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HALFORDS INTERIM RESULTS: MODEST GROWTH IN ‘CHALLENGING CONDITIONS’

HALFORDS INTERIM RESULTS: MODEST GROWTH IN ‘CHALLENGING CONDITIONS’

Retail chain Halfords has published interim results for 2018. This will be the first set of results released since CEO Jill McDonald finished working out her notice at the end of October.

The group published modest growth in most areas, during what it described as ‘challenging conditions’, citing the weak pound and disappointing summer weather as reasons for gross margin to be weaker than it could be.

Like-for-like sales in car accessories were down two percent, which the group blamed on the continuing slide in the sale of sat-navs (which now make up around three percent of accessory sales, down from a high of 20 percent). The results were offset to some extent by the continued growth in dashcam sales.

The number of pushbikes sold was lower than the previous period, but the sector still recorded growth as the bikes had a higher average price, helped in no small part by the increase in popularity of e-bikes, which are now available across the chain’s network. The report also mentioned that two new Cycle Republic stores opened during the period.

Jonny Mason, Chief Financial Officer & Interim Chief Executive Officer, commented: “It is pleasing to report positive sales growth for this period, despite the poorer summer weather and the uncertainty in the UK economy. We are also pleased with our profit performance in the half, as we offset a large part of the (circa) £15m increase in costs that resulted from the impact of the weaker pound. Looking ahead, we have strong plans both in-store and online for the Cyber, Christmas and winter peaks.”

Ex-Dixons Carphone boss, Graham Stapleton has been hired as the new CEO and is expected to start in January.

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VALEO COMPLETES FTE AUTOMOTIVE ACQUISITION

VALEO COMPLETES FTE AUTOMOTIVE ACQUISITION

Parts maker Valeo has completed the acquisition of actuator firm FTE Automotive, having received clearances from the European Commission and the Turkish Competition Authority. All FTE employees will transfer to Valeo.

Valeo says that the acquisition will allow it to expand its offering of active hydraulic actuators, a fast-growing market that has benefited from the rise of hybrid and electric vehicles.

Jacques Aschenbroich, Valeo’s Chairman and Chief Executive Officer, said: “With the acquisition of FTE Automotive, Valeo is positioning itself as the technological leader on the actuators market and thereby consolidating its CO2 emissions reduction strategy. This acquisition will help strengthen Valeo’s Powertrain Systems business. We are happy to welcome FTE’s 3,800 employees to the Valeo Group.”

In 2016, FTE Automotive generated sales of around 550 million euros. The company has more than 3,800 employees and a diversified manufacturing footprint in eight countries, including Germany, the Czech Republic, Slovakia, Mexico and China.

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BREAKING: NINE AP BRANCHES MUST BE SOLD TO ‘PURCHASER APPROVED BY CMA’

BREAKING: NINE AP BRANCHES MUST BE SOLD TO ‘PURCHASER APPROVED BY CMA’

In a statement released by the Competition and Markets Authority (CMA), Euro Car Parts must now ‘sell a depot in each of these areas to a purchaser approved by CMA, so that customers don’t lose out’.

ECP bought most of the Andrew Page business in October 2016, after the latter went into administration.

A group of independent CMA panel members identified nine areas in England where the both companies were close competitors and where the merger could ‘significantly reduce competition’ for local customers.

The group did not consider that larger national or multi-regional customers would be adversely affected by the merger.

Professor Alasdair Smith, Inquiry Chair, said: “Following an in-depth investigation, we have found that this merger has the potential to drive up prices or reduce levels of service for customers in 9 local areas. That’s why we are requiring a depot in each area to be sold to a buyer approved by the CMA”.

“Outside of these areas, we did not find that the merger will further reduce competition compared to what would have happened if Euro Car Parts had not purchased Andrew Page”.

The nine affected areas are: Blackpool, Brighton, Gloucester, Liphook, Scunthorpe, Sunderland, Wakefield, Worthing and York. Swindon had also been identified during the provisional findings stage, but new evidence came to light which resulted in the group deciding that competition would not be affected in this area.

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BREAKING: ECP/ANDREW PAGE CMA FINAL REPORT PUBLISHED

BREAKING: ECP/ANDREW PAGE CMA FINAL REPORT PUBLISHED

Breaking news: CMA has published its final report on the ECP takeover of Andrew Page.

You can read the full report here

Statement from ECP“Euro Car Parts welcomes today’s decision by the Competition & Markets Authority (CMA) to give approval to its proposed acquisition of Andrew Page, subject to the divestment of nine branches*. 

Euro Car Parts bought most of the Andrew Page business in October 2016, after the company went into administration. Euro Car Parts supports the CMA’s conclusion that “The group did not consider that larger national or multi-regional customers would be adversely affected by the merger”. 

