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AUTOMOTIVE INDUSTRIES ASSOCIATION OF CANADA

2015Canadian Collision Repair Industry

YEARBOOK

2 AUTOMOTIVE INDUSTRIES ASSOCIATION OF CANADA

Canadian Collision Repair Industry Yearbook 2015

Prepared by:

3AUTOMOTIVE INDUSTRIES ASSOCIATION OF CANADA


Table of Contents

IntroductionThe Canadian Collision Repair Industry – Oversight and Direction Executive Summary

Section 1: Industry Profile 9 1.1 Number of Establishments 10 1.2 Employment Estimate 11 1.3 Industry Metrics 12 1.3.1 Collision Statistics 12 1.3.2 Miles Driven 13 1.3.3 Number of Drivers on the Road 14 1.4 Mitchell Industry Reports 15 1.5 CCIF Business Conditions Survey - Body Shop Sales and Claims Information 1.6 Financial Performance of Automotive Body, Paint, Interior and Glass Repair 18

Section 2: Provincial Profile 20 2.1 Newfoundland 21 2.2 Prince Edward Island 36 2.3 Nova Scotia 50 2.4 New Brunswick 64 2.5 Quebec 78 2.6 Ontario 92 2.7 Manitoba 107 2.8 Saskatchewan 121 2.9 Alberta 135 2.10 British Columbia 149

17



DesRosiers Automotive Consultants Inc. (DAC) is proud to present the first edition of the Canadian Collision Repair Industry Yearbook; it aims to address the current lack of market information for the Canadian collision market. The report for the first time gath-ers together relevant data for the collision sector in one place to provide valuable and insightful information.

There are two sections in this book, the national industry profile and the provincial profiles. In the national industry profile, you will find information regarding the size and scope of the collision industry in Canada. Some of the key data covered in the national section include: establishment counts, employment estimate, total dollar sales volume, collision statistics and financial performance of the collision industry.

In the provincial section, there is a more in depth analysis of the collision industry for each of the ten provinces in Canada. Some of the key variables and metrics covered in the provincial section include: overall living cost, some auto specific items’ cost, labour productivity measures, the structure of the vehicle fleet and the growth of vehicle sales etc.

This report is intended as a starting point upon which further research can be built to increase the amount, scope and utility of information available on the collision sector in Canada. DAC welcomes feedback on the report and ideas for additional data sets that the industry would like to see included. For more information or to suggest further research please contact Andrew Shepherd ([email protected]) or Leanne Jefferies ([email protected]).

Introduction



The Canadian Collision Repair Industry – Oversight and Direction For many decades the Canadian collision industry has developed in a fashion unlike any other country. The emergence and ongoing dominance of repair networks (whether MSO, banner or franchise-based) here in Canada is striking – currently some 55-60% of repair activity is carried out by this segment of industry.

This consolidation has enabled the operation of very effective discussion and decision-making collectives and has given the domestic industry a very powerful tool to tailor “Made-in-Canada” solutions to industry challenges.

Canadian Collision Industry Forum (CCIF)

CCIF’s origins can be traced back to a meeting facilitated by the Automotive Industries Association’s Paint, Body & Equipment Council in September 1998. It was attended by collision repairers, insurers, suppliers, trainers, trade associations and service providers from across the country. At the September 1998 meeting, it was felt that a national voice and a catalyst for change were necessary in order to address the critical issues. There was no desire to cre-ate a body that would compete with existing industry associations or duplicate their work. Instead, it was decided to create a forum that would facilitate debate on the issues and provide an opportunity for all industry stakeholders from across the country to become involved, ie. collision repairers, insurers, suppliers, trainers, service providers, trade associations.

CCIF operates as a volunteer body with no members, only participants. However, there are administrative and meeting venue costs to be covered and these are funded through sponsorship.

CCIF is managed by a chairperson, an administrator and a Steering Committee, com-prising representatives from each industry stakeholder segment. CCIF is not an associ-ation and has no direct lobbying status. However, it provides inspiration, influence and direction to those that do.

