Canada is generally considered to be the most similar market to Australia with a number of different states, a large land mass, relatively small population and a similar number of bodyshops. This IBIS report was prepared by Collision Repair Magazine.
MARKET OVERVIEW
OEM certification programmes remain the subject of interest in any conversation about the collision repair market, with many shops seeking certification for at least one brand. Despite an uptick of OEM certifications for some mid-market brands, the most sought- after brands for certifications remain those of luxury marques.
In addition, we've seen a number of general shop accreditation programmes launched in the past 36 months. The Automotive Industries Association (AIA) of Canada runs the Canadian Collision Industry Accreditation Program (CCIAP). Launched in 2016, with the goal of accrediting collision repair facilities against a collection of industry standards taken from leading OEMs and other stakeholders. The Automotive Retailers Association (ARA) of BC runs a very similar programme to CCIAP. An official Memorandum of Understanding exists between the two programme. In essence, if a shop qualifies for one, they qualify for the other.
Regionally, the more easterly provinces, which favour a more liberal market for auto insurance, have seen rate dips precipitated by the easing of taxes levied on premiums and other fiscal reforms and the adoption of no-fault insurance claims. In Western Canada, public insurers remain the norm, though their time may be coming to an end.
After the Insurance Company of British Columbia saw an unexpected $1.3bn loss in 2017, the provincial government enacted a number of measures designed protect the crown corporation from collapse. While the government had initially attempted to paint bodyshop owners as responsible for the out-of-control costs, the local ARA chapter conducted a significant campaign against suggestions of widespread fraud, effectively muting the government’s insinuations.
Advancements in vehicle complexity and accident avoidance technology are two trends that will continue to have significant impact over next few years.
Repair shop monitoring is primarily performed by insurance companies. While labour laws are mandated at the federal and provincial levels, these rules relate more to shop safety and the wages of low-skilled employees than any oversight of the vehicles themselves. While Canadian Common Law has not yet had cause to rule on a case similar to the John Eagle case in the US, it is generally accepted that a bodyshop could be found responsible for improper repairs leading to death or injury.
Advancements in vehicle complexity and accident avoidance technology have pushed Canadians towards buying newer vehicles, and bodyshops to finding better ways to fix them. While there has been a precipitous dip in the number of vehicles that require repairs in the last 20 years, the increased fees required to fix more specialised vehicles have had an overall positive impact on the bottom line of repair facilities.
There is a continued shortage of qualified technicians entering the business. An issue in Canada since the late 1980s, the average age of technicians is now about 44, compared to an industry-wide average of 37 in 1997.
FACTS & FIGURES
Population 36,963,854 (Statistics Canada 2018)
GDP $1,535,768m
Number of people who hold a full driving licence
25 million (Statistics Canada, 2017)
Note: These are all licensed drivers, as national statistics are not currently available regarding holders of graduated licenses. Thegraduated licensing programme differs from province to province and not all provinces have them in place.
Total vehicle parc 33,771,855 (Statistics Canada 2017)
Average vehicle age
7.4 years (Mitchell Industry Trends Report 2018)
Total new road vehicle sales
2015 : 1,939,517
2016 : 1,983,745
2017 : 2,076,970
(Statistics Canada 2018)
Number of alternative fuel vehicles registered
There are currently 32,482 EVs (16,578 BEVs and 15,904 PHEV registered in Canada (FleetKarma March 2017)
Exact statistics on other alternative fuel vehicles are not available, but estimates tend to indicate that they form a very small part of the overall vehicle fleet.
Top three motor manufacturer brands by volume sold (2017)
1. Ford (14.7%)
2. Toyota (9.8%)
3. Honda (8.7%) )
Top three models sold (2017)
1. Ford F-Series: 155,290
2. Ram Truck: 98,465
3. Honda Civic: 69,030
Top three motor insurers by number of vehicles insured
1. Intact Financial Corporation
2. TD Insurance
3. Aviva Canada
Average motor insurance premium and excess/deductible
Average annual premium across Canada is $1,100, though the rate in Ontario, around $1,500, is significantly higher than in the rest of the country.
Number of reported road collisions per annum
Statistics Canada registered 18,404 fatal or serious collisions in 2016, though other accidents are not recorded, but it is estimated to be at about two million.
Number of collision repairs per annum 2.2 million
Total accident repair market value $3.1bn (AIA Canada)
Insurance approved collision repair networks in operation Yes
Insurance owned collision centres in operation No
Vehicle manufacturer approved collision networks in operation No
Vehicle manufacturer owned collision networks in operation No
Accident management companies active within market Yes
Accident management company approved collision repair
networks in operation No
Total number of collision repair operators (all body repair
facilities/types) Around 3,500. While networks and franchise
operations have grown considerably over the past decade, the
majority of shops are still independent, single location operations.
Number of collision repair centres (static sites dedicated to
collision repair) Approximately 4,500
Types of collision repair centres
Independents: Yes
Dealer: Yes
Networks: Yes
Group/multi-site operators (MSO): Yes
Franchise operators: Yes
Largest operators by number of sites
1. CSN Collision Centers/Carrossier ProColor: 355 locations in
Canada.
2. Carstar: more than 280 locations in Canada.
3. Fix Auto: more than 250 locations in Canada. The entire Fix
Auto network, headquartered in Canada, has over 550 shops in
various markets.
The biggest news in the Canadian market has been the acquisition of the Ontario-based banner Assured Automotive by a Manitoba-based The Boyd Group. More than doubling its Canadian presence,the $193.6m sale saw another 68 locations come into the firm’s portfolio bringing its total number of Canadian shops to 110. It also has 474 locations within North America.It should be noted that there are also a number of very large regional operators: Craftsman Collision operates around 45 sites, primarily in British Columbia (BC). Speedy Collision operates 24 collision centres on a network model and was recently acquired by Belron Canada.
We’ve also seen the national roll-out of CCS, a dealership-only collision repair network operated by Consolidated Dealers, and CarrXPert, a network of new car dealerships and dealer authorised collision centres. As of September 2016, CarrXpert offered support to 500 dealerships and 200 collision centres.
Average cost of repair Approximately $930 (Mitchell Industry Trends Report 2017)
Average labour rate $45.13/ph (Mitchell Industry Trends Report, 2017)
Mobile collision repairers in operation Yes
Mobile SMART repairers in operation Yes
Total accident repair market value Approximately $4.4bn (2017) including both private and public insurance provinces.