Bulgaria Automotive Aftermarket in 2024
A comprehensive overview of the market and top wholesalers
Bulgaria's automotive aftermarket industry may not be the first thing that pops into your mind when you think of this charming Balkan country, but trust me, there's more revving under the hood here than you'd expect.
From nimble local players to European heavyweights like Inter Cars BG, this sector is shifting gears and zooming toward dominance. So, buckle up as we break down the key players, strategic moves, and maybe even a few unexpected plot twists in this high-octane world of spare parts and market maneuvers. Spoiler alert: it's not all nuts and bolts!
Bulgaria’s automotive aftermarket overview
What you should know about the IAM market in Bulgaria is that it is about three times smaller than the one in Romania and is very well connected to the Turkish auto parts market for supply.
In the distribution department, Bulgarian companies reach very easily the ex-Yugoslavian countries, as they are very similar in terms of car fleet and customer requirements.
The low purchasing power makes Premium IAM products difficult to sell. Bulgaria is the preferred place for quality Private Label brands, with a very good price/quality ratio.
Now, let’s get to the nitty gritty! Bulgaria's automotive aftermarket industry is supported by several prominent companies, each contributing uniquely to the sector's development and expansion. Usually I try to include in my analysis official audited numbers, but documenting the Bulgarian aftermarket proved to be an impossible challenge for most companies, hence the missing data points.
Here’s a breakdown of the key players and their influence:
INTER CARS BG
Inter Cars Bulgaria represents a significant player not just in Bulgaria but throughout the region, with its influence reaching neighboring countries like Greece, Albania, Kosovo, and Serbia (you can read more here insert link).
Their success is anchored by the larger presence of Inter Cars Group, one of the most powerful entities in Europe’s automotive aftermarket. Inter Cars Group saw remarkable growth in the last couple of years, with a 50% growth in 20211, and with a 21% increase in revenue between 2022-2023. This growth was driven by robust logistics and a strategically placed distribution center in Bulgaria, which serves as a hub for several regional markets.
In addition to the growth in Bulgaria, Inter Cars BG is integral to the Inter Cars Group’s broader regional expansion. Countries like Greece, Hungary, and Ukraine have shown significant growth as well, but Bulgaria remains a crucial part of the company’s strategy.2
By the numbers:
€269 million in revenue (2022-2023)
21% year-on-year (22' vs 23’) sales growth
Operations in Greece, Albania, Kosovo, and Serbia
Over 1,000,000 spare parts available
Part of Inter Cars Group
Titi’s take
The sudden rise of Inter Cars in Bulgaria came as a surprise for some folks. People erroneously argue that their success is solely based on Inter Cars’ products, which are private label products with a very competitive price.
I beg to differ. In my humble opinion, there are two very important preliminary steps that paved the way to Inter Cars’ success in Bulgaria:
Innovating sales teams: for the first time ever, sales teams were accepted as business partners. When building their teams, they hand picked people with vast service experience in auto parts distribution; not toy traders, tailors or butchers, like other companies would do.
This careful selection of franchise owners enabled not only a quick and healthy scaling of Inter Cars operations, but also the weakening of the former Bulgarian market leaders.Strategic supply chain decisions: the opening of the central warehouse in Sofia was a very serios blow to Inter Cars’ competition. Before this move, the distribution in Bulgaria was painful for Inter Cars as it relied on the central warehouse in Codlea, Brasov, Romania! Once in Sofia, the rise of Inter Cars Bulgaria became lightning fast: third place in the top of countries where Inter Cars is present - very close to surpassing Romania, a country 3 times larger in terms of car fleet, population, volume of auto parts traded etc. This proves just how large Inter Cars Bulgaria’s marketshare is at the moment!
For the two reasons mentioned above, I don’t see any new players entering the Bulgarian market and end up being successful. Any company that will model and project the operating margin in Bulgaria will think twice or thrice before committing to entry.
07 AD
Founded in 1992, EURO 07 AD is one of the largest importers and distributors of automotive spare parts in Bulgaria. The company has established itself as a major player in the Eastern European market, offering a comprehensive range of products from over 80 global manufacturers, including suppliers from Italy, Germany, Japan, and Korea.
