Neil Pattemore wonders what the next five years may have in store for the independent aftermarket.
I was once told that there is no such thing as a perfect decision – only a judgement based on what you know at the time the decision is taken. To mitigate the risk of making a bad decision, you need as much information as you can get to make a ‘fully informed decision’.
When this applies to making decisions about what will happen in the future, it becomes much more difficult and reliant on predicting the future, which is hardly an exact science. From the UK aftermarket’s perspective, the next five years will be increasingly dependent on the decisions taken by the UK Government and in turn by UK aftermarket businesses.
The impact on the aftermarket is both a ‘top down’ as well as a ‘bottom up’ challenge. The top down aspect is centred around the changes to vehicle design, technology and associated legislation to allow independent operators to continue to work effectively on a range of vehicles. The bottom up aspect is what aftermarket businesses need to do to adapt and grow depending on what they want to achieve in five years’ time. Unfortunately, not all of these aspects are under the control of the aftermarket and in legislative terms, five years is the near future.
So what do we know which might help clarify the situation and what is needed to support the UK Government’s decisions?
Firstly, the UK Aftermarket is one of the largest and most diverse in Europe and represents over 70% of all service and repair work. This is supported by existing legislation that supports access by independent operators (workshops, parts distributors, technical training organisations, diagnostic tool manufacturers, breakdown and recovery organisations etc.) to the tools, technical information, parts, training and service records of vehicles. This supports a vibrant, diverse and innovative sector that provides competitive choices for vehicle owners and operators.
However, although the current legislation is based on the EU ‘pillars’ of Motor Vehicle Block Exemption (MV-BER) and vehicle type approval regulations that contain the access to vehicle ‘repair and maintenance information’ (RMI), both of which are now referenced in UK law, the UK Government has yet to consider, discuss or decide the changes needed to ‘address technological progress’, as is being done in the EU.
New legislation
New legislation is also being drafted in the EU for a range of these ‘technical developments’, such as vehicle cybersecurity, remote access to vehicle data, electronic certificate processes, data access and data handling. The UK Government has recently conducted an online consultation about the future strategy for automotive legislation, but the detail of what the aftermarket needs did not appear to be high on their agenda.
The Government’s decisions taken as a result of this study will significantly influence whether the business models of independent workshops will be increasingly under the control of the vehicle manufacturers or that future legislation will support the UK aftermarket’s needs.
So, what will these needs be? A number of interlinked aspects will dictate the UK aftermarket in five years’ time.
Firstly, connect and communicate with the vehicle, so you will need an (ideally standardised) interface which needs to be accessible both in the workshop and remotely (the repair process is increasingly starting remotely when the vehicle is being driven), but this creates cybersecurity compliance (set by each vehicle manufacturer individually), leading to what their cybersecurity settings allow you to do.
Secondly, use the data to decide what the repair process/quotation will be and subsequently order the parts needed. Ideally, this should be done before the vehicle comes to your workshop using remote access to the vehicle, as this creates substantial cost savings and will be the basis of being competitive.
Thirdly, have the tools and training to do the job, but this may funnel your business into increasing specialisation of vehicle brands, as well as increasing your costs. Proving your competency to complete a repair correctly will also become increasingly important (think ADAS as a good example).
And then, the cost and choice of replacement parts will also become a ‘viciousvcircle’, as the volumes of more specialised parts reduce and the cost for them to be cybersecurity compliant increases.
Finally, the vehicle owner/operator will change to become more focused on ‘mobility as a service’ as drivers increasingly turn to ‘renting’ (pay by use) the vehicle only when they need it. The competitive cost of this ‘mobility as a service’ will also require competitive repair prices for the vehicle operator.
These are all huge ‘high level’ issues, so choose your supply partners carefully, as these partners may be in a better position to facilitate some aspects of your future registration, access, competency and compliance requirements.
For all of this to happen in a way which maintains competition and consumer choice, the UK Government needs to decide about updating and implementing legislation – and that takes time. For the majority of the aftermarket, this is a ‘David and Goliath’ issue, as the vehicle manufacturers want to evolve their business models to increase their aftermarket and ‘mobility as a service’ activities. By controlling access to the vehicle, what can be done by whom and at what price allows them to control the aftermarket and its profit potential. The Government needs to decide if this is what the UK wants and needs.
The next steps
The aftermarket needs to ‘unite and fight’ like never before to ensure that the Government is made fully aware of the important part that the sector plays in the UK’s societal and economical activities, created by the innovative and competitive nature of the sector.
Although the UK Aftermarket has come together as a range of associations and organisations to form ‘UK AFCAR’, there is much work to be done and every company in the industry should consider how best to actively support these efforts.
In five years’ time the UK aftermarket will either be increasingly under the control of the vehicle manufacturers, or will be supported by the legislation needed to allow independent operators to exploit the opportunities that new business models will bring. The situation in 2027 is likely to be based on the decision you take now to support UK AFCAR. Doing nothing may not be the best decision you ever make.
