Report prospectus extended_warranties_new_used_cars_emerging_global_markets

Expertise in financial services Web: www.finaccord.com. E-mail: [email protected]

Extended Warranties for New and Used Cars in Emerging Global Markets

© Finaccord Ltd., 2012 1

Extended Warranties for New and Used

Cars in Emerging Global Markets

Report prospectus

March 2012

http://www.finaccord.com/

mailto:[email protected]




Prospectus contents

What is the research?

What methodology has been used?

How do dealership surveyed break down?

Which manufacturer brands have been investigated?

What is the report structure?

What are the key features of the research?

How can the research be used?

How can the PartnerBASE™ be used?

Who can use the research?

What are some of the key findings?

What is the cost and format?

How can the research be purchased?

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What is the research?

Finaccord’s report titled Extended Warranties for New and Used Cars in Emerging Global Markets

investigates the market for extended warranties linked to sales of new and used passenger cars to

consumers in ten important global markets. In total, Finaccord has calculated this sector across all

ten countries to have been worth in the region of USD 615 million in 2011 in gross written premiums

and other revenues.

Based on a survey of 765 dealers in Argentina, Brazil, China, India, Indonesia, Mexico, South

Africa, South Korea, Taiwan and Thailand plus an investigation typically covering between 30 and

40 automotive brands in each country, the study delivers unique insights into the market for

extended warranties for passenger cars bought by consumers, with fully comparable and

standardised market values split between new and used cars.

In addition to this market data, the survey measures the propensity of dealers to work with

independent extended warranty providers as well as those tied to manufacturers and importers; it

reports on customer take-up rates for extended warranties at the point of sale; it identifies the

leading non-tied providers used at the point of sale; and it describes the partnerships in place

between manufacturers or importers and extended warranty providers.






What methodology has been used?

Finaccord’s survey of dealerships in emerging global markets was carried out between November

2011 and January 2012. The research embraces the following information:

• whether extended warranties are marketed to purchasers of new and used vehicles;

• if so, how many providers are used?

• if so, what are the identities of the providers used?

• if so, how do these differ between manufacturer-branded providers and independent suppliers?

• if so, what are the average take-up rates for buyers of new and used cars?

The results of this research provide unique data for dealer penetration rates, operating models,

provider share of partnerships, and both average and overall customer take-up rates for extended

warranties in each country.

Moreover, Finaccord’s manufacturer brand survey pinpoints programs for extended warranties

organised by manufacturers or their local importers in each country, identifying the extent to which

these are offered through captive entities or in association with external partners. As such, this

constitutes a unique report with an unrivalled level of detail about countries that are key to the future

of the automotive industry.






How do dealerships

surveyed break down?

Finaccord’s universe of dealerships includes 765 respondents in total spread across ten important

emerging markets including manufacturer-owned dealerships, franchised dealerships, multi-marque

dealerships and new and used car supermarkets. For a full list of the organisations contacted for the

research and included in PartnerBASE™, please contact Finaccord.

Toyota, 8.8%

Volkswagen, 5.8%

Hyundai, 5.6%

Chevrolet, 5.1%

Maruti Suzuki, 5.0%

Honda, 4.8%

Ford, 4.7%

Nissan, 3.9%

Fiat, 3.1%Mitsubishi, 2.6%

Other groups, 25.0%

Multi-marque, 25.6%

China, 13.1%

India, 12.0%

Brazil, 10.8%

Mexico, 10.5% South Korea,

10.5%

Argentina, 9.8%

Thailand, 9.2%

Indonesia, 8.5%

South Africa, 7.8%

Taiwan, 7.8%






Which manufacturer brands

have been investigated? Manufacturer brands investigated through the local offices of the manufacturers themselves or those

of their importers in at least one of the countries covered in this report are as follows:

Acura Chery Geely Jinbei MG Škoda

Alfa Romeo Chevrolet Gleagle Karry Auto MINI Smart

Alpheon Chrysler Great Wall Kia Mitsubishi Soueast Motor

Aston Martin Citroën Hafei Automobile Lamborghini Nissan Spyker

Audi Daihatsu Haima Land Rover Opel SsangYong

Baojun Dodge Hawtai Landwind Peugeot Subaru

Bentley Effa Hindustan Motors Lexus Porsche Suzuki

Besturn Emgrand Honda Liebao Proton Tata Motors

BMW Englon Hongqi Lifan Motors Ram Tobe

Buick FAW Hyundai Lincoln Rely Toyota

BYD Fengshen Infiniti Luxgen Renault Troller

Cadillac Ferrari Isuzu Mahindra & Mahindra Renault Samsung Volkswagen

Chana Fiat JAC Maruti Suzuki Riich Volvo

Changan Force Motors Jaguar Maserati Roewe WuLing

Changfeng Ford Jeep Mazda Saab Zhonghua

Changhe FXauto Jiangling Mercedes-Benz Seat Zotye Auto






What is the report structure?

