In this age, when a tech startup dreamt up between two college pals texting each other results in an immediate $20 billion valuation, our industry looks kinda of boring — at least from the outside. Boring. Yes, that’s us. Just the same old, almost ridiculously predictable growth, year after year after year. What’s that saying about a boring airline flight being the best kind? That’s not to say there haven’t been some bumps over the automotive aftermarket’s history or there won’t be any in the future. But overall, there’s almost no industry like it. What our industry lacks in minute-by-minute, heart-pounding action, most certainly makes up for it with steady — dare I say, recession-proof? — growth.
Recently, the “2015 Joint Channel Forecast Model,” produced by the Automotive Aftermarket Suppliers Association (AASA) and the Auto Care Association, reported that the U.S. automotive aftermarket is expected to grow at a compound annual growth rate (CAGR) of 3.6 percent through 2018. What’s that mean? That total aftermarket sales will grow from $246.7 billion in 2014 to $284.3 billion in 2018, an increase of nearly $38 billion over that four-year period, the organizations say. As a practical matter, how big is $38 billion?
The motion picture industry in the United States is about that size. So, the aftermarket is creating something as large as Hollywood in that four years.
That, to me, is astounding. Here, it’s not the percentage of our growth that makes these huge numbers, it’s that at roughly $250 billion, we are an enormous industry to begin with. In fact, we’re about 2.5 percent of the total U.S. gross domestic product. Wow. Remember that tech startup I mentioned above? It was real, except for the $20 billion. Recently, an app that offered the ability to broadcast live streaming video was the hottest thing ever — for about a month or so. That was, until a competitor came along and ate its lunch via its own broadcasting app.
What resulted was a spectacular death spiral. Over. Done. Sometimes you’re hot. Until you’re not. Think about what you do every day. Thankfully, in this industry, the turbulence we sometimes experience is mitigated by a few things, chiefly, the need for people to get from Point A to Point B. And they can’t do it without all of you. That should make you all feel pretty good. Keep those parts coming.
