The global automotive parts and components market size is anticipated to grow at a Compound Annual Growth Rate (CAGR) of 2.7 percent till 2025. With the latest technologies being introduced in the market every day, the automotive industry has a dynamic business environment.
Therefore, to remain competitive in such a dynamic environment, auto parts manufacturing companies are aligning their strategies with extensive trends. For instance, the auto parts manufacturing market is predicted to gain momentum in the next few years with the launch of the latest technologies in automotive engine radiators.
Also, leading organizations are already getting ready for manufacturing lightweight auto parts that are more fuel-efficient but much lighter compared to their predecessors since such new designs might increase the floor space but reduce the overall weight of the vehicle. Automotive parts and components are segmented based on their type and applications.
Online aftermarket business The global automotive aftermarket size is expected to grow at a CAGR of 4.0 percent from 2020 to 2027. The pursuit of automobile drivers to enhance their vehicle performance is one of the major factors driving this market. The factors predicted to draw significant investments from the key participants include the digitization of component delivery sales and services with online portals distributing aftermarket components. Due to the aforementioned trade gateways, the online aftermarket business is anticipated to witness high growth in the developing economies. Furthermore, a rise in online sales of automotive components is predicted to bolster market growth. automotive replacement part suppliers and service enablers are the two primary segments of the value chain of the aftermarket.
Based on the region, this market is divided into Europe, North America, Asia Pacific, South America, MEA and the Asia Pacific led the aftermarket in terms of revenue last year. Other factors such as an increase in consumer and passenger automobile production and sales, digitization of automotive component delivery services are expected to drive automotive sales in the Asia Pacific market. In 2019, the revenue of the sector increased to 14.5 percent to 3.95 lakh crore. However, the total turnover of the automobile component manufacturing companies in the country has declined by 11.7 percent to 3.49 lakh crore in the financial year 2019-2020, owing to the prolonged slowdown in the auto sector and the outbreak of the COVID-19 pandemic.
According to Deepak Jain, President of ACMA, Subdued vehicle demand, investments made for transition from BS-IV to BS-VI, liquidity crunch, lack of clarity on policy for electrification of vehicles, and the slowdown in key export markets, among others, had an adverse impact on the performance of the components sector in India as also on its expansion plans. All these factors pulled back the domestic auto component industry by almost two years, Jain noted.