CLEPA participates in the 25th edition of Automechanika, presenting how connectivity and digitalisation are changing the automotive aftermarket, as reported in the “Aftermarket 2025” study.
in CLEPA, 10-09-2018
The automotive industry is being transformed by megatrends such as electrification, automated driving and connectivity. This is impacting the aftermarket business as well, that represents on average about 15-20% of the total business for automotive suppliers.
CLEPA commissioned the study “Aftermarket 2025” from the Danish agency QVARTZ and Stern Stewart & Co Munich, who conducted numerous expert interviews with decision makers from the automotive supplier’s industry, trade, OEM and insurance companies, to investigate the effects on individual market participants.
The automotive aftermarket has a global market volume of 400 billion EUR and is estimated to grow to EUR 566 billion by 2025, this corresponds to an annual growth of 4.5%. The study shows that the major growth will take place in Asia (+8.6%), catching up with USA and Europe. This growth will no longer take place in the classic segments, but in new developments, such as software, content, data or retrofit solutions which will be offered over the lifetime of a vehicle.
Taking into account the hypothesis that 70% of vehicles will be connected by 2025, this will open the opportunity to new services and business models. New digital players such as mobility service providers, repair platforms, insurance providers or eCommerce are gaining relevance.
The prerequisite for all these services is, user consent provided, the ability to communicate with the vehicle, make use of the data generated in the vehicle and the access to available resources in the vehicle. Sigrid de Vries, CLEPA Secretary General, highlighted the importance of a fair and equal access to in-vehicle data to utilise the full potential of new and innovative data-based business models. “There is a need to ensure a fair and non-discriminatory access for all market participants to facilitate undistorted competition between service providers in this emerging market of data-based mobility services”.
Also, future vehicle ownership models will change the aftermarket. Leasing, re-leasing and mobility services are gaining in popularity and will lead to more decisions on vehicle repair and maintenance being made by professional fleet operators. Both OEMS and independent providers will increase their share in the fleet business by using the opportunities and offering additional services.
The trend towards fleet business, slow market growth in wear and tear parts in combination with a fast consolidating wholesale distribution will lead to increased pressure on automotive parts manufacturers.
In the next years, CLEPA expects an intense discussion on the total costs in the supply chain and on more efficient flows of goods, which will ultimately redefine the go-to-market strategy of some suppliers, also with new providers of platforms in the field of eCommerce, repair management, repair brokerage or fleet management that will find new cooperation models.
“The aftermarket is evolving from a pure maintenance and repair market into a mobility-related service sector. Access to in-vehicle data and changes in vehicle ownership models are bringing both challenges and opportunities. We expect to see more changes in the aftermarket in the next five years than in the previous two decades”, highlighted Frank Schlehuber, CLEPA Senior Advisor Aftermarket, during the Automechanika press conference.