Lang: ‘Domestic nameplates’ account for two-thirds of cars & light trucks sent to junk yards
“Domestic nameplates represented approximately two-thirds of the cars and light trucks scrapped in the U.S. during 2015 through 2018.
“At the same time, domestic nameplate annual new vehicle sales averaged 46% share, down significantly from 15 years earlier. Low new vehicle sales share and high vehicle scrappage have combined to reduce domestic nameplate vehicles in operation (VIO) from 55% share in 2013 to less than 52% during 2018.”
— Jim Lang, publisher, Lang Aftermarket iReport
Domestic Nameplate VIO Plunge
Domestic nameplate vehicles in operation (VIO) peaked at 168 million during 2005. Since then, the domestic nameplate car and light truck population across the U.S. has plunged by more than 20 million.
Domestic nameplates receded from 59% of all cars and light trucks on U.S. roads in 2013 to 52% of the 2018 VIO.
Two Forces Whipsaw Domestic Nameplate VIO
Domestic nameplate share of vehicle scrappage during 2018 was significantly higher than their share of vehicles in operation (VIO).
High Scrappage Share
Domestic nameplates comprised approximately two-thirds of the more than 30 million cars and light trucks sent to the junk yard during 2015 through 2018.
This high scrappage share will continue over the next five years as domestic nameplates will comprise a dominant share of vehicles at least 15 years old.
Slumping New Vehicle Sales Share
Although the number of new vehicles sold has reached a four-year record in the U.S. between 2015 and 2018, the domestic nameplate sales share has declined.
Domestic car and light truck sales share totaled 45% of the 2018 new vehicle market.
This is a far cry from the 60% share of light vehicle annual sales captured by domestic nameplates 15 years earlier, in 2003.
As a result, 2.5 million fewer domestic nameplates were sold in 2018 compared to their sales volume last year if their share had not significantly declined since 2006.
Lang Marketing Projects Domestic VIO Decline
Caught between the diminishing new vehicle sales share and high annual scrappage, the number of domestic nameplates on U.S. roads will continue to dwindle.
Lang Marketing projects domestic nameplate VIO will continue to fall from 2018 to 2023, slashing their VIO share to 48%.
In contrast, foreign nameplate VIO will soar by more than 18 million between 2018 and 2023.
Foreign Nameplate Aftermarket Surge
The plunging population and share of domestic nameplate cars and light trucks on U.S. roads will create a dynamic growth in foreign nameplate aftermarket product volume over the next five years.
Lang Marketing projects foreign nameplates will generate all car and light truck aftermarket product growth during 2019 through 2023.
While foreign nameplates will register at least a $15 billion surge in product volume over this five-year span, Lang Marketing projects domestic nameplate cars and light trucks will decline in aftermarket product sales.
Six Major Takeaways
- The domestic nameplate VIO peaked at 168 million during 2005. Since then, the number has dropped by approximately 18 million.
- Two forces are diminishing the population of domestic nameplates on U.S. roads: high vehicle scrappage and slumping new sales.
- Domestic nameplates account for approximately two-thirds of cars and light trucks being scrapped, substantially higher than their share of VIO.
- While new vehicles recorded record-high sales over the last four years, domestic nameplate share was down nearly one-quarter from just 15 years ago.
- Lang Marketing projects the domestic nameplate population will fall by an additional 18 million during 2019 through 2023, pushing their VIO share down to 48%.
- While foreign nameplates will record at least a $15 million surge in product volume during 2019 through 2023, domestic nameplate aftermarket product sales will fall during this period.
Copyright 2019 by Lang Marketing Resources, Inc.
NOTE: Special thanks to publisher Jim Lang for granting us permission to publish the Lang Aftermarket iReport.