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The European Automotive Aftermarket: The impact of the economic crisis and of the protection of
competition principles of the SMEs of the sector
EESC meeting on SMEs, Crafts and Professions Category 05 March 2013
Sylvia Gotzen FIGIEFA Secretary General
The European automotive aftermarket
The automotive sector is more than only the car
industry!
The European automotive economy encompasses
the production of cars…
but also their operation throughout their working lives/the services that
keep them on the road
The European automotive aftermarket
Repairers
Roadside patrols
Parts manufacturers
Parts wholesalers Remanufacturers
Tool manufacturers
Data publishers
Training institutes
Europe’s aftermarket is a
chain of operators:
848 000 companies
4,7 Million employees
SMEs are the backbone of the aftermarket
Companies on the aftermarket are predominantly SMEs:
• Example: 93,7% of all parts distributors on the European automotive
aftermarket are small, 5,6% medium and only 0,7 % large
companies (Wolk Aftersales Experts, 2012)
• SMEs owners or company managers are generally highly involved in
all steps of the business/work processes
• Direct and long-term relations with suppliers/clients and their staff
• They are sustainably managed for the long term
• SMEs create and retain local and regional employment
SMEs on the aftermarket should receive the same promotion by
the European policy as SMEs in other sectors.
Structure of the Aftermarket
The economic crisis and the aftermarket
Overall financial and economic crisis
1) ~2008 - 2010
• General crisis of the automotive industry
• Car manufacturers and OEM-related first equipment suppliers highly
affected by the crisis
• Many EU Member States reacted with financial support (scrapping
schemes)
• Aftermarket less severely affected
• As a consequence, vehicle manufacturers have i.a. intensified their
aftermarket business activities
The economic crisis and the aftermarket
Overall financial and economic crisis
2) 2011 onwards: A varied picture
• OECD: “Even though the European car industry clearly has
problems, it does not seem justified to speak about a European-wide
crisis of the car industry as some car manufacturers are doing
reasonably well”.
• Aftermarket is affected as well, e.g. Italy recorded a drop of 30% in
repair and maintanance services
• Consumer purchasing power has strongly decreased, with the
consequence that repair and maintanance is postponed or not
carried out at all.
Problems with current policies
• The current European industrial policy and CARS 2020 focus their
activities very strongly on the car manufacturers
• They make the vehicle manufacturing industry look more important
than it is: “12 million jobs”
• The aftermarket is distinct from the new vehicle market, it is also its
indispensable complement.
• The whole of the European automotive economy must be taken into
account
Design a „good“ industrial policy which takes an holistic approach of
the automotive sector and supports the entire lifecycle of a vehicle
EU Policy Framework
Contribution to EU’s economy and competitiveness
• Maintain effectiv ecompetition and provide freedom of choice in
repair and maintanance services-close to the consumer
• Ensure affordable mobility for 260 million motorist consumers during
the entire life of a vehicle
• Contribute to Europes competitiveness
• Support keeping 4,7 million jobs local and sustainable
The functions of the aftermarket
Suggestions by CNA / ADIRA / CONFARTIGIANATO / FIGIEFA
EU measures to soften impact of the crisis for SMEs
in the automotive aftermarket
Competition policy
• Enforcement of Automotive Block Exemption Regulation 461/2010:
Help SMEs to enforce prohibition of (contractual) clauses which
oblige or lead car owners to exclusively use the authorised network
for the repair and maintenance operations (e.g. misleading warranty
conditions)
• Ensure that the insurance industry respects the car owner’s freedom
of choice for repairs for the workshop of his or her preferrence.
Suggestions by CNA / ADIRA / CONFARTIGIANATO / FIGIEFA
EU measures to soften impact of the crisis for SMEs
in the automotive aftermarket
Fiscal policy
• Reduction of VAT for the repair and maintenance sector (e.g. 10%)
• Possibility of fiscal deduction for repair and maintenance expenses
Promotion of environmentally friendly technologies in the entire
value chain
• Incentivise the installation and use of fuel gas equipment in vehicles.
Short term beneficial effect for reduction of emissions and creation of
jobs
Suggestions by CNA / ADIRA / CONFARTIGIANATO / FIGIEFA
EU measures to soften impact of the crisis for SMEs
in the automotive aftermarket
Cutting red tape
• Type-approval legislation for aftermarket products (e.g. test
equipment) are still defined by EU Member State bodies who add
national clauses thus hampering the marketing and free trade of our
products.
Better access to finance
• With increasing technological complexity of vehicles, a continuous
investment in tools, test equipment, information and training is
crucial for survival. However, access of SMEs to bank credits is
currently difficult and must be eased.
• That the impact assesment for any new European legislation would
not only consider the competitiveness effects for the vehicle
manufacturers but also its effects on the aftermarket
• Design a „good“ industrial policy which takes an holistic approach of
the automotive sector/ Support the entire lifecycle of a car
Suggestions by CNA / ADIRA / CONFARTIGIANATO / FIGIEFA
EU measures to soften impact of the crisis for SMEs
in the automotive aftermarket
Improve functioning of existing legislation: Access to technical
information
• Despite the Automotive Block Exemption Regulation or the ‘Euro 5’
legislation, there are still major deficiencies in the availability/release
of technical information by vehicle manufacturers (see Report of
October 2012 the French Competition Authority on the Functioning of
Competition in the Aftermarket): SMEs need support for
enforcement activities.
Suggestions by CNA / ADIRA / CONFARTIGIANATO / FIGIEFA
EU measures to soften impact of the crisis for SMEs
in the automotive aftermarket
Impact assesment for new legislation
• The impact assesment for any new European legislation sould not
only consider the competitiveness effects for the vehicle
manufacturers but also its effects on the aftermarket