adjust its logistics to counter what he sees as a likely movement by suppliers away from having bases in the UK.

DIGITAL ECONOMY
Any analyst will tell you that the next few years is likely to see great change, not only in the type of components purchased, but in the way in which they are bought. This is a point that Escribe is well aware of. “For example, the website Auto Butler is a Danish company that was sold to Peugeot and it wants Escribe at 2016 Nexus conference to be like Booking.com or Trip Advisor for the independent garage” he explains, adding that the group has invited a number of speakers to it’s winter conference (an event described by Escribe in his usual business hyperbole as the ‘Davos of the aftermarket’) where the issue will be seriously debated.

Escribe clearly believes that the plan for the next few years is going to work. “We are saying that you don’t have to spend billions of Euros on making acquisitions to lead in this market. Now you know there is another potential way that is less risky, probably less exposed to the digital revolution” he said. “It’s great for LKQ for example to multiply acquisitions, but what happens in five years if digitalisation goes quicker than expected? I’m more in favour in our model, which is less risky – but I have to prove that the economics you can get by spending millions, you can potentially get instead by leveraging the volume and bringing our members into a limited number of suppliers” he concluded.

We’ll be interested to see how Nexus and other trading groups develop over the next few years.

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ICO RAID ON BODYSHOP DATA

ICO RAID ON BODYSHOP DATA

bodyshop_picThe Information Commissioner’s Office (ICO) has raided two houses and a business in the North West, following a tip that people in the premises were involved in the illegal sale of personal data from the motor trade.

The raids are connected to an ongoing investigation into hundreds of thousands of cold calls made to people to encourage them to make personal injury claims in relation to road traffic accidents.

Mike Shaw, Enforcement Group Manager at the ICO, said: “We know lots of people get these calls suggesting they’ve been involved in an accident, and wonder how the caller had their details”.

“The answer is that lists of people who’ve been involved in car accidents can be valuable leads to claims companies. That information is difficult to come by, even for the more disreputable firms, so data on people who’ve simply had their vehicles repaired is still prized, even though many of those people won’t have been involved in any accident”.

Jason Moseley, Director of RMI Bodyshops said: “We are pleased to hear that investigations into the illegal trade of motorists personal data are proving successful”.

He added: “We are committed to helping eradicate this type of behaviour which is tarnishing our sectors reputation. RMI Bodyshops members recognise the importance of ensuring motorists details remain confidential and we will continue to protect our member’s reputations by doing whatever it takes to prevent and stop this behaviour”.

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FPS AND NISSENS COMPETITION WINNER REVEALED

Paul Stewart is the winner pictured far right

Paul Stewart is the winner (pictured far right)

Paul Stewart of Kingswood Autopart Ltd has been crowned the winner of the latest competition organised by engine cooling parts manufacturer Nissens and FPS Distribution.

The awards ceremony took place at Stewart’s Bristol-based motor factor where Nissens UK General Manager Duncan Rainbird and FPS Marketing Campaign Manager Sarah Matthews, handed over a life-size cheque to the victor. “When I was told that I won the competition I didn’t believe it at first”, said Stewart. “It’s a great prize to win. I am a motor racing fan and not many people get the opportunity to go to NASCAR” he added: “It’s a good competition to be put on through the motor trade and I’m really happy Kingswood Autopart won it”. Stewart’s first place prizes include a trip for two to Orlando Florida with £500 spending money, car hire and tickets to the NASCAR Daytona 500 Racing.

Rainbird said the competition partnership with FPS, has seen a ‘positive’ increase in sales from its engine cooling range during October and November, where entrants would receive a ticket for every £100 spent on Nissens engine cooling and air con parts before entering the prize draw. “Looking at the figures we’ve seen on FPS sales during these months we’re both up year-on-year in what is usually a quiet time in terms of engine, engine cooling and climate products that we offer”, Rainbird elaborated: I think one of the things we are keen to promote is the association that we have got together. People now associate FPS with Nissens and likewise with FPS, and the service capabilities for what they can offer”.

FPS Distribution’s Sarah Matthews added: “It’s been a good opportunity to work with Nissens, get to know them and help promote the brand”. Matthews is now in the process of sending out the second prize to its 80 winners who will each receive £25 worth of Love2Shop vouchers to spend at a number of high street retailers up and down the country.

Before drawing the ceremony to a close, Rainbird gave some final words to Stewart. “I hope Paul has an enjoyable time with his wife in Florida and escapes some of this English winter. Have a great time”.

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