Insurers and intermediaries have not reviewed the price of tow-truck services for more than a decade. Yet in 2022 alone, motor insurance rose by 3.31 %.
The National Roadside Assistance Alliance continues to publicise data concerning the motor insurance sector. Specifically, the 3.31 % rise last year, 2022, despite the fall in vehicle registrations (35 %); this can only be explained by the increase in the price of motor policies. Something that is not passed on to the roadside assistance value chain, since more than 60% of roadside assistance tow-truck companies closed last year with losses.
The reality is that average assistance rates are more than 40 % below the price that would be needed to avoid technical insolvency. Rates that have not been revised for more than a decade, the Alliance complains.
The organisation speaks of a context of growth in motor insurance, which brought in turnover of 11,353 million euros for insurance companies. By contrast, the average income of assistance companies fell by 27 %. What is more, the leading companies in the assistance sector have seen their profits turn into losses, in the face of rising taxation and operating expenses (fuel, wages and social security contributions, among others); and despite having seen more work pile up due to an increase in call-outs (3-8.5 %).
"It will be better not to work than to work at a loss"
These are the words of the Alliance's spokesperson, Xavier Martí, who describes "this situation in the roadside assistance value chain" as unsustainable over time. "Assistance companies are clear that in 2023 they cannot ruin themselves by working. Many have already found that it would be better not to work than to work at a loss," he concludes.
The economic unviability of many Spanish assistance companies, given the rates set by the intermediaries – insurers, assistance platforms and motoring clubs – is a reality. These rates are clearly insufficient to cover tow-truck companies' operating costs.
Selective stoppages
Selective stoppages affecting companies that do not offer rates sufficient to cover costs – the case of the Real Automóvil Club de España (RACE) – continue in the Basque Country, but could also spread to other places, as the Alliance has been warning. It so happens that this motoring club persists in failing to apply Royal Decree-Law 3/22 of 1 March, passed by the Government, under which fuel price increases were to be indexed to the price of assistance services.
This is happening despite the assistance sector's repeated complaints, which is how it explains why it is impossible to serve RACE – with the inevitable harm this causes to users, as well as to road safety.
The National Roadside Assistance Alliance is made up of the following regional and national associations and business organisations: ABEAC (Balearic Islands), ABEAC (Basque Country), ASCA (Catalonia), AMEAC (Madrid), ASCALEAC, (Castile and León), ASEDA (Andalusia), ASEGA (Galicia), AGRUAXA (Salamanca), ASEXTEAC (Extremadura), GRUPO CARTER (National), CEPAS (National), FEGRUAL (National Federation) AGREGA-GRÚAS and REAC (National Group).