At the beginning of November 2021, Euro 07 AD joined the big family of AMERIGO International. AMERIGO is a company that brings together manufacturers and importers of spare parts for the transport industry who wish to expand their business presence and increase their business influence in their target markets.
The established partner network provides cooperation between more than 60 members from 35 countries around the world, with a total turnover of more than 800 million dollars. All members cooperate for their successful development in the European and other fast developing markets.
Euro 07 AD represents3 the unification of the territory of Bulgaria, Serbia and North Macedonia.
By the numbers:
26 warehouses and 50 stores in Bulgaria
100,000+ products in its portfolio
Active in Serbia and North Macedonia
Over 80 manufacturers represented globally
Part of AMERIGO Group
Titi’s take
Having a philosophy very similar to Inter Cars, Euro 07 was one of the main sources from which Inter Cars’ Bulgarian expansion was fed.
With a recognized training school for sales agents that forms specialists in private label, Euro 07 sent a large part of the team to Inter Cars. Having a very similar portfolio, with many own brands, helped them reach the audience that was already used to the idea of using a private brand.
At the moment, Euro 07 has stabilized this situation. I really wish with all my heart that the undergoing reorganization will be a success and that we see growth again for this company that has such an extensive tradition.A few words about their expansion in other markets: if Romania was not a success, the expansion in Serbia and North Macedonia ensured the volumes for a much needed stability, while the Bulgarian market was shaking under the blows of Inter Cars.
ELIT CAR BG
Founded on core values of "trust, innovation, and strong partnerships," ELIT Car BG has grown into one of the easily recognized names in the Bulgarian automotive aftermarket. The company’s business strategy focuses on exceeding customer expectations through openness and professionalism, making it a key player in the market.4
In 2019, ELIT Car BG took a bold strategic move by merging with Auto Kelly Bulgaria, a subsidiary of the global giant LKQ Corporation. The transactions were completed on 30 September 2019 following obtaining of an unconditional phase-one merger control approval of the Bulgarian competition authority.
This merger significantly increased its market power and allowed the company to tap into LKQ's vast supply chain network, enhancing its product offerings and logistical capacity. LKQ now owns a 20% equity interest in the combined business, which will continue to operate under both the Elit Car Group and Auto Kelly brand names. In addition, the combined business will acquire parts from LKQ's aftermarket supply chain. The integration of LKQ’s resources with ELIT Car’s local expertise has made the company even more competitive, especially in terms of its ability to offer an extensive range of automotive parts at competitive prices.
On April 25, 2019 the company announced that it had identified several businesses that it intended to sell over the course of the next year. These assets are held on the balance sheet as net assets held for sale, and with the disposal of these small, non-core businesses, the Company is attempting to simplify its operating model and improve margins.
Dominick Zarcone, President and Chief Executive Officer of LKQ, declared5:
“The rationalization of our European asset base and divestiture of non-core businesses is one of the many initiatives that will help improve the EBITDA margins of LKQ Europe. We believe the Auto Kelly Bulgaria business will perform strongly under the leadership of Elit Kar, and we look forward to a successful partnership, as both an equity holder and supplier.”
On April 25, 2019 the 07 AD announced that it had identified several businesses that it intended to sell over the course of the next year. These assets are held on the balance sheet as net assets held for sale, and with the disposal of these small, non-core businesses, the Company is attempting to simplify its operating model and improve margins.6
By the numbers:
Warehouses with a total area of over 5,000 m2
50,000 SKUs
10,000,000 stock items available from their suppliers
part of LKQ Corp
Titi’s take
It is difficult to say why LKQ’s expansion in Central and Eastern Europe is based only on acquisitions of small and medium-sized companies and not on a systematic development, with an increase in sales based on a long-term strategy.
I have to allow myself a small joke: I have the feeling that it is an expansion made by someone from a distance, via a remote control. A financial colossus, with impressive logistics behind it, with an impressive history that fails to establish itself as a real competitor for the Central-Eastern European companies that have developed naturally, with work and passion, to the likes of Inter Cars and SAG.
