ICDP predicts changing future
Data experts ICDP has predicted an average 23% reduction in collision repairs across EU4 countries in 2030.
Using a simulation model to analyse the EU4 markets of France, Germany, Italy and the UK, ICDP suggests the drop will only be slightly compensated for by higher repair costs.
The research comes as part of ICDP’s first foray into specific collision repair market research which Steve Young, managing director of the research organisation, suggests is ‘key for a number of operators, but there are many complexities, some emerging threats and a lack of data.’ He pointed at how collision repair currently accounts for 23% of the total EU aftermarket, with a value of €45bn of which parts represents almost half.
Speaking at the IBIS Global Summit 2018, Steve told delegates, ‘Despite the size and importance of the overall market there are many differences and complexities – and, in partnership with IBIS, we are looking to bring some clarity and consistency to this.’
He continued, ‘The glass repair sector is also becoming increasingly interesting.’
Providing an insight into the research to date, Steve highlighted how the differing factors effecting the collision repair markets throughout the EU create ‘different’ trend lines. ‘It’s all over the place,’ said Steve, ‘We don’t have consistency with repair volume trend lines across the EU4 for a variety of reasons.’
Looking at the impact of ADAS, Steve suggested that in principle, ADAS systems should reduce the accident rate, but he pointed out, this will depend on penetration into the vehicle parc as a whole. He highlighted how feedback has been mixed and one OEM interviewee response to the research programme stated: ‘We’ve not seen any change yet in accident rates, though when we looked in detail we found that front end damage was being replaced by rear end.’ Another, respondent, a premium brand bodyshop, suggested it would see a 50% reduction in structural repairs in the next five years.
Along with ADAS, ICDP highlighted other ‘challenges’ such as vehicle construction, embedded technology, telematics and insurers’ strategies as being major influences on the market in the coming years.
‘In order to function a whole variety of sensors are positioned around the periphery of the vehicle and therefore when an accident happens these will be impacted. This brings with it its own challenges around calibration,’ explained Steve.
Taking into account areas such as miles driven, vehicle parc growth, ADAS adoption, amongst many others, by 2030 ICDP predicts a decrease of 30% in incidence rate, an average increase of 39% in total losses, a decrease in 22% of heavy collisions, and an increase of eight per cent in the number of incidents managed by insurers across the EU4. ‘The general trend will be fewer collisions but the cost of repair will be greater,’ said Steve.
Overall, ICDP predicts an average across the EU4 markets of a 15% reduction in collisions; a 23% reduction in repairs; a reduction of 19% in parts value; and a 17% reduction in total market value.
Steve closed by saying, ‘It’s a worse level of reduction than when we looked at the service and maintenance sector 10 years ago and hopefully it acts as a wake up call for the industry. The collision repair industry is going to be a fascinating space in the coming years.’
The IBIS Global Summit 2018 is partnered by 3M, AkzoNobel, Audatex, Axalta, Enterprise Rent A Car, Fix Auto and Symach.