The average age of vehicles on the road is still hovering just below 12 years, although the rate of aging of the fleet is slowing down, says a new report from IHS Automotive. At the same time, the rise in new vehicle sales and improving vehicle quality are moving the traditional "sweet spot" for independent aftermarket repair shops and dealerships.
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The age and type of vehicle coming in for repairs will change significantly over the next five years, and the aftermarket will need to adjust accordingly.
The average age of light vehicles on the road held steady at 11.4 years, according to data from January 2014 gathered by IHS. IHS incorporated Polk, previous publishers of the average age data, into its business in 2013.
Total light vehicles in operation (VIO) in the U.S. increased more than 3.7 million (1.5 percent) to 252.7 million, a new record. New vehicle registrations outpaced scrappage by more than 24 percent for the first time in 10 years, reflecting steadily improving vehicle sales figures.
"That's reflective of three or four years of pretty significant growth in new to five-year-old vehicles," says Mark Seng, global aftermarket practice leader at IHS Automotive. "New light vehicle registrations have had double-digit increases in previous years, and last year that growth was about 7.5 percent. Couple that with people hanging on to their vehicles longer, and all of that contributes to what we're seeing in terms of VIO and the scrappage rate."
The number of vehicles scrapped in 2013 was just 11.5 million, compared to the more than 14 million scrapped in 2012.
The scrappage rate has declined as new vehicle sales increase. Those newer vehicles are built to last longer, and owners are driving them longer than ever before. "New light vehicle sales have taken off, and all of the vehicles being added to the VIO are low-scrappage-rate vehicles," Seng says.