The hidden business behind Carglass's relentless ad blitz
A former employee reveals that Carglass makes 4,000 euros for every three euros it spends on its rain-repellent treatment. Inside a business of abusive margins and monopoly
English · Original discussion in Spanish · Published
Carglass: the multimillion-euro business behind the ever-present ads
Carglass fills the ad breaks on every channel, including German channels and, as the most attentive viewers point out, ones with a Catalan accent. The recurring question is how a windscreen repair company can afford such an investment. The answer, according to those who know the industry from the inside, is that the business lies less in repairs than in the monopoly and the stratospheric margins on its add-ons.
A 1,233% margin on the rain-repellent treatment
A former employee reveals that the bottle of rain-repellent treatment that Carglass sells for around 40 euros costs the company exactly 3 euros. It is made exclusively for them and applied in three sprays on industrial paper. A single bottle covers a hundred cars. That works out at 4,000 euros of profit for every three euros spent. A 1,233% margin that needs no advertising, yet gets it.
Dominance through absorption
According to another source with knowledge of the market, the company has pursued a systematic strategy of buying up competitor workshops. If a local workshop starts to overshadow them, they acquire it and convert it into a Carglass centre, or shut it down. The result is a de facto oligopoly where small competitors only exist because Carglass tolerates them. Most insurers allow you to choose a workshop, but convenience and omnipresence tip the scales.
Interests and characters
Among the names floating around the discussion are Antonio Lobato, known for his time in Formula 1, and the recurring character of Joseba, the supposed Basque employee whose face changes with every ad. Staff turnover is so high that each campaign antiestéticatures a different worker. Some point to a Catalan connection in the ownership, but the truth is that the parent company is the multinational Belron, headquartered in Belgium.
The mystery of the relentless advertising dissolves once you look at the numbers: a business with monopoly margins and virtually no real competition can afford any campaign it wants. The question that remains is how long the model can hold up before the regulator or insurers react.
Related debates on the forum
Carglass fills the ad breaks on every channel, including German channels and, as the most attentive viewers point out, ones with a Catalan accent. The recurring question is how a windscreen repair company can afford such an investment. The answer, according to those who know the industry from the inside, is that the business lies less in repairs than in the monopoly and the stratospheric margins on its add-ons.
A 1,233% margin on the rain-repellent treatment
A former employee reveals that the bottle of rain-repellent treatment that Carglass sells for around 40 euros costs the company exactly 3 euros. It is made exclusively for them and applied in three sprays on industrial paper. A single bottle covers a hundred cars. That works out at 4,000 euros of profit for every three euros spent. A 1,233% margin that needs no advertising, yet gets it.
Dominance through absorption
According to another source with knowledge of the market, the company has pursued a systematic strategy of buying up competitor workshops. If a local workshop starts to overshadow them, they acquire it and convert it into a Carglass centre, or shut it down. The result is a de facto oligopoly where small competitors only exist because Carglass tolerates them. Most insurers allow you to choose a workshop, but convenience and omnipresence tip the scales.
Interests and characters
Among the names floating around the discussion are Antonio Lobato, known for his time in Formula 1, and the recurring character of Joseba, the supposed Basque employee whose face changes with every ad. Staff turnover is so high that each campaign antiestéticatures a different worker. Some point to a Catalan connection in the ownership, but the truth is that the parent company is the multinational Belron, headquartered in Belgium.
The mystery of the relentless advertising dissolves once you look at the numbers: a business with monopoly margins and virtually no real competition can afford any campaign it wants. The question that remains is how long the model can hold up before the regulator or insurers react.
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Summary of a discussion on Burbuja.info - Foro de economía, actualidad y política., translated from Spanish and reviewed before publication. Read the full discussion (17 replies).
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