Inchcape Plc · LSE:INCH
Inchcape — Investor Day (November 2024)
50 slides from Inchcape's investor day presentation, Nov 14, 2024
Slide 1: In the Driving Seat: Accelerate+ and APAC
IN THE DRIVING SEAT: ACCELERATE+ AND APAC 14 November 2024
Slide 2: Agenda
Inchcape 2 Agenda Introducing our presenters INTRODUCTION ACCELERATE+ INCHCAPE & OVERVIEW IN APAC Duncan Tait Liz Brown Ruslan Kinebas Chief Executive Chief Strategy Officer CEO, APAC
Slide 3: Introduction and Overview
Inchcape 3 INTRODUCTION AND OVERVIEW Duncan Tait Group CEO
Slide 4: The Inchcape Investment Case
Inchcape 4 The Inchcape Investment Case The leading global automotive Distribution pureplay – diversified and scaled Essential element in Cash generative Enables investment in Disciplined approach automotive value financial profile growth and market to capital allocation chain share gains and shareh
Slide 5: Inchcape is the critical partner for OEMs
Inchcape 5 Inchcape is the critical partner for OEMs Why OEMs value Inchcape We provide an Differentiated by With local A professional efficient, effective our market-leading expertise partner with robust and sustainable technology and supported by systems and route-to-market data global capabilitie
Slide 6: Key takeaways from today
Inchcape 6 Key takeaways from today Our evolved strategy Achieving 10%+ Our diversified and will enhance our market share will scaled APAC business position as the leading drive substantial has compelling Global automotive stakeholder value growth prospects Distributor References to 10% market share
Slide 7: A substantial Total Addressable Market
Inchcape 7 A substantial Total Addressable Market With significant growth opportunities for Inchcape TAM: 10.8m, ~£325bn 10.8m MEA*: 2.0m Americas: 1.6m Europe: 2.6m TAM Inchcape Share Ambition: 10% APAC: 4.5m Revenue: ~£32bn Inchcape share: 3% Revenue: ~£9.7bn ~3x Group Inchcape TAM Size 1: Inchcap
Slide 8: Building towards our market share ambition
Inchcape 8 Building towards our market share ambition Drive towards 10% market share in our markets over medium to long term ABOVE 5 10% c.35% Brands of Inchcape >10% Market share is the key threshold per market (on average)* markets 10% 6% Operating >10% Market share drives….. Market share Margin
Slide 9: Capturing the TAM opportunity
Inchcape 9 Capturing the TAM opportunity Our key growth drivers Developing existing OEM partnerships Contract wins M&A Market share gains Conversion of OEM-led Value-accretive acquisitions markets to independent Volume growth distribution A healthy pipeline in a highly fragmented market
Slide 10: Accelerate strategy – developments since launch
Inchcape 10 Accelerate strategy – developments since launch Transformation into a pureplay automotive Distributor 7 acquisitions, generating £3.2bn in retail disposals Group operating margins £2.9bn additional revenue up 120 bps to 6.3%* Operating in more markets DXP and DAP in more Evolution of Veh
Slide 11: Evolving our strategy
Inchcape 11 Evolving our strategy Remaining agile in the face of a changing environment Macro and market developments since 2021… Macro-economic NEV transition OEM – increasing Evolving OEM conditions drive for efficiency landscape Fast-evolving Used vehicle market Sustainability: increasing technol
Slide 12: Our ambition
Inchcape 12 Our ambition Enhancing our position as the world’s leading automotive distributor Building a stronger, more diversified company that generates sustainable growth for our OEMs and for our investors, and opportunities for our colleagues to grow and thrive.
Slide 13: Accelerate+
Inchcape 13 Accelerate+ Our evolved strategic framework SCALE OPTIMISE Passenger Adjacent Vehicle Distribution Value Added Cars Categories Excellence Services OUR ENABLERS Culture & Digital, Data OEM M&A & Capabilities & Analytics relationships Integration SUSTAINABILITY
Slide 14: Liz Brown, Chief Strategy Officer
Liz Brown Chief Strategy Officer
Slide 15: Accelerate+
Inchcape 15 Accelerate+ Our evolved strategic framework SCALE OPTIMISE Passenger Adjacent Vehicle Distribution Value Added Cars Categories Excellence Services OUR ENABLERS Culture & Digital, Data OEM M&A & Capabilities & Analytics relationships Integration SUSTAINABILITY
Slide 16: SCALE
Inchcape 16 SCALE Based on developing OEM partnerships Grow market share in Growth in adjacent vehicle passenger cars in existing categories – premium motorbikes & new markets and light commercial vehicles
Slide 17: Our opportunity to drive scale
Inchcape 17 Our opportunity to drive scale Significant market growth opportunities for Inchcape Driving share in Entering new markets: Our scale existing markets opportunity: 39 83 Markets with Inchcape presence Total Addressable Markets (TAM) 25 44 c.70 Markets where we New potential markets have <
Slide 18: OPTIMISE Distribution Excellence
Inchcape 18 OPTIMISE Improving our route to market to remain the best distribution partner for our OEMs Delivered through: Distribution Value Added Excellence Services Ensuring we are the Creating greater revenue most efficient and per customer - over the effective distributor lifecycle of a vehicle
Slide 19: OPTIMISE: Distribution Excellence
Inchcape 19 OPTIMISE Distribution Excellence Leverage our unique Drive efficiency and Deliver an outstanding Distribution platform excellence across our omnichannel experience and scale to deliver distribution business for customers enhanced results for OEMs.
