NZ Autocar
No Result
View All Result
  • Home
  • News
  • Reviews
  • Electric
  • Industry
  • Bikes
  • Classics
  • Motorsport
  • Prices
    • New Bike Prices
    • New Car Prices
    • Make
      • Alfa Romeo News and Reviews
      • Aston Martin News and Reviews
      • Audi News and Reviews
      • Bentley News and Reviews
      • BMW News and Reviews
      • BYD News and Reviews
      • Chevrolet News and Reviews
      • Citroen News and Reviews
      • Cupra News and Reviews
      • Ferrari News and Reviews
      • Fiat News and Reviews
      • Ford News and Reviews
      • GWM News and Reviews
      • Haval News and Reviews
      • Honda News and Reviews
      • Hyundai News and Reviews
      • INEOS News and Reviews
      • Isuzu News and Reviews
      • Jaguar News and Reviews
      • Jeep News and Reviews
      • KIA News and Reviews
      • Lamborghini News and Reviews
      • Land Rover News and Reviews
      • LDV News and Reviews
      • Lexus News and Reviews
      • Lotus News and Reviews
      • Mahindra News and Reviews
      • Maserati News and Reviews
      • Mazda News and Reviews
      • McLaren News and Reviews
      • Mercedes-Benz News and Reviews
      • MG News and Reviews
      • MINI News and Reviews
      • Mistubishi News and Reviews
      • Nissan News and Reviews
      • Omoda News and Reviews
      • Opel News and Reviews
      • Peugeot News and Reviews
      • Polestar News and Reviews
      • Porsche News and Reviews
      • RAM News and Reviews
      • Renault News and Reviews
      • Skoda News and Reviews
      • SsangYong News and Reviews
      • Subaru News and Reviews
      • Suzuki News and Reviews
      • Tesla News and Reviews
      • Toyota News and Reviews
      • Volkswagen News and Reviews
      • Volvo News and Reviews
  • Subscribe
    • Print
    • Digital
  • Contact us
    • Contact us
    • Advertise
NZ Autocar
No Result
View All Result
Home Industry

$1bn NZ Auto Repair Industry Facing ‘Perfect Financial Storm’ – Expert

by Zane Shackleton
April 20, 2022

New Zealand’s billion-dollar collision repair industry is set to lose up to 15% of its revenue to offshore owned repairers within the coming year, according to experts.

The projected loss of revenue comes at a time when the industry is facing a “perfect financial storm” of economic and environmental factors which will adversely affect its long term viability – including the pandemic, skills shortages and inflation. 

New industry figures show demand for parts and repairs are down 31% on pre-Covid levels – as significantly fewer Kiwis travel in vehicles. Rising petrol prices are also contributing to an up to 20% drop in traffic volumes in the major city centres.

The reduction in vehicle collisions on New Zealand roads has boosted profitability within the motor vehicle insurance sector to a six-year-high. 

In contrast, new panel repair industry research shows that cost pressures on repairers are growing rapidly; wages in the industry have increased by over 10% over the past year with other inputs including paint, consumables and services also up by as much as 15% over the same period. 

Australian owned IAG insurers (AMI, State, NZI and Lumley), which collectively have over 60% share of the local market, are rapidly vertically integrating throughout New Zealand, opening high-volume panel repair shops in Auckland, Wellington, Hamilton and Christchurch.

Each of the 11 new facilities, which will operate under the ‘Repairhub’ brand, are capable of processing up to 5,000 jobs annually – four times the amount of work an average panel repairer can process and around 15% of the industry’s total volume.

Neil Pritchard general manager of the Collision Repair Association (CRA) says the insurers are now able to selectively channel the more profitable, cosmetic repair work through their claims process directly into their own repair network.

He says prior to 2019, almost all 500 collision repair shops in NZ were locally owned and the additional competition faced by the new insurer model could not have come at a worse time for the industry.

“Since its inception the local collision repair industry has been made up of hundreds of New Zealand owned panel repair shops.

“With prices dictated by insurers, the industry does not operate under the same competitive forces that most other service providers do.

“The absence of these forces creates a high level of vulnerability to external cost changes for businesses and when this is coupled with the introduction of an insurer network which can artificially capture high volumes of work from the most lucrative jobs, it places our ability to develop infrastructure for more complex, structural repairs in jeopardy.

