Collision Repair: Enduring Upside for Investors

Featured Professionals: Joe Conner, Elliott Yousefian

High-quality collision repair is always in demand, particularly as most repairs are nondiscretionary and nondeferrable. Although the sector has faced temporary headwinds from falling claim counts due to rapidly increasing insurance premiums, rising total loss rates, and decreasing used car values, there’s an uplift from greater repair complexity and industry consolidation. This continues to present a powerful, long-term structural tailwind that should drive ongoing investment interest in the sector.

Our Transportation & Logistics Group has seen several recent signs that these short-term headwinds are stabilizing or improving, while M&A activity, including several high-profile, marquee transactions, has matched the sector’s uptick.

Below, they share why they remain bullish on the collision sector and believe that now is an opportune time to invest in the space.

The Case for Scale

Long-term data shows that scaled players consistently take share from smaller competitors regardless of market conditions.¹ “There’s a clear advantage for scaled companies that can handle increasingly complicated work, manage insurance partner relationships, and consolidate a fragmented market to better serve customers,” says Joe Conner, a managing director in our Transportation & Logistics Group. “MSOs have outgrown the sector for over a decade, demonstrating the durability of collision repair’s consolidation thesis.”

Several dynamics support the growth opportunity for scaled MSOs, making it a compelling time to invest in the space. For one, claim severity is accelerating. “Modern vehicles are packed with sensors and advanced materials,” explains Elliott Yousefian, a managing director. “Even simple bumper repairs now require costly recalibrations, fueling additional revenue growth opportunities for the industry.” In fact, up to 60% of all collision repairs are expected to involve at least one mandated calibration.¹ Scaled MSOs are better equipped to handle these higher-complexity repairs, having the capital for advanced equipment, the expertise to properly train technicians, and the processes to perform such services effectively.

Collision repair’s many benefits of scale are complemented by its large and fragmented market. This presents many opportunities for both investors and strategic buyers to build platforms and gain share. “The technical and capital demands of modern repairs are challenging smaller shops, creating substantial consolidation potential for MSOs and the chance to provide customers with more value,” says Conner.

Businesses like Joe Hudson’s Collision Center and CSN Collision are both prime examples of market-leading operators capturing strong buyer attention. Harris Williams advised Joe Hudson’s on its sale to Boyd Group Services Inc. and ONCAP on its partnership with CSN. “Each highlight how M&A can be used to establish scale and market density, expand into attractive geographies, generate cost synergies, drive digital transformation, and enhance operational excellence,” notes Conner.

Relatedly, Wesco Group’s acquisition of National Coatings & Supplies (NCS) underscores the sustained appeal of companies across the collision repair ecosystem. NCS is one of the most recognized distributors of coatings and related solutions to aftermarket automotive refinish customers and other specialty industrial markets. Harris Williams advised NCS on its sale to Wesco.

“As the industry continues to evolve, national scale distributors present a compelling value proposition,” says Yousefian. “Together, NCS and Wesco will have a broader national footprint, more product offerings, improved customer support, and greater technical expertise.”

A Convincing Opportunity

The collision repair industry is in a period of profound structural change. The long-term data is clear: For over a decade, scaled players have consistently outgrown the market, proving the consolidation thesis is not a recent phenomenon but a durable, long-term trend.

The current environment, marked by soaring repair complexity, is accelerating a flight to quality and sophistication. For an investor with a multi-year horizon, this presents a compelling opportunity to invest in the long-term winners of this industry transformation before the return to normalcy is fully reflected in industry growth.

“The sector’s resilient M&A activity is underpinned by long-term growth trends, clear benefits of scale, and a highly fragmented landscape,” says Conner. “Strong operators are finding success through the current headwinds while leveraging them to build a deeper competitive moat and positioning themselves to thrive during the market’s recovery.”

To further discuss collision repair M&A, please contact our senior professionals.

1. Quarterly Analysis of MSO Claim Count vs Industry Claim Count; Boyd Group Services public filings