Rising Average Age of Vehicles on Road to Drive Opportunities for Automotive Aftermarket, According to New Report by Global Industry Analysts, Inc.

GIA announces the release of a comprehensive global report on the Automotive Aftermarket. Global Automotive Aftermarket is projected to reach US$708.3 billion by 2018, primarily driven by growing vehicle population especially in developing countries, rising average age of vehicles on road, and rising awareness among car owners over the importance of car maintenance. Rising vehicles per capita in Asia-Pacific also augurs well for the future of the market.

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Automotive Aftermarket: A Global Strategic Business Report

San Jose, CA (PRWEB) September 26, 2012

Follow us on LinkedIn – Growth in the automotive aftermarket is largely determined by the replacement cycle of vehicles, which of late as a result of the tough economic conditions has become even longer. The auto aftermarket is poised to emerge into the greatest beneficiary of the tough economic conditions now widely touted to be the new normal in developed economies. Developed economies are now saddled with financial and economic conditions, which are likely to persist into the foreseeable future, such as, depressed GDP growth, federal austerity measures, capital raising constraints, consistently high unemployment rates, and increased taxes. The scenario is aggravating the trend towards buying used cars and the tendency to retain vehicles for longer time in good working condition therefore requiring continued maintenance, which in turn translates into greater demand for aftermarket service and mechanical parts. The penchant of car owners to turn their cars from a simple transportation machine to an ultimate status symbol by installing a range of electronic gadgets and accessories is also driving growth in the aftermarket.

Growing percentage of electronic content in automobiles coupled with modern consumers’ proclivity to in-car infotainment technologies provides ample opportunities for growth in the area of automobile entertainment in the aftermarket. The rapid pace of depreciation in the value of factory-fitted systems will result in skewing consumer preferences towards aftermarket products. For instance, in-car navigation and information systems have a higher appeal in the aftermarket as factory fitted satellite navigation systems have product cycles that lag behind technology development in the aftermarket. In the upcoming years, energy efficient and environmentally safe aftermarket products will find special demand, impelled by stricter emission norms and rising fuel prices. Investments in R&D and production processes are therefore seen as critical for sustained success in the marketplace.

Growth in the global automotive aftermarket is also forecast to be driven by increasing demand for cosmetic parts or crash parts such as panels, bumpers and bonnets and other sheet metal parts such as doors, fenders and hoods, as a result of the increasing number of automotive accidents and crashes. These parts typically take the highest impact in the event of collisions and therefore demand immediate replacements in case of damage. Given the growing demand for crash parts in the aftermarket and consumers emphasis on safety, aftermarket manufacturers are focusing on providing crumple zones in bumpers, hoods etc for crash safety at quality levels comparable with those provided by auto OEMs. Independent aftermarket component manufacturers are poised to gain the highest score over for standard stock OEM replacement parts offered by the automaker. This is primarily because of the lower and highly competitive prices offered by independent component manufacturers. The Certified Automotive Parts Association (CAPA) certification, which ensures quality levels on par with OEM manufactured parts, is also is expected help spur demand for parts supplied by independent aftermarket component manufacturers.

In Europe, the aftermarket is buckling under the pressure of the debt crisis weighing down heavily on the domestic automotive industry. The domestic automotive industry during the year 2012 vacillated widely between optimism and fear, marring sentiments in an otherwise recovering automotive market. Credit restrictions as a result of austerity measures implemented by debt ridden governments, consumer indecisiveness, weakening consumer confidence as a result of periodic flaring up the region’s financial problems, resulted in slowing down auto sales during the year. Weakness in auto sales was witnessed in France, Spain, Greece and Portugal during the year. A future downgrade in the outlook for auto production cannot be ruled out, given the tumbling sales and the decline in new car registrations in the first half of 2012 and excess production capacities. The continuation of the trend will likely witness Europe carry over 32% excess production capacity than what the market demand can accommodate, into the upcoming years.

Currently over 25% of automobile dealers in Europe are under the extreme financial pressure, throwing into sharp relief the disruption in day-to-day business environment. Also unlike the Government support received by Ford and General Motors in the United States during the 2007-2009 recession, the European auto industry is seen as unlikely to receive federal support from the already debt burdened Governments.

With Europe mired in a crisis of confidence, the sustained uncertainty in itself is dragging down growth patterns in the aftermarket. Demand growth is currently treading the tight rope with numerous factors continuing to threaten automobile demand patterns in debt affected economies, especially so for an industry which pins future growth prospects on medium to long term health of the economy Electronic products and premium priced exterior and structural products and appearance chemicals are expected to be the worst affected, while critical mechanical aftermarket parts like brake parts & assemblies, engines & parts, fuel system components are expected fare better since replacement of worn parts is a necessity if the vehicle needs to be kept running.

As stated by the new market research report on Automotive Aftermarket, the United States is the largest regional market accounting for a majority share in the total revenue generated. Asia-Pacific represents the fastest growing market with annual revenue waxing at a CAGR of about 6.6% over the analysis period. Aftermarket Mechanical Products represents the largest segment, while aftermarket electronic products represents the fastest growing segment with revenue waxing at a CAGR of about 4.9% over the analysis period.

Major players in the marketplace include ACDElco, Affinia Group Inc., Akebono Brake Corporation, American Axle & Manufacturing Inc, ASIMCO Technologies Limited, Bridgestone Corp, Continental AG, Cooper Tire & Rubber Company, Delphi Automotive PLC, Denso Corporation, Federal-Mogul Corporation, Gates Corporation, Goodyear Tire & Rubber Company, Grupo Kuo, S.A.B. de C.V., Honeywell International, Inc., Johnson Controls, Kumho Tires Co. Inc., Lear Corp., Magna International, Meritor Inc., Magneti Marelli S.p.A, Michelin, Pirelli & C. S.p.A., Robert Bosch GmbH, Shell, TRW Automotive, Visteon Corp., and Yokohama Rubber Co., Ltd., among others.

The research report titled “Automotive Aftermarket: A Global Strategic Business Report” announced by Global Industry Analysts, Inc., provides a comprehensive review of market trends, issues, drivers, company profiles, mergers, acquisitions and other strategic industry activities. The report provides market estimates and projections for key regional markets such as the United States, Canada, Japan, Europe, Asia-Pacific, Middle East and Latin America. Product segments analyzed include Mechanical Products, Electrical Products, Electronic Products, Exterior and Structural Products, Motor Oil, Fluids and Additives, and Appearance Chemicals.

For more details about this comprehensive market research report, please visit –
http://www.strategyr.com/Automotive_Aftermarket_Market_Report.asp

About Global Industry Analysts, Inc.
Global Industry Analysts, Inc., (GIA) is a leading publisher of off-the-shelf market research. Founded in 1987, the company currently employs over 800 people worldwide. Annually, GIA publishes more than 1300 full-scale research reports and analyzes 40,000+ market and technology trends while monitoring more than 126,000 Companies worldwide. Serving over 9500 clients in 27 countries, GIA is recognized today, as one of the world's largest and reputed market research firms.

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Global Industry Analysts, Inc.
Telephone: 408-528-9966
Fax: 408-528-9977
Email: press(at)StrategyR(dot)com
Web Site: http://www.StrategyR.com/

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