The global automotive aftermarket size was valued at USD 378.4 billion in 2019 and is expected to grow at a compound annual growth rate (CAGR) of 4.0% from 2020 to 2027. The market is majorly driven by the pursuit of automobile drivers to enhance their vehicle performance in terms of exhaust sound, speed, appearance, along with other aspects.
Regional regulatory authorities, such as the Japanese Automobile Sports Muffler Association (JASMA) and the U.S. Environmental Protection Agency, monitor built-up standards and environmental impacts associated with automotive component functioning, for instance, noise emission levels associated with the modern-day resonators and mufflers in automotive exhaust systems.
Digitization of component delivery sales and services, along with online portals distributing aftermarket components in synchrony with global automotive suppliers, is expected to draw significant investments from the key participants. Owing to the above-mentioned trade gateways, the online aftermarket business is expected to witness high growth in developing countries. Additionally, increasing online sales of automotive components is estimated to further boost market growth.
Value chain of the aftermarket consists of two primary segments, automotive replacement part suppliers and service enablers. These prime industry segments exchange value through automotive sectors at several intermittent stages. Access to a considerable number of components along with simple transactions through digitalization are expected to solve the obtainability issues, thereby driving the aftermarket growth. Ensuing digitalization and rising trend of Internet-of-Things (IoT) are anticipated to have a significant impact on industry growth.
Though technological improvements have created several market opportunities, high R&D expenditures are expected to hinder market growth over the forecast period. Automobile manufacturers face various constraints, such as increased production costs during manufacturing processes. However, some automotive replacement parts, such as aftermarket filters, offer the chance of choosing a part that suits the condition in which the vehicle operates.
On the basis of replacement part, the market is segmented into the tire, battery, brake parts, filters, body parts, lighting and electronic components, wheels, and exhaust components. The tire is anticipated be the largest segment in terms of the replacement part and is expected to dominate the market in terms of size owing to the low replacement cycle of tires as compared to its counterparts.
The aftermarket replacement part suppliers include various accessories, lubricants and tires, and other component replacement suppliers. The industry value chain consists of service enablers, such as repairing services providers and entertainment service providers. The automobile industry is observing growth in demand for hybrid electric cars due to increased prices of petrol and petrol engine-based automobiles. This would eventually throttle the demand for exhaust parts and specific tools for these vehicles in the coming years.
Increasing disposable income in developing countries, such as China and Brazil, is expected to have a positive impact on the aftermarket. Increasing demand for automotive is projected to trigger the demand for automobile component sales in the forecast period. Stringent regulatory rules and standards for car safety across the globe are anticipated to drive the market growth. Modern age production technologies, such as 3D printing of automotive parts that enable efficient fabrication and reduces emission, are being used extensively by major players in the aftermarket to optimize their production costs.
On the basis of distribution channel, the aftermarket is categorized into retailers and wholesale and distribution (W&D) segments. In terms of size, the retailer segment is anticipated to dominate the market, whereas the wholesale and distribution segment will witness the fastest growth from 2020 to 2027. The automotive aftermarket plays a significant role in the automotive manufacturing and maintenance scheme as automotive components need to be replaced on time to maintain the overall performance of the vehicle.
Technological advancements are transforming the market toward digitalization, leading to automotive components, parts, and services being sold online. Every player in the value chain, including Original Equipment Manufacturers (OEMs), Original Equipment Suppliers (OESs), wholesalers, insurers, and workshops are reacting to the growing online trend. Advanced technology usage in automotive fabrication, rise in automobile manufacturing, and digitalization of automotive repair and maintenance services are some of the factors boosting the market growth.
On the basis of service channel, the aftermarket is segmented into Do It Yourself (DIY), Do It For Me (DIFM), and Original Equipment (delegating to OEMs). In terms of revenue, the OE segment is anticipated to dominate the aftermarket by 2027 while the DIY segment is expected to witness the fastest growth over the forecast period. DIY customers have technical knowledge and interest to maintain, repair, and upgrade their cars on their own whereas, DIFM customers buy parts online but get them installed by professionals.
The aftermarket service channel includes raw material suppliers, tier 1 distributors, and automobile exhaust hubs/manufacturing units and aftermarket units, comprising jobbers and repair shops. Repair centers are important stakeholders in the aftermarket service channel. The industry is witnessing a trend of strategic alliances and collaborations between collision repair centers and insurance companies to gain a competitive edge and capture a significant share in the market. For instance, Utica Mutual Insurance Company, State Farm Mutual Automobile Insurance Company, and Progressive Casualty Insurance Company have tie-ups with certified automotive repair shops across all the states in the U.S.
On the basis of certification, the aftermarket is segmented into genuine, certified, and uncertified. The genuine segment is anticipated to dominate the aftermarket in terms of size by 2027 while the uncertified segment is expected to witness the fastest growth from 2020 to 2027. Genuine parts are manufactured by the car manufacturers or by the OEMs, also known as subcontractors. Genuine replacement parts have greater quality assurance, are diverse, easy to find, and come with manufacturing warranty. The downside, however, is that they are expensive and need to be purchased from authorized dealers.
Certified automotive parts are tested and inspected by certified organizations. The Certified Automotive Parts Association (CAPA) is a non-profit organization that was incorporated in 1987, to ensure the quality of replacement parts used by collision repair shops. CAPA offers test programs to verify and guarantee the quality and suitability of automotive replacement parts. Certified parts are cost-effective alternatives to costly genuine parts whereas, uncertified parts can be used instead of original automotive parts. Uncertified parts are not approved by the carmaker. However, the low cost of uncertified parts is anticipated to create significant growth opportunities for the segment in the coming years.
