The Managing Director’s comments
Stable Service Business and focus on existing operations
Second quarter
Operational earnings for the quarter amounted to SEK 410 M, with a margin of 3.9 per cent. Results for the Service Business were stable at SEK 292 M, which was SEK 17 M higher than the previous year. The Car Business reported a result of SEK 155 M, of which used cars accounted for SEK 90 M. The order intake was at a higher level than the previous year. Operating cash flow remained strong at SEK 423 M for the quarter.
Focus on existing operations
As we grow our business through acquisitions, we are working with existing operations to further improve profitability and customer satisfaction.
We are reviewing our service and sales processes as part of our efforts towards being a little better every day. One evolving area is repair workshops in our MobiliaCare operations. Despite increased safety equipment in new cars, vehicle damage is not decreasing. In addition, the damage nowadays is more extensive due to a higher level of technology.
In Sweden we have launched the first service in MobiliaCare Car Glass, whereby we offer windscreen repair or replacement for all car brands. MobiliaCare includes products and services for all car brands, including used cars, wheels, rims, glass and car dismantling.
We are continuously developing our operations. This is done for example through our Business Excellence team, whose main task is to assist Bilia’s existing and new operations with improvements measures and help them work more efficiently to thereby increase profitability. Over the past decade Bilia has made almost 45 acquisitions, which has entailed expansion into new countries, new car brands and new service areas.
Expansion in Western Europe
We want to continue expanding with our existing car brands in our existing markets. This is one reason why we reached an agreement during the quarter to acquire Carlo Schmitz S.à.r. l., a full-service operation for BMW in Luxembourg. The business operates from a facility approximately 30 km from our existing business in Luxembourg. We look forward to further developing the company and strengthening our position in the region.
During the quarter, we took over importing operations for Jaguar and Land Rover brands in Sweden and Norway. The importer operation is conducted through a joint venture, and complements our Swedish and Norwegian dealer operations for these car brands. We also took over the operations of Bil AB Ove Olofsson in Sweden, thereby doubling our Volkswagen Group market share in Sweden.
During the quarter we also expanded our operations with XPENG in Sweden and Norway, and opened further sales points at our existing facilities in response to customer interest.
Future lower interest rates positive for our customers
The Service Business remained stable and represented a significant share of Bilia’s operational earnings in the second quarter. Demand for used cars stayed stable at a good level. We are actively working to strengthen our
range of cars. The order intake was higher than in the previous year, but as in recent quarters private individuals, foremost in Sweden and Western Europe, have been cautious about ordering a new car, and orders were thus
at a historically relatively low level. Having said that, some improvement in activity among private individuals is evident and, in combination with a belief in a stronger economy and lower interest rates in the future, we are cautiously optimistic about new car sales in the fourth quarter of 2024
Per Avander, Managing Director and CEO
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