The value chain

The independent automotive aftermarket is a complex ecosystem bringing together multiple operators to offer competitive and innovative solutions to consumers with a view to the maintenance and the repair of their vehicles.

The repair and maintenance of a vehicle involves a complex chain of various actors: the automotive aftermarket. Each stage within this aftermarket chain has its importance, each operator fulfilling a special role to keep replacement parts, repair and maintenance competitive and efficient.

The consumers, most of the time,

know well the first stage of the repair process:

The consumers, most of the time, know well the first stage of the repair process:

the road patrols and
the workshops (some of them generalist, some others specialist, e.g. body repair).

But these two are working in close cooperation with a wide range of other operators which are active behind the scenes:

the distributors of replacement parts (represented by FIGIEFA);
the providers of tools and diagnostic and test equipment;
the providers of technical information;
the training centres providing the qualified workforce.

How does the repair chain work?

PRODUCING PARTS “NO VEHICLE WITHOUT THE PARTS SUPPLIERS”

When building a vehicle, manufacturers rely very much on parts suppliers, also called Original Equipment Suppliers (OES). These original equipment suppliers are not only the most important production source of automobile components, they are also the design engineers of most components of the first equipment of new vehicles.

It is not much known to what low extent vehicle manufacturers contribute to the production of automotive replacement parts. Vehicle manufacturers produce only about 20% of the components themselves for repair purposes, whereas the rest of the replacement parts is produced by parts manufacturers, i.e. original equipment suppliers and independent parts producers who supply exclusively the independent aftermarket.

The existence of this independent parts manufacturing industry is important because it produces a wide range of components needed to satisfy consumers’ demand and to ensure competition in the automotive aftermarket between vehicle manufacturers’ network and the independent distribution and repair system.

THE INDEPENDENT DISTRIBUTION OF REPLACEMENT PARTS A strong partner

After they are produced, replacement parts need to be distributed to the workshops to perform repair and maintenance jobs. Distributing parts is a specific job that demands experts in product assortment and logistics. Independent parts wholesalers provide an efficient delivery of replacement parts throughout a European supply network. The aim is to get “the right part – for the right price – at the right time” to the workshop: just-in-time delivery is crucial, as customers want to have their vehicle quickly repaired and back on the road.

On the one hand, vehicle manufacturers supply their dealers and their franchised repairers the full range of spare parts for all vehicle types of their brand.

On the other hand, independent wholesalers distribute an extended variety of replacement parts of different types and of all brands, ranging from original spare parts and parts of matching quality to parts of higher quality or parts adapted to the age of the vehicle. In all cases, all parts meet the safety and environmental quality requirements.

Independent distributors count among their customers commercial end users, such as multi-brand repairers, roadside patrols, fleet operators and other retail companies (such as auto centres or supermarket chains). Specialised repairers and gas stations as well are common customers, and even franchised repairers purchase parts from the independent parts distributors.

Repairing vehicles two competing options

When performing a repair or maintenance job at hand, workshops need to source replacement parts. They have the choice between the vehicle manufacturer’s network and the independent parts distribution. If competition in the upstream market functions efficiently, they can take great advantage of replacement parts prices submitted to competition (there is an exception however concerning so-called ‘captive parts’, parts produced by vehicle manufacturers and that can be sourced only from the vehicle manufacturer’s network).

At the very end of the chain, the consumer (whether a household owning a car or a fleet operator) chooses between the two competing options: repairers affiliated to vehicle manufacturers’ networks, or the independent motor vehicle service market.

European consumers should be able to freely choose how, where, by whom and with which parts they have their vehicle serviced or repaired. The wide and varied product range offered by different workshops ensures a healthy competition which will meet the diverse demands of the customers and help keeping mobility in Europe affordable. The role of the European legislator in upholding effective competition and consumer choice is crucial.