A Fortune 500 chemical company supplies refrigerant for vehicle air conditioning (AC). In the European aftermarket it reaches workshops only through intermediaries, so it sees little of how AC service is bought and delivered. In late 2021 it began to explore whether it could become more than a refrigerant supplier. One route was vertical integration: adding the recovery, recycling and recharging (RRR) machines that workshops use to service AC systems. A package of refrigerant and machines would give workshops one partner for AC service, a business-to-business model. A network of equipped garages, reached through a digital platform, could then let the company serve car owners directly, a business-to-consumer model.
The company did not know how workshops buy machines and refrigerant, whether they would accept customers referred by a supplier, or whether drivers and fleet operators had AC service needs the market left unmet. It needed evidence from both sides of the market in France, Germany, Italy, Spain and the United Kingdom before it chose a value proposition and a go-to-market strategy.
PP&A ran the study in two steps between December 2021 and April 2022. The first step was qualitative. PP&A conducted 12 in-depth interviews with garage owners and technicians from independent and chain workshops, a parts wholesaler, a fleet manager and two RRR machine manufacturers in the UK, France, Germany, Spain and Sweden. The interviews covered how workshops buy and maintain RRR machines, how they choose and procure refrigerant, how seasonal the AC business is, and how they would view a referral service or customers who had paid in advance.
The second step was quantitative. PP&A designed two surveys, one with about 240 private car owners and one with 60 fleet owners and operators, split evenly across France, Germany, Italy, Spain and the UK. The car owner survey traced each respondent's most recent AC problem from first symptom to repair, cost against estimate and satisfaction, then asked about service coverage, payment and waiting-time preferences, loyalty to repair shops and openness to an app-based recommendation. The fleet survey covered fleet size and drivetrains, warranty and extended service coverage, service contracts with repair shops, approved vendor lists, who chooses the repair shop, and sustainability requirements. PP&A combined both streams in a 55-slide report built around customer market signals, machine market dynamics, business model feasibility and how to win customers.
The refrigerant was invisible at the point of service. Garage owners buy it through wholesalers ahead of the summer season, treat it as a compliance item, and almost none could name the brand they used. Workshops typically run at least two RRR machines, one for each refrigerant generation, and buy them outright. No combined offer of refrigerant and machine service was widely available. Garages welcomed paid referrals of new customers, but every one interviewed opposed taking customers who had paid in advance, because garages want to control the transaction.
About 90 percent of drivers were satisfied with their last AC service, and a missing refrigerant charge caused over half of all AC problems. The gap was coverage. Only 45 percent of owners had a warranty or extended service contract, and 69 percent of German owners without AC coverage wanted it, with the UK close behind at 63 percent. More than a third turned to digital channels first, and a majority of both loyal and switching-prone owners would accept a repair-shop recommendation from an app. Fleets already relied on contracted service and approved vendor lists, and 85 percent had sustainability requirements, but serving them would demand standardized service at enterprise scale.
The report named Germany and the UK as test markets for a digitally enabled AC service coverage business, citing driving distances, AC problem rates, stated demand for coverage, digital-first habits and openness to partial upfront payment. The client went on to commission a business-model design phase built on these findings.
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