KBS - Automotive Repair - Market Insight

MARKET INSIGHT – AUTOMOTIVE REPAIR INDUSTRY

M&A ACTIVITY REMAINS STRONG IN THE AUTOMOTIVE REPAIR INDUSTRY

The UK Automotive Repair sector is experiencing a period of intense mergers and acquisitions (M&A) activity, driven by a combination of private equity (PE) interest and strategic consolidation.

Within that industry, the focus for this white paper is on the Accident/Collision Repair sub-sector, in which larger national groups are actively acquiring regional operators to build scale, streamline operations and offer end-to end solutions to insurers and fleet providers. Among the most prominent players are Steer Automotive, backed by Chiltern Capital, and Activate Accident Repair, both of whom are pursuing aggressive buy-and-build strategies.

With most deal activity focused on businesses valued under £100 million, small to mid-sized operators with one to ten sites are in high demand, offering a compelling window of opportunity for owners seeking an exit.

With most deal activity focused on businesses valued under £100 million, small to mid-sized operators with one to ten sites are in high demand.

CURRENT LANDSCAPE Motor Vehicle Maintenance & Repair in the UK BUSINESS CONCENTRATION Percentage of total industry Estab. in each region

Percentage of Estab. (%)

15

SCT

10

NE

NIR

YKS

NW

5

EMD

WMD

UKH

WAL

LDN

SE

SW

0

SOURCE: IBISWorld

Repair complexity is rising rapidly as new vehicle technologies become standard. ADAS, radar systems, and sensor-based features have added new layers to even basic repairs, requiring workshops to invest in specialist tools and recalibration capabilities. Simultaneously, the accelerating adoption of electric and hybrid vehicles is pushing operators to train technicians in high-voltage systems and equip facilities with EV-safe infrastructure. Supply chain challenges, particularly for OEM parts, have driven up costs and extended repair times. These pressures are compounded by insurers’ push for efficiency, which has led to a preference for repairers who can deliver short cycle times, digital claims handling, and wide geographic coverage. As a result, multi-site operators with advanced capabilities are becoming increasingly attractive acquisition targets.

CURRENT TRENDS WITHIN THE SECTOR

The market has rebounded strongly post-Covid, with accident volumes now exceeding pre-pandemic levels.

INCREASED REPAIR COMPLEXITY This is shaped by advances in vehicle technology, increasing operational complexity and shifting expectations from insurers and consumers alike. One of the most notable developments is the growing complexity of vehicle repairs due to the integration of sophisticated technologies such as Advance Driver Assistance Systems (ADAS), sensors, radar systems and onboard diagnostics. These features, once limited to premium models, are now standard across mainstream vehicles. This means that even seemingly minor collisions can trigger intricate repair processes that demand specialist knowledge, precise recalibration, and investment in advanced diagnostic equipment. Workshops that lack these capabilities risk being excluded from insurer networks and falling behind the curve. ELECTRIC VEHICLE (EV) AND HYBRID REPAIR READINESS The rapid shift towards electric vehicles (EV) and hybrid models is placing new demands on repairers. EV and hybrid models require entirely different protocols for diagnostics, battery handling, and structural repairs, particularly when high-voltage systems are involved. As adoption of these vehicles continues to accelerate, driven by both consumer preferences and government mandates, repairers must invest in technician training, safety accreditation, and dedicated EV repair bays to remain competitive. For many insurers and fleet operators, EV-readiness is no longer a bonus, but a baseline requirement when allocating repair volumes. RISING REPAIR COSTS At the same time, repair costs are rising across the board. The combination of global supply chain challenges, extended lead times for parts, and rising labour costs is pushing up average repair values. High-tech vehicles take longer to assess and fix, particularly when recalibration or component replacement is required. This has led to increased cycle times, more downtime for end users, and growing pressure on bodyshops to operate more efficiently under tight margins. These cost pressures are forcing many independent repairers to rethink their operations or consider joining larger groups with stronger purchasing power and process optimisation tools. INSURER-LED EFFICIENCY PUSH Insurers, under their own cost and efficiency pressures, are also playing a decisive role in reshaping the repair landscape. Many are actively consolidating their networks of approved repairers, reducing the number of operators they work with and concentrating volume on those who can provide national or regional coverage, faster turnaround, and seamless digital integration. This means bodyshops which offer streamlined claims processing, digital estimating, real-time updates, and customer portals are increasingly winning insurer contracts. Conversely, smaller businesses without these capabilities are being squeezed out or pushed toward acquisition. CONSOLIDATION OF INDEPENDENTS As a result of these market dynamics, consolidations continue at a rapid pace. Private equity-backed platforms and large strategic operators are actively acquiring smaller independents to expand their geographic footprint, boost insurer appeal, and driver profitability through acquisition. For owners of well-managed but resource constrained repair shops, this consolidation wave offers both opportunity and urgency - a chance to exit on favourable terms before operational demands outpace their capacity to compete.