Probably, at some point, someone will join LKQ Europe’s management and will draw new development directions. Until then, there are too many steps forwards and backwards, decisions that are contradicted after a while by other decisions. For example, we were discussing some time ago about the exit of LKQ from Bulgaria, while now we are discussing ongoing mergers.
We are all waiting to see the future of a company that invested massively but delivered little.
AUTO PLUS BULGARIA JSO
Auto Plus Bulgaria stands as a leading importer and distributor of automotive spare parts, known for its commitment to "high standards in product quality, customer satisfaction, and employee development".7
The company offers an impressive range of products for various car models in the market, maintaining a broad portfolio that includes both OEM and aftermarket parts.
To ensure efficient distribution and rapid service across Bulgaria, Auto Plus operates 35 warehouses throughout the country, supported by a central hub in Sofia and recently it opened a regional warehouse in Varna. The company also has a logistics base in the city of Ruse, as well as several regional warehouses in the cities of Plovdiv, Stara Zagora, Varna, Pleven, V.Tarnovo. 22 of the 35 warehouses function under the own brand "Auto Plus" and the other 13 are franchise sites, thus covering the territory of the entire country. This fulfills one of the principles that define the company's attitude towards its partners, namely – fast delivery.
One important thing to note about them is that since 2006 Auto Plus has been a part of ATR International AG.8 Through this affiliation, Auto Plus benefits from global best practices in parts distribution and logistics, allowing it to deliver top-quality products swiftly to its clients.
More than 400 employees work in the company. Trainings are held together with the company's partners, with the aim of increasing their professional competence, developing their knowledge and skills and awareness of innovative products and technologies.
By the numbers9:
35 warehouses nationwide
500 orders processed per hour
400 trained employees
Part of ATR International AG network
Titi’s take
Auto Plus, a long time market leader, tried to do exactly what was needed in a normal market. The adherence to ATR International AG obliged them to develop the relationship with Premium IAM producers, by introducing said producers on the Bulgarian market at a competitive price. Due to the price-oriented market (and I'm not discussing the economic condition of Bulgaria here), this was quite difficult, with a margin that did not allow for great development.
I am very convinced of the good future that Auto Plus has, the proof being the purchases of the last period. I also appreciate the professionalism of the Auto Plus team, a team that has sailed through dangerous waters alongside valuable, much better equipped competitors.
AUTOGRAND
Founded in 1997, Autogrand has built a reputation as a key importer and distributor of spare parts, lubricants, and chemical products for cars and light trucks. The company has experienced steady growth over the years, establishing a reliable network of regional warehouses and shops that provide quick service to its customers.
Autogrand's growth is supported by its close relationships with major manufacturers, allowing the company to maintain optimal stock levels and offer competitive pricing. In 2021, Autogrand reported an impressive sales revenue increase of nearly 30%.10 The company's dedication to fast and reliable service continues to set it apart from the competition, ensuring it remains a top choice for consumers in Bulgaria.
On November 25th, 2021, the Bulgarian Commission for the Protection of Competition cleared an acquisition by Auto Plus Bulgaria AD of Autogrand Ltd. in the market for (i) the sale of spare parts.11
By the numbers:
90,000 parts in stock
30% sales growth reported in 2021
Regional warehouses across Bulgaria
Bought by Auto Plus Bulgaria AD
Titi’s take
Autogrand proved to be a surprise discovered during the documentation for this article. It is clear to me that they were in need of a bigger "umbrella", which they seem to have found in Auto Plus Bulgaria AD.
AUTO 1
Auto 1 has been a trusted importer and distributor of original spare parts since its founding in 1996. With partnerships with some of the biggest names in the automotive parts industry, such as Bosch, Castrol, and Brembo, Auto 1 is able to offer a wide selection of high-quality products. Their range of over 60,000 SKUs covers most car and light truck models, ensuring that customers can always find the parts they need.
Auto 1's logistics network is another key asset, with six large warehouses spread throughout the country: Sofia, Plovdiv, Veliko Tarnovo, Pazardzhik, Blagoevgrad and Dobrich. These facilities allow for fast delivery times and efficient service, making Auto 1 a reliable partner in Bulgaria’s aftermarket sector.