“What we are seeing at the moment is the culmination of several economic factors which are threatening the long term viability of the industry and could see the reduction in services for Kiwi consumers.

“Reduced consumer access to repair facilities that are capable of carrying out structural repairs could see more cars being written off unnecessarily, and higher insurance costs for motorists,” he says.

Pritchard says the industry also needs more oversight to protect the interests of consumers.

“Most consumers would be unaware that the repair facility being advocated by their insurer is also owned by the insurer and the profits flow offshore rather than being retained by local businesses. 

“Our concern is that with the insurance industry now effectively self-monitoring the quality of their own work, and the resulting loss of transparency in the relationship with their repairer, there is little in the way of consumer protection,” he says.

Previous Post

Mercedes reveal luxurious EQS SUV

Next Post

2003 Hummer H2 review

ADVERTISEMENT
ADVERTISEMENT
ADVERTISEMENT
ADVERTISEMENT
Free NZ Autocar Enewsletter
ADVERTISEMENT
ADVERTISEMENT
NZ Autocar is New Zealand’s leading automotive magazine. Delivering news reviews from the automotive world, including commentary from leading automotive writers and covers the scope of motoring including new cars, classic cars, EVs and motorbikes.

Our team

Publisher: Mark Petch
General Manager: Gavin Shaw
Editor: Kyle Cassidy
Senior Editor: Peter Louisson
News Editor: Harrison Wade
Art Director: Alex Schultz
Photographer: Isaac Western

To Subscribe

nzautocar.subscription.co.nz

Contact Us

Advertising:
Gavin Shaw
[email protected]
.
Editorial:
Kyle Cassidy
[email protected]
.
NZ Autocar
PO Box 44 304
Point Chevalier
Auckland 1246
New Zealand

Categories

Useful Links

Home
News
Motorsport
New Car Prices
New Bike Prices
Subscriptions
Competitions
Contact Us
Advertising
Terms and Conditions

© 2021 AUTOCAR 2016 LIMITED. ALL RIGHTS RESERVED.

No Result
View All Result
  • Home
  • News
  • Reviews
  • Electric
  • Industry
  • Bikes
  • Classics
  • Motorsport
  • Prices
    • New Bike Prices
    • New Car Prices
    • Make
      • Alfa Romeo News and Reviews
      • Aston Martin News and Reviews
      • Audi News and Reviews
      • Bentley News and Reviews
      • BMW News and Reviews
      • BYD News and Reviews
      • Chevrolet News and Reviews
      • Citroen News and Reviews
      • Cupra News and Reviews
      • Ferrari News and Reviews
      • Fiat News and Reviews
      • Ford News and Reviews
      • GWM News and Reviews
      • Haval News and Reviews
      • Honda News and Reviews
      • Hyundai News and Reviews
      • INEOS News and Reviews
      • Isuzu News and Reviews
      • Jaguar News and Reviews
      • Jeep News and Reviews
      • KIA News and Reviews
      • Lamborghini News and Reviews
      • Land Rover News and Reviews
      • LDV News and Reviews
      • Lexus News and Reviews
      • Lotus News and Reviews
      • Mahindra News and Reviews
      • Maserati News and Reviews
      • Mazda News and Reviews
      • McLaren News and Reviews
      • Mercedes-Benz News and Reviews
      • MG News and Reviews
      • MINI News and Reviews
      • Mistubishi News and Reviews
      • Nissan News and Reviews
      • Omoda News and Reviews
      • Opel News and Reviews
      • Peugeot News and Reviews
      • Polestar News and Reviews
      • Porsche News and Reviews
      • RAM News and Reviews
      • Renault News and Reviews
      • Skoda News and Reviews
      • SsangYong News and Reviews
      • Subaru News and Reviews
      • Suzuki News and Reviews
      • Tesla News and Reviews
      • Toyota News and Reviews
      • Volkswagen News and Reviews
      • Volvo News and Reviews
  • Subscribe
    • Print
    • Digital
  • Contact us
    • Contact us
    • Advertise

© 2021 AUTOCAR 2016 LIMITED. ALL RIGHTS RESERVED.