0. Executive Summary: providing a concise evaluation of the principal findings of the report.

1. Introduction: offering a rationale, a detailed description of methodology and definitions.

2. Overview: including an overview of the market for providing extended warranties in conjunction

with the purchase of new and used passenger vehicles across the ten countries. Analyses include:

trends in sales of new and used passenger vehicles; comparison of key metrics describing the

behaviour of dealers in this market; comparison of average customer take-up rates for point-of-sale

extended warranties; and calculation of the market size, in terms of gross written premiums and

other revenues in each country, for extended warranties for new and used cars.

3. Argentina: an in-depth analysis of the market for extended warranties for new and used cars in

Argentina including: an overview of the market for new and used passenger cars; dealer survey

results including analysis of the use of extended warranty programs branded or endorsed by

manufacturers as opposed to policies provided by independent warranty providers; and

manufacturer / importer survey results, including identification of partners used for branded or

endorsed extended warranty schemes.

4 - 12: Brazil, China, India, Indonesia, Mexico, South Africa, South Korea, Taiwan and Thailand (for all, contents as for Argentina).






What are the key features of the research?

Key features of this report include:

• comparable and standardised data concerning extended warranties for new and used cars

covering a total of ten major emerging economies, ranging from relatively well-established

automotive markets such as Mexico, South Korea and Taiwan to fast-developing ones such as

China and India;

• provision of hitherto unpublished market size and segmentation data for all of these markets

generated from Finaccord’s proprietary European Automotive Financial Services Model;

• unique analysis of the provision and uptake of extended warranties at the point of sale, including

the average number of providers used by dealers, the degree to which dealers collaborate with non-

tied companies in addition to tied partners, and average customer take-up rates;

• in both the report and the accompanying PartnerBASE™ database, identification of non-tied

providers of extended warranties used by dealerships;

• in both the report and the accompanying PartnerBASE™ database, identification of partnerships

between manufacturers or importers and extended warranties






How can the research be used?

You may be able to use this report and the PartnerBASE™ that accompanies it in one or more of

the following ways:

• understand the current size and future potential of the market for extended warranties in ten of the

most important growth economies in the world;

• appreciate how this opportunity breaks down between extended warranties for new and used

cars;

• benchmark the degree of competitive intensity recorded for distributing extended warranties

through the point of sale, and see where dealers are most open to working with non-tied partners;

• identify the foremost competitors in each country: have international companies such as Allianz,

Assurant, AXA, MAPFRE and The Warranty Group established themselves in each market, or do

national providers predominate?

• evaluate the potential for establishing partnerships with manufacturers and importers for branded

or endorsed extended warranty schemes across these ten key markets.





© Finaccord Ltd., 2012

EXTENDED WARRANTIES

Brand Country

Product

offered?Operating model

Total number

of schemesPartner(s)

Mazda South Africa Yes External underwriter 1 Innovation Group

Peugeot Brazil Yes External underwriter 1 Indiana Seguros (Liberty Mutual)

Peugeot Mexico Yes External underwriter 1 Quálitas

Škoda India Yes External underwriter 1 Bajaj Allianz General Insurance

Toyota South Africa Yes External underwriter 1 Innovation Group

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How can the PartnerBASE™ be used?

Select country Choose operating model

Identify product

partners

Look up

specific brands

Note: for this report, PartnerBASE also covers 765 dealerships.






Who can use the research?

1. Automotive manufacturers: this research provides a unique data allowing you to assess

objectively your position in extended warranties and to gauge the threat from non-captive

competitors;

2. Underwriters and administrators of extended warranties: what are the opportunities to increase

or build market share within the extended warranty markets of each country by means of

distribution alliances with manufacturers, importers or dealers?

3. Finance and leasing companies: extended warranties can be embedded in consumer finance

and leasing packages, hence it is important for providers in these areas to comprehend fully

the apparent opportunities;

4. Management consultancies: are you helping a manufacturer or warranty provider with its

strategy or evaluating how it can develop its business in extended warranties? Understand the

current status of this product in ten emerging global markets, saving time and effort on

researching the subject yourself.






What are some of the key findings?

