As the age of the average vehicle increases, owners are becoming more attuned to the importance of preventative maintenance and service in order to increase the life of their vehicles. This awareness is, in turn, presenting lucrative growth opportunities for the automotive aftermarket.
The automotive industry has long been considered an intrinsic part of the global economy. In recent times, however, particularly following the worldwide impact of the COVID-19 pandemic, automotive sales have seen a considerable slowdown due to fluctuations in the economy. Given this scenario, an increasing number of consumers are making targeted efforts to maintain the operating condition of their existing vehicles for longer periods.
Furthermore, advancements like the emergence of sophisticated new technologies, digitalization, and new product innovations are also adding impetus to automotive aftermarket size, which is anticipated to reach $1.43 trillion by 2026.
Automotive aftermarket moves into the digital era
Technological advancements, particularly in e-commerce have created a significant change in the decision-making process of customers. Prominent platforms like Amazon and Walmart are driving the penetration of e-commerce, notably in the sale of automotive aftermarket products. In 2019, Amazon was set to register sales worth almost $6.3 billion from car care products, auto parts, and accessories, among others.
The integration of e-commerce in the automotive aftermarket industry has given consumers wider access to more in-depth knowledge about any products they wish to purchase. Leading manufacturers of aftermarket auto parts are now offering online catalogs, reviews, manuals, and videos related to their products, in order to help a consumer make more informed purchase decisions.
For instance, in 2020, Continental began bundling information pertaining to its automotive aftermarket products and services portfolio on a new online portal. This development was undertaken to ensure easier access for dealers and workshops to all Continental brands, products, and services that support independent aftermarket.
Rapid digitalization is also allowing for simpler and more comprehensive vehicle ownership. Many automotive aftermarket retailers are now offering manuals, catalogs, and other information through digital means which can be viewed on various devices such as smartphones, tablets, etc.
New product launches & partnerships in aftermarket industry
In recent years, several strategic growth strategies have been employed by major automotive aftermarket players to strengthen their position in the global industry space. These strategies include partnerships and new product launches, which are allowing automotive aftermarket retailers to address the growing need for robust aftermarket auto parts and services, as well as sustain a strong position in the global business landscape.
To illustrate, a part of Groupe PSA, Citroën launched a new automotive aftermarket product line in India in September 2020, under the brand Eurorepar. This initiative was undertaken in partnership with GoMechanic, in order to facilitate the distribution and sales of Eurorepar parts across over 15 cities nationwide.
The Eurorepar brand, which is the multi-brand range of accessories and parts of Groupe PSA for vehicle maintenance and repair, comprises of several accessories, spare parts, oil, tires and workshop consumables, among others, designed for use in the repair and maintenance of vehicles in use for three years or more.