In terms of group affiliations, Auto 1 is a founding member of Nexus Bulgaria and a member of the well-known Nexus Automobile International. This, in turn, allows them to stay competitive and keep their product portfolio diverse.
By the numbers12:
6 large distribution centers
Partnerships with over 100 global suppliers
Member of Nexus Automotive International
Titi’s take
I assume that Auto 1’s affiliation with the Nexus network should increase their speed of development. The unrestricted access to the big producers will bring the much needed edge to finance the development of the distribution network and the growth of the sales team.
From what I gathered so far, the auto parts distribution arm seems to be just one of the many facets that the company has. This is how the lack of focus and development at market’s pace can be explained.
AVTO HIT
AVTO HIT, established in 1990, has grown into one of the major suppliers of automotive parts and accessories in Bulgaria. Originally focused on importing from Russia and Ukraine, the company has diversified its sourcing to include suppliers from Germany, Poland, and Italy.13 This shift has allowed AVTO HIT to offer a broad range of products at competitive prices, which has earned the company a loyal customer base.
The company’s solid distribution network of wholesale warehouses helps it maintain a strong foothold in the Bulgarian market.14
By the numbers:
21 cregional warehouses (how many?)
Sourcing from four different countries
34 years in the market
Titi’s take
Avto Hit is one of the pioneers in the import of auto parts from Bulgaria, with a good subsequent development in terms of logistics.
At this point, Avto Hit is ripe for acquisition by an external distributor in the coming years.
TECH KO
Tech-Co has positioned itself as a leader in the Bulgarian aftermarket, specializing in spare parts, lubricants, batteries, and accessories for both cars and trucks.
Tech-Co operates 35 branches across 28 major Bulgarian cities, ensuring its products are easily accessible to customers across the country.15
A member of Temot International, an organization that unites leading aftermarket companies worldwide, Tech-Co benefits from access to a global network of suppliers, which helps them stay competitive in pricing and product availability.
By the numbers:
35 branches in 28 cities
Member of Temot International
Titi’s take
Tech Co joins the list of companies affiliated to the big international buying groups, from which a development of the distribution of the big Premium IAM producers is expected. Although I know that they started the development of private label, I did not find any supporting data to document it.
Temot is a group that has facilitated many acquisitions between shareholders in the past, therefore I wouldn't be surprised if in a short while we would hear about something similar.
NELAS AUTOPARTS
Founded in 1995, NELAS AUTO PARTS offers one of the most comprehensive selections of spare parts for commercial vehicles and heavy-duty trucks in Bulgaria. Their inventory includes parts for key vehicle systems like engines, suspensions, steering, electric systems, and drivetrains.16
With 9 branches located throughout Bulgaria, including its main headquarters in Sofia, NELAS AUTO PARTS is strategically positioned to serve the country’s automotive professionals efficiently. This extensive network has helped the company secure its place as a market leader in the commercial vehicle aftermarket sector.
In the early 2021, NELAS AUTO PARTS joined the NEXUS Automotive International network, becoming part of one of the largest automotive communities worldwide, that gives them acces to more than 85 global OEMs and over 160 distributor companies.17
By the numbers:
9 branches throughout Bulgaria
Over 30 000 SKUs
Almost 3 decades of activity
Member of Nexus Automotive International
Conclusions
When discussing Bulgaria as the IAM market, we must first take into account its financial strength and size. With a small purchasing power and with a size three times smaller than that of Romania, Bulgaria needed a business model that is adapted, not necessarily created from scratch.
This explains the rise and rapid development of Inter Cars Bulgaria.
With a portfolio of products at an affordable price but which offers a sufficient margin, with a team of professional people and well positioned in the market, IC Bulgaria is currently heading for second place in the top of the countries in IC is present,
All the other players are trying to create a new direction, in such a way as to avoid regression: some by adapting the portfolio, others by reorganizing the company and rethinking the costs.
Regardless of who will come to invest in Bulgaria in the future, among the big corporations, it will be incredibly difficult to adapt to such a strong and competitive local market. As years pass by, I believe InterCars Bulgaria will be harder and harder to beat at their own game.
Titi
Hi, interesting article but what about other significant players like Autocommerce 93 or Bulgarina memebers of Group Auto? Cheers!