In 2014 management of CCIF was turned over to AIA Canada. This move established a formal connection (see graphic below) between the collective voice of the industry and major program elements (e.g. I-CAR training run by AIA, government relations activity, OE relations) and decision-making bodies (e.g. the AIA Collision Council).

Since January 2014 CCIF has launched action initiatives related to industry data col-lection (the Business Conditions Survey), human resources (Haiti Arise and the ongoing success of the CCIF Skills program), vehicle complexity (OE demonstration of new tech-nologies), and sustainability (insurance harmonization project).



AIA Collision Council

The AIA Collision Council was formed in 2014 and represents a renewal of the older Paint, Body and Equipment Council. The Collision Council is comprised of AIA mem-bers who are collision repairers or who provide direct service to the collision repair industry, as well as a representative from CCIF. The Council’s mandate is to act as the central hub for collision repair industry support by directing, coordinating and prioritiz-ing initiatives related to the improvement of the Canadian collision repair industry.

The Council receives recommendations for action (advocacy, government relations, communication, research, policy development, etc.) from the widest range of collision industry stakeholders, with particular attention to the Canadian Collision Industry Forum (CCIF).

The Council provides strategic oversight of AIA staff, consultants and others in action projects, and provides advice to the AIA Board of Directors on collision industry issues.

Regional Repairer Representation

A number of regional repairer associations operate across Canada. These are loosely coordinated under the aegis of NATA, the National Automotive Trades Association. Member associations are the Automotive Retailers Association of British Columbia (ARA); the Saskatchewan Association of Automotive Repairers (SAAR); the Automotive Trades Association of Manitoba (ATA), the Hamilton District Autobody Repair Associa-tion (HARA); the Automotive Aftermarket Retailers of Ontario (AARO) and the Collision Repair Association of Nova Scotia (CRANS).



Executive SummaryDAC analysis of Statistics Canada indicates that in 2014 there were a total of 4,869 outlets for the Automotive Body, Paint and Interior Repair and Maintenance industry in Canada.

The employment of the collision industry as estimated by DAC totalled 21,739 employ-ees in 2014.

The Canadian driving age population has steadily increased since 1997. In 2013 approximately 29.5 million Canadians were of legal driving age relative to the 23.5 mil-lion documented in 1997.

According to the CCIF Business Conditions Survey, there was a 17.38% year-over-year increase in sales among participating body shops when comparing 2014 year-end sales to 2013. Sales per store reached $1.57 million in 2014.

In terms of total claims dollar volume reported by major software providers, there was a 7.96% increase when comparing 2014 Q4 dollar volume to the same quarter last year. In 2014 Q4, 18.83% of claims were declared a total loss in Canada. The average age of vehicles declared total loss reached 10.07 years old.

A total of 1,528 establishment counts of the Automotive Body, Paint and Interior Repair and Maintenance industry were recorded in Ontario in 2014, making up 31.4% of the national total, the largest share across Canada. P.E.I. accounts for the smallest share of 0.4% or 20 outlets.

Employment of the collision industry is highest in Ontario with an estimate at 6,383 em-ployees in 2014, accounting for 29.4% of the national total.

Total annual compensation per job of the Automotive Repair and Maintenance indus-try reached $57,045 dollars in Alberta in 2013, well above the national average of $40,335 dollars. New Brunswick reported the lowest annual compensation at $29,564 dollars.

According to Statistics Canada, the annual average number of hours worked at an auto-motive repair and maintenance job in Ontario totalled 2,017 hours in 2014, 107 hours above the national average of 1,910 hours. On the other hand, lowest annual average number of hours worked for the industry is found in B.C. with 1,761 hours.

Overall Consumer Price Index (CPI) including all items is the highest in Alberta reaching 132.2 in 2014 (comparing to a 2002 benchmark of 100), 5.6% higher than the na-tional average of 125.2.

Looking at CPI for vehicle parts, maintenance and repairs, Newfoundland reported the highest cost increase across Canada at 151.8, 13.6% higher than the national average of 133.6. New Brunswick recorded the lowest increase at 127.8.