1. Few manufacturer brands have schemes for extended warranties in China,

Indonesia or South Korea, while most do in India, Mexico and South Africa

Source: Finaccord Global Automotive Financial Services Survey

Proportion of manufacturer brands with schemes for extended warranties, 2011

0%

20%

40%

60%

80%

100%

ARG BRA CHN IND IDN MEX ZAF KOR TWN THA Ave.






0%

20%

40%

60%

80%

100%

Product offered Product source (see legend)

legendtrick

Undisclosed

Both

Dealer (non-tied)

Manufacturer / importer

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What are some of the key findings? (cont.)

2. Most dealers in South Africa offer extended warranties that they have arranged

themselves, with Motorite and SA Warranties holding the largest share of partnerships

% of dealers offering extended warranties and product source

Source: Finaccord Global Automotive Financial Services Survey

Provider share of partnerships, %

Motorite, 26.7%

SA Warranties,

25.6%

McCarthy Insurance Services / McSure, 11.4%

Innovation Group, 8.5%

other, 27.8%






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0

10

20

30

40

50

2007 2008 2009 2010 2011

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3. In Brazil, although customer take-up rates for extended warranties are higher with new car

sales than with used cars, the scale of the used car market offers massive potential

Source: Finaccord Global Automotive Financial Services Model

Passenger car parc (million)

Car parc

Used car sales

New car sales

New / used passenger car sales (million)







4. Key findings from the executive summary include:

• across the ten countries in question, the market for extended warranties for passenger cars was

worth in the region of USD 615 million in 2011 in terms of gross written premiums and similar

revenues;

• the value of extended warranties sold with new cars was greater than that for used cars in seven

countries out of ten, though the used car segment is likely to rise as dealers become more involved

in selling used cars and as consumers become more aware of the cost of repairing cars;

• the use of extended warranties varies widely between countries: while 40.6% of dealers offered

them measured as an unweighted average across all ten countries, this figure ranged from a low of

3.1% to a high of 97.5%;

• in many countries, dealers rely on manufacturers’ and importers’ tied schemes, and many of these

are run internally; nevertheless, there are opportunities for external providers to form new

partnerships, both with dealers and with manufacturer brands.






What is the cost and format?

Extended Warranties for New and Used Cars in Emerging Global Markets is available as a standard

Adobe Acrobat PDF document and / or hard copy. The PartnerBASE™ that accompanies it at no further

charge is in Microsoft Excel format. Costs for this research set and other titles about automotive financial

services are as follows:

For UK-based clients, VAT at the prevailing rate will be added to the basic price.

Costs quoted are for a single site user licence only.

For a corporate user licence, please see the next slide for further details.

Invoices can be paid in EUR, at the prevailing exchange rate, if preferred.

REPORT


Automotive Finance and Leasing for Consumers in Emerging Global Markets

Automotive Finance and Leasing for Consumers in Europe

Consumer Automotive Financial Services in Eastern and South-Eastern Europe

Consumer Automotive Financial Services in Emerging Global Markets

Consumer Automotive Financial Services in Northern and Central Europe

Consumer Automotive Financial Services in Southern and Western Europe

Extended Warranties for New and Used Cars in Europe

Manufacturer-Branded and Dealer-Intermediated Motor Insurance and Road Assistance in Emerging Global Markets

Manufacturer-Branded and Dealer-Intermediated Motor Insurance and Road Assistance in Europe

PRICE *

GBP 1,995

GBP 1,995

GBP 2,495

GBP 2,495

GBP 3,995

GBP 2,995

GBP 2,995

GBP 2,495

GBP 1,995

GBP 2,495






How can the research be purchased?

Simple. Just go to the relevant area of the Finaccord web site available at

www.finaccord.com/order_eu_afsr.htm and fill in the online order form, clearly indicating:

• report required

• type of corporate user licence, if required *

• billing name

• address and e-mail address

• purchase order number, if applicable

Please allow up to one working day for the delivery of electronic copy by e-mail.

* For the corporate user licence please choose one of the following options:

1. One office, one country: no supplement over and above basic cost of reports ordered

2. Multiple offices, one country: additional 20% over and above basic cost of reports ordered

3. Multiple offices, two to ten countries: additional 50% over and above basic cost of reports ordered

4. Global (unlimited offices in unlimited countries): additional 100% over and above basic cost of reports ordered

VAT at the prevailing rate will be added to the price of any corporate user licence acquired by UK-based buyers.



http://www.finaccord.com/order_eu_afsr.htm







Report prospectus extended_warranties_new_used_cars_emerging_global_markets

Economy & Finance

Transcript of Report prospectus extended_warranties_new_used_cars_emerging_global_markets