Rising availability of automotive replacement equipment on online platforms coupled with an adequate supply chain fuels the global e-commerce automotive aftermarket, which is estimated to reach $ 43.9 billion by 2028.
According to a new report by Grand View Research, the e-commerce automotive aftermarket will grow at a CAGR of 14.6% over the forecast period.
The US-based market research and consulting company said improved supply chain activity with technology deployments such as the Internet of Things (IoT) and automation had boosted the growth of e-commerce platforms in the automotive sector. In addition, growing awareness of automotive OEMs to establish an omnichannel presence promotes them to deploy e-commerce practices, thereby offering growth opportunities for the e-commerce aftermarket parts.
The key players in the e-commerce automotive aftermarket space include Advance Auto Parts, Alibaba, Amazon, AutoZone, CARiD, E-bay, Flipkart, NAPA, O'Reilly, RockAuto and US Auto Parts Network.
Key Insights & Findings
Grand View Research observed that the lighting segment is expected to register the fastest growth over the forecast period. The growth is on account of the ongoing trend of automobile owners to customise and install new and personalised lighting equipment for interiors and exterior uses.
In addition, the b2c segment is expected to register the highest CAGR over the forecast period due to the rising acceptance of DIY innovation in automobiles, thereby promoting automobile users to order automotive parts replacement and self-installation.
The Asia Pacific region is expected to dominate the market over the forecast period owing to rising economic activity in China and India. In addition, the presence of several automotive parts manufacturers in China and their ability to provide affordable and attractive products offer an impetus to market growth.
According to the research firm, the increasing automotive sales and the growing presence of new automotive players are expected to aid the market growth. In addition, the production of new automobiles with diverse technologies facilitates the need to develop new aftermarket products.
Moreover, rising awareness amongst people to adopt electric vehicles (EVs) promotes automotive companies and OEMs to develop more proficient products, which help increase the efficiency of these vehicles. This increasing awareness is expected to result in higher R&D activities in product development, thereby offering promising growth opportunities to the market.
Highest growth from Asia Pacific region
The Asia Pacific region is expected to record the highest CAGR, primarily fuelled by China due to the increasing number of light motor vehicles. In addition, the growing average age of the vehicle population and technological innovation in automotive manufacturing practices such as the influx of robots and automation is expected to grow the e-commerce aftermarket over the forecast period.
The reports stated that the Chinese government incentivises automotive suppliers to improve automotive aftermarket transparency and presence by enabling independent suppliers to sell Original Equipment Service (OES) parts.
Also, E-tailers are continuously challenging traditional retailers by penetrating the market more effectively. This has led to the emergence of companies such as RockAuto and Tire Rack and also promoted companies such as Alibaba and Amazon to increase investments in the automotive aftermarket sales segment, the report said. This has led to an increase in automotive equipment sales via e-commerce channels, and the trend is expected to continue over the forecast period.
Moreover, the onset of COVID-19 has promoted people to stay confined to their homes, encouraging them to resort to online shopping activities, which will help the e-commerce automotive equipment shopping trend stay buoyant, the research agency added.
Courtesy: Grand View Research. NB: Photo is representational.