When the surrounding world changes at a rapid pace and with it the conditions of doing business, we have to be able to listen and act quickly to keep our leading position. This is why we created an organisation during the year with more efficient decision making.
I formally became the President and CEO of Mekonomen Group in the first quarter of 2017. One of the things I have worked on from day one is creating an organisation and Group Management that is adapted to the changing world we live in. The result is that today we have a new, broader Group Management team that includes the managers of all of our market companies. They are the ones who really have their ears to the ground and understand the customers’ needs and how customer behaviour can be developed. The new organisation provides conditions for more decisions to be made closer to the customers and our business.
To continue creating customer value and living up to our motto, “making car life easier”, it is important that we as industry leaders are in the forefront with innovation and development.
A changing market
The market we act in is undergoing several major changes. The way we use, own and view our car and our car ownership is different today than just a few years ago. The technology in the cars is undergoing major changes, where online functions in the car and various types of electric motors are a few examples of this.
In 2017, the market was neither strong nor weak. Sales varied between the quarters, where the first and third quarters were somewhat worse while the second and fourth quarters were stronger. Sales being somewhat lower at the beginning of the year is due in part to the mild winter.
The trend in Norway was somewhat more challenging than in Sweden with higher competition and weaker consumer business.
A year of transformation in Mekonomen Sweden with a stable closing
In Mekonomen Sweden, 2017 was a year of transformation where focus was on reintroducing a more decentralised organisation and creating calm to work for the employees. In the second quarter, we saw signs of a stabilisation in the organisation and that we had formed the right conditions to turn the weak development. I am proud that we were able to see a stabilisation in the fourth quarter in sales and profitability as well. The work of winning back market shares remains a challenge, but I am certain that we have the right people and tools to succeed.
Innovation in products, services and working methods
To constantly be able to offer the best customer value, innovative strength needs to exist throughout the Group. It is a matter of developing new services that we can offer our affiliated workshops and end customers, but also smart ways of improving our internal systems and approaches with new technology. In 2017, we acquired 20 per cent of the technology company Swedspot that develops the digital driver experience in new and older cars. As a market leader, we see the acquisition as a strategically important piece of the puzzle to develop the modern workshop with valuable services for car owners.
One of the largest changes in our market is of course the transition towards a fossil-free vehicle fleet that entails growing numbers of electric powered and rechargeable vehicles on our roads. In extension, this entails a change in what kind of service our workshops will carry out and how often. As early as 2016, we opened the first pure electric car workshop in Norway and in 2017, several workshops in Sweden and Norway were adapted to be able to service electric and hybrid cars.
Our industry-leading workshop chains should be the obvious choice for owners of electric and hybrid cars as well. Our successful work with ProMeister continued in the past year. The rate at which we launch new categories has been somewhat lower, however, which is because the categories we are developing now that we plan to launch in the future are more complex. The more complex they are, the more time is needed for testing and quality assurance. With the market’s longest warranty periods, ProMeister has established itself as a high-quality brand and we make no compromises on quality when new categories are to be launched.
At the end of 2017, Mekonomen Norway began the implementation of our new digital spare parts catalogue, which has been a long and important project. The roll-out is continuing in 2018 to our companies in Sweden and other companies in Norway. In parallel with this, the work on our new central warehouse in Strängnäs was intensive. Both of these projects are good examples of how we constantly develop our processes and our working methods, which in turn increases the value of our offering.
More automotive technicians are needed
There is a major shortage of automotive technicians throughout the Nordic region. This is because the interest in the profession is low among young people, but also because the quality of the vehicle mechanic upper-secondary programme is not good enough. Of those who attend the programme, the percentage of those who are employable is too low. To resolve this, Mekonomen Group began upper-secondary programmes in Lund and Stockholm in 2017. Already from the beginning, the students are out and practising in the workshops and I am convinced that this is absolutely crucial for them to learn the latest technology and be ready for a real job after graduation.
It feels really good that we, as a leading actor, can contribute to the positive development of our entire industry. And there is plenty of work for skilled automotive technicians, as we know that there is a great need for new employees in our own chains. It is also a profession that has undergone major changes and is today characterised by high-tech rather than dirty workshop floors.
Backed by hard work – every day
Although 2017 was a year of major changes both in and around Mekonomen Group, our employees have worked extremely hard every day. I would like to take this opportunity to thank everyone for 2017 and I am looking forward to continuing to work with you with great commitment.
For the upcoming year, our most important priorities will be to create growth by developing the customer offering, increasing the number of affiliated workshops, continuing to streamline our processes and systems and actively seeking acquisition opportunities.
This is a challenging to-do list, but given our position in the market, our strong brands, clear concepts and our skilled employees, I am very much looking forward to making our plans a reality.
President and CEO
CEO´s comments in Annual Report 2017