Skyrocketing fuel prices and emissions regulations have slowed global demand for new motor vehicles and, thus, automotive parts
Los Angeles, CA (PRWEB) August 18, 2012
The Global Auto Parts and Accessories Manufacturing industry cannot exist without motor vehicle production. Over the past five years, motor vehicle production has been supported by furious growth in China and other developing economies. “Incomes in China have risen, which has created new demand for motor vehicles,” says IBISWorld industry analyst Aries Nuguid. “Motor vehicle manufacturers began opening plants to satisfy demand, and parts manufacturers soon followed.” A rise in the number of vehicles in use globally also supported the aftermarket parts segment.
However, skyrocketing fuel prices and stringent emissions regulations have slowed global demand for new motor vehicles, which has flowed on to the Global Auto Parts and Accessories Manufacturing industry. Furthermore, global car and light commercial vehicle production dropped during the global economic downturn, as people delayed new vehicle purchases. “The drop in production meant less original equipment manufacturer (OEM) demand for automotive parts and, thus, has dampened industry revenue over the past five years,” says Nuguid. Industry revenue is estimated to fall at an annualized 3.0% to $1.16 trillion over the five years through 2012.
Concentration levels are low in this industry, as a large number of small players characterize it. Market share concentration has increased over the past five years as the larger players have expanded capacity and purchased smaller players. Market share concentration is expected to continue to increase over the next five years as consolidation among the larger OEM suppliers is set to rise. Consolidation among the larger OEM suppliers will rise, as they take cost-cutting measures and consolidate to become more competitive.
Industry revenue is estimated to grow in 2012 due to higher motor vehicle output in developing economies. Weak demand for motor vehicles in Europe, however, will dampen the rapid growth. And in the next five years, the industry will be back on track. Strong demand from high-growth economies will support revenue, but demand from developed economies will be more subdued. Greater motor vehicle production volumes will support revenue growth. Demand from motor vehicle production will increase on the back of pent-up demand, environmental concerns and continued expansion in developing economies. For more information, visit IBISWorld’s Global Auto Parts and Accessories Manufacturing industry report page.
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IBISWorld industry Report Key Topics
Companies in this industry manufacture motor vehicle parts and accessories other than engines, engines parts, batteries, tires, bodies and chassis. Motor vehicle assembling is not included in this industry. Manufacturers typically supply parts and accessories to original equipment manufacturers (OEM) for use in the manufacturing of complete motor vehicles or for replacement parts in OEM dealerships. They also supply parts to the aftermarket.
Key External Drivers
Industry Life Cycle
Products & Markets
Products & Services
Globalization & Trade
Market Share Concentration
Key Success Factors
Cost Structure Benchmarks
Barriers to Entry
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