KEY DRIVERS AND MOTIVATIONS FOR ACQUIRERS

Strategic and financial buyers are motivated by several critical factors.

INSURER-APPROVED STATUS AND LONG-TERM CONTRACTS Chief among these is access to insurer contracts that guarantee recurring, high-volume work.

GEOGRAPHIC FOOTPRINT AND SITE DENSITY Many insurers now require national or regional coverage from their repair partners, prompting acquirers to pursue bolt-on acquisitions that can help expand footprint quickly.

EV AND ADAS REPAIR CAPABILITY In addition, workshops with demonstrated capabilities in EV repair or ADAS recalibration are in high demand, as these skills are in short supply and increasingly necessary for compliance and customer satisfaction.

STRONG OPERATIONAL EFFICIENCY For many buyers, acquiring skilled labour through a transaction is more efficient than recruiting in a talent scarce environment.

INVESTMENT IN TECHNOLOGY AND SYSTEMS Technology and systems are another key draw with repairers, with modern equipment, digital workflows, and real-time tracking capabilities representing scalable, efficient platforms for future growth.

In the current market, EBITDA multiples for accident repair businesses generally range between 5x and 8x, with transaction values typically falling under the £100 million mark

WHAT DRIVES HIGHER VALUATIONS AND MULTIPLES?

In the current market, EBITDA multiples for accident repair businesses generally range between 5x and 8x, with transaction values typically falling under the £100 million mark.

Several factors influence where a business falls within this range. Larger, geographically diversified operations with strong insurer relationships, with a robust digital infrastructure, tend to command higher multiples. Equally, businesses with certified EV and ADAS capabilities are seen as future-ready and therefore more valuable.

Conversely, single-site or legacy operations without digital integration or insurer contracts may achieve lower multiples due to the perceived risk and higher transition costs involved for the buyer.

Valuations in the accident and collision repair sector are increasingly influenced by a business’s ability to demonstrate long-term resilience, scalability, and specialisation.

Buyers place a premium on operators that exhibit a strong track record of financial performance, underpinned by robust margins and consistent cash flow. Businesses that have proactively invested in advanced repair technologies, EV infrastructure, and compliance-led capabilities such as ADAS calibration tend to command higher multiples, as these offerings represent barriers to entry and sustainable competitive advantages.

Furthermore, acquirers value strong leadership teams, well-established operational processes, and the ability to integrate with larger platforms without significant disruption.

In today’s market, premium multiples are awarded not just for size or location, but for forward-thinking, systemised businesses capable of delivering both volume and quality in a rapidly evolving repair landscape.

In today’s market, premium multiples are awarded not just for size or location, but for forward thinking, systemised businesses capable of delivering both volume and quality in a rapidly evolving repair landscape.

WHICH FACTORS DRIVE GROWTH IN THE UK AUTOMOTIVE REPAIR INDUSTRY?

Several structural and market dynamics continue to fuel growth in the accident and collision repair industry. A significant driver is the rebound in vehicle use following Covid-19, which has led a resurgence in accident volumes.

