1© GfK 2016
Spare Parts Market Overview
2© GfK 2016
Age
nd
aIntroduction To GfK
GfK Methodology
Spare Parts Market In UAE And KSA
Tire And Engine Oil Market Trends
Germany Spare Parts Market
Iran Market Overview
3© GfK 2016
GfK Introduction
4© GfK 2016
GfK 80 Years of Innovation Have Made us a Leading Global Market Research Group
ExperienceFounded in 1925 as “Institute of Monitoring of German Goods”
EmployeesMore than 13,000full-time staff
OwnershipTotal autonomy: Majority owned by GfKAssociationGlobal performance: quoted company on the German stock exchange since 1999
Global Reach115 subsidiariesin more than 100 countries
GfK. Growth from Knowledge. Trusted for quality. For 80 years.
13.000 passionate experts
We are the trusted source of relevant market and consumer information
Thought leader in the industries we serve
We deliver globally vital insights into local markets – in 100 countries
…enable our clients to create winning
strategies to enrich consumer‘s lives.
5© GfK 2016
Asia Americas Africa
...via our global automotive expert network of over 350 professionals located in key automotive markets....
AustraliaChinaSouth KoreaIndia Japan
ArgentinaBrazilCanadaChileColombia
Sub-Saharan Africa (main office in South Africa)Egypt and Morocco
RussiaSaudi ArabiaUnited Arab Emirates& ME region
MexicoUSAVenezuela
EuropeAustriaBelgiumBulgariaCzech Republic
FranceGermanyItalyRomaniaSpain
SwitzerlandTurkeyUKGreeceHungary
PolandPortugalSwedenSlovakiaUkraine
6© GfK 2016
GfK Middle East & Africa Regional Scope
7© GfK 2016
GfK…Growth From Knowledge…. Trusted For Quality... For 80 Years....
13.000 passionate experts
We are the trusted source of relevant
market and consumer
information
Thought leader in the
industries we serve
We deliver globally vital insights into local
markets –in 100 countries …enable our clients to
create winningstrategies
to enrich consumer‘s lives
8© GfK 2016
Aftermarket Products Audited
Tyres
Batteries
Engine MotorOil
Oil Filters
Spark Plugs
Brake Pads
Horns
Wipers
AFTERMARKET
9© GfK 2016
GfK Methodology
10© GfK 2016
GfK Retail Audit Approach:
Providing actionable insight on key drivers ofin the market sales, own businessperformance, partners and competitorsdevelopment. Achieved through thecollection of live sales data from leadingretailers and through a dedicated field forceworking with manual store audit, sales arecollected, handled and coding with a full setof features at individual SKU level enablingsegmentation and analysis of the market on afeature by feature basis.
GfK Retail Audit ApproachGfK Retail Audit – Insights and Support
11© GfK 2016
Enumeration Understanding Extrapolation Census Listings
Enumerate outlets which are under the Census Study
Understand the structure of retail in terms of:
Product and Brand distribution
Type and size of Outlets
Establish an accurate basis for panel selection and data extrapolation
Maintain an excel based file with outlet information
GfK Conducted Face To Face Interviews Across The Country To Understand The Retail Landscape
12© GfK 2016
How our Census Forms Look
13© GfK 2016
Spare Parts Market In UAE And KSA
14© GfK 2016
Population Close To 10 Million (4.1 Mio in 2006) Net migration rate at 21%, the highest in the world
2.9%
82 years77 yearsDependency Ratio 20%
South-Asian 58%
UAE Arab-13%
Westerner 12%
Other Asian-17%
HDI Rank 40
1.05
Inflation growth 4.3%
4.3%402 billion current prices
Current Account Balance $46 billion
GDP Index 135
15© GfK 2016
620
148
469
120205
648
61
Spare Part Handlers
