How a Graz-based company became successful thanks to stricter exhaust emissions testing

AVL DiTEST achieved record sales thanks to stricter laws on measuring particle emissions in diesel cars. Growth is now reaching its limits.
Many suppliers in the automotive industry are currently having to cut back. Not so AVL DiTEST in Graz, a subsidiary of the AVL Group specialising in automotive diagnostics and measurement technology. ‘We don't deal directly with suppliers on the production line, but are active in the after-sales market,’ says Gerald Lackner, explaining the company's success. Over the past three years, the company has grown 2.5-fold.

Last year, it generated record sales of 125 million euros (up 11 per cent year-on-year). Operating profit (EBIT) rose by 70 per cent from 15.5 million euros to 26 million euros. ‘We want to stabilise the figures at a high level,’ says Lackner in an interview with KURIER. Further growth on the same scale as before is unrealistic due to market developments and ‘we would not be  able to achieve it’. At the same time, it is already a challenge to keep sales constant.
According to Lackner, there is one main reason for this and the great success of recent years, and that is particle number measurement. This involves measuring the number of soot particles in the exhaust gases of diesel cars (Euro 6 and above) and determining more accurately than before whether the particle filter is working correctly. ‘The number of particles emitted can be 100 to 1,000 times higher,’ says Lackner. Sometimes this is due to manipulation through tuning. ‘This would not have been detected in exhaust emissions tests in the past.’

According to Lackner, the new measurement methods have already been introduced in Belgium, the Netherlands, Switzerland and, most recently, Germany. The new measurement system was actually supposed to be implemented in Austria at the beginning of last year. However, the law had to be suspended for six months due to delivery problems on the part of the manufacturer. Even then, AVL DiTEST was the only supplier able to deliver large quantities, according to Lackner. The reason for this was the digitalisation of supply chains during the pandemic, including those of the company's own suppliers. ‘This is a lasting value.’ As a result, AVL DiTEST has a total market share of 80 per cent among testing organisations in Germany, with approximately 20,000 devices delivered.
To Lackner's regret, such a law on the new measurement method has not yet been implemented in other countries. ‘It's a bit too slow for me.’ This also applies to Austria. He is now hoping for a corresponding EU-wide regulation.

94 percent export quota
AVL DiTEST supplies around 50 countries, with a focus on Europe. The export quota is 94 percent. In addition to Graz, there are also locations in Germany and China. ‘Our customers are major car manufacturers who equip workshops with our tools, as well as independent workshops and testing organisations.’

Even though ‘combustion engines will be around for a long time,’ the Styrian group is also focusing on e-mobility. ‘Electric cars must be inspected in the same way as conventional cars.’ Repairs and long-term performance are the challenges. Regarding the EU requirement to only allow new electric cars from 2023, Lackner says that his company is ‘not directly affected’ because AVL DiTEST does not deal with the drive system itself, but with the diagnosis and repair of the entire vehicle. Lackner advocates openness to technology, saying, ‘You have to be allowed to try out all possibilities. That's the only way to make progress.’ In the rarest of cases will you hear ‘That's impossible.’

That is why AVL DiTEST invests heavily in research and development, more than ten percent of its annual turnover. ‘There is no alternative,’ says Lackner. ‘We have been on the market for 25 years and have always made a profit because we do a lot of research.’

Article: Robert Kleedorfer, published in KURIER on 16 August 2024

How a Graz-based company became successful thanks to stricter exhaust emissions testing

AVL DiTEST achieved record sales thanks to stricter laws on measuring particle emissions in diesel cars. Growth is now reaching its limits.
Many suppliers in the automotive industry are currently having to cut back. Not so AVL DiTEST in Graz, a subsidiary of the AVL Group specialising in automotive diagnostics and measurement technology. ‘We don't deal directly with suppliers on the production line, but are active in the after-sales market,’ says Gerald Lackner, explaining the company's success. Over the past three years, the company has grown 2.5-fold.

Last year, it generated record sales of 125 million euros (up 11 per cent year-on-year). Operating profit (EBIT) rose by 70 per cent from 15.5 million euros to 26 million euros. ‘We want to stabilise the figures at a high level,’ says Lackner in an interview with KURIER. Further growth on the same scale as before is unrealistic due to market developments and ‘we would not be  able to achieve it’. At the same time, it is already a challenge to keep sales constant.
According to Lackner, there is one main reason for this and the great success of recent years, and that is particle number measurement. This involves measuring the number of soot particles in the exhaust gases of diesel cars (Euro 6 and above) and determining more accurately than before whether the particle filter is working correctly. ‘The number of particles emitted can be 100 to 1,000 times higher,’ says Lackner. Sometimes this is due to manipulation through tuning. ‘This would not have been detected in exhaust emissions tests in the past.’

According to Lackner, the new measurement methods have already been introduced in Belgium, the Netherlands, Switzerland and, most recently, Germany. The new measurement system was actually supposed to be implemented in Austria at the beginning of last year. However, the law had to be suspended for six months due to delivery problems on the part of the manufacturer. Even then, AVL DiTEST was the only supplier able to deliver large quantities, according to Lackner. The reason for this was the digitalisation of supply chains during the pandemic, including those of the company's own suppliers. ‘This is a lasting value.’ As a result, AVL DiTEST has a total market share of 80 per cent among testing organisations in Germany, with approximately 20,000 devices delivered.
To Lackner's regret, such a law on the new measurement method has not yet been implemented in other countries. ‘It's a bit too slow for me.’ This also applies to Austria. He is now hoping for a corresponding EU-wide regulation.

94 percent export quota
AVL DiTEST supplies around 50 countries, with a focus on Europe. The export quota is 94 percent. In addition to Graz, there are also locations in Germany and China. ‘Our customers are major car manufacturers who equip workshops with our tools, as well as independent workshops and testing organisations.’

Even though ‘combustion engines will be around for a long time,’ the Styrian group is also focusing on e-mobility. ‘Electric cars must be inspected in the same way as conventional cars.’ Repairs and long-term performance are the challenges. Regarding the EU requirement to only allow new electric cars from 2023, Lackner says that his company is ‘not directly affected’ because AVL DiTEST does not deal with the drive system itself, but with the diagnosis and repair of the entire vehicle. Lackner advocates openness to technology, saying, ‘You have to be allowed to try out all possibilities. That's the only way to make progress.’ In the rarest of cases will you hear ‘That's impossible.’

That is why AVL DiTEST invests heavily in research and development, more than ten percent of its annual turnover. ‘There is no alternative,’ says Lackner. ‘We have been on the market for 25 years and have always made a profit because we do a lot of research.’

Article: Robert Kleedorfer, published in KURIER on 16 August 2024