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Canadian Tire plans to launch a driving academy

The move is shaking up a quaint industry of mom-and-pop shops


 
Schooling the competition

Photograph By Andrew Tolson

When most Canadians learn to drive, they do so at a locally owned driving school. While Young Drivers of Canada is a nationwide brand, it’s only one name in a sea of privately owned mom-and-pop shops. The Driving School Association of Ontario alone lists hundreds of members. In a world where the corporation is king, the driver’s ed business remains charmingly quaint—learning to drive now is a lot like learning to drive 50 years ago.

But Canadian Tire aims to change that. Last month, it announced the launch of the Canadian Tire Drivers Academy. The school’s pilot location opens in Toronto’s east end next month, and will give classrooms of about 40 students driving lessons, prepare them for road tests and provide basic information about car maintenance, like how to check tire pressure and alignment. After completing the class, students receive discounts from Canadian Tire on car repairs, parts, accessories and roadside assistance. If the pilot program does well, the company will roll out classes across the country (it has plans to open three more locations by December).

Rival driving schools say they can still offer a level of service that Canadian Tire can’t. Imtiaz Hassan, founder of David’s Academy of Defensive Driving, also in Toronto’s east end, says he’s not overly concerned about the corporate invasion. “We offer the same course, but for less than the bigger companies,” he says. (The Canadian Tire beginner’s course will cost $799 for 10 hours of in-car driving and 20 hours of classroom instruction. A comparable course from David’s would cost about $465, he says.) Peter Christianson, the president of Young Drivers, says teaching is “not within [Canadian Tire’s] field of expertise. There’s certainly room for a good competitor. We’re just waiting to see if they’ll be one.”

But experts say small operators should have their eyes trained on the rear-view mirror. Canadian Tire has the ability to do what the likes of Chapters and Wal-Mart did to small booksellers and local retailers in the ’90s. David Dunne, a professor of marketing at the University of Toronto, says independent schools need to come up with a game plan:“What they have to show is that they are different, and better in many ways than the big ones are,” he says. “They have to make people look to the little local guy for real excellence.” Pete Mateja, co-director of automotive research at the University of Windsor, adds that the whole Canadian Tire package is not just competition for driving schools. “This is a threat to anyone servicing cars, because it’s going to create traffic to the store,” he says. “This strengthens all its franchises.”

But Canadian Tire is not exactly the big, bad guy. While it reported $2.4 billion in revenue in the last quarter (a 20 per cent increase over the same period last year), it has been struggling with intense competition from the likes of Lowe’s and Home Depot. What it has that they don’t is automotive chops. “We’ve been renewing our focus on the automotive business over the last couple of years, and have made a number of changes that have been about reasserting Canadian Tire as Canada’s automotive authority,” says company senior vice-president Allan MacDonald. Some of those changes include introducing online tire sales, and even a driver’s magazine. Still, “there’s a big opportunity that we hadn’t been focusing on and that was a universal constant—the driver,” says MacDonald. The driving school won’t focus only on youth, either—Canadian Tire plans to offer courses to new adult drivers, and possibly classes in different languages for new Canadians.

“More businesses are looking to create experiences around products rather than just selling things. What [Canadian Tire] brings is power of the brand,” says Dunne. MacDonald says the Canadian Tire name offers a sense of comfort to parents, who might otherwise be nervous about dropping their kids off to learn from strangers. And that’s one thing small driving schools may never be able to match, no matter how good their service.


 

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