Automotive Electrical Component Manufacturing in Australia Industry Market Research Report Now Updated by IBISWorld

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The industry is expected to face tough times over the next five years as the Australian automotive industry continues to struggle. For this reason, industry research firm IBISWorld has updated its report on the Automotive Electrical Component Manufacturing industry in Australia.

IBISWorld Market Research

IBISWorld Market Research

As the Motor Vehicle Manufacturing industry continues to struggle, upstream suppliers feel the pinch.

Despite greater electric content in motor vehicles, the Automotive Electrical Component Manufacturing industry faced numerous challenges that have hindered growth over the past five years. Rising petrol prices left consumers little choice but to switch to smaller imported vehicles. IBISWorld industry analyst Kosta Lev states, “domestic motor vehicle production plummeted, to the detriment of parts manufacturers.” Specialist component manufacturers were hit worst, as they mainly supply to motor vehicle assemblers. Due to the dire conditions, industry revenue is expected to decline by an annualised 0.8% over the five years through 2013-14 to reach $1.4 billion. However, revenue is expected to increase 6.9% over 2013-14. A dropping Australian dollar from 2012-13 has assisted with the rebound in revenue over the past two years.

Industry profitability has increased over the five years through 2013-14. However, this is off a low base year and misrepresents the falling trend in industry profitability. Operating profit margins have been declining in line with falling demand. The automotive manufacturing sector in Australia has suffered immensely over the past five years. According to Lev, “production declines from this major market led to drops in demand. The resulting overcapacity in the industry has been causing profitability to fall.” Falling margins will be cushioned as the least efficient operators leave the industry over the next five years. The industry is forecast to continue to face challengers over the next five years. Pent-up demand for motor vehicles will benefit the industry. However, the domestic automotive sector is likely to remain uncompetitive in the global market.

Market share concentration is at a low level in the Automotive Electrical Component Manufacturing industry. Market share concentration is low because manufacturers tend to specialise in a few product segments. The specialisation limits market share of major companies. An estimated 55% of establishments are non-employers, implying that besides a few major players, the industry is highly fragmented. The Motor Vehicle Manufacturing industry in Australia being in a state of flux. Concentration is expected to increase over the next five years, as the motor vehicle assemblers reduce the number of suppliers they purchase from. For more information, visit IBISWorld’s Automotive Electrical Component Manufacturing report in Australia industry page.

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IBISWorld industry Report Key Topics

Companies in this industry manufacture automotive electrical components such as air conditioners and demisters. Companies can be either specialist component manufacturers, producing components for use in new motor vehicles, or standard manufacturers, making parts for the aftermarket. Firms in this industry do not manufacture batteries.

Industry Performance
Executive Summary
Key External Drivers
Current Performance
Industry Outlook
Industry Life Cycle
Products & Markets
Supply Chain
Products & Services
Major Markets
International Trade
Business Locations
Competitive Landscape
Market Share Concentration
Key Success Factors
Cost Structure Benchmarks
Basis of Competition
Barriers to Entry
Industry Globalisation
Major Companies
Operating Conditions
Capital Intensity
Technology & Systems
Revenue Volatility
Regulation & Policy
Industry Assistance
Key Statistics
Industry Data
Annual Change
Key Ratios

About IBISWorld Inc

Recognised as the nation’s most trusted independent source of industry and market research, IBISWorld offers a comprehensive database of unique information and analysis on every Australian industry. With an extensive online portfolio, valued for its depth and scope, the company equips clients with the insight necessary to make better business decisions. Headquartered in Melbourne, IBISWorld serves a range of business, professional service and government organisations through more than 10 locations worldwide. For more information, visit http://www.ibisworld.com.au or call (03) 9655 3886.

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Gavin Smith
IBISWorld
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