Emerging Trends in the Australia Automotive Aftermarket Market
Emerging Trends in the Australia Automotive Aftermarket Market
Blog Article
The automotive aftermarket in Australia involves the manufacturing, remanufacturing, distribution, retailing, and installation of all vehicle parts, chemicals, equipment, and accessories, after the sale of the original vehicle by the OEM. The aftermarket parts include tires, batteries, brake pads, filters, engine parts, lighting, and other vehicle components that require periodic replacement due to wear and tear.
The Australia Automotive Aftermarket Market industry provides maintenance and repair services to vehicle owners through independent repair shops and dealership service centers. The growing vehicle parc size and higher average age of vehicles in Australia have increased the demand for repair and maintenance services.
The Australia Automotive Aftermarket Market is estimated to be valued at USD 13.45 Bn in 2024 and is expected to reach USD 17.38 Bn by 2031, growing at a compound annual growth rate (CAGR) of 3.73% from 2024 to 2031.
Key Takeaways
Key players operating in the automotive aftermarket in Australia are Bosch, 3M, Continental, Delphi, Denso, Magna International, Arnott.
Growing vehicle parc: The rising vehicle ownership, higher average age of vehicles, and higher mileage driven per year have augmented the demand for replacement parts and maintenance services in the aftermarket. According to industry estimates, the total vehicle parc in Australia is expected to grow at a CAGR of 2-3% during 2022-2027.
Technological advancement: The integration of advanced technologies such as telematics, sensors, and remote diagnostic tools by OEMs and independent workshops have made the repair and diagnostics more efficient and convenient. The availability of online repair manuals and DIY repair videos have further aided self-maintenance by vehicle owners.
Market Trends
Increasing penetration of generic parts: The share of lower-cost generic and non-OE components has been rising in the Australian aftermarket due to competitive pricing. These parts accounted for over 30% share in 2022.
Rising demand for multi-brand workshops: The automotive workshops are diversifying their service offerings to cater to multiple vehicle brands instead of specializing in a single brand. This is attracting more customers through competitive pricing and one-stop maintenance solution.
Market Opportunities
Specialized services for EVs: With the rising EV adoption in Australia, opportunities are emerging for new skills development and services like EV battery repair/recycling, charging infrastructure maintenance etc.
Subscription models for vehicle health management: Opportunities exist for the development of digital platforms and services offering all-inclusive monthly/yearly vehicle maintenance packages. This offers convenience to customers.
COVID-19 Impact on Australia Automotive Aftermarket
The COVID-19 pandemic has massively disrupted the Australia automotive aftermarket sector. During the pre-COVID times, the aftermarket was experiencing steady growth driven by increasing vehicle fleet size and average vehicle age. However, the imposition of lockdowns and other restrictions during the pandemic led to a steep decline in demand across most categories in 2020.
As the pandemic raged on, many garages faced temporary closure or operated at limited capacity due to social distancing norms. This led to repair backlogs building up. Supply chain disruptions also affected the timely availability of spare parts. However, some categories like DIY parts saw increased demand as more people took vehicle maintenance into their own hands due to mobility restrictions.
With vaccination drives progressing well in 2021, the aftermarket is slowly recovering. But supply chain challenges and changing consumer behavior continue to impact growth. Repair shops are focusing on managing the pending repair backlogs while ensuring COVID appropriate protocols. Meanwhile, established online channels for purchase of parts and accessories are gaining more traction.
The Australia automotive aftermarket sees maximum value contribution from regions like New South Wales and Victoria. This is owing to the high population and vehicle density in major cities like Sydney and Melbourne located across these states. Also, the presence of major vehicle OEM manufacturing plants and a large dealer and repair networks aid the aftermarket business growth here.
On the other hand, Western Australia is emerging as the fastest growing region for the Australia automotive aftermarket. Factors like rising vehicle fleet, increasing average age of vehicles due to remoteness and steady economic growth are stimulating aftermarket demand. Initiatives to boost localized repairs and service also support the sector's expansion in Western Australia.
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About Author:
Ravina Pandya, Content Writer, has a strong foothold in the market research industry. She specializes in writing well-researched articles from different industries, including food and beverages, information and technology, healthcare, chemical and materials, etc. (https://www.linkedin.com/in/ravina-pandya-1a3984191)