The automotive aftermarket is a huge secondary market in the automotive industry. It comprises of manufacturing, remanufacturing, distribution, retailing and installation of all vehicle parts, chemicals, equipment and accessories. All the extra parts and accessories are not necessarily manufactured by the original equipment manufacturer (OEM’s). Replacement or spare parts and accessories are the two categories in automotive aftermarket. Automobile accessories are certain parts made for comfort, convenience, performance, safety, or customization, and are designed for add-on after the original sale of the motor vehicle. Aftermarket consists of parts for replacement, collision, appearance, and performance, such as electric propulsion at varying qualities and prices for all types of vehicle and models. Aftermarket provides vehicles services, maintenance, and customized services. Automotive aftermarket consist of vehicle manufacturers, distributors, wholesalers, importers and retailers of automotive parts, accessories, tools, equipment, vehicle service, repair.
According to the study “Automotive Aftermarket in Europe”, Europe has enforced stringent laws for the growth of remanufacturing business because a lot of worn-out car parts are discarded and dumped in the environment. Consumers buying new automobile parts in Europe are deemed to volatile the prices of raw materials and European automotive aftermarket consists of fragmented presence of OEMs. Therefore, reprocessing and testing core components of cars are solidifying the growth of its automotive parts remanufacturing market in the country. Environmental concerns in Europe are associated with ageing of automobiles that continue to be on road and demand for automotive parts remanufacturing. The automobile aftermarket is introducing new products and components for controlling a vehicle’s performance. The advent of hybrid and advanced vehicles in Europe is also encouraging the adoption of automotive parts remanufacturing within the automobile industry. Majority of the European consumers demand for remanufactured engines, transmission components, turbochargers, transmission clutches, brake calipers and steering wheels.
Europe’s is the leading country in automobile manufacturing in the world and Germany dominates the aftermarket market with a huge share of revenue followed by France and Italy. Automotive aftermarket is associated with higher profit margins due to the sales of automotive components, coupled with minimal input costs for remanufacturing discarded products. The leading players in Europe’s automotive parts remanufacturing market are Borg Automotive A/S, Valeo SA, Caterpillar Inc., ZF Friedrichshafen AG, Carwood Group, Meritor Inc., Robert Bosch GmbH, Budweg Caliper A/S, Monark Automotive GmbH, and LuK Unna GmbH & Co. KG. The automotive aftermarket in Europe provides tires, batteries, collision body parts, oils, lubricants, brake parts, filters, lightening and electronic components, wheels, exhaust components, and others.
The increase in consumers’ disposable income, growth in trade and country’s economy are the various factors driving a favourable growth in the automotive aftermarket in Europe. Aftermarket has stepped into the shipping industry by supplying various ship spare parts. Diversification in the shipping industry with the introduction of multilateral and multinational agreements enhances the growth and trading in European automotive aftermarket market. Vast automobile manufacturing units, demand for automobile goods and commodities to boost the automotive aftermarket market. However, Europe’s uneven economic growth and fluctuating prices of raw materials may hinder the growth in the automotive aftermarket over the next few years.
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Ankur Gupta, Head Marketing & Communications