Slide 20: OPTIMISE: Value Added Services
Inchcape 20 OPTIMISE Value Added Services (VAS) Driving customer and vehicle lifecycle value Delivered in four areas: Parts Finance & NEV Used cars Insurance opportunities % Drive parts volumes Enable new car sales, Provide new services Leveraging our improve profitability driven by electrification
Slide 21: Our opportunity in parts distribution
Inchcape 21 Our opportunity in parts distribution A multi-dimensional approach, driven by data Our 1. 2. 3. 4. objectives: Optimise customer Ensure longevity Optimise our Capture greater engagement in of customer operations share of independent our network relationships aftersales network Our approa
Slide 22: Sustainability is embedded in Accelerate+
Inchcape 22 Sustainability is embedded in Accelerate+ The global mobility transition, delivered locally Embedding sustainability for OEMs & customers, throughout our business globally Delivering insights Enabling new Playing our part technologies An authority on the Driving adoption of The most sust
Slide 23: Embedding Accelerate+ across our business
Inchcape 23 Embedding Accelerate+ across our business Ensures our enhanced global leadership position Essential element in automotive value chain Critical partner for OEMs Market-leading technology capabilities Customer-centric approach Leading in Sustainability
Slide 24: Inchcape in APAC
INCHCAPE IN APAC Ruslan Kinebas CEO - Inchcape APAC
Slide 25: Regional Overview
Inchcape 25 REGIONAL OVERVIEW
Slide 26: APAC is set for structural growth…
Inchcape 26 APAC is set for structural growth… Regional characteristics Inchcape markets APAC Inchcape markets worldwide Developed markets1 Total population (2023) 500m 1.1bn 700m Average GDP/capita (2023, USD) $9k $19k $49k GDP CAGR (2024 - 2030) 3% 3% 1% Motorisation rate2 (2023 avg) 175 275 650 T
Slide 27: Inchcape in APAC: Regional snapshot
Inchcape 27 Inchcape in APAC Regional snapshot Headquarters: Singapore Key facts: c.4,000 11 23 Colleagues Markets OEM brands Longest OEM relationship: c.90,000 £2.8bn c.8% New vehicles Revenue in FY23 Average c.60 years distributed operating margin Toyota in 32% since 2019 Hong Kong Of Group revenu
Slide 28: APAC Leadership Team
Inchcape 28 APAC Leadership Team Diverse mix of leading industry experts and functional specialists UK Ruslan Kinebas Chief Executive Officer, APAC APAC MARKET LEADERS REGIONAL FUNCTIONAL LEADERS AUS USA UK SG Colin Christie Alex Hammett Dean Sykes Wendy Foong Director, Transformation Managing Direc
Slide 29: Sustainability is embedded across our APAC business
Inchcape 29 Sustainability is embedded across our APAC business Global mobility transition, delivered locally Delivering insights Enabling new Playing our part technologies Singapore Future Mobility Academy Inchcape ONE Developing capabilities
Slide 30: Our opportunity in the 4.5m vehicle regional TAM
Inchcape 30 Our opportunity in the 4.5m vehicle regional TAM The potential for Inchcape to scale across the region Driving share in Entering new markets: Our scale existing markets opportunity: 11 19 Markets with Inchcape presence Total Addressable Markets (TAM) 5 8 13 markets Markets where we New p
Slide 31: Our commercial model in APAC
Inchcape 31 Our commercial model in APAC Managing our retail network across the region Typical Vertically Distribution integrated markets markets Inchcape owns Distribution value Inchcape owns entire Distribution chain and c.19% of Retail network and Retail value chain Inchcape c.75% APAC c.25% 244
Slide 32: Recent growth momentum in APAC
Inchcape 32 Recent growth momentum in APAC Supported by our technology capabilities 14 More Customers Contract wins and Acquisitions since 2020 Supported + by our technology Improved Efficiencies capabilities 23 + OEM partners in 11 markets in 2024 Higher Growth
Slide 33: Market Deep Dives Overview
_ inchcape MARKET DEEP DIVES OVERVIEW
Slide 34: Accelerate+ in APAC
Inchcape 34 Accelerate+ in APAC Driving growth across the region SCALE OPTIMISE Passenger Adjacent Vehicle Distribution Value Added Cars Categories Excellence Services OUR ENABLERS Culture & Digital, Data OEM M&A & Capabilities & Analytics relationships Integration SUSTAINABILITY
Slide 35: Scaling Across a Range of Markets
Inchcape 35 SCALING ACROSS A RANGE OF MARKETS
