Lang Aftermarket iReport: $17 billion foreign ‘Do-It-For-Me’ (DIFM) up for grabs
“The Do-It-For-Me (DIFM) foreign nameplate vehicle aftermarket will surge more than $17 billion in Parts and Purchased Service during 2019 through 2023. Foreign nameplates will generate virtually all light vehicle aftermarket growth over that five-year span.
“Not all major outlet groups will share equally in this bonanza of foreign nameplate DIFM business. Independent (non-Dealer) repair outlets must recognize the dynamic changes underway in the repair market and position themselves to battle effectively for this unprecedented foreign nameplate DIFM market surge.”
— Jim Lang, publisher, Lang Aftermarket iReport
Foreign Nameplate Repair Surge
Lang Marketing projects foreign nameplate cars and light trucks will soar over $17 billion in Parts and Purchased Service during 2019 through 2023. They will generate virtually all DIFM light vehicle Parts and Purchase Service growth.
Sharper Dealer Competition
The drop in new vehicle sales for several years following the 2008 Recession caused Dealers to reevaluate their position in the DIFM market.
As a result, the reduced Dealer population has become much more aggressive in competing for light vehicle repair and maintenance.
The extended new vehicle ownership cycle (buyers are holding vehicles for an average of approximately 6 years) is providing Dealers the opportunity to establish repair and maintenance roots with new vehicle buyers, a dominant share of whom are selecting foreign nameplates.
Independent Repair Outlets: Fastest Growth
Foreign Specialists (outlets focused on the repair and maintenance of foreign nameplates) will achieve the highest growth rate in the foreign nameplate DIFM market during 2019 to 2023.
Repair Specialists: Largest Dollar Gain
Repair Specialists (outlets focusing on a limited menu of repair and maintenance jobs) are well positioned to compete effectively with Dealers for the repair jobs in which they specialize.
Lang Marketing expects Repair Specialists to gain the largest dollar portion of the expanding foreign nameplate DIFM market.
Service Stations & Garages: Big Challenges
Service Stations & Garages face the greatest challenges, among leading Independent repair outlets, in competing for the fast-growing foreign nameplate DIFM market.
Competitive Advantages for Larger Outlets
Larger Service Stations & Garages and those with multiple locations have an above average share of their current business represented by foreign nameplates and are best positioned within this outlet group to cash in on the foreign nameplate DIFM surge.
Greater Success and Survival
This will result in a growing disparity of business success (and even survival) among Service Stations & Garages based on their repair volume, which will be a significant factor determining their ability to adapt to the changing foreign and domestic nameplate mix within the light vehicle repair market.
Over 70% of DIFM Growth
These three outlet groups (Foreign Specialists, Repair Specialists and Service Stations & Garages) will capture over 70% of the more than $17 billion DIFM growth in the foreign nameplate Parts and Purchased Service market between now and 2017.
Dealers Will Expand Their DIFM Share
Dealers, led by foreign nameplate operations, will expand their share of the DIFM market for both Parts and Purchased Service. By 2023, Dealers will be able to account for a greater share of DIFM Parts and Purchased Service volume than they captured last year.
The domination of DIFM market growth by foreign nameplates during 2019 to 2023 will have important implications for the strength of brands across the light vehicle DIFM market, particularly for Independent (non-Dealer) outlets.
Among the five major types of product brands, OE-Supplier, OE and Foreign brands stand to increase their aftermarket Parts sales the most, especially in the fast-growing foreign nameplate market.
Six Major Takeaways
- Foreign nameplate cars and light trucks will surge more than $17 billion in Parts and Purchased Service over the next five years (2019 through 2023).
- Foreign Specialists will average the highest annual rate of foreign nameplate Parts and Purchased Service growth during 2019 through 2023.
- Repair Specialists will generate the largest dollar portion of the expanding foreign nameplate DIFM market.
- Service Stations & Garages face the greatest challenges among Independent (non-Dealer) repair outlets in competing within the foreign nameplate aftermarket.
- Dealers will expand their DIFM market share in both Parts and Purchased Service, fueled by the strong foreign nameplate aftermarket growth.
- OE-Supplier brands, OE and Foreign brands are positioned to strongly increase their aftermarket product sales over the next five years.
Copyright 2019 by Lang Marketing Resources, Inc.
NOTE: Special thanks to publisher Jim Lang for granting us permission to publish the Lang Aftermarket iReport.