Automotive Aftermarket Industry

According to MarketDigits, the global automotive aftermarket industry was valued at USD 427.51 billion in 2023, and it is projected to grow at a compound annual growth rate (CAGR) of 4.0% from 2023 to 2030. The market is primarily driven by car owners' desire to enhance their vehicle's performance in areas such as exhaust sound, speed, and appearance. Regional regulatory authorities, such as the Japanese Automobile Sports Muffler Association (JASMA) and the U.S. Environmental Protection Agency, monitor the standards and environmental impacts related to automotive components.

For example, there are regulations on noise emissions from modern automotive resonators and mufflers in exhaust systems. The digitization of component sales and services, along with the emergence of online platforms for distributing aftermarket components, is expected to attract significant investments from key participants. Market leaders like US Auto Parts Network, Inc. and CarParts.com are driving global market demand. Developing countries have great potential for online aftermarket sales, and the growing digitalization of automotive component sales is expected to generate significant market demand. Companies are transitioning to digital platforms to provide customers with a smoother experience. Continental AG, for instance, introduced an online portal in January 2020, offering services and product information to the market.

The automotive aftermarket industry's value chain consists of two primary segments: automotive replacement part suppliers and service enablers. These segments exchange value throughout the automotive sector at various stages. Digitalization of global automotive component sales is expected to address availability issues and drive the growth of the aftermarket industry as more people embrace IoT and digital trends.

Technological advancements in propulsion present numerous opportunities in the market. However, high research and development (R&D) costs are expected to hinder market growth. Automobile manufacturers face constraints, including production costs. Aftermarket filters, for example, offer the opportunity to choose parts that suit a vehicle's operating conditions.

Impact of COVID-19:

The ongoing COVID-19 pandemic has had a significant impact on the automotive aftermarket industry. Supply chain disruptions and decreased demand for aftermarket products are key concerns. The demand for commercial vehicle parts has declined due to the shutdown of non-essential services. Consumer behavior changes and economic uncertainty have implications for future industry growth. People are holding onto their vehicles for longer periods, and aftermarket players are facing liquidity and cash crunch challenges. In the aftermath of the pandemic, consumers are expected to prefer private transportation, but financial constraints may hinder the purchase of new vehicles. This could lead to increased demand for aftermarket auto parts for vehicle maintenance, particularly for used cars. In developing countries, the pandemic may give rise to the resurgence of entry-level aftermarket players. Market dynamics will vary across different customer segments based on their preferences for car repair and maintenance.

Replacement Parts Insights:

In 2022, the ""others"" segment held the largest market share of 48.3%. However, the tire segment is expected to dominate the market in terms of size due to the frequent replacement cycle of tires compared to other components. The aftermarket replacement part suppliers include various accessory, lubricant, and tire suppliers, among others. The demand for exhaust parts and specialized tools for hybrid electric cars is increasing due to the rising popularity of these vehicles, driven by factors such as higher petrol prices. The growth of disposable income in developing countries like China and Brazil is expected to positively impact the market's growth. Major players in the industry are utilizing advanced production technology, such as 3D printing, to optimize costs and reduce emissions.

Distribution Channel Insights:

In 2022, the retail segment accounted for 56.0% of the market share and is expected to continue dominating the market in terms of size until 2030. The wholesale and distribution segment is expected to experience rapid revenue growth from 2023 to 2030. The aftermarket is undergoing a transformation towards digitization, with online sales of parts and services becoming more prevalent. Original Equipment Manufacturers (OEMs), Original Equipment Suppliers (OESs), wholesalers, insurers, and workshops are all adapting to this growing online trend. Factors such as advanced technology in parts manufacturing, increased production of consumer and passenger automobiles, and the digitization of repair and maintenance services are expected to drive market growth.

Service Channel Insights:

In 2022, the original equipment (OE) segment held the largest market share of 71.1%. The OE segment is anticipated to maintain its dominance in the aftermarket arena until 2030. The Do-It-Yourself (DIY) segment is expected to witness fast revenue growth from 2023 to 2030. DIY customers have technical knowledge and prefer to maintain, repair, and upgrade their vehicles themselves. Some customers purchase parts online and have them installed by professional workshops (known as Do-It-For-Me or DIFM customers). The service channel includes stakeholders such as raw material suppliers, distributors, manufacturing units, and repair shops. Strategic alliances between collision repair centers and auto insurance companies are becoming common to gain a competitive edge. This collaboration aims to capture a significant share of the market.