ACCESS TO INSURER CONTRACTS One of the most significant growth drivers in the UK accident and collision repair industry is access to insurer contracts that require extensive regional or national coverage. Insurers increasingly prefer to work with repair networks that can offer consistent service standards, faster turnaround times, and digital claims integration across wide geographies. This has made businesses with multiple sites and broad coverage highly attractive, especially those with long-standing relationships and approved status with major insurers. Such contracts provide predictable, high-volume work streams that underpin stable revenue and encourage strategic acquisition interest.

Motor Vehicle Maintenance & Repair in the UK PRODUCTS & SERVICES SEGMENTATION Industry revenue in 2025 broken down by key product and service lines.

Repairs (£20.7bn)

59.4%

Car washes (£1.6bn)

4.7%

Body shop services (£4.9bn)

14.0%

Servicing and MOT tests (£7.6bn)

21.9%

EV-READY AND ADAS-CAPABLE WORKSHOPS The evolution of vehicle technology has made EV and ADAS repair capabilities critical to long-term business viability. Acquirers are actively targeting repairers who have invested in EV-trained technicians, high-voltage safety infrastructure, and specialist ADAS calibration equipment. These facilities are not only better aligned with the demands of modern vehicle repairs, but they are also more likely to meet the technical and safety standards increasingly expected by insurers, manufacturers, and fleet operators. The ability to repair technologically advanced vehicles is now a key differentiator in the marketplace.

SKILLED LABOUR ACQUISITION With the sector facing a chronic shortage of qualified repair technicians, skilled labour has become a valuable and scarce asset. Businesses that have successfully retained or trained experienced staff are in high demand from buyers looking to address their own workforce challenges. In many cases, acquiring a business also means acquiring a skilled team. This trend has made talent acquisition through M&A a strategic imperative, rather than simply a by-product of scale. TECHNOLOGY UPLIFT Legacy operations are increasingly being replaced by modern, digitally integrated repair centres equipped with advanced diagnostic tools, workflow automation, and customer communication platforms. These technology driven businesses are more efficient, deliver better customer experiences, and are more capable of integrating with insurer and fleet claims systems. For acquirers, the uplift provided by modern infrastructure not only enhances operational performance but also offers scalable growth potential. The ability to digitise and streamline the repair process is fast becoming a baseline expectation across the sector. INSURER INFLUENCE AND REVENUE SYNERGIES Insurer influence continues to play a defining role in shaping M&A activity. Strategic buyers are particularly focused on repair businesses already embedded within insurer-approved networks, as these offer immediate access to repair volumes and established revenue streams. Joining such a network typically involves meeting rigorous service, turnaround, and technology standards, criteria that insurer-approved repairers have already fulfilled. As a result, these businesses offer instant strategic value and smoother integration post-acquisition. INTEGRATION OF FAMILY-RUN INDEPENDENTS Finally, many growth-focused buyers are targeting well-established, family-run independents that may lack the scale or digital infrastructure to compete independently in a rapidly evolving market. These businesses often come with strong reputations, loyal customer bases, and reliable workflows, making them ideal acquisition targets. By integrating into larger, more sophisticated platforms, these independents gain access to better systems, supply chain efficiencies, and insurer relationships, while the acquiring groups benefit from immediate local market presence and increased operational capacity.

WHAT TYPES OF BUSINESSES ARE STRATEGIC ACQUIRERS PURSUING IN THE AUTOMOTIVE REPAIR SECTOR?

Buyers, whether strategic or financial, are targeting specific business profiles that align with their growth strategies.

MULTI-SITE OPERATORS Multi-site operators that can provide regional or national coverage are especially sought after due to their ability to service large insurer accounts.

INSURER-APPROVED REPAIRERS Repairers that are part of insurer-approved networks or hold direct repairer status with key insurance companies are valued for their recurring revenue and stability.

