Revenue is slowly climbing as motor vehicle production rises
London, United Kingdom (PRWEB) August 03, 2012
Motor vehicle part wholesalers buckled over the past five years, as the automotive sector stalled in the global downturn. Industry revenue is forecast to fall an annualised 2.7% over the five years through 2012-13 to reach £12.3 billion. An aging car fleet promoted demand for replacement parts. Older vehicles require more maintenance and repair than new, more technologically advanced vehicles. The number of cars on UK roads also increased over the past five years, which backed demand for replacement parts. However, industry conditions were so severe during the global downturn that industry revenue fell overall. According to IBISWorld industry analyst Aries Nuguid, “demand for motor vehicle parts from retailers, car dealers and carmakers weakened as consumers delayed discretionary purchases”. When the recession hit, Britons started saving money in anticipation of losing their jobs or having lower income. Consequently, the demand for new vehicles fell. Demand for new vehicle parts plummeted, which affected revenue of motor vehicle part wholesalers during the recession. The aftermarket also felt the brunt of this trend, as many households postponed repairing vehicles unless it was necessary. In contrast, the effect on the replacement market was not dire as Britons opted to repair instead of purchase new vehicles.
Despite the troubles, the industry has been on the road to recovery. Industry revenue will rise 2.8% in 2012-13. Nuguid adds, “the revenue growth will come from improved demand in the aftermarket and continued recovery among motor vehicle manufacturers”. Demand for motor vehicle parts wholesaling will experience mixed conditions over the next five years. Motor vehicle manufacturing in the UK is expected to remain weak due to import competition. On the other hand, car sales will grow, supported by higher consumer confidence, lower unemployment and a younger vehicle fleet. These same trends will diminish demand from mechanics. Consequently, industry revenue is expected to grow slowly over the five years through to 2017-18.
The Motor Vehicle Parts Wholesaling industry has a low level of market share concentration, with the top four players accounting for about 11% of revenue. The industry is highly fragmented, with a large number of sole traders.
For more information on the Motor Vehicle Parts Wholesaling industry, including latest industry trends, statistics, analysis and market share information, purchase the full report from IBISWorld, the nation’s largest publisher of industry research.
IBISWorld industry Report Key Topics
Companies in this industry wholesale a wide variety of motor vehicle parts and accessories, including tyres, spark plugs, engines and batteries. Retail sales direct to the public are not included in this industry.
Key External Drivers
Industry Life Cycle
Products & Markets
Products & Services
Globalisation & Trade
Market Share Concentration
Key Success Factors
Cost Structure Benchmarks
Barriers to Entry
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