Experian: Aftermarket Sweet Spot to Stabilize Then Grow

Date: March 28, 2019
Source: The Greensheet
The aftermarket’s sweet spot will stabilize and then grow for the next several years, according to a 2018 Q4 market trends report from Experian Automotive. The findings were based on vehicles in operation (VIO) and registration data.
 
“It should go up for at least five years, based on what we see so far,” said Marty Miller, Experian’s automotive product marketing manager.
 
Total light duty VIO (275.3 million) continues to grow in the United States, with just over 30 percent, or 83 million, within the sweet spot range last quarter.
 
The sweet spot is shifting to model years 2008 to 2014. While the older end still shows the effects of a purchasing decline during the Great Recession, there’s an increase in cars on the road with the newer models, Miller said.
 
Changes in market trends should lead to aftermarket parts inventory reviews, Miller said. For example, the sweet spot now includes more crossovers -- such as CRVs and Rav4s -- and fewer sedans, he said.
 
The electric vehicle (EV) market also is gaining in popularity. EV registrations for 2018 increased by 111 percent over the prior year, according to the report.
 
And electric vehicles -- including the Nissan Leaf and Tesla’s Model S -- are coming into the sweet spot for the first time this year. The BMW i3 and Fiat 550e will enter next year.
 
Experian expects more than a dozen EV car, van and truck model launches this year, with at least 29 more planned for 2020 and beyond.
 
They’ll need everything from shocks to brakes and fluids, Miller said.
 
“Electric vehicles are going to increase across multiple brands, and there’s going to be a lot of competition and brands we haven’t seen before,” Miller said. “It’s going to really take off and change the marketplace.”
 
California is still the No.-1 market for EVs, but that could change, he said. Experian is now seeing increased registrations in larger metro areas.
 
The report also found that Millennial and Gen Z buyers continue to increase in registration share for all vehicle class types.
 
“There always is talk of Millennials not buying vehicles, but, as they’re getting older -- into their mid- to late-20s and 30s and starting families -- they’re buying,” Miller said.
 
The top sweet spot models include: the Ford F150, Toyota Camry, Honda Accord, Chevrolet Silverado and Honda Civic.
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