Spare Part Handlers In UAE- 2771
Filters Handlers-
2155
Spark Plugs
Handlers-1357
Brake Pads
Handlers-1343
Fuel Pump
Handlers-1133
Engine Belts-1179
2771 Spare Parts Handlers In UAE; Total Outlet Universe- 4089 Outlets
16© GfK 2016
479
150
481
108
158
542
39
ABU DHABI
AJMAN
DUBAI
FUJAIRAH
RAS AL KHAIMAH
SHARJAH
UMM AL QUAIN
Starter Batteries
Battery Handers In UAE
Car Batteries Handlers-
1840
Truck Batteries Handlers-
477
Coach Batteries Handlers-
140
Caravan/ Motor Home
Batteries Handlers-
32
Agricultural
Batteries Handlers-
26
1957 Battery Handlers In UAE; Total Outlet Universe- 4089 Outlets
17© GfK 2016
826
205
667
171301
790
72ABU
DHABIAJMAN DUBAI FUJAIRAH RAS AL
KHAIMAHSHARJAH UMM AL
QUAIN
Oil Handlers in UAE 772
198
632
161281
752
70164
57 116 56 69207
9
Handlers by Oil Type
Car / Mixed Fleet Truck
3032 Engine Oil Vehicle Handlers In UAE; Total Outlet Universe- 4089 Outlets
18© GfK 2016
403 66358 80 106 253 26
740 204583 138 237 837 58
ABU DHABI AJMAN DUBAI FUJAIRAH RAS AL KHAIMAH SHARJAH UMM AL QUAIN
Organization Types in UAE
Chain Independent
3137 Independent Outlets; 932 Independent Outlets In UAE
19© GfK 2016
Text Box Headline
Pirated goods are preferred by buyers as they are offered at heavily discounted prices
Illegal operators able to beat local agents and distributors as they survive on low profit margins and high volumes with extensive distribution
Import tariffs and other additional expenses not passed on to their customers in order to maintain their low prices
Second-hand spare parts are sourced from damaged cars sold by insurance companies at throwaway prices and the rest coming from police auctions
Outlets Are Capable Of Providing
Nearly 90% Of Such Parts On
Demand
Some Second-Hand Spare Parts Outlets In Sharjah Reportedly Selling Parts Of Even 2011
Models At Less Than Half The Price
Of Genuine Parts
UAE – Leading Supplier of Pirated and Second Hand Parts
20© GfK 2016Source: International Monetary Fund
KSA – World’ Largest Oil ExporterKSA boasts of the 19th highest GDP in the world
31.5 Billion
46% Dependency Ratio
2%M/F Ratio 1.37
67% - KSA National
15% - South Asian National
10% - Other Arab National
8% - African National
Source: United Nations Development Program
772 Billion GDP
4%
Inflation Rate 3.26%
44% National Savings
21© GfK 2016
In 2015, UAE’s automotive trade value reached USD 22.6bn, up 22% compared to 2014, according to International Trade Centre (ITC)70% of imported parts re-exported to other MENA countries
22© GfK 2016
43 36238173
75 6 84
401
845
7227
123
431
1731
85146203
700
29210756
1866
14 90 9129158
8 80 77
Aftermarket Universe across 30 cities
KSA- 8440 Outlets Audited Across Saudi Arabia
23© GfK 2016
Total Spare Parts
Handlers-5991
Spark Plug
Handlers-3010
Brake Pads
Handlers-2900
Filers Handlers-
5678
Engine Belt
Handlers-2630
Fuel Pumps
Handlers-2690
Water Pumps
Handlers-2795
Front Grill Handlers-
2302
Total 5991 Spare Part Handlers In KSA
24© GfK 2016
1 37 56
691
6 20 113
441
18 27 71
529
9
98 103
7
819
66 47519
1119
56 41 216
815
66
Organization Types in KSA
Chain Independent
5596 Independent Outlets; 2844 Chain Outlets In KSA
25© GfK 2016
1 76 96 19
1179
75 46
551
1317
43 37
287
1192
56
Engine Oil Handlers
Total Engine Oil Vehicle Handlers are 4917
26© GfK 2016
5 9 13
338
19
147
680
1495
174 85
19
1103
73 39
540
1219
38 32
284
1152
56
Oil Type Handlers
Truck Car Mixed Fleet
KSA- Car Engine Oil Handlers are 4772; Truck Engine Oil Handlers are 1379
27© GfK 2016
Some Market Trends…
28© GfK 2016
CAR TIRESUnited Arab Emirates Sales Ths.Un.
