Market Outlook and Opportunities in the Australian

Auto Parts IndustryPresenter: Ben Bartlett

Senior Manager, Government Relations & InternationalAustralian Automotive Aftermarket Association

The AAAA – Who are we?

The Australian Automotive Aftermarket Association (AAAA) is the national industry association representing 1300 manufacturers, distributors, wholesalers, importers and retailers of automotive parts and accessories, tools and equipment in Australia.

The AAAA represents member companies in negotiations with Government, Regulators and other industry groups and works with member companies on the development of their businesses.

The AAAA – Who are we?

The AAAA represents member companies in negotiations with Government, Regulators and other industry bodies.

The AAAA has relationships with Automotive Aftermarket industry associations in the USA, Europe, Canada, Africa, Asia and the Middle East.

The AAAA produces Australian Auto Aftermarket Expo, the Australian Automotive Aftermarket magazine and works with member companies on the development of their businesses.

The Australian EconomyTotal Population 22 million people

GDP USD$700 Billion per annum

The Resources sector drives the Australian economy

Economy has not entered a Recession at any stage during the Global Financial Crisis

Australian Repair & Service Sector – Current Status

• 2010/11 industry revenue $12.5 billion (1% -1.5% growth)

• 26,315 premises delivering vehicle maintenance and repair.

(includes approx 2,300 dealerships)

• Highly fragmented industry

• High degree of competition in post warranty repair and

handbook service segments

• Independent repairers approx 65% market share overall

• Significant consolidation/structural change taking place

Australian Car Parc – Current Status

• Total Number of Registered Vehicles– 16 million (2% growth)

• Average age vehicles – 10.0 years (9.8 years PMV)

• New Vehicle Sales – approximately 1 million per annum

• 62 brands selling over 320 models (85% imported) - Europe 60 brands: 15 million new vehicles sold- USA 32 brands: 17 million new vehicles sold

• 85 makes and 1200 models of vehicles registered

The GFC slowed vehicle sales, however 2008 was only the second time on record over 1 million vehicles were sold in a calendar year.

The Passenger vehicle market contributed 59% of total sales, followed by sports utility vehicles (18%), light commercial vehicles (18%) and heavy commercial vehicles (4%).

The Australian automotive industry

AFTERMARKET DISTRIBUTION

Car Owners

Vehicle Manufacturer’s P&A Divisions

Wholesalers & Distributors

Parts Manufacturers OE and Non-OE

Resellers Retailers

Carmaker Dealer Networks Service Stations Chains Independent

WorkshopsSpecialists &

Mobile Repairers

1,200 2,000, comprising 800 tyre specialists and

1,200 mechanical repair chains

7,500 3,000, comprising 1,000 mobile

repairers and 2,000 specialists

2,500Number of enterprises

Car Owners

Vehicle Manufacturer’s P&A Divisions

Wholesalers & Distributors

Parts Manufacturers OE and Non-OE

Resellers Retailers

Carmaker Dealer Networks Service Stations Chains Independent

WorkshopsSpecialists &

Mobile Repairers

1,200 2,000, comprising 800 tyre specialists and

1,200 mechanical repair chains

7,500 3,000, comprising 1,000 mobile

repairers and 2,000 specialists

2,500Number of enterprises

Opportunities to purchase from the Australian automotive aftermarket industry

What types of products?

Performance Parts and Accessories

Accessories for PMV & SUV vehicles

Some Replacement parts eg, suspension, brake, engine

Opportunities to supply to the automotive aftermarket industry

What types of products?

Service parts including filters & brake pads

Replacement parts eg, suspension, brake, engine

Performance Parts and Accessories

Accessories for PMV & SUV vehicles

Workshop tools and equipment

Typical Retail Store Turnover – % of Turnover Automotive Parts & Accessories

Cosmetics & Appearance: 17.00% General accessories: 17.00% Communication & Electronics: 15.00% Oils, Filters & Chemicals: 13.00% Auto Electrical: 13.00% Brake, Exhaust & suspension: 10.00% Engine, Cooling & Transmission: 8.00% Paint & Body: 3.00% Performance: 2.50% Wheels & Tires: 1.50%

The Australian automotive aftermarket industry

Australian Aftermarket Growth Segments

www.4wdcouncil.com.au

www.prtc.com.au

Market DynamicsAustralia is a large country with a relatively small population

Most people live on the eastern seaboard

Diverse car park, high percentage of imported vehicles

Well developed distributor, wholesale and retail networks

Significant number of Retail Chains, with the independent segment reducing.

What do we look for?

QualityDeliveryRelationshipInnovationPrice

Opportunities to supply to the automotive aftermarket industry

The Global “Right to Repair”

Campaign

AAAA Choice of Repairer Campaign

• Australia’s leading Auto Parts & Accessories Magazine.

• Published 8 times per year.

• CAB audited circulation of 14,000

businesses across Australian and

around the world.

• Held Bi-Annually, rotating between Melbourne & Sydney • Next held in Sydney in April 11-13 2013• 18,000 sqm of exhibition space• Concurrent Collision Repair Expo• 350+ Exhibitors – OVER 92% SOLD OUT• 10,000 B2B Visitors including OE, Aftermarket & International• International Pavilions from USA, Thailand, Taiwan & China.• Supported by 14 Australian & International Business Associations

• Like AAAA on Facebook: search Australian Automotive Aftermarket Association.

• Follow AAAA on Twitter: search AAAATweets

• On LinkedIn? Join the ‘Australian Automotive Aftermarket Association’ Group.

• Check out the AAAA YouTube Channel

Major AAAA Contacts

• Stuart Charity – Executive Director

• Ben Bartlett – Senior Manager – Government Relations & International

Australian Automotive Aftermarket Association

Building 3, Suite 16, 195 Wellington RdClayton, VIC, 3168, Australia

Ph: +61 3 9545 3333 Fax: +61 3 9545 3355

Email: info@aaaa.com.auWeb: www.aaaa.com.au

Ben Bartlett – Senior Manager, Government Relations & International