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Main trends in the aftermarket for 2021

Trends

December 16, 2020

10 MIN of Reading

Despite being consensual that 2020 was a globally challenging year for the automotive industry, the aftermarket in particular showed a distinct behavior compared to the new vehicle business, as the impact of the pandemic crisis had different effects on both.

If, on the one hand, we saw very significant falls in the sale and registration of new vehicles from March onwards, the used-vehicle market (and its related services) showed stronger resistance to the fall in business, largely due to the behaviour adopted by consumers, especially with new habits acquired, and also due to the vital importance of the automotive sector itself (transport) for the dynamics of other economic activities.

The importance of deeply understanding the drivers that affect the business in times of great change has become even more relevant in the coming years.

The main trends for 2021 in Tips4y vision

The restrictive measures adopted this year due to the pandemic crisis will continue to have a strong impact on economic activities in 2021, given the spread over time of this effect at a structural level and also due to the context of uncertainty at a social level, which together could deteriorate the already heavily affected industries.

In this context, the new vehicles market will continue to suffer from this pressure, especially on the private consumer side, since new registrations for business segments (corporate fleets, mobility and transport services, etc.) may have a different response.

Given the evolution that took place throughout 2020, there are some trends that could emerge or become more significant over the next year:

6 trends in the aftermarket for 2021

1. Mergers of distribution companies will accelerate and smaller individual workshops will most probably suffer a decline in business, mainly for those operating outside the most competitive networks.

2. Demand for used cars is in advantage compared to new ones: this trend will lead to very aggressive campaigns by official dealers so as to buy a second car or to replace the current one.

3. Preference for electrified vehicles: especially electric and plug-in hybrids, which will continue to increase in the top-of-mind of consumers largely due to the legal framework of incentives for their acquisition.

4. Digitalization will continue to move forward: online sales will remain a “natural” choice for all players in the automotive parts market. The use of end-to-end platforms will be increasingly valued.

5. DIY in online parts sales: the online purchase of automotive parts by end consumers will increasingly become a reality (for simple “do it yourself” maintenances).

6. New workshop services to retain customers: opportunities for workshops to start offering value-added services to retain their best customers (“pay X and get Y” such as car pick-up and drop-off, among others)

The activity of the main players in the aftermarket (distributors, workshops and parts e-commerce) is conditioned by this context and needs to show capacity and agility to constantly adapt.

This requires the ability to interpret current signals and trends, as well as future ones, which will shape the future of the business.

Aware of this context, Tips4y has developed a new range of solutions to support professionals in the aftermarket in order to overcome these challenges and develop their own strategies.

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