LONDON – The U.K. automotive aftermarket is set to grow.
That’s the conclusion of a new Frost & Sullivan forecast, which sees telematics, connected-car systems, personal contract purchase financing, service aggregators and e-stores “propelling demand and creating unique value for customers in a price-sensitive market.”
“To capitalize on the growing aging vehicle market, service chains should focus on highly replaceable parts associated with top brands while independent garages should develop a better understanding of servicing top brands,” the firm says.
Trends detailed in “UK Automotive Aftermarket Forecast to 2023” include:
- A high percentage of older vehicles requiring ongoing maintaining to pass yearly Ministry of Transportation requirements
- Dominance of independent aftermarket players caused by a rise in average vehicle age and relatively old VIO
- Increased growth in replacement and requirement frequency of parts such as tires, lights, brakes, suspension, parking aids, wipers and wheel hubs due to age of vehicle, and user interest in new technologies
- Demand for personal contract purchase (PCP) financing because they provide low monthly repayments, discounts on fleets and guaranteed future resale of vehicle if conditions of contract are maintained
- High penetration of e-retail for automotive parts and services
- Service aggregators playing a major role in customer choice of service center because of a price-sensitive market
- Rise in OEM e-stores attributed to strong penetration of Internet, smartphone usage and discounts available on online retail
“In a fiercely competitive evolving ecosystem, independent aftermarket players and franchises must harness available opportunities such as developing mutually beneficial partnerships and tie-ups with PCP agencies, tire companies, telematics and connected-car manufacturers to offer better discounts, customer value and ensure availability of parts on time,” said Frost & Sullivan Mobility Program Manager Anuj Monga.