EV & HYBRID SPECIALISTS Workshops with electric vehicle and hybrid servicing capability, including high-voltage training and specialised equipment, are considered essential in today’s landscape.

ADAS CALIBRATION CENTRES Similarly, businesses that offer ADAS recalibration services are increasingly attractive, as these features are now present in most modern vehicles.

OEM-CERTIFIED BODYSHOPS Operators with OEM certifications from premium manufacturers such as Tesla, Jaguar Land Rover or BMW can command premium pricing, enhancing margins and valuation.

SMART REPAIR PROVIDERS Small/Medium Area Repair Technique (SMART) repair providers, who offer cost-effective cosmetic solutions, are also gaining popularity.

DIGITALLY INTEGRATED BUSINESSES Finally, businesses that have fully integrated digital claims systems and customer portals are ahead of the curve, offering efficiency, transparency, and scalability.

M&A ACTIVITY IN THE AUTOMOTIVE REPAIR SECTOR

COPPERWAITE FLEET MANAGEMENT ACQUIRED BY MITSILAND

KBS DEAL

Copperwaite, a vehicle repair and testing specialist based in Keighley, was sold to automotive service and repair company Mitsiland in a deal advised on by KBS Corporate.

ARC, a network of repair centres in the South West of England, was acquired by Steer Automotive Group – backed by private equity investor Oakley Capital - to strengthen its regional presence. ARC GROUP ACQUIRED BY STEER

Wales and the West Midlands were other regions targeted by Steer as it acquired six Innovative Repair Group sites. Established in 1999, IRG is a leading independent network of automotive repair centres. IRG ACQUIRED BY STEER

With backing from Elysian Capital, Activate, which provides accident management services to insurance groups and corporate fleet operators, acquired Avant, a well established collision repair specialist. AVANT GROUP ACQUIRED BY ACTIVATE GROUP

Leeds-based Alton Cars, a 16-site collision repair group founded in 1979, was acquired by leading private investment firm Sun European, creating strong potential for growth and increased market share. ALTON CARS ACQUIRED BY SUN EUROPEAN PARTNERS

SERVICE AND REPAIR SPECIALIST SOLD TO DACK MOTOR GROUP

KBS DEAL

A large Northamptonshire-based, Ford-approved operation was sold to Dack Motor Group, which has branches across the Midlands and East of England.

CAR CARE SERVICE CENTRES SOLD TO INVESTMENT FIRM

KBS DEAL

Devon-based Car Service Centres, established in 1985 and with a large client base throughout the South West of England, was acquired by an investment firm with ambitious growth and expansion plans.

MAJOR UK DEALS IN THIS SECTOR 2022-25

VENDOR

ACQUIRER

ARC Group

Steer Automotive Group

IRG

Steer Automotive Group

Avant Group

Activate Group

Alton Cars

Sun European Partners

Lovells

Steer Automotive Group

Motorcare (Kent)

Activate Group

Aftercare Response

Motus Group

C&C Vehicles Services

Steer Automotive Group

Masterglass Windscreens

Cary Group

Crash Accident Repair Saintfield

Manette Ltd

Grantham Motor Company

Vertu Motors

MG Cannon

Steer Automotive Group

Bizee Cars

Shak Autos

M&A Coachworks

Steer Automotive Group

J Huggins and Son

Cary Group

Auto Technics

Perfect Paint

Brocksford Motors

Vella Group

Carcomm Coachworks

Steer Automotive Group

Smith & Hughes

Express Bodyworks

KEY ACQUIRERS AND INVESTORS IN THIS SECTOR

STEER AUTOMOTIVE GROUP

Backed by: Chiltern Capital

•

• Strategy: Aggressive buy-and-build platform with over 90 sites across the UK • Notable acquisitions: Artis Accident Repair Centres, iRG Group • Focus areas: EV and ADAS repair capability, long-term insurer contracts, OEM certifications