Insurance CPI in Nova Scotia is 28.8% lower than the national average; it is the second lowest across Canada. Between 2009 and 2014, CPI for insurance experienced an an-nual average growth rate of 0.8%, well below the national average growth rate of 2.6%.

In terms of light vehicle registrations across Canada, Ontario accounts for the largest share at 34.60% with 8.1 million light vehicle registrations in 2013, up from 7.7 million in the previous year. P.E.I. accounts for the smallest share at 0.46% with only 114,528 registrations in 2013.

Average age of light vehicle registrations is the oldest in Saskatchewan as average age of the fleet reached 11.25 years in 2013, almost 2 years older than the national aver-age of 9.29 years.



The Canadian Collision Industry Yearbook includes reference to the Business Conditions Survey conducted by CCIF. One of the charts from the Survey shows repairer sales vs. insurance claims.

Excerpts from the Yearbook

Drawing on this information (broken down by region), repairers can measure quarterly performance against other repairers, and against the total market. (The graph above shows clearly that shops contributing to the Business Conditions Survey are gaining substantial market share.)



COLLISIONS AND

CASUALTIES

COLLISIONS VICTIMS

FA-TAL

PERSON-AL INJURIES

FATALI-TIES

SERI-OUS INJU-RIES

INJURIES (TOTAL)

1993 3122 168,036 3615 23902 247593

1994 2837 164,635 3230 21564 241899

1995 2818 162,014 3313 20188 238458

1996 2740 153,944 3129 18734 227283

1997 2660 147,549 3076 17294 217401

1998 2583 145,615 2919 16410 213319

1999 2632 148,683 2980 16187 218457

2000 2548 153,290 2904 15581 222848

2001 2415 149,023 2758 15296 216542

2002 2583 153,832 2921 15894 222665

2003 2487 150,493 2777 15110 216123

2004 2438 145,150 2735 15572 206104

2005 2551 145,559 2898 15792 204701

2006 2586 142,517 2871 15879 199976

2007 2455 138,615 2753 14216 192745

2008 2197 127,672 2431 12674 176512

2009 2014 123,561 2216 11780 170912

2010 2020 123,628 2238 11625 172100

2011 1837 121,159 2023 10794 166725

Sample Chart: Collision Statistics

Sample Chart: Number of Drivers On the Road

0.65

0.7

0.75

0.8

0.85

0.9

0.95

1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011

Num

ber o

f veh

icle

s per

Year

Vehicles on the Road vs. Licensed Drivers and Driving Age Popula>on Canada

Vehicles per Licensed Driver

Vehicles per Driving Age PopulaAon

Source: DesRosiers AutomoAve Consultants Inc., StaAsAcs Canada, Transport Canada, and registraAon data © iHS AutomoAve driven by Polk, 2013 data released 2014.

AUTOMOTIVE INDUSTRIES ASSOCIATION OF CANADA

180 Elgin Street • Suite 1400 • Ottawa, ON K2P 2K3 • www.aiacanada.com

COLLISIONS AND

CASUALTIES

COLLISIONS VICTIMS

FA-TAL

PERSON-AL INJURIES

FATALI-TIES

SERI-OUS INJU-RIES

INJURIES (TOTAL)

1993 3122 168,036 3615 23902 247593

1994 2837 164,635 3230 21564 241899

1995 2818 162,014 3313 20188 238458

1996 2740 153,944 3129 18734 227283

1997 2660 147,549 3076 17294 217401

1998 2583 145,615 2919 16410 213319

1999 2632 148,683 2980 16187 218457

2000 2548 153,290 2904 15581 222848

2001 2415 149,023 2758 15296 216542

2002 2583 153,832 2921 15894 222665

2003 2487 150,493 2777 15110 216123

2004 2438 145,150 2735 15572 206104

2005 2551 145,559 2898 15792 204701

2006 2586 142,517 2871 15879 199976

2007 2455 138,615 2753 14216 192745

2008 2197 127,672 2431 12674 176512

2009 2014 123,561 2216 11780 170912

2010 2020 123,628 2238 11625 172100

2011 1837 121,159 2023 10794 166725

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