<= 15"16"17"
18"19">= 20"
Jan 15 Feb 15 Mar 15 Apr 15 May 15 Jun 15 Jul 15 Aug 15 Sep 15 Oct 15 Nov 15 Dec 15 Jan 16 Feb 16 Mar 16
0
20
40
60
80
100
120
140
160
180
200
220
240
260
280
Sal
e sTh
s.Un .
19
20
36
58
89
20
21
36
59
93
20
22
39
61
98
23
22
41
64
100
227
24
43
67
103
21
24
42
69
105
21
23
40
64
98
237
25
42
67
98
227
25
42
68
105
227
26
41
65
103
216
24
40
65
98
21
23
37
61
91
22
22
37
64
99
226
22
37
65
100
227
24
38
67
102
229 235245
256265 267
252262 268 265
254239
249 252 259
UAE- Major Contributing Inch Segments Are <=15” and 16”
29© GfK 2016
CAR TIRES Saudi Arabia
LIGHT TRUCK
PASSENGER CAR
4X4
Jan 15 Feb 15 Mar 15 Apr 15 May 15 Jun 15 Jul 15 Aug 15 Sep 15 Oct 15 Nov 15 Dec 15 Jan 16 Feb 16 Mar 16
0
100
200
300
400
500
600
700
800
Sal
e sT
h s.U
n .
118
468
41
122
486
43
120
487
44
119
491
43
126
514
43
131
531
41
130
537
40
132
543
43
130
543
41
117
498
38
116
478
42
116
455
37
111
452
37
109
454
36
121
485
41626 651 651 653684 702 707 717 714
653 636608 599 599
647
KSA- Passenger Car Largest Segment- 485K Units In March 2016
30© GfK 2016
ENGINE OILS VEHICLESUnited Arab EmiratesSales Ths. P/L/K
10W-4020W-50
5W-40
5015W-40
40
5W-30
0W-4010W-60
15W-50
Others
Nov 15 Dec 15 Jan 16 Feb 16 Mar 16
0,0
0,5
1,0
1,5
2,0
2,5
3,0
3,5
4,0
4,5
Sale
sTh
s.P
/L/K
(x1 .
000
)
103
251306
833
384
1.117
1.027
178
286
758
348
1.095
1.120
171
222
737
349
1.001
1.132
185
295
695
391
991
1.135
205
309
742
395
1.136
1.063
4.2353.940
3.742 3.8253.987
Nov 15-Mar 16
2
258
65
BARRELBUCKETBULKCANCONTAINERJUG
UAE Engine Oils- 20W-50 Is The Largest Contributing Viscosity
31© GfK 2016
Germany Spare Parts Market
32© GfK 2016
The automotive value chain focusing on After Sales.
Source: GfK Illustration, adopted from University St. Gallen
Only 37% of the total revenue stems from new car sales. The remaining 63% account for sales in the Automotive Aftermarket business.
Product development Logistics
Manufacturing New Cars
Financial Services
1 2 3 4 5 After Sales
Used Car Sales
6 7Recycling
8
AccessoriesAppearance Products
Lubricants & Tires
Replacement Parts
Service Repairs
1 2 3 4 5 Telematics & Navigation Entertainment
6 7
33© GfK 2016
Expense for maintenance increased by 15% from
1996-2015.
Key Insights: German Spare Parts Market 2015
Ø – Cost per repair
TRENDS
14%3%
Source: DAT 2016
12.30
8.5911.93
8.22
16
1116
MAINTENANCE REPAIR
IN BILLION € 2014 2015
Development of Maintenance and Repair
Expense for repair decreased by 7% from
1996-2015.
