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  4. > 2015 Outlook of the Global Automotive Aftermarket : China and India Markets Developing Rapidly

Key Highlights of 2014

Global automotive parts and service suppliers enjoyed a year of steady growth in 2014, thanks to continued development of Asian and Latin American markets.

Market Size/ Growth
•Total manufacturer-level parts revenue (including maintenance, repair, body/collision and accessories) was $ x billion in 2014.
•Revenue grew by nearly x percent in 2014, led by industry development in China, India and Southeast Asia.

Drivers and restraints
•Increasing vehicles in operation was the main growth driver in the emerging markets of Asia and Latin America. Global light vehicles in operation will increase from x billion in 2014 to x billion in 2020.
•Increasing average age of vehicles was the main growth driver in developed regions. This is resulting in higher repair bills for motorists keeping their aging vehicles for several more years.

Revenue by product type
•Demand for routine maintenance parts such as tires, filters, and brakes grew sharply in emerging regions such as Asia and Latin America to service the high growth in new vehicles in operation.
•Demand for electrical and mechanical parts ranging from sensors, fuel injectors, steering gears and telematics/infotainment receivers will enjoy high growth in developed regions as a large share of vehicles in operation (VIO) enters the prime replacement age for “life-of-vehicle” repairs.

Parts distribution channels
•Fragmented distribution was observed in Asia and Latin America, with networks of small retailers serving garages and workshops in Latin America and parts of Asia.
•Growth of “auto part cities,” in China, which are similar to “flea markets” in the United States featuring small wholesale vendors clustered together are set to provide coverage of major aftermarket products.
•High growth is anticipated for e-retailers as the Internet becomes a major distribution channel for tires, accessories and other do-it-yourself products.

Service channels
•OES channel enjoys high share of parts and services in Asia but remains weak in Europe and the Americas.
•Tire stores, fast-fits, and lube-oil-filter chains will enjoy high growth in developed regions as more vehicle owners look for lower-priced service options.
•Independent repair facilities face challenges keeping pace with changes in vehicle technologies and the tools, equipment and training to repair them. Many “mom-and-pop” shops will be forced out of business.

Top 6 Predictions of 2015

Rising vehicles in operation and increasing average car/light truck will continue to drive industry revenue higher in 2015.

Total Vehicles in Operation to Reach x Billion
•About x million more vehicles will be in use worldwide in 2015, pushing the global population total from x billion last year to x billion this year.
•About x % of these new vehicles will be located in China.

Total Manufacturer-level Parts Revenue to Reach $ x Billion
•Rising vehicles in operation in emerging regions and increasing average vehicle age in developed countries will drive total manufacturer-level parts revenue up by x % worldwide in 2015.

OES to Account for Less than x % of Manufacturer-level Parts Revenue
•Automobile dealerships in the OES channel are losing share to independent parts and service suppliers in Europe and both North and Latin America.
•OES remains strong in Asia but also faces increasing competition there from warehouse distributors and service chains.

China to Have the World’s Youngest Average Car Parc at Years
•With a small vehicle parc (per x residents) and high growth in new vehicle sales, average car/light truck age will be lower in China in 2015 than any other region.
•By comparison, the average vehicle age in the United States is x years and in Europe is x years.

Tire Pressure Sensors to Be the Fastest Growing Product Line
•With a compound annual growth rate of nearly x % worldwide, tire pressure sensors will be the fastest-growing product line that Frost & Sullivan has investigated.
•Demand will be highly concentrated in North America and Europe.

E-retailers to Account for x % of all Parts Sales Worldwide
•Led by tire manufacturers, which account for more than x % of all sales, the share of parts sold through online channels will reach its highest level in 2015 on its way to x % of revenue by 2020. E-retailers can reduce prices for consumers and serve as a surrogate distribution channel in regions without all-makes-and-models wholesalers.

Definitions

•This automotive aftermarket includes independent parts and service suppliers (IAM) as well as automakers’ dealership networks (OES).
•Vehicle scope includes passenger cars and light trucks only, unless otherwise noted.
•Geographic scope includes North America, Latin America, Europe, and Asia.
•Revenue includes parts only and excludes service, unless otherwise noted.
•Revenue is measured at the manufacturer level and expressed in US dollars, unless otherwise noted.

Aim
•The aim of this study is to identify the size and direction of the global automotive parts and services aftermarket, and to identify growth opportunities.

Objectives
•Calculate size of global automotive aftermarket through analysis of vehicles in operation and replacement rates
•Update the main Frost & Sullivan research findings for each region
•Identify the main industry trends in each region
•Determine which regions and sectors will enjoy the highest growth potential
•Analyze the role of Mega Trends such as e-retailing and telematics solutions on demand for aftermarket parts and services
•Predict major benchmarks the global aftermarket will achieve in 2015 and beyond

Key Questions This Study Will Answer

What are the main factors that influence the size and direction of the global automotive aftermarket?
How does the industry structure vary from region to region?
Which emerging distribution channels will offer opportunities for growth and differentiation?
What is the position and competitive outlook of leading global automakers in the aftermarket?
How are emerging regions currently being served, or underserved, by automotive parts and services suppliers?

Table Of Contents

2015 Outlook of the Global Automotive Aftermarket : China and India Markets Developing Rapidly
Executive Summary 3
Research Scope and Definitions 6
Global Aftermarket Overview 14
Mega Trends and Industry Convergence Implications 19
North American Automotive Aftermarket 25
European Automotive Aftermarket 32
Chinese Automotive Aftermarket 40
Latin American Automotive Aftermarket 47
Rest of World 55
Conclusions and Future Outlook 63
Appendix 67

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