Slide 36: Scaling our new growth markets
Inchcape 36 Scaling our new growth markets Indonesia and the Philippines Indonesia The Philippines Expected population Expected GDP Expected population Expected GDP Population1: CAGR2: CAGR 2 : Population1: CAGR 2 : CAGR 2 : 278m 3% 5% 117m 6% 5% Expected TIV CAGR 2 : Motorisation rates1: Local dist
Slide 37: Building a strong platform for growth
Inchcape 37 Building a strong platform for growth Indonesia – a substantial market, with 900k TIV* 2021 2022 2023 Contract win Contract win M&A Contract win Initial presence Diversify into new Scale through Continue to develop segment acquisition multi-OEM portfolio Targeting market share growth, fr
Slide 38: Establishing a presence in a new market with M&A
Inchcape 38 Establishing a presence in a new market with M&A The Philippines – another major market, with 450k TIV* Strong OEM portfolio through M&A in 2023 Leveraging scale with new OEMs in 2024 Targeting market share growth, from <1% in 2024 * 2023 - approximate
Slide 39: Driving scale through adjacent vehicle categories
Inchcape 39 Driving scale through adjacent vehicle categories Guam Pre-2018 2018 2021 Financial performance: Record passenger Growth outlook: Since 2019 car market share: Substantial federal infrastructure >1.5x 5x >2x 40%+ investment Recovery of Revenue More OEM Operating tourist industry growt
Slide 40: Optimising Across Our Established Markets
Inchcape 40 OPTIMISING ACROSS OUR ESTABLISHED MARKETS
Slide 41: Our established markets – Australia
Inchcape 41 Our established markets – Australia Diversifying our OEM portfolio Market characteristics OEM portfolio Growth outlook: Further developing our 500 – 600 relationship with Subaru Motorisation rates Expanding into adjacent Since 1991 Since 2017 vehicle segments with new contract wins 1
Slide 42: Our established markets – Singapore
Inchcape 42 Our established markets – Singapore Growing through the upcycle Market characteristics OEM portfolio Growth outlook: On upcycle of “Certificate 100 – 200 of Entitlement” scheme Motorisation rates Expansion into adjacent Since 1967 Since 2006 segments, with BYD commercial vehicles 60,
Slide 43: Our established markets – Hong Kong
Inchcape 43 Our established markets – Hong Kong On-going evolution of our business Market characteristics OEM portfolio Growth outlook: Continued diversification <100 of our OEM brand portfolio Motorisation rates – across products and Since 1966 Since 1990s drive trains Technology-enabled 40,000
Slide 44: Optimising through Value Added Services
Inchcape 44 Optimising through Value Added Services Multiple aftersales and F&I opportunities Fleet servicing Extended EV servicing Digital parts Market-leading opportunities warranty capabilities platform F&I product 10% of aftersales programmes 700 workshop services implementation portfolio revenu
Slide 45: Optimising through Value Added Services: Digital Parts Platform
Inchcape 45 Optimising through Value Added Services Digital Parts Platform – major opportunity across APAC Strong early growth indicators: B2B technology Australia Hong Kong platform Driving 600+ c.30% c.20% market share Registered workshops Monthly growth during start-up Share in workshop sales For
Slide 46: Optimising through Distribution Excellence
Inchcape 46 Optimising through Distribution Excellence Driving sales and productivity through our technology Digital Hot Leads to Sales Conversion %: Industry-leading metrics: 2020 2024 YTD 2% 11% 33% 41% E-commerce Sales contribution 6% 26% leads to sales from digital conversion platforms Toyota /
Slide 47: Growth Outlook
GROWTH OUTLOOK inchcape
Slide 48: Our growth outlook for APAC
Inchcape 48 Our growth outlook for APAC Through Accelerate+ strategic approach – scaling and optimising Driving profitable growth and market share across the region: Inchcape in 2024 Accelerate+ growth pillars Our ambition c.90,000 Scaling Optimising 2X new vehicles across new & in established size
Slide 49: @®inchcape
@®inchcape
Slide 50: Key takeaways from today
Inchcape 50 Key takeaways from today Our evolved strategy Achieving 10%+ Our diversified and will enhance our market share will scaled APAC business position as the leading drive substantial has compelling Global automotive stakeholder value growth prospects Distributor References to 10% market shar