Based on region, the aftermarket is segmented into North America, South America, Europe, Asia Pacific, and MEA. Asia Pacific led the aftermarket in terms of revenue in 2019 and is also expected to witness significant growth from 2020 to 2027. Advanced technology usage in the fabrication of auto parts, surge in consumer and passenger automobile production and sales, and digitalization of automotive component delivery services are anticipated to spur the automotive sales in the region.
Universities and other R&D organizations are working toward increasing the cost and operational efficiencies of critical automotive components, thus reducing the price of the end product. A new design, developed by a team of researchers from the Department of Chemical Engineering at Imperial College, London, uses up to 80% less rare metal, reducing costs of the vehicle and component fabrication considerably. The prototype is anticipated to exhibit better results than the existing automobiles.
Strict vehicle emission rules by governments across the globe have also pressurized component suppliers to manufacture environment-friendly and high-efficient automotive components for the native and global markets. Over the past few years, emerging economies, such as China, India, and Brazil have witnessed considerable developments in the automotive sector, which is expected to boost the market growth in Asia Pacific.
Technological advancements and increasing investments in R&D by manufacturers are expected to drive the aftermarket. Several domestic and regional competitors prevailing in the market are challenged to offer innovative products to help buyers understand the changing technologies, security needs, and business practices. Some of the prominent players in the automotive aftermarket include:
Continental AG
3M Company
Delphi Automotive PLC
Federal-Mogul Corporation
Denso Corporation
Magneti Marelli S.p.A.
Robert Bosch GmbH
Report Attribute |
Details |
Market Size value in 2020 |
USD 390.1 billion |
Revenue forecast in 2027 |
USD 513.8 billion |
Growth Rate |
CAGR of 4.0% from 2020 to 2027 |
Base year for estimation |
2019 |
Historical data |
2016 - 2018 |
Forecast period |
2020 - 2027 |
Quantitative units |
Revenue in USD billion & CAGR from 2020 to 2027 |
Report coverage |
Revenue forecast, company ranking, competitive landscape, growth factors, and trends |
Segments covered |
Replacement part, distribution channel, service channel, certification, region |
Regional scope |
North America; South America; Asia Pacific; Europe; MEA |
Country scope |
U.S.; Canada; Mexico; U.K.; Germany; France; Japan; China; India; Brazil |
Key companies profiled |
Continental AG; 3M Company; Delphi Automotive PLC; Federal-Mogul Corporation; Denso Corporation; Magneti Marelli S.p.A.; Robert Bosch GmbH |
Customization scope |
Free report customization (equivalent up to 8 analysts working days) with purchase. Addition or alteration to country, regional & segment scope. |
Pricing and purchase options |
Avail customized purchase options to meet your exact research needs. Explore purchase options |
This report forecasts revenue growth at global, regional, and country levels and provides an analysis of the latest industry trends in each of the sub-segments from 2016 to 2027. For the purpose of this study, Grand View Research has segmented the global automotive aftermarket report based on the replacement part, distribution channel, service channel, certification, and region:
Replacement Part Outlook (Revenue, USD Billion, 2016 - 2027)
Tire
Battery
Brake Parts
Filters
Body parts
Lighting & Electronic Components
Wheels
Exhaust components
Turbochargers
Others
Distribution Channel Outlook (Revenue, USD Billion, 2016 - 2027)
Retailers
OEMs
Repair Shops
Wholesalers & Distributors
Service Channel Outlook (Revenue, USD Billion, 2016 - 2027)
DIY (Do it Yourself)
DIFM (Do it for Me)
OE (Delegating to OEM’s)
Certification Outlook (Revenue, USD Billion, 2016 - 2027)
Genuine Parts
Certified Parts
Uncertified Parts
Regional Outlook (Revenue, USD Billion, 2016 - 2027)
North America
The U.S.
Canada
Mexico
Europe
Germany
The U.K.
France
Asia Pacific
China
Japan
India
South America
Brazil
MEA
b. The global automotive aftermarket size was estimated at USD 378.4 billion in 2019 and is expected to reach USD 390.1 billion in 2020.
b. The global automotive aftermarket is expected to grow at a compound annual growth rate of 4.0% from 2020 to 2027 to reach USD 513.8 billion by 2027.
b. North America dominated the automotive aftermarket with a share of 24.2% in 2019. This is attributable to rise in the number of aging vehicles and the increasing adoption of electric and hybrid vehicles.
b. Some key players operating in the automotive aftermarket include Continental AG; 3M Company; Delphi Automotive PLC; Federal-Mogul Corporation; Denso Corporation; Magneti Marelli S.p.A.; and Robert Bosch GmbH.
b. Key factors that are driving the market growth include advanced technology used in the fabrication of auto parts, the surge in consumer and passenger automobile production and sales, and the digitalization of automotive component delivery services.
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The automotive & transportation industry is amongst the most exposed verticals to the ongoing COVID-19 outbreak and is currently amidst unprecedented uncertainty. COVID-19 is expected to have a significant impact on the supply chain and product demand in the automotive sector. The industry's concern has moved on from being centered on supply chain disruption from China to the overall slump in demand for automotive products. The demand for commercial vehicles is expected to plummet with the shutdown of all non-essential services. Furthermore, changes in consumer buying behavior owing to uncertainty surrounding the pandemic may have serious implications on the near future growth of the industry. Meanwhile, liquidity shortfall and cash crunch have already impacted the sales of fleet operators, which is further expected to widen over the next few months. We are continuously monitoring the COVID-19 pandemic, and assessing its impact on the growth of the automotive & transportation industry. The report will account for Covid19 as a key market contributor.