The following is a brief summary of the entire contents of our 11th annual industry white paper, Advancing Our Insights into the 2016 Collision Repair Marketplace.
Consolidation within the collision repair industry is slowing and we now have at least one “category killer” among the four largest multiple‐location consolidators. MLO consolidators have altered their market development and growth strategies from primarily acquiring large multiple‐location operators, MLOs, as a quick way to enter new markets and shore up and expand existing first‐tier markets. Their network development strategy now includes a combination of continued aggressive organic growth and selectively building out and expanding existing markets to include “cluster and tuck ins” which are based more on single‐location acquisitions, brownfields, and Greenfields.
Industry contraction has stabilized. As a result, we see a temporary market equilibrium resulting in a slowdown in the rate of loss of collision repair facilities
nationally. The current encouraging health of the collision repair market is due in part to an increase in accident frequency and the upward trend in vehicle repair severity. Nevertheless, we remain certain of the path forward involving the continued long‐term, multi‐segmented market’s structural transformation
throughout the entire auto physical damage ecosystem for all companies providing products, services, software, and technology that in any way touches
cars in the U.S. and Canada.
U.S. Collision Repair Industry
Since 2006, the total growth within the four U.S. segments we track and analyze; four independent consolidators, ≥$20 million multiple‐location operators, MLOs, franchise and banner groups, and $10‐$19 million MLOs which we did not track in 2006, have grown from $3.8 billion to $11.7 billion in market share, an 11.9 percent compounded annual growth rate. The top ten ranking of all ≥$20M segment repairers including independents, dealers and franchisors can be seen in the table below. Under the All Repairers column, we see there are four independent consolidators, three independent franchise organizations and three dealer groups. Within this ≥$20M segment, the four independent consolidators represent well over half of the revenue processed in 2016.
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We estimate that by 2021, the four consolidators could represent nearly a quarter of the market. When combined, the four segments we track and analyze could represent, on an aggressive market gain basis, up to 50 percent of the collision repair industry by 2021. The following chart reflects the ranking of the Top 10 multiple‐location operators and networks for 2016.
U.S. Top 10 MLO/MLN Repairers — 2016
|Service King||Service King||Hendricks|
|ABRA Corporate & Franchise||ABRA Corporate & Franchise||Berkshire-VT|
|Auto Nation||Fix Auto||Sonic|
|Fix Auto||Cook's Collision||Carl Sewell|
|Hendricks||Joe Hudson||Terry Taylor AMSI|