Automotive Aftermarket Market: Introduction
- Automotive aftermarket industry majorly depends on automotive consumers and is consumer-driven. The automotive aftermarket industry is constantly evolving due to changes in consumer preferences owing to rapid technological changes in vehicles. Therefore, advancement in automotive technology is expected to propel the global automotive aftermarket industry.
- The automotive aftermarket industry engages in the remanufacturing, retailing, distributing and installing vehicle parts and equipment, post the sale of the car. The global automotive aftermarket market is estimated to expand at a consistent pace owing to a rise in the demand and production of vehicles across the globe.
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Key Drivers of Automotive Aftermarket Market
- Increasing preference by consumers to replace OEM parts/products to improve performance of various vehicle systems and components such as engine, audio system, and power delivery among others is a prominent factor that is projected to drive the global automotive aftermarket market during the forecast period. For instance, several consumers opt to change their factory audio system with aftermarket audio system in order to enjoy better sound quality. Additionally, several consumers opt for vehicle engine modification for improving vehicle engine performance and increased power output.
- Automotive components and systems need to be replaced after several months/ years based on their utility and manufacturer’s guidelines. Major and common replacement components of the automotive industry include tires, windshields, oils, and braking components. Most of these products are available for in the automotive aftermarket. Therefore, replacement of vehicle components and parts owing to reduced performance of existing automotive components and systems is expected to drive the global automotive aftermarket market.
- An increase in the per capita income of the population globally has boosted the ownership of new vehicles. This, in turn, creates significant opportunity for automotive aftermarket industry players to cater to the increased number of automotive consumers.
Global Automotive Aftermarket Market: COVID-19 Impact
- Until the Corona Pandemic, globally, the financial crisis in 2007-2009 was one of the largest events that hampered the automotive industry. In 2007-2009, new car sales plummet by 42% in the U.S., while aftermarket sales witnessed a decline of mere 1%. However, during 2019-2020, the Corona Pandemic has impacted the global automotive industry on a larger scale. Governments across the globe enforced lockdowns in order to stop the spread of corona virus, resulting in the shutdown of manufacturing and production units across multiple industries.
- The corona pandemic hit the automotive aftermarket more severely and rapidly. It started as disruptions in domestic supply chain on a country level such as in China, U.S., and rapidly resulted in a sharp decline in the demand for aftermarket products, systems and components worldwide. According to industry experts, the global automotive aftermarket industry witnessed a decline of approximately 20% in 2020, the largest in the 21st century.
- Governments have enacted restrictions in terms of conducting business during the corona pandemic; however, the trend toward online trading in the automotive aftermarket is increasing sharply. Compared to 2019, in 2020, the online automotive service bookings are expected to increase by 30%, while sales of automotive aftermarket parts rose by more than 60%. Continuation of these trends toward business digitalization and online trading are expected to help automotive aftermarket industry recover from economic losses during the forecast period.
Asia Pacific to Account for Prominent Share of Global Automotive Aftermarket Market
- In terms of region, the global automotive aftermarket market can be segmented into North America, Europe, Latin America, Asia Pacific, and Middle East & Africa
- Asia Pacific is anticipated to hold a major share of the global automotive aftermarket market owing to the presence of prominent OEM and aftermarket players catering to the auto industry. Asia Pacific accounts for more than 42% of the total global automobile production, while China leads in terms of production of passenger cars, commercial vehicles as well as electric vehicle production. According to Ministry of Commerce, China, the aftermarket industry in China was valued at more than US$ 153 billion in 2020, which is exceeds aftermarket industry value of the U.S. Germany, France, U.K. and other countries across the globe.
- Moreover, the other countries in Asia Pacific including Malaysia, Thailand, Japan, Indonesia, South Korea, and India are witnessing an increase in production of vehicles. All the factors mentioned above led Asia Pacific to account for a prominent share of the global automotive aftermarket market.
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Key Players Operating in Automotive Aftermarket Market
The global automotive aftermarket market is concentrated owing to the presence of prominent transportation service providers. A few key players operating in the global automotive aftermarket market are:
- 3M Company
- ALCO Filters
- Aisin Seiki Co.
- ASIMCO Technologies Ltd.
- Bridgestone Corporation
- Continental AG
- Delphi Automotive
- Denso Corporation
- Federal Mogul
- Hella KGaA Hueck & Co.
- Hyundai Mobis.
- Lear Corp.
- Magna International Inc.
- Robert Bosch GmbH
- Shandong Zhengnuo Group Co. Ltd.
- Valeo SA
- ZF Friedrichshafen AG
- Other Key players
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