M. Van Der AA, Forvia Hella: “Our restructured aftermarket organisation is well set for the future”

Marco Van Der Aa: We observed a few differences between the performances of the different areas we serve (diagnostic tools and Adas, lighting, exhaust systems, etc.). Sales of diagnostic tools are developing well in both hardware and software, buoyed by the quality of our licences and the breadth of our data. On the other hand, while our exhaust testing business in 2023 was driven by strong demand for particulate filters (DPFs), particularly in Germany, due to a legislation for testing diesel particular filers. We also had high hopes for the electric vehicle business. However, the hesitancy shown by consumers in recent months has not resulted in the expected take-off, as workshops are reluctant to invest in dedicated equipment. But this will come in due course.

M. V.D.A: We're banking heavily on our Adas calibration equipment with the launch of the new, fully digital CSC-Tool X 20. With this version, we are a step ahead of the competition. Launching innovations like this gives us grounds for optimism. All the more so because, generally speaking, the spare parts market is doing well. We're benefiting from an ageing fleet and the growing importance of sustainability. And what is more sustainable than making a parc last by maintaining it? On the other hand, I'm more concerned about the situation that garages are in, as they are facing a worrying problem in recruiting technicians.

M. V.D.A: Indeed, the restrictions resulting from the Russian-Ukraine war have already caused us to lose business in this region. And now there are tensions in the Middle East. Forvia Hella is established in Dubai, and while sales have remained flat for the time being, the trading environment is starting to deteriorate. To be honest, this is more complicated for our OE colleagues than for spare parts or equipment, where the market remains buoyant there too. As you know, when OE slows down, the IAM speeds up!

M. V.D.A: Quite logically, Europe, where we have historically been strong, not least because we are an OE supplier, which contributes to the growth of our spare parts business. We are still seeing healthy growth there, with an increase in our market share among the major players [Editor's note: pan-European ITGs] that we strategically chose to target a few years ago, and this is bearing fruit. Latin America, particularly Mexico and Brazil, is a booming market for us.

M. V.D.A: We have sales companies in Singapore, India, Australia and New Zealand. Asia will represent a great opportunity for our Group in the years to come. Our strength is that, grouped together within Forvia, we are helped by Faurecia's strong presence and the consolidation of our product portfolios. The other good news is that the Group is winning bids with Chinese carmakers. Working with these players is obviously one of our objectives, because no one can deny that they are rapidly gaining ground, both in China and in Europe. And while not all Chinese car brands will survive, some will undoubtedly become very powerful. We Europeans can learn a lot from the Chinese in terms of speed of development. And at the end of the day, in the IAM, we also want to incorporate parts from these Chinese vehicles into our catalogue.

M. V.D.A: In China, it's difficult to match the prices of alternative parts brands of lesser quality. But with our products, we bring more than just price. And let's not forget that in China, the vehicle fleet is still very European-oriented, and there is a demand for independent after-sales service. We're looking to offer real added value to those who buy Hella. It's a challenge, but it's also a big market for us.

M. V.D.A: It's a given for the Original Equipment business. And while Faurecia does indeed offer many interesting products for our spare parts portfolio, we need to be patient and not overlook the inevitable time-to-market (transition from OE to IAM).  But this merger gives us access to a range of remanufactured electronic parts, developed by Faurecia's French workshops. This is an opportunity for our IAM customers.

M. V.D.A: As a supplier, we are increasingly being asked this question. We are negotiating with car manufacturers on this subject. In fact, we have just presented our first LED headlight that can be repaired!  The same goes for ‘Reman’ products, with a range of remanufactured brake calipers  in our portfolio. The question is: is the reman business really worth investing more in, given the costs associated with warranties and deposits (return of old materials)? You really need to compare your CO2 footprint from end to end and then decide. The current trend is pushing us in this direction of course , abd we will decide for each product group what will be the best solution. Therefore we decided to stay with our new range of S&A because end to end this is more environmentally friendly than  reman in this case. In terms of eco-circularity we see an important role for IAM ., In the end in terms of CO2 footprint it much better to keep our carpark longer on the road than massively introduce new models.
Our target is to keep these carpark in a safe and clean conditions and underlines our IAM vision : “we protect value”. We also enable this via our Hella Gutmann support to help the garages to tackle the increased complexity and make sure they will also have access on the newer cars,  with our remote service, Cyber security management solutions and High Voltage measurement systems.

M. V.D.A: In the Hella portfolio, 90% of our products are suitable for vehicles with either internal combustion engines or electric motors. New business models will also emerge, to which we will adapt via our digital solutions (electronic catalogue, remote diagnostics, etc.). With our Hella Gutmann equipment, we already provide a complete ecosystem for the workshop which, step by step, is being enhanced with processes for electric vehicles. We are also working on battery repair processes. So there are plenty of opportunities. One thing is certain: it will become more complicated and more specialised. The only worrying obstacle is finding the right technicians for our garage customers.

M. V.D.A : As an industrial company, we can’t say that the current situation has no impact on us. As a result, we are examining our regions and our customer mix. We know we need to build strength in China, and we're taking a critical look at our cost base in Europe. If you want to stay healthy, you have to be able to adapt before the storm. The fact remains that for an equipment manufacturer, it is all the more important today to have a solid aftermarket organisation. This is the case at Hella Gutmann. We have already restructured, and now we can concentrate on business development.