According to a report by business analyst Frost & Sullivan, aftermarket revenue expanded by 4.1% in 2019. This was largely driven by a 3.2% growth in vehicles in operation, with the contraction in global gross domestic product (GDP) growth stifling consumer expenditure on new vehicle purchases.
However, for 2020, the market was initially forecasted to grow at a healthy 4%; but following muted consumer demand and supply-chain disruptions caused by the pandemic, it is now expected to contract between 4.9% and 11.6% according to the report. New aftermarket demand ‘pockets’ will rise from the need for customer safety and wellbeing, creating a $75-billion market opportunity for contactless delivery of parts and services by 2025.
“The global automotive aftermarket is at a crossroads and has severely impacted stakeholders at all levels. Supply chain reorientation, financial aid to channel partners and the digitization of traditional business models and services can help mitigate some of the adverse effects of the pandemic,” said Anuj Monga, Research Manager, Automotive & Transportation at Frost & Sullivan
The report, titled: Digital Business Models Mitigating COVID-19 Implications on Global Aftermarket Performance in 2020, identifies eCommerce, digital retailing and services relating to hygiene and car care