Halfords Group addresses two distinct areas of the UK’s highly-fragmented motoring market – car parts, accessories, consumables and technology; and car servicing and aftercare. From the perspective of the former, there is no single equivalent competitor selling all of our product ranges. In respect of the latter, there are over 30,000 garages in the UK, an estimated two-thirds of which are small independents.
Car Parts, Accessories, Consumables and Technology
Our strong heritage and brand mean that Halfords is a destination for consumers who want inspiration and support with their vehicles. We continue to make progress in our markets through investment in our stores and colleagues to help deliver innovative products and services to our customers when and where they want them. Whilst some of the traditional motoring product markets are in decline, there is opportunity for innovative, unique and differentiated products to be brought to market. Halfords is also seeing an increase in service-related sales as more people are preferring to have an expert fit or install products as opposed to performing it themselves.
Car Servicing and Aftercare
The automotive servicing market is large and highly fragmented
with no clear leader, and with only 2% share, there is significant
opportunity for Halfords to grow. Increasing car complexity,
accelerated by the transition to electric, is expected to drive
growth in this market. Our goal is to operate from 1,000 service
locations in the UK and ROI, whether a Retail store, a garage or a
mobile van. This will enable us to deliver customers the services
they want at a location convenient to them.
We will continue to invest in equipment and colleague training in
order to remain at the forefront of technological changes. This
will give us a competitive advantage in this fragmented market
dominated by independent operators.
Specifically, we have made significant progress in providing
industry-accredited training to Autocentres colleagues in the
servicing and maintenance of hybrid and electric vehicles, with
the majority of our centres now capable of servicing hybrid and
The cycling market is highly fragmented, with an estimated 2,500 bike shops in the UK, the majority of which are independently owned. Our research shows that these shops are closing at an average of 10% per year. Halfords Group is the market leader, with strong brand awareness in bicycles, parts, accessories and clothing.
Halfords Group boasts the biggest and most popular cycle brand in
the UK – Carrera. In total, approximately 80% of our bikes are ownbrand, covering both children and adults at a wide range of price
points. Our stores are conveniently located, and our online platform
provides support and information to help customers choose the
products and services they want. Our bike build proposition is
leading the market with free 6-week checks and bike care plans to
make sure our customers continue to stay safe whilst enjoying the
Many customers take advantage of our Click & Collect offer, placing
orders online via our website and picking up from a designated store
at a time which is convenient to them. This also drives positive store
footfall. Additionally, we are the market leader in the UK’s Cycle-toWork scheme, supporting sales and introducing new customers to
Through Tredz, Halfords has a strong and increasing foothold in
the performance cycling market. Offering products and services
of particular appeal to performance cyclists has contributed to
growth in the overall number of customers and provided many with
bikes and exercise equipment during the COVID-19 pandemic.
Cycle-to-Work vouchers can also be redeemed through Tredz which
contributes significantly to the ongoing success of that partnership.
Tredz has a strong online presence which differentiates it from the
independent cycle shop community and helps the brand to stay
relevant and competitive in a challenging market environment.
A likely impact of the COVID-19 pandemic is a significant increase in demand for bikes and scooters, as the public explore clean and cheap alternatives to public transport and look for ways to stay healthy. The Government’s £2bn package to put cycling and walking at the heart of transport policy will provide significant investment in infrastructure and subsidies to encourage people to cycle.
E-bikes and E-scooters are continuing to grow in popularity, which will only be boosted by the response to the COVID-19 pandemic. The Government has supported this through an expansion of the Cycle-to-Work scheme, as well as infrastructure investment. Though still a relatively small proportion of the bicycle population, if the trends continue to mirror those experienced in countries such as Germany and the Netherlands, we would expect E-bike sales to double from the current level of approximately 10% of all bikes sold, to 20% within the next few years. The Government is recognising the growth and increasing popularity of E-bikes and has raised the limit on Cycle-to-Work accordingly, from the previous £1,000 to an employer-set limit, meaning that employees are now able to purchase the more expensive E-bikes.
Finally, existing participants in the cycling market are willing to spend more on their cycles and accessories. As a result, we expect higher spend per person to complement volume growth, via demand for more expensive E-bikes, for cycle and accessory upgrades, or additional cycles for a different style of riding.
Whilst the unpredictability of the weather will continue to impact the timing of purchases, the overall trends in the market are positive and show that scope for growth remains.