Surge in foreign nameplates having impact on aftermarket product volume, brand mix: Report
From Aftermarket Matters
FORT WAYNE, Ind. — As 43 million light vehicles were added to the nation’s VIO between 2010 and 2020, even greater changes were occurring in the nameplate mix of cars and light trucks.
Domestic nameplates fell in their number and share of vehicles in operation (VIO) between 2010 and 2020, as the foreign nameplate population increased by more than 50 million.
“This trend will continue for the foreseeable future,” according to the “2020 Lang Aftermarket Annual” report. “The VIO surge of foreign nameplates is having a strong impact on aftermarket product volume and brand mix.”
The following are a few key findings from the report:
Slow Vehicle Growth
The light vehicle population across the U.S. increased at a modest 1.7 percent annual pace between 2010 and 2015. This slow growth followed the dramatic impact of the 2008 Great Recession on new vehicle sales, which dropped nearly 30 percent between 2007 and 2010.
Domestic Vehicle Decline
The number of domestic nameplates on U.S. roads declined by nearly 500,000 between 2010 and 2015, as domestic new vehicle sales fell and domestic nameplates suffered a disproportionate share of car and light truck annual scrappage.
Despite the VIO growth revival from 2015 to 2019, the domestic nameplate share continued to decline.
The situation was particularly severe in terms of domestic nameplate cars. Their VIO share fell from 24 percent in 2010 to 19 percent during 2015. This downward trend continued, as the domestic nameplate car VIO share decreased to 13 percent in 2020.
Domestic nameplate light trucks fared better, but their performance could not offset the VIO drop suffered by domestic cars. Domestic nameplate light trucks represented 37 percent of 2020 VIO, down from 41 percent in 2010.
Foreign Nameplate Increase
As domestic nameplates fell in both population and VIO share, the foreign nameplate population (imports and transplants) increased rapidly between 2010 and 2015.
The domestic nameplate population fell during this five-year span, but foreign nameplates increased by 21 million between 2010 and 2015, pushing their VIO share to from 38 percent to 43 percent.
More VIO Changes: 2016 through 2020
This disparity was even more dramatic from 2016 through 2020. Foreign nameplates on the road increased by more than 25 million as they climbed from 115 million cars and light trucks to 140 million.
This foreign nameplate increase generated all of the light vehicle population growth across the country, as the domestic nameplate population fell by more than 6 million.
Ten Years of VIO Change
Differences in the domestic and foreign nameplate populations between 2010 and 2020 are noticeable.
The population of domestic cars and light trucks fell by more than 6 million during those 10 years, falling from 62 percent of total vehicles in operation to just more than 50 percent.
At the same time, foreign nameplate light vehicles increased by nearly 50 million between 2010 and 2020. As a result, foreign nameplates climbed from 38 percent to more than 49 percent of the total VIO between 2010 and 2020, nearly a one-third change.
Aftermarket Impact of Changing VIO Mix
This “unprecedented” light vehicle VIO shift from domestic to foreign nameplates has created large consequences for aftermarket product volume.
Foreign nameplate aftermarket product sales climber at a 4.7 percent average annual pace between 2010 and 2020. Domestic nameplate car and light truck products, in sharp contrast, fell at a 0.8 percent annual rate.
VIO and Aftermarket COVID-19 Recovery
As the aftermarket rebounds over the next several years from the 2020 impact of COVID-19, foreign nameplates will lead the way, generating virtually all aftermarket product volume growth during 2021 and 2022.