Two recent acquisitions – Niterra EMEA GmbH’s of WhoCanFixMyCar.com and Stellantis South America’s of Norauto Argentina – underpin the growing focus of original equipment manufacturers (OEMs) and original equipment suppliers (OESs) on the automotive downstream channel. Such strategies have become increasingly important for OEMs and OESs as they struggle with tepid new vehicle sales. An aging car parc, coupled with shortages in new cars and auto parts, are further emphasizing the need for OEMs and OESs to expand their presence and strengthen their position in the aftermarket. In essence therefore, such acquisition strategies reflect efforts to tap more effectively into new revenue streams to offset underwhelming vehicle sales in recent years as well as build more comprehensive, end-consumer driven service portfolios.
Niterra, formerly known as NGK Spark Plugs Ltd, is a Japanese automotive supplier known for its spark plugs, with applications oriented towards internal combustion engine (ICE) vehicles. Its acquisition of WhoCanFixMyCar.com, a leading online vehicle maintenance and repair services marketplace in the UK, spotlights its bid to boost its presence in the automotive aftermarket.
Similarly, Stellantis’s acquisition of Norauto—a seller and distributor of automotive spare parts that offers a wide range of aftermarket products and services across multiple vehicle brands—aligns with its #DareForward2030 roadmap which seeks to accelerate the company’s transition towards becoming a mobility services and solutions provider. On the one hand, it is seen as reinforcing Stellantis’ position in the aftersales space and, secondly, it is perceived as helping promote brand loyalty by offering customers more wide-ranging, high quality, end-to-end services across the automotive value chain. Currently, Norauto’s 13 stores located in Buenos Aires serve more than 40,000 customers every month. Following its acquisition, service operations are slated to expand to cover other parts of the country.
To learn more, please access our report on Latin American Automotive Aftermarket Growth Opportunities or contact [email protected] for information on a private briefing.
Our Perspective
Niterra’s acquisition of WhoCanFixMyCar.com fast-tracks its entry into the service delivery space, while allowing it to distribute its resources beyond the current focus on ICE vehicles. As importantly, it allows Niterra access to market and consumer data drawn from WhoCanFixMyCar.com’s online platform which brings together garages, independent workshops, and dealerships.
This is set to enable Niterra to instantly increase its range of services as well as realize more competitive product positioning. One of the biggest bets placed on the service aggregation space in recent times, this acquisition bears close monitoring with a potentially successful outcome poised to set a template for competitors to emulate.
Frost & Sullivan’s recent analysis of growth opportunities in the Latin American Automotive Aftermarket underscores Stellantis’s position as the most popular OEM in Argentina, accounting for just under a quarter of the light vehicle (LV) parc in the country in 2022. Its acquisition of Norauto allows Stellantis to rapidly ramp up its spare and multi-brand services in the Argentinian automotive aftermarket which, according to Frost & Sullivan research, will be worth $4.2 billion by 2028.
Both acquisitions are directed at acquiring platforms that engage with end customers. They also point to an approach wherein companies are continuously tapping into aftermarket opportunities inorganically by investing in end consumer fulfillment services. Many companies are now trying to identify and implement strategic M&A that can help them leverage the aftermarket opportunity linked to servicing from the demand perspective. These measures can, in the long run, also facilitate the creation of further opportunities for upselling through a better understanding of the end consumer.
With inputs from Amrita Shetty – Senior Manager, Communications & Content, Mobility