Sukhpal Singh, Chairman of LKQ UK & ROI, commented “We are genuinely thrilled the future of the Andrew Page business has been secured, which celebrates its UK centenary this year. We remain committed to assuring that the Andrew Page ‘brand’ continues to thrive and remains separate from Euro Car Parts, but will benefit from our UK infrastructure, inventory and the financial support from the LKQ Corporation. 

“We very much hope that customers of Andrew Page will continue to support the business, and we will partner with them to ensure that the company’s proposition continues to meet their current and future requirements in the way they have come to rely upon and cherish. 

“I would like to thank all Andrew Page colleagues for their professionalism, with total focus on serving their customers during a challenging time. We wish to reassure them that we are committed not just to retaining them but to investing in their long-term progression and development.” 

Martin Gray, CEO of Euro Car Parts, stated: “Euro Car Parts will continue to work with the CMA to bring this process to a conclusion and will update as appropriate.  We are delighted that approval has been clarified. This will provide welcome direction and confirmation for our customers, employees, suppliers and shareholders.” 

*The 9 branches are: Blackpool, Brighton, Gloucester, Liphook, Scunthorpe, Sunderland, Wakefield, Worthing and York. Swindon had also been identified during the provisional findings stage, but new evidence came to light which resulted in the group deciding that competition would not be affected in this area.”

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EQUIPAUTO 2017 UNDERWAY

EQUIPAUTO 2017 UNDERWAY

The biennial Equipauto exhibition is currently underway in Paris.

Official visitor figures are not available until after the show, but the organiser has indicated that it is pleased with the number of visitors, with a figure of 100,000 indicated on a pre-show communication.

Highlights of the fringe have included a number of discussions (in French) on the subjects of the connected car and the future of the aftermarket, while the show itself has played host to a number of presentations and launches from the likes of Hella, AAG France, Falken Tyres and Federal Mogul.

A Grand Prix D’Or was held to celebrate innovations in service and garage equipment. Bosch won trophies in three out of eight possible categories with awards also being taken by Hella France, ENV4, Mixplast and Robot-Wash.

Look out for a full report in November issue CAT.

 

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CMA LATEST: FACTORS RESPONSES TO PROVISIONAL REPORT PUBLISHED

CMA LATEST: FACTORS RESPONSES TO PROVISIONAL REPORT PUBLISHED

Following the publication of a draft report relating to the takeover of Andrew Page by Euro Car Parts, the Competition and Markets Authority (CMA) has received detailed responses by three motor factors. As expected ECP responded to the points raised in the report while the Parts Alliance and Motor Parts Direct also aired their views and discussed what requirements they might have for any branches that are being divested in documents published today (Weds, 11 October).

ECP agreed with the report’s conclusion, which stated that most of Andrew Page would have closed for good, had it not been for the takeover. However it disagreed with various parts of the report, including a paragraph about dealerships and specialist one-marque distributors, which the CMA acknowledges that it ‘entirely misstates ECP’s position with respect to competition from OEM and specialist suppliers’.

All the documents can be read here, under the cross-heading ‘Response hearing summaries’.

The deadline for the final report to be published is November 5.

 

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CAT AWARDS 2018

CAT AWARDS 2018

NOMINATIONS NOW OPEN!

It’s that time of the year where we launch the CAT Awards for 2018. Once again, the event will be held in the stylish surroundings of the Lowry Hotel in Manchester on Friday February 9. All we need now is your nominations for companies and people that you think would be worthy winners! Email cat.awards@haymarket.com with a note saying who you think should be on our list. Why not do it right now?

Factor Team of the Year
Nominate branch team for recognition

Factor Chain of the Year – Sponsored by Boswell Aftermarket
Any factor with two or more branches can be nominated

Independent Garage of the Year – Sponsored by Euro Repar
Nominate the best independent garage

Garage Chain of the Year – Sponsored by HaynesPro
For any garage with two or more workshops

Retailer of the Year – Sponsored by Haynes
Let us know who your favourite retailer is

Supplier of the Year
For suppliers that have gone beyond the call of duty

Outstanding Achievement – Sponsored by NOCO
For individuals who made the aftermarket what it is

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SUSPENSION WAREHOUSE SPRINGS UP

SUSPENSION WAREHOUSE SPRINGS UP

Suspension brand Lesjöfors Springs has relocated to a  new purpose-built UK distribution centre at Lindley Moor Road, Huddersfield.

The new facility measures 65,000 sq ft, offering almost 50% more storage capacity than its previous premises, with improved transport links to the motorway network and easy access for heavy goods vehicles as it is right next to the M62.

Robert Glynn, Managing Director of Lesjöfors Springs UK, said: “We continue on a ‘journey of improvement’ and this new facility means customers will experience even greater levels of service”.

“The increased space, improved materials handling and warehouse management solutions, position us well to maintain our 99% service rate and to meet whatever demands the market throws at us, whilst allowing us to remain competitive through efficiencies.”

The new unit has potential to extend the warehouse by a further 15,000 sq ft  should the need arise.

