Global Automotive Part Store Industry
The automotive part store industry is part of the automotive service sector.
The global automotive part store industry recorded slight growth during the economic recession as an increasing number of vehicle owners opted for the cheaper alternative of repairing their vehicles themselves due to falling levels of disposable income. Companies in the automotive parts market provide parts and accessories for motor vehicles including radiator cores, air bags, engine exhaust systems, wheels, air-conditioners, radiators, catalytic converters, mufflers, resonators and more.
There are four main groups of auto part store products, namely accessories, performance parts, maintenance parts including fluids and filters, and critical parts, reports IBIS World. Auto part product purchases are usually urgent as functioning parts are necessary to keep the vehicle running. Wear and tear on maintenance parts happens gradually, leaving a margin for customers to decide when to replace parts.
Though car seats have only slight technical content, they are among the most expensive of vehicle parts. Research in China estimates the 10 leading seating manufacturers represent 95% of the world automotive seating market. Four Japanese companies are counted among the leading automotive seating manufacturers, along with five corporations spanning the US and Europe.
Regional Market Share
- Hoovers estimates the US automobile parts retail sector encompasses around 40,000 facilities, some with one location and others representing multi-location outfits. Leading companies in the sector include The Pep Boys, O'Reilly Automotive, Genuine Parts Company, AutoZone and Advance Auto Parts. The US automobile parts retail market is concentrated, with the 50 leading players generating around 50% of overall industry revenue.
- IBIS World estimates the US automobile parts retail market recorded yearly growth in excess of 1% between 2007 and 2012 to exceed $40 billion. The industry is, however, expected to record a 3.5% decline in 2012. Many large national auto parts chains have sought to increase revenue through acquisitions, applying tried-and-tested business practices and strategies to boost productivity and profitability at newly acquired stores. The majority of auto parts stores outside of the top five are owned and operated independently. Commercial sales, in particular, have helped fuel growth in the US automobile parts retail market.
- Leading players currently operating in the global automotive part store market include Australian Super Cheap Auto, Halfords Group in the UK, German ATU Auto-Teile-Unger, and Japanese companies AUTOBACS SEVEN and Yellow Hat.
The length of vehicle ownerships increased as slowing credit markets and falling employment curbed new vehicle sales in 2009 and 2010, and IBIS World predicts this slow rate of growth will continue through 2017. To maintain existing customers and attract new customers, garages will have to work on bringing down their repair prices. Buying automotive parts from large retailers can help lower average repair costs. Economic recovery is also likely to fuel new car sales and garage repairs as levels of disposable income rise.
In addition to competitive pricing, the fate of individual players in the global automotive part store market will depend on their approach to inventory management and marketing. Larger outfits will continue benefiting from economies of scale in terms of purchasing and distribution; meanwhile, smaller companies can compete by providing customers with specialized parts and tailored services like fast delivery.
Overall, dependent on economic recovery, increasing levels of disposable income will help customers invest in new cars and opt to have their repairs carried out at professional garages.
Leading Industry Associations
- Automotive Aftermarket Industry Association www.aftermarket.org
- Automotive Parts Manufacturers’ Association www.apma.ca
- Automotive Body Parts Association www.autobpa.com
- National Automotive Parts Association www.napaonline.com
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