While you wait for the release of our IBIS 2017 Global Focus report on Australia available in our upcoming issue, here are some of the key stats, figures and insights from our friends across the ditch in New Zealand. Report by Panel Talk editor Rex Crowther.
Market trends:
There are signs of more Australian based consolidators moving in with greater numbers than at present. There are now a number of multi site operators but they are only two or three sites, with the largest having seven.
A major factor in New Zealand is the large market share held by two insurers, which could be as high as 90%. This domination tends to keep repairers on the back foot, with a lot of them fearing retribution if they do not follow suit with insurer rules.
Suncorp’s Capital Smart has recently opened in the two major cities of Auckland and Christchurch, taking care of VERO and AA Insurance claims.
They are mostly taking the small claims at present, but there is evidence that they are moving into the medium hits area as well.
VERO have applied to the Commerce Commission to purchase Tower Insurance, one of the larger of the remaining locally owned insurers, which will see more repairs going to the insurers own repair facilities in the major centres.
Bodyshop trends:
There are definitely more MSO’s due to some shop owners having enough of trying to make a dollar out of the industry and selling out to other owners who have a little more drive to make a go of it. Some shops that are changing hands have seen new owners from outside of the collision repair industry.
There are no signs of new shops opening at this stage, although there is some solid speculation around Australian consolidator AMA/Gemini doing a deal with IAG and opening a number of new facilities, but there is no proof of this at this stage.
There are some networks or buying groups in operation. A new twist to our market is a PPG Paint distributor linking with several large rental car companies through large rebates from PPG back to the rental car companies. The threat of losing this business has seen a number of repair facilities changing there paint to PPG.
Technological impacts:
Any structural repairs have to follow manufacturers specific repair methods to the letter, in most cases with insurers not paying repairers unless proof that repair specs are acquired and followed.
This has led to a greater number of total losses and has lifted the part content costs of repairs significantly.
Access to data, while easier than before is still an issue, especially with one insurer only accepting manufacture specs.
This issue is acerbated by the large number of second hand imports that feature in the countries car parc.
The next generation:
It is becoming increasing difficult to find that next generation at present, with better opportunities in front of the young in a very buoyant economy.
There seems to be reluctance among youth to take on a trade that involves physical work, and the young are not anywhere near as car mad as previous generations.
In New Zealand we have a great penetration of training in modern vehicle technology and repair, both amongst tradesmen and apprentices, however there has definitely been a move away from the actual repair side of the panel trade, and these skill gaps are starting to show.
Key statistics:
Number of collision repair centres: 712
Types of collision repair centres:
- Independents: Yes - 700
- Dealer: Yes - 12
- Networks: None
- Group/multi-site operators (MSO): Yes – Approx 18
- Franchise operators: None
Largest operators by number of sites:
1. 7
2. 5
3. 3
Average cost of repair: $2300
Average cycle time of repair (key-to-key): Not measured in New Zealand, but is becoming a bigger focus for repairers.
Average labour rate: $98
Mobile collision repairers in operation (eg panel repair/s within mobile rig/booth): No
Number of mobile collision repairer operators: None
Mobile SMART repairers in operation (eg paintless dent removal specialists): Yes
Number of mobile SMART repair operators: Approximately 24
Other vehicle damage repair facilities/models in operation - None
Total accident repair market value: Approximately $920,000,000