The United States Automotive Service Market is expected to register a CAGR of over 3.95%, during the forecast period, 2020 - 2025.
- As vehicles are becoming more advanced and efficient, most of them are now seeing more miles before they are discarded or scrapped. In 2019, more than 33 million vehicles in the United States were older than 14 years. As a result, these vehicles need regular servicing and probably replacements due to their age. Most owners prefer to go to local garages and workshops to get the job done on their vehicles, as this would be economical.
- The United States also dominates the North American automotive service market by occupying a share of more than 60% in 2017. This is primarily due to a continuous rise in the number of vehicles on the road, along with the presence of major automotive service players in the country.
- The increasing availability of automotive parts on e-commerce platforms is one of the major aftermarket trends in the United States. Over the past few years, the sale of parts through these platforms has been on-par, if not higher than the traditional brick and mortar shop sales. E-commerce websites provide customers with a platform to research and compare parts, thereby enabling them to make an informed choice.
Key Market Trends
Increase in Sales of Electric Vehicles is a Restraint
The Market for electric vehicles is increasing year-on-year, impacting the operations of the automotive industry. The annual sales of plug-in electric vehicles crossed the 400 thousand mark in 2019, gathering more than 1% of the overall vehicle sales share. The transformation of the automotive industry has its impact on the automakers, tire manufacturers, aftermarkets, and supply chain of the industry itself. Manufacturers of the parts and components of the IC engine vehicles are also expanding into the electric vehicle domain as electric vehicles become ubiquitous.
The RandD activities of automakers and tier manufacturers would increase as they have to support both the IC powertrain segment and the electric vehicle segment during the initial stages, which may hinder the Market for automotive services.
However, the average age of vehicle usage has been consistently increasing in the United States since 2015. This increasing trend of vehicle usage has further boosted the need for maintenance and repair services in the US market. As a result, diesel or gasoline vehicles will have demand in the automotive service market.
Increasing Commercial Vehicle Sales Driving Market
Though the sale of passenger cars has been declining in the country since 2018, commercial vehicles continued to record a year-on-year increase in sales since the post-recession period. They even breached the 12 million mark in 2018. The shifting consumer preference in the United States to pick-up trucks that can transport both cargo and passengers is one of the reasons behind the growth.
Commercial vehicles like medium and heavy-duty trucks tend to cover more miles on average than passenger cars. Hence, they often require servicing. Even their part and component maintenance and replacement cycle is more frequent due to high distances travelled in a relatively short period.
Common parts like engine oils, brake and transmission fluids, air filters, brake pads, etc. are consumed faster, and most vehicle owners tend to reach out to aftermarket garages or workshops for these kinds of jobs after the warranty period. Also, since most commercial vehicles run on diesel, they require even more service compared to petrol counterparts. For instance, most petrol vehicles nowadays are coming with a non-serviceable fuel filter and can go on even without a filter replacement during their lifetime.
But purification of diesel is done using either a single filter or a combination of primary and secondary filters. These filters need to be replaced at regular intervals based on the build and variant of vehicles. This is expected to drive the market for this class of vehicles over the forecast period.
The United States Automotive Service Market is consolidated with existing market players such as Firestone Complete Auto Care (a unit of Bridgestone), Jiffy Lube, Meineke, Midas, Monro Muffler Brake, and Safelite Group who hold the most significant shares. To have the edge over its competitors' companies are making joint-ventures, partnerships, launching new products with advanced technology.
The US automotive repair and maintenance services industry includes about 160,000 establishments (single-location companies and units of multi-location companies) with combined annual revenue of about USD 105 billion.
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