Lang Aftermarket iReport: Nameplate age gap drives different brand use

“There is a widening gap in the average ages of domestic and foreign nameplates on U.S. roads. With dramatic changes in the sales and mix of vehicles over the past ten years, these average age differences are shifting into overdrive.

“The average age gap between domestic and foreign nameplates is changing the types of brands used in the repair and maintenance of these two vehicle groups. ”

— Jim Lang, publisher, Lang Aftermarket iReport

Changing New Vehicle Sales Mix

Foreign nameplates have averaged 55% of new vehicle sales in the U.S. over the past ten years, up nearly two-thirds from their 34% share of the new vehicle market at the turn of the new millennium. This has dramatically boosted the average age of domestic nameplates.

Nameplate Age Gap

Domestic nameplate light vehicles averaged 2.6 years higher in age than foreign light vehicles at the beginning of 2020. There were significant differences in the age gap of cars and light trucks, with domestic nameplate cars 3.8 years higher in age than foreign nameplate cars and a much narrower age gap between light truck nameplates.

With Covid-19 lowering the annual vehicle scrappage rates during 2020 and 2021, the age of domestic nameplates will climb faster than the age of foreign nameplates, which will increase the average age between these two vehicle groups.

The increasing domestic vehicle average age and the surging population of domestic nameplates over 15 years old are changing the types of brands used in the repair and maintenance of domestic nameplates.

Falling Dealer Repair of Domestic Vehicles

Dealers are performing a decreasing share of work on the aging domestic nameplate population. This trend will continue, reflecting the growing age of domestic vehicles as well as the declining outlet share of domestic nameplate Dealers. This will shift more domestic nameplate vehicle repair to Independent (non-Dealer) service outlets.

Declining OE Product Use on Domestics Nameplates

As the Independent (non-Dealer) service market captures an increasing share of domestic nameplate repair, OE brand use in domestic nameplate repair will decline and non-OE brand share will rise.

“Value” Brand Use Increases in Domestic Repair

Owners of aging domestic cars and light trucks are becoming more price sensitive about vehicle services and products.

In both the Do-It-Yourself (DIY) and Do-It-For-Me (DIFM) markets, Value brands, which provide acceptable levels of quality and performance at lower prices, will expand their domestic nameplate aftermarket product share.

Foreign Dealers and Foreign Specialists

Vehicle Dealers will retain a large share of foreign nameplate repair. At the same time, Foreign Specialists will continue to expand their foreign nameplate service market (DIFM) position.

Both of these types of outlets prefer OE brands, OE-Supplier brands, as well as an array of Foreign brands of aftermarket products.

As a result, Value brands will not significantly increase their foreign nameplate aftermarket product share over the next three to five years.

Six Major Takeaways

• The average age gap between domestic and foreign car and light truck nameplates in the U.S. climbed to 2.6 years. See the 2021 Lang Aftermarket Annual for a 10-year review of changes in the average ago of foreign and domestic nameplates.
• The Dealer share of domestic nameplate repair is declining as the average age of domestic vehicles in the U.S. increases and they constitute a decreasing share of vehicles 5 years and younger, which is the primary repair focus of many Dealers.
• As the Independent (non-Dealer) Do-It-For-Me market captures an expanded share of domestic nameplate repair, OE brand use on domestic nameplates will decline and aftermarket brand strength in domestic nameplate repair will increase.
• The increasing average age of domestic nameplates on U.S. roads and the growing number of domestic nameplate 15 years and older are boosting the use of Value brands (which provide acceptable levels of quality and performance at lower prices) in domestic nameplate repair.
• The large share of foreign nameplate repair conducted by Dealers and Foreign Specialists will promote OE brands, OE-Supplier brands, and foreign brand use in the foreign nameplate Do-It-For-Me market.
• The primary change in foreign nameplate aftermarket brand use will be a move from OE brands to OE-Supplier brands, particularly among Independent (non-Dealer) outlets repairing foreign vehicles, as well as the growth of an array of Foreign brands among Independent outlets repairing foreign nameplates.

Copyright 2020 by Lang Marketing Resources, Inc.

NOTE: Special thanks to publisher Jim Lang for granting us permission to publish the Lang Aftermarket iReport.