Certification Insights:

In 2022, the genuine parts segment held the largest market share of 51.8%, and it is expected to continue dominating the aftermarket until 2030. However, the uncertified segment is projected to experience rapid revenue growth from 2023 to 2030. Counterfeit parts are illegal and lack testing, certification, and warranties. Genuine parts, produced by car manufacturers or OEMs, offer assured quality, variety, ease of availability, and warranty, but they are expensive and typically sold through dealerships. Certified parts are tested and inspected by organizations like the Certified Automotive Parts Association (CAPA) to ensure quality. Uncertified parts, although not approved by car makers, provide cost-effective alternatives. The lower cost of uncertified parts creates growth opportunities for this segment.

Regional Insights:

Asia Pacific held the largest market share of 28.5% in 2022 and is expected to continue delivering significant growth from 2023 to 2030. The region benefits from advanced technology in auto parts manufacturing, increased production and sales of consumer and passenger automobiles, and the digitalization of automotive component delivery services. Companies are focusing on acquisitions to gain a larger market share. For example, Goodyear Tire & Rubber Company acquired Cooper Tire & Rubber Company in February 2021 to expand their brand portfolio and provide comprehensive services. Universities and research organizations are working to increase cost and operational efficiencies of automotive components, aiming to reduce prices. Developments in emerging economies like China, India, and Brazil present thriving prospects for market growth in the Asia Pacific region.

Key Companies & Market Share Insights

Technological proliferation and increasing investments in R&D activities by manufacturers and associations are expected to drive industry growth. There are numerous domestic and regional competitors prevailing in the market that are challenged to deliver innovative offerings, which help buyers to address the changing technologies, security needs, and business practices. The key participants are in an advantageous yet vulnerable position in terms of market share gain or losing points. The key players are adopting the merger and acquisitions strategy intending to extend their foothold across the globe.

Some prominent players in the automotive aftermarket industry include:

• 3M Company
• Continental AG
• Cooper Tire & Rubber Company
• Delphi Automotive PLC
• Denso Corporation
• Federal-Mogul Corporation
• HELLA KGaA Hueck & Co.
• Robert Bosch GmbH
• Valeo Group
• ZF Friedrichshafen AG

Recent Developments

• In June 2023, Continental released the UltraContact NXT series tire, which is distinguished by its high share of sustainable material usage. The tire comprises up to 65% of recycled, renewable, and ISCC PLUS mass balance-certified materials. The tires will be made available in 19 sizes.
• In June 2023, the Goodyear Tire & Rubber Company added the ‘WORK Series Regional Haul Trailer (RHT) 2’ to its Cooper WORK Series line. The trailer tire is SmartWay-verified and helps deliver better fuel efficiency and durability in tough driving environments and high scrub applications.
• In April 2023, Delphi Technologies released overall 87 parts in its product line. Of these, 65 parts were for the company’s primary portfolio of chassis, fuel delivery, and engine management. On the other hand, the company’s specialty brand Sparta announced the remaining 22 parts for its fuel portfolio.

Global Automotive Aftermarket Industry Segmentation

Replacement Parts Outlook (Revenue, USD Billion, 2017 - 2030)

• Tire
• Battery
• Brake Parts
• Filters
• Body parts
• Lighting & Electronic Components
• Wheels
• Exhaust components
• Turbochargers
• Others

Distribution Channel Outlook (Revenue, USD Billion, 2017 - 2030)

• Retailers
  • OEMs
  • Repair Shops
• Wholesalers & Distributors

Service Channel Outlook (Revenue, USD Billion, 2017 - 2030)

• DIY (Do it Yourself)
• DIFM (Do it for Me)
• OE (Delegating to OEM’s)

Certification Outlook (Revenue, USD Billion, 2017 - 2030)

• Genuine Parts
• Certified Parts
• Uncertified Parts

Regional Outlook (Revenue, USD Billion, 2017 - 2030)

• North America
  • U.S.
  • Canada
  • Mexico
• Europe
  • Germany
  • U.K.
  • France
• Asia Pacific
  • China
  • Japan
  • India
• South America
  • Brazil
• Middle East & Africa