U.S. Leads Powertrain Aftermarket but Trails in Trends

The U.S. leads the North American fore sales of powertrain aftermarket components, accounting for 86% of overall sales, or $10.3 billion, in 2016. However, through 2021, aftermarket powertrain demand in Mexico will expand at the fastest rate, though from an admittedly small base. Factors sustaining demand in Mexico include the advanced age of much of the country’s light vehicle population buoying the probability that long-lasting powertrain components will need to be repaired or replaced, according to a study from The Freedonia Group, a Cleveland-based consultancy.

Mexico’s hot climate contributes to vehicle overheating and powertrain component damage along with poor road conditions in many areas, increasing powertrain wear and tear. How this differs from U.S. conditions was not clear. As was the silence on where the U.S. sold parts were built.

Canada will record the next fastest market advances, after Mexico prompted by above average growth in the number of light vehicles in use. Overall, the rate of expansion for aftermarket powertrain demand in the US will lag that for Mexico and Canada,

Through 2021, U.S. aftermarket demand for engine, transmission, and drivetrain components will rise 1.6% per year, a slight uptick from the 2011-2016 period, but trailing advances in the smaller Canadian and Mexican markets. These and other trends are presented in Automotive Aftermarket in Powertrain Components in North America, a new study from The Freedonia Group, a Cleveland-based industry research firm.

U.S. Aftermarket Sales

Pros

  • increases in the size and the average age of the light vehicle park, which stood at 11.4 years in 2016
  • climatic extremes, including snow in some regions and heat in others
  • technological improvements, such as the incorporation of computers and sensors, that raise the average per-unit cost of repairs and replacements
  • growth in the total number of light vehicles involved in accidents

Cons

  • technological improvements that reduce the frequency of maintenance and replacement intervals
  • increased reliability and durability of many powertrain components

Nevertheless, a preference in the country for standard transmission vehicles, which are more economical to repair, will restrain overall sales advances. In addition, the 2017 deregulation of gasoline prices in Mexico will raise the cost of gasoline by as much as 20%, which will likely reduce the average number of miles driven per vehicle and associated powertrain product aftermarket demand.

Canada will record the next fastest market advances, supported by above average growth in the number of light vehicles in use. The rate of expansion for aftermarket powertrain demand in the US will lag that for Mexico and Canada, but the US will account for the lion’s share of all North American sales advances through 2021 in value terms due to its huge light vehicle park and higher automotive accident rates.

Study Coverage

The study presents historical demand data (2006, 2011 and 2016) and forecasts (2021 and 2026) by product category (transmissions & parts, engines & parts, and drivetrain components), country (US, Canada, Mexico), and performer (professional and consumer/DIY). The study also evaluates company market share and competitive analysis on industry competitors including Federal-Mogul, GKN, GM, Jasper Engines & Transmissions, Schaeffler, ZF Friedrichshafen.

About Kenneth Zino

Ken Zino is an auto industry veteran with global experience in print, broadcast and electronic media. He has auto testing, marketing, public relations and communications expertise garnered while working in Asia, Europe and the U.S.
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