Commitment To Training

Search Autoparts/Aftermarket-business/Automotive-aftermarket-technology/

Connected vehicles, EVs will reshape aftermarket supply chain

Monday, September 12, 2016 - 07:00
Print Article

Despite getting a lot of attention during the past five years, electric vehicles are still just a small part of the entire vehicle fleet. According to Navigant, there were just 2.6 million hybrids, plug-in hybrids, and battery electric vehicles on the road globally in 2015, a number that is expected to grow to slightly more than 6 million by 2024.

The market for connected vehicles, meanwhile, is growing quickly. Gartner forecasts that one in five vehicles on the road worldwide will have some form of wireless network connection by 2020.

How will the roll out of additional high-tech and electric vehicle models affect the aftermarket parts supply chain? These new types of vehicles will require new categories of replacement parts and assemblies, while demand for other types of replacement parts may decline as they increasingly rely on electronic functions rather than mechanical ones.

As EVs, connected cars and other types of vehicles continue to incorporate advanced technology, more parts and components will include processors and embedded software. "That can make it considerably more difficult to build compatible parts," says Aaron Lowe, senior vice president of regulatory and government affairs at the Auto Care Association. "Some of that is also due to OEMs protecting that software through copyright protection, which has become a major issue in the aftermarket."

At ACDelco, Bob Stewart, manager of aftermarket service support, says there will be more modules that need to be set up with a tool or are programmable once installed, which affects installation at the repairer level. "The other big thing we've seen is that there are more remanufactured electronic assemblies," Stewart says.

FREE TELEMATICS WHITEPAPER From The Commitment to Training

Get Whitepaper

Stay ahead of the industry and expand your technical automotive knowledge by downloading our free whitepaper.

Get Whitepaper


Demand for connectivity will expand beyond new vehicles, which presents an opportunity for the aftermarket. While newer vehicles will be increasingly connected, the fact remains that the overall fleet is increasingly getting older. The aging of the vehicle fleet will likely be exacerbated by the fact that younger drivers are delaying vehicle purchases or putting off buying a car altogether.

"Having a sufficient number of cars in the fleet that can communicate will require the aftermarket to provide and install that equipment," Lowe says.

When it comes to electric and hybrid vehicles, the types of parts and assemblies that may see growth in the future will depend on which types of alternative fuel sources gain traction. "Whether we see bigger growth in electric cars or fuel cell vehicles could change parts demand, or reduce the number and types of components that have to be repaired because they aren’t under the same type of stress as in a traditional car," Lowe says. "How big the opportunity is and when those technologies will come into the market remains to be seen."

Article Categorization
Article Details
blog comments powered by Disqus