Asia-Pacific Tire Market

Increasing Vehicle Age Propelling Automotive Aftermarket Components Demand

The International Energy Agency (IEA) estimates that the stock of plug-in hybrid electric vehicles (PHEVs) (cars) and battery electric vehicles (BEVs) (cars) will mount to 44,355,904 and 79,975,992, respectively, by 2030. Furthermore, the IEA forecasts that the stock of BEV vans and PHEV vans will reach 11,041,648 and 1,959,625, respectively, by 2030. The soaring demand for electric vehicles (EVs) and increasing electrification of powertrain systems across the world, owing to the rising implementation of favorable government initiatives and mounting awareness about air pollution mitigation, will create a huge requirement for aftermarket vehicle parts.

Additionally, the increasing vehicle age, especially in the developing countries of Asia-Pacific (APAC) and Latin America, Middle East, and Africa (LAMEA), will aid the automotive aftermarket in advancing at a 5.07% CAGR during 2020�"2030. Owing to this reason, the market revenue will escalate from $803.22 billion in 2019 to $1,370.17 billion by 2030. For instance, the International Trade Administration forecasts that the average age of a car in China is projected to surge from 4.6 years in 2018 to 5.5 years in 2023 owing to the increasing integration of technologically advanced components.

Engine parts, such as pistons, piston rings, engine valves and parts, carburetors, fuel injection systems, and powertrain components; drive transmission and steering parts, such as wheels, gearboxes, axles, steering systems, and clutch assembly systems; suspension and braking parts, such as brake pads, brake calipers, and suspension systems; and electrical components, including spark plugs, starter motors, batteries, and electric ignition systems; are being offered by aftermarket companies. Additionally, such companies provide headlights and associated components, dashboard instruments, wipers, and washer systems.

  

Providers of such replacement components, such as Robert Bosch GmbH, Delphi Technologies PLC, Meritor Inc., DENSO CORPORATION, Continental AG, Tenneco Inc., ZF Friedrichshafen AG, BorgWarner Inc., Valeo SA, and HELLA GmbH & Co. KGaA, serve customers via online and offline distribution channels. In the coming years, online sales will surge at the higher rate due to the easy payment options, home delivery service, and hefty discounts offered on online platforms.

Nowadays, all the above-mentioned companies and many more offering such components are focusing on product launches, facility expansions, and partnerships to cater to a wide customer base. For instance, in September 2019, DENSO CORPORATION announced its expansion plan for its DENSO Hokkaido Corporation plant. The company plans to invest around $101.2 million by 2025 in the project. Production at the expanded facility will start in stages, by October 2021. The expansion aims to enhance the production of semiconductor sensors, to strengthen the manufacturing system of the company.

Geographically, APAC led the automotive aftermarket in the recent past, and it is expected to retain its dominance in the foreseeable future. This can be primarily attributed to the surging number of vehicles on the road, especially in India and China, and the increasing presence of prominent tier-1 suppliers in the region. Furthermore, the region is expected to advance at the highest rate in the upcoming years due to the soaring number of passenger cars in India, China, Japan, and South Korea, and the increasing requirement for vehicle repair and maintenance services in the region.

Therefore, the burgeoning EV sales and increasing vehicle age in developing nations will create a huge requirement for aftermarket automotive components in the forthcoming years.  

Author's Note

How Is Booming Electric Vehicle Sale Driving Automotive Aftermarket Parts Demand?

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