Market Shares (in %) of different workshops(2015)
5239
8OEM Workshops
IndependentWorkshopsDo-it-yourself
162,00
34© GfK 2016
Decreasing repair work units in Germany: In 2015 0,52work units were executed in German workshops.Frequency of repair work in Germany according to DAT Study 2016
Source: DAT 2016
0.750.72
0.70
0.62
0.67
0.620.65
0.61
0.55
0.52
2006 2007 2008 2009 2010 2011 2012 2013 2014 2015
Number of vehicles/year
35© GfK 2016
Spare Parts segmented by channel in Germany.
36© GfK 2016
Some Insights On Iran…
37© GfK 2016
6,500 6,800 7,100 7,500 8,160 9,000 9,900 10,720 11,400 12,300
15,120 16,481
18,458
21,227
24,411
28,561
860 870 910 950 1,020 1,1001,200 1,300 1,340
1,700
0
5,000
10,000
15,000
20,000
25,000
30,000
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020
Passenger Cars ('000)
Commercial Cars ('000)
Actual Data Forecast
Automotive per capita, as of 2015, is 178
Iran is ranked as 79th in the world, as of 2013, by automotive per capita (164/1000)
38© GfK 2016
Automotive Industry, the 2nd most active industry in Iran, after Oil & GasAccounts for 10% of GDP and 4% of workforce (700,000 people)
Source: "Iran ranks 5th on OICA growth chart". PressTV. Source: "Resources - Iran’s Automotive Industry Overview". Atieh Bahar.
18th Largest Automaker in WorldOne of the Biggest in AsiaLargest in ME
Produces 6 different types of vehicles:1. Passenger Cars (75% of Automotive
Industry in Iran)2. Pick-up Trucks (2nd largest segment in
Automotive Industry in Iran)3. 4WD4. Trucks5. Buses6. Mini-buses
39© GfK 2016
IKCO and SAIPA two main players of passenger car market, among 25 Automakers in Iran
48%
34%
8%
10% IKCO
SAIPA
Others
Import
25 Automakers in Iran Despite being listed in the Stock Exchange, the government still
owns ~40% of IKCO & SAIPA IKCO (units%=47.8%) Leads Passenger Car Market IKCO Leads Commercial Car Markets (units%=60.7%)
– Azhitechs– Bahman Group– Rakhsh Khodro– Kerman Motors– Kish Khodro– Raniran– Traktorsazi– Shahab Khodro– Etc.
Automakers’ Units SharePassenger Car Market
Period: April 2013 – March 2014/ 1393 Persian Year
13%2%
5%9%
12%
18%
41%Hyundai
Kia
Geely
Toyota
BMW
Honda
Others
MG, Mercedes Benz, Renault, Ssangyong, Mitsubishi, Zotye, Great Wall, Lexus, Volvo, VW, Alfa Romeo, Porsche, Maserati, Jaquar, Ferrari
Automakers’ Units ShareImported Passenger Car Market
Period: April 2013 – March 2014/ 1393 Persian YearSource: Statistics Center of IranSource: Iran Customs
40© GfK 2016
ImportLocal production is underlicense of foreign companies,so it heavily depends onthem.
Expect a further boost to the automotive aftermarket!
Source: "PressTV-Iran car imports up by 31%". Retrieved 10 June2015.
Source: http://iran-daily.com/newspaper/page/4737/4/4663/0
The Automotive Aftermarket is all set to benefit from the overall growth of the automotive sector
Tire Manufacturers10 tire manufacturing unitsoperating in Iran.
Automotive Parts IndustryThe Iranian Automotive Parts Industry consists of 1,200companies (15,000 factories)
This industry consists of 2 primary sectors:1. OEM Suppliers, which produce parts for
automakers2. AMPM, which produces replacement parts
As of 2015, 60% of Auto Spare Parts in Iran are imported.
As of 2014, 70% of Tire Domestic Demand is
met
70% 60%
+39 CountriesExport to