The North American light vehicle aftermarket is projected to rise 3.2 percent annually to $85.5 billion in 2016. Gains will be fueled by an expansion in size and increasing age of the North American light vehicle fleet, which includes a growing number of vehicles in prime aftermarket service age: 5 to 10 years for many components. Additionally, as the regional economy improves and unemployment rates fall, average miles driven per vehicle are expected to climb along with travel to and from work. Continuing improvements in vehicle component durability will prevent aftermarket demand from rising more rapidly, as will increased monitoring of vehicle systems by advanced onboard electronics, alerting owners to any performance issues. This will reduce the need to make major repairs, although these losses will be offset somewhat by the ensuing maintenance work and sales of minor repair parts. Increasing price pressures from aftermarket parts sourced from low labor cost countries will also dampen sales growth in dollar terms. These and other trends, including market share and product segmentation, are presented in Automotive Aftermarket in North America, a new study from The Freedonia Group, Inc., a Cleveland-based industry market research firm.
Among the three North American markets, the Mexican automotive aftermarket will post the fastest advances, averaging 4.8 percent per annum through 2016. Aftermarket sales will be bolstered by Mexico’s rapidly expanding vehicle park and the country’s rising affluence, which will lead to greater demand for more expensive, fully-featured vehicles and associated aftermarket products. While the US will record the slowest gains, averaging 3.0 percent per year through 2016, the $10.0 billion increase in aftermarket demand will represent four-fifths of the region’s total sales growth from 2011 to 2016.
The fastest growth among the major aftermarket product segments will be registered by electronic products. Suppliers of items such as controls, modules, and sensors will be the beneficiaries of the further development of advanced vehicle systems and the increasing amount of electronic content found in light vehicles. The second fastest growing aftermarket segment will be exterior and structural products (the vast majority of which consists of replacement tires). Gains will be bolstered by increased demand for higher priced items like performance tires and advanced glass products, including solar control windows and electrochromic mirrors. Sales of electrical parts are expected to climb at a somewhat slower pace, limited by the long useful life of many products in this segment and stabilizing raw material prices.
The Freedonia Group is a leading international business research company, founded in 1985, that publishes more than 100 industry research studies annually. This industry analysis provides an unbiased outlook and a reliable assessment of an industry and includes product segmentation and demand forecasts, industry trends, demand history, threats and opportunities, competitive strategies, market share determinations and company profiles.
