BLOG TIPS 4Y

Tips4y anticipates the trends for the aftermarket in 2024

Trends

December 21, 2023

8 MIN of Reading

The Portuguese economy will grow less than in 2023, going from the 2.2% recorded last year to a forecast of 1.5% in 2024. Despite the expected decline in inflation we live in uncertain times and we will continue to have purchasing power and investment capacity still constrained.

These indicators will determine the business outlook in the aftermarket, just like in 2023 the impact of inflation and the cost of credit influenced the demand for used vehicles and, in turn, the aging of the circulating fleet. In 2022, according toACAP data, the average age of light vehicles was 13.4 years and 63% are over 10 years old.

One of the measures that is expected to advance in 2024 and that could bring some dynamics to the circulating fleet is the return of the incentive for scrapping end-of-life vehicles, now also available for the purchase of used vehicles, in case they are 100% electric vehicles less than four years old.

Beyond the factors of the economic situation and measures planned for 2024, we highlight the effect of some ongoing movements, such as electrification driven by the legal force of the EU, the change in the concession model in Europe, and digitalization as a transformative factor for businesses, particularly in the aftermarket.

Main trends for 2024 according to Tips4y:

DIGITALIZATION OF THE BUSINESS ECOSYSTEM

The implementation of digital solutions in various aspects – from internal processes to the relationship with customers, partners, and suppliers – will continue its progressive path of digitalization of the sector, especially in businesses where profitability margins are clearly enhanced by the dematerialization of processes and traditional operational procedures.

IMPACT OF ELECTRIFICATION

The advance of electrification will require the redesign of businesses that still maintain a traditional approach – from workshop repairs to parts distribution and tire commerce – where productivity management will take into account the paradigm of new vehicle models (lower level of wear with implications for maintenance plans and repair interventions).

SUSTAINABILITY

In 2023, the sustainability was the central theme or topic of debate, in preview of its specific legislation, which will require companies to consider their impact as one of the great challenges, and with which there will have to be efforts and adaptation strategies, whether in the decarbonization of mobility or in the implementation of related solutions, such as the so-called “green parts” (original used parts) in the circular economy.

ARTIFICIAL INTELLIGENCE (AI)

The most recent advances in AI applied to increasing productivity are seen as an opportunity for capturing, retaining, and reskilling professionals from the sector, through new competencies in management and process efficiency that result in innovative work methods in the different areas of the aftermarket.

Build the future of automotive mobility

In an industry transforming due to technological changes, changing customer habits, and an ambitious European regulatory framework, it is critical to know how to interpret the signs and future trends that will shape the destiny of businesses.