By just about every measure, the auto industry has climbed back to health in recent years. After hitting below 10 million units sold in 2009, sales rose to reach 16.3 million in 2014. Looking long-term, that bodes well for the automotive aftermarket. More vehicles today equal more aftermarket work in the future.
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But, aftermarket executives might sound a bit like delegates at a sitting president’s electoral convention chanting “Four more years. Four more years.”
Why four more years? Because that’s about how long it will take for the aftermarket sweet spot to get back into growth mode. The aftermarket sweet spot – the six- to 12-year-old vehicles that currently cover model years 2003 to 2009 – now stands at 92.2 million vehicles. Model years 2003 to 2005 will drop out of the aftermarket sweet spot in the next three years. But, they will be replaced by model years 2010 to 2012, which combined had fewer new vehicle sales than the 2003 to 2005 models. That means the sweet spot will contract for another three years and will not grow again until model year 2006 falls out and 2013 is added.
Not only is the aftermarket sweet spot shrinking, it’s morphing from a dominant-domestic vehicle mix to an import-controlled vehicle market. Five years ago, domestic vehicles covered nearly two-thirds of the aftermarket sweet spot, but today, domestic share is down to a 55/45 percent mix. Five years from now, import vehicles will take over with an anticipated market share of 55 percent of all vehicles in the aftermarket sweet spot.
An altering sweet spot creates a challenge for the industry, but certainly doesn’t mean disaster is looming. It will be important for aftermarket professionals to use data and analytics for the good of their business. The insights that these businesses will gain, enable them to take action and better prepare for the future. Here are some of the trends driving the industry today:
Pickup trucks still rule
Pickup trucks are to the auto industry what blue jeans are to apparel. No matter what trends come and go, blue jeans are a comfortable and functional staple of just about any wardrobe. Pickup truck functionality, year in and year out, is a staple of the auto world.
Currently, 15 percent of all vehicles in operation are pickup trucks. The two most prevalent vehicles on the road today are both pickup trucks – there are nearly 9 million Ford F-150s and nearly 8 million Chevrolet Silverado 1500 pickup trucks in operation today. Many pickup trucks are critical to their owners’ livelihood. Therefore, keeping them running smoothly is mandatory.