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HAYNESPRO ACQUIRES E3 TECHNICAL

HAYNESPRO ACQUIRES E3 TECHNICAL

Data solutions firm HaynesPro – a division of Haynes Publishing Group P.L.C, has announced the acquisition of Carweb’s e3 Technical business in order to strengthen its online presence. Full terms of the deal are yet to be confirmed.

The deal will see HaynesPro take control of the latter’s direct and indirect business which includes Repair and Maintenance Information (RMI), Vehicle Registration Mark (VRM) look-up software as well as its associated helpdesks and a number of Carweb’s employees. All customer contracts associated with the e3 Technical brand will also be transferred to the new owner.

“This acquisition is an important milestone in our European growth strategy and significantly enhances HaynesPro’s data offering”, said HaynesPro MD Peter van der Galiën, “Having worked with the E3 Technical team for many years, we know that we are bringing on board the best talent and capabilities in the industry.”

Darryl Watts, former e3 Technical Sales Director and new HaynesPro UK Managing Director, commented. “The acquisition reflects our strong commitment to providing UK partners and customers with the best possible technical data solutions. It also guarantees the continuity of existing services, without any interruptions during the hand-over, and ensures the development of future products to meet customer and partner needs.”

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BREAKING: AAG ACQUIRED BY GENUINE PARTS COMPANY

BREAKING: AAG ACQUIRED BY GENUINE PARTS COMPANY

BREAKING:  The following statement has been released by Genuine Parts Company:

ATLANTA and LONDON, September 25, 2017 — Genuine Parts Company (NYSE: GPC) (“the Company”) and Alliance Automotive Group (“AAG”), a leading European distributor of vehicle parts, tools and workshop equipment, announced today that they have entered into a definitive agreement under which Genuine Parts Company will acquire Alliance Automotive Group from private equity funds managed by Blackstone and AAG’s co-founders.  The acquisition is valued at a total purchase price of approximately $2 billion, including the repayment of AAG’s outstanding debt upon closing. The transaction has been approved by the Board of Directors of GPC and is expected to close in the fourth quarter of 2017, subject to the satisfaction of customary closing conditions and applicable regulatory approvals.    

AAG is the second largest parts distribution platform in Europe, with a focus on light vehicle and commercial vehicle replacement parts.  Headquartered in London, AAG has 7,500 employees and over 1,800 company-owned stores and affiliated outlets across France, the U.K. and Germany. AAG has a consistent track record of organic revenue and earnings growth supported by strategic investments based on a proven M&A strategy to gain scale, efficiencies and geographic coverage. 

AAG is expected to generate gross annual billings of approximately $2.3 billion (US$) including supplier direct billings, or $1.7 billion of revenue on a U.S. GAAP basis in 2017.  Additionally, the Company expects the acquisition to be immediately accretive to earnings in the first year after closing.  For 2018, incremental diluted earnings per share is estimated at $0.45 to $0.50 and adjusted earnings per share is estimated at $0.65 to $0.70, which excludes the amortization of acquisition-related intangibles.  The Company expects to incur one-time transaction costs in the fourth quarter of 2017.  

Paul Donahue, Genuine Parts Company’s President and Chief Executive Officer, stated, “We are excited to combine with AAG and enter the European markets with critical scale and a leading market position in the automotive aftermarket.  AAG is poised to contribute significant sales growth and earnings accretion to Genuine Parts Company and also serves to enhance the GPC platform for long-term, sustainable expansion across the global automotive parts industry.  AAG has a strong management team and a deep bench of talent, and our similar cultures and histories make this acquisition an excellent strategic fit. We are confident this business investment will create significant value for our shareholders, and we welcome the AAG team to the Genuine Parts family.  We look forward to their future contributions to our ongoing success.”

Jean-Jacques Lafont, Chairman, Chief Executive Officer and co-founder of Alliance Automotive Group, said, “The AAG team has tremendous respect for Genuine Parts Company and its well-deserved reputation as a long-standing leader in the automotive parts industry.  We are very pleased to combine our two great businesses and leverage our collective resources and expertise to accelerate growth.  AAG’s success is a testament to the hard work and dedication of our wonderful employees, without whom this transaction would not be possible. I am confident that, together, we will achieve great things and continue to provide the highest quality parts and service to our combined customers across the globe.” 

Lionel Assant, Head of European Private Equity at Blackstone, said, “Over the past three years, AAG has experienced tremendous growth and transformed into one of Europe’s leading automotive parts distributors.  We would like to thank AAG’s management team led by Jean-Jacques Lafont and Alistair Brown for their vision and leadership as well as all its staff for their exceptional efforts.  We have no doubt that the business will go on to further growth under Genuine Parts Company, which is the right partner to support AAG’s continued success.” 

The Company intends to finance the transaction, including the pay-off of AAG’s existing debt arrangements, with approximately $2 billion of debt financing.  This will include the combination of new term loan agreements, new multi-currency debt and an upsized revolving credit facility

 

We’ll have more analysis on this breaking story soon.

 

 

 

 

 

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