From the Magazine: Navigating the winds of change

Resilience in the face of economic headwinds 

Reflecting on the macroeconomic landscape over the last several months, one theme continues to resonate strongly within the Canadian aftermarket: The importance of resilience.

Today’s business climate — shaped by mounting domestic political challenges, global geopolitical uncertainty and shifting macroeconomic forces — requires aftermarket players to remain agile, strategic and forward-thinking.

During the COVID-19 pandemic when I owned and operated automotive jobber stores, I witnessed firsthand the volatility, lack of control and instability caused by lockdowns. These conditions created enormous pressure across the industry.

Staffing became a constant challenge. Supply chain disruptions tested our operational capabilities. Cash flow was strained as customers — collision centers, repair shops and service providers — faced similar economic and logistical pressures, including increasing accounts receivables and cost-conscious end-users.

Despite these challenges, the aftermarket proved remarkably resilient. As the world began reopening, the sector experienced what many described as a “golden age.” With new vehicle supply severely constrained, inflation driving up prices and interest rates making vehicle financing less accessible, consumers held on to their cars longer. This environment created a surge in demand for replacement parts and repair services — an ideal scenario for jobbers, WDs and service providers across the country.

Fast-forward to today, and we’re once again facing turbulent waters — albeit from different sources. The evolving American trade agenda has introduced a level of uncertainty that even the most seasoned business leaders and investment professionals struggle to navigate. Rapidly shifting trade policies and tariffs have made it increasingly difficult to model risk, forecast demand, and build long-term business plans.

We’re already seeing the effects ripple through Canada’s economic ecosystem. For example, some OEMs in Windsor, Ontario, have implemented temporary shutdowns and layoffs to assess and respond to the impact of tariffs on their supply chains. These disruptions are not isolated. They cascade throughout the broader automotive value chain, eventually reaching the consumer.

Fast-forward to today, and we’re once again facing turbulent waters — albeit from different sources.

As disposable income shrinks and vehicle kilometres travelled decrease, many consumers are deferring or avoiding repairs. This directly impacts parts sales volumes, compresses margins and applies pressure on pricing and product assortments across the board.

Yet, as I consider the similarities between today’s challenges and the COVID era, I’m reminded of an important lesson: The aftermarket’s ability to adapt is one of its greatest strengths.

While we can’t control global trade policy or inflation, we can control how we respond. Jobbers and WDs have learned valuable lessons from the pandemic — most notably, the dangers of over-reliance on single-source suppliers and long, fragile supply chains.

This time around, the most acute impacts will likely be felt by OEMs, given the complexity and global nature of their manufacturing operations — spanning steel, aluminum, tires and thousands of individual components. In contrast, the aftermarket has the opportunity to move quickly, diversify sourcing strategies, and deepen relationships with partners who prioritize flexibility, domestic inventory and tariff-mitigating solutions.

Ultimately, while short-term volatility may persist, the Canadian aftermarket is well-positioned to thrive once again. By embracing the lessons of the past, staying nimble, and focusing on core customer value, our sector can turn these headwinds into a tailwind — and continue driving forward.

Zakari Krieger is the Fix Network, Canadian vice president of Prime CarCare, responsible for the Canadian retail business, encompassing the Speedy Auto Service and Novus Auto Glass business lines

This article originally appeared in the May issue of Jobber News