Automotive Aftermarket Industry: An Overview
The automotive aftermarket, commonly known as "Autocare" is one of the underrated, and yet, one of the most significant markets in the world. In the US alone, there are 290 million vehicles on the road, with 538,000 auto care businesses catering to their needs every second of the day. Moreover, the industry promises one of the brightest forecasts in near future, with insider forecasts estimating that it will reach $448 billion by 2023 end. The consumer insights also suggest a bright forecast for the automotive aftermarket industry. For example, according to the industry-wide survey conducted by the Autocare association in 2019, 36% of businesses remained concerned about their business's ability to finance current operations, signaling a major possible decline in the purchase of commercial vehicles. Similarly, the businesses also reported 46% also reported major disruptions across supply chains, due to covid-19, and signaling a potential uncertainty in the business climate, further constricting investments and cash flows. Most businesses or 58% reported that they expect the business outlook to remain negative over the next 12 months. While vaccination drives continue to brighten the forecast, the emergence of new covid-19 variants also promises interruptions to recovery. Keep in mind, the recovery in the auto sector took 7 years during the last financial crisis, and this pandemic promises a much bleaker economic forecast for new sales of vehicles.
According to the Brandessence market research, the automotive component manufacturers remain on their toes, as increased competition, and key changes in consumer trends remain key to driving growth. Furthermore, regulations like recent changes by the Environmental Protection Agency (US), to reduce noise emissions with new standards have led to strong demand for new automotive exhaust systems. According to Brandessence experts, the automotive aftermarket reached USD 381.67 billion in 2020 and is likely to witness major growth for both performance-driven auto components, and spare parts to extend the road-life of current vehicles. Some key players in the global automotive aftermarket are Denso Corporation, Robert Bosch GmbH, Continental AG, Aisin Seiki Co., ZF Friedrichshafen AG, among others.
According to the International Energy Agency (IEA), electric car numbers crossed 10 million in 2020, registering 43% growth from the previous year. Europe took the global lead in an electric vehicle last year, with 3.2 million electric vehicle sales in 2020. The growing sales of electric vehicles, the economic downturn in global incomes due to the pandemic, and the looming horizon of gradual phase-out of the conventional vehicle have driven global consumers into the arms of used car dealers. During the 2009 financial crisis, the US automobile sector recovered after seven years. This pandemic promises an even bleaker forecast. The IEA estimated 15% lower sales in 2020, as opposed to in 2019, with the largest declines being witnessed in key markets like the US, Europe, and China. The actual outcome was a little worse than the initial forecast. In 2020, total passenger vehicle sales in the EU reached 3, 403,119. This was a decline of 18.2% from 4,157, 849 vehicles sold in 2019.
On the other hand, in key markets like the US, used car sales hit a new record with every passing year. The total used car sales stood at 38,602,000 in 2016, 39,204,000 in 2017, and 40,233,000 in 2018 and 40,807,000 in 2019. The delayed vehicle purchases for conventional vehicles and growing purchases of used vehicles remain a rare golden opportunity for players in the automotive aftermarket industry.
Robert Bosch GmbH, commonly known as Bosch, is a German multinational engineering and technology company that was founded in 1886. Companies Headquartered at Robert-Bosch-Platz 1, Gerlingen, Baden-Wuerttemberg, 70839, Germany. Bosch's core business is divided into four business segments: mobile (hardware and software), consumer goods (including home appliances and power tools), industrial technology (including powertrains and power tools). and control), energy, and construction technology.
DENSO Corporation is a Japanese global manufacturer of automotive components that was established in 1949. Companies Headquartered at 1-1, Showa-Cho, Kariya, Aichi, 479-0805, Japan. The company develops and manufactures various automotive parts, including gasoline and diesel engine components, hybrid vehicle components, air conditioning systems, instrument clusters, airbag systems, front radar systems collision, and spark plugs. Denso also develops and manufactures non-automotive components, such as home heating equipment and industrial robots.
Continental AG, commonly known as Continental is a German multinational auto parts manufacturing company that was founded in 1871. Companies Headquartered at Vahrenwalder Straße 9, Hannover, Lower Saxony, 30165, Germany. specializes in brake systems, interior electronics, automotive safety, powertrain and chassis components, tachometers, tires, and other parts for the automotive and transportation industries. Continental is structured into six divisions: Chassis and Safety, Powertrain, Interior, Tires, Link Technology, ADAS (Advanced Driver Assistance System).
ZF Friedrichshafen AG, also known as ZF Group commonly abbreviated as ZF, is a German auto parts manufacturer established in 1915. Companies Headquartered at Löwentaler Strasse 20 ZF Forum, Friedrichshafen, Baden-Wuerttemberg, 88046, Germany. Specializing in engineering, it is primarily known for its design, research, development, and manufacturing activities in the automotive industry. It is a global supplier of drivetrain and chassis technology for automobiles and commercial vehicles, as well as specialized plant equipment such as construction equipment. It is also involved in the railway, marine, defense, and aeronautical sectors, as well as in general industrial applications.
Aisin Corporation is a Japanese company that develops and manufactures components and systems for the automotive industry. Company established in 1949 & is Headquartered at 10, Takane, Fujii-Cho, Anjo, Aichi, Japan. Company supplies engines, transmissions, bodies and chassis, spare parts, and other auto parts to various major OEMs. In addition to automotive products, Aisin also offers living and recreational products, mattresses, cogeneration and heat exchange systems, as well as health care products, and more. Aisin Seiki worked with Toyota's Central R&D Lab to develop dyed solar cells.
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