• Group: Part of Activate Group (including Motor Repair Network, Motor Assist) • Expansion strategy: Organic growth and bolt-on acquisitions • Focus areas: Technology-enabled repair processes, high-volume throughput, strategic national presence ACTIVATE ACCIDENT REPAIR

• Role: Strategic acquirers of repair centres to support aftersales, used-vehicle prep, and warranty work • Strategy: Acquisition of bodyshops to internalise repair functions and improve operational efficiency LOOKERS, ARNOLD CLARK AND OTHER DEALERSHIP GROUPS

• Focus: Trades, services, and multi-site operating platforms • M&A interest: Likely to enter the market through acquisition of scalable, insurer-aligned repair groups with national potential CAIRNGORM CAPITAL

• Reputation: Known for backing service-oriented and fragmented sectors with high consolidation potential • Likely activity: Platform investment, secondary buyouts, and operational scaling through digital transformation LIVINGBRIDGE, LDC, INFLEXION (INVESTOR INTEREST)

PRIVATE EQUITY ACTIVITY

Private equity interest in the sector continues to grow as investors are attracted by the industry’s recurring revenue, essential nature, and clear potential for platform growth.

The market remains highly fragmented, making it ideal for buy-and-build strategies. PE firms are particularly drawn to businesses with predictable, contract-based income from insurer and fleet relationships, as well as those with modern infrastructure that can support operational scaling. Many investors see further upside in digitising operations, improving throughput, and enhancing sustainability. For example, Chiltern Capital’s investment in Steer Automotive has underpinned the creation of a market-leading consolidator.

Investment targets typically include businesses with 3–20 sites, £2 million to £10 million in EBITDA, strong insurer partnerships, and scalable systems.

Other active or potential investors include Livingbridge, LDC, Inflexion, and Cairngorm Capital, all of whom have a track record of backing service-based, fragmented industries with long-term growth prospects.

PRIVATE EQUITY INVESTMENT ACTIVITY CHILTERN CAPITAL INVESTMENT INTO RAPID REPAIR NETWORK Chiltern’s experience in this sector enabled a strong understanding of the market and how Rapid Repair, a market-leader in same-day repairs with 100% mainland UK coverage, was well positioned to capitalise on that expertise. GSF CAR PARTS ACQUIRED BY EPIRIS Epiris Fund III acquired GSF Car Parts, a leading supplier of aftermarket automotive parts with 180 branches across the UK, from LKQ Corporation. AUTOTECH VENTURES INVESTMENT INTO BUMPER Bumper, which helps motorists spread the cost of repairing their cars, has raised £20million in investment in 2024 and 2025 from the venture arms of leading automotive groups including Jaguar Land Rover and Porsche.

PENDING COMPLETION - AUTOMOTIVE COLLISION AND REPAIR COMPANY, SALE VALUE £6.5M TO OVERSEAS PRIVATE EQUITY

PENDING COMPLETION - AUTOMOTIVE COLLISION AND REPAIR COMPANY, SALE VALUE £2MILLION TO OVERSEAS PRIVATE EQUITY

MARKET INSIGHT The future of the accident repair sector will be shaped by technology, demographics, and structural insurer preferences. The post-pandemic rebound has revealed underlying capacity limitations, particularly in workforce and parts availability. The rise of electric and hybrid vehicles has introduced new repair challenges that many operators are only beginning to address. Similarly, ADAS calibration is now a routine part of many repair jobs, creating additional time and equipment requirements. Insurers are concentrating repair volumes among fewer partners who can deliver national service, rapid turnaround, and digital integration. The skills gap remains a persistent issue, with few new technicians entering the trade, prompting forward-thinking operators to launch internal academies.

Digitisation continues to separate leaders from laggards, with real-time tracking, automated estimating, and integrated customer communication becoming standard.

Lastly, sustainability is no longer optional. Insurers and corporate fleets increasingly assess environmental performance, and repairers with strong ESG credentials will be better positioned to win contracts, raise capital, and command premium valuations.

The future of the accident repair sector will be shaped by technology, demographics, and structural insurer preferences.

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