A larger size of the sweet-spot, compared to 2016, will boost aftermarket product volume during 2021 as it recovers from the impact of Covid-19
Fort Wayne, Ind.—During 2021, more vehicles will be in the repair-age sweet-spot than five years earlier, and they will represent a larger share of vehicles in operation (VIO), according to the “2021 Lang Aftermarket Annual” from Lang Marketing. There will also be a different mix of nameplates and types of vehicles in the 2021 repair-age sweet-spot than there were in 2016. All of this will have significant aftermarket consequences.
The following are highlights from the report, which was released on Wednesday:
New vehicle sales change sweet-spot
The five vehicle model years (2011 through 2015) that will constitute the 2021 repair-age sweet-spot were part of the strong new car and light truck sales recovery after the 2008 Great Recession.
New light vehicle sales in the U.S. reached 12.8 million during 2011 (up from 10.3 million in 2009) and totaled 14.5 million in 2012 and 15.6 in 2013. During 2014 and 2015, the new vehicle market continued to increase, attaining sales of 16.5 and 17.5 million, respectively.
As a result, approximately 75 million cars and light trucks 6 to 10 years old will be on U.S. roads during 2021. This will be an increase of nine million vehicles in the repair-age sweet-spot, a 15-percent boost compared to 2016.
2016 vehicle sweet-spot VIO
In 2016, vehicles 6 to 10 years were the product of car and light truck annual sales during 2006 to 2010, which were rocky years for the new vehicle market.
While 2006 and 2007 were strong in car and light truck sales, averaging 16.3 million, significant changes loomed just ahead.
The new car and light truck market took a historic hit in 2008, as light vehicle volume plunged to 13.2 million. The following year, car and light truck volume bottomed out at 10.4 million. New vehicle sales rebounded moderately to 11.5 million during 2010.
As a result, approximately 17 million fewer cars and light trucks were in the light vehicle age repair-age sweet-spot during 2016 than five years earlier.
Foreign versus domestic nameplate mix
The foreign and domestic nameplate mix of the 2021 repair-age sweet-spot will be decidedly different from what it was five years earlier.
Foreign nameplates rose from a 39-percent average share of the new vehicle market between 2001 and 2005 to 51-percent of car and light truck sales from 2006 to 2010.
Sweet-spot nameplate changes
As a result, foreign nameplate cars and light trucks expanded their repair-age sweet-spot share in 2016 by more than one-quarter compared to 2010.
This trend will persist, as foreign nameplates continued to increase their new vehicle market share between 2011 and 2016.
Foreign nameplates will account for 55 percent of the vehicles in the repair-age sweet-spot during 2021, up from 51 percent six years earlier.
Cars versus light trucks
A third difference in the 2021 repair-age sweet-spot compared to five years earlier will be a larger share of light trucks. Lang Marketing estimates that light trucks will account for more than 64 percent of vehicles in the 2021 repair-age sweet-spot, up one-fifth from their 53-percent share five years earlier.
This will be positive for aftermarket product volume since light trucks account for a larger annual volume per vehicle of aftermarket products than passenger cars.
Aftermarket impact of 2021 sweet-spot
The larger size of the 2021 repair-age sweet-spot, compared to 2016, along with its different mix of nameplates and larger share of light trucks, will combine to fuel the recovery of the aftermarket product volume during 2021 as it recovers from the impact of Covid-19.
Comments are closed.