Let’s get big-picture for just a bit. While you’re in your shop day in and day out servicing vehicles out of warranty, there are current market trends that will impact your business. Ultimately as the landscape shifts, this will also dictate the tools and equipment needed for repairs.
At this year’s ETI ToolTech conference, Mark Seng, global aftermarket practice leader for IHS Automotive, shared insights on what we can expect to see from vehicles in the near future.
1.) Light duty vehicle sales are hitting record levels in the U.S., and remain strong around world.
Globally, nearly 88 million light duty vehicles were sold in 2015, with 17.5 million units in the U.S. (The first time the U.S. topped that number in sales since 2001). And, sales are on pace to break 100 million units worldwide by 2017 – but the bulk of those sales will be in China.
2.) The U.S. vehicle mix continues to shift as consumer preferences evolve.
The market has seen an increase of crossover utility vehicles (CUVs) on the road, with one quarter of U.S. sales, and consumer demand indicates the heavy adoption of this body style will continue. Seng says a primary reason for this shift is the increasing efficiency and power provided by 4-cylinder engines today. This powertrain, along with the increased space and family-friendly features of CUVs, will show a continued rise in popularity (56 percent of vehicle sold in the U.S. in 2013 were 4-cylinder engines, according to J.D. Power and Associates).
Consumers also have continued the shift of purchasing imports over domestic vehicles. In 2010, for the first time, imports overtook domestic vehicle makes in terms of majority of vehicles on the road.
It’s important to understand consumer preferences in the aftermarket, since these are the vehicles that will be out of warranty a few years down the road, where they’ll end up at your shops for service.
3.) The aftermarket repair sweet spot is changing as vehicles continue to age.
This comes as no surprise: the age of vehicles on the road continues to rise, with the average age of U.S. vehicles being 11.6 years old.
And not only are vehicles on the road longer, but consumers are hanging onto their purchased vehicles longer, with a two-year average increase from 2006 to 2016. Consumers are willing to finance for longer terms, and select higher quality vehicles in the process.
4.) OEM mega platforms are emerging and will drive global vehicle equivalents.
More and more vehicles will be made on global platforms, meaning vehicle manufacturers will make increasingly more vehicles on fewer platforms.
There has been an increased focus on standardizing different specs of the vehicle such as the engine compartment, front and rear underbodies, etc. This also suggests that more and more vehicles will share components around the world.
With this shift, Seng says the aftermarket must understand global vehicle markets, identify where parts are the same and develop a global product and supply chain strategy.
5.) Technological complexity is coming quickly, on multiple fronts.
While all of these trends are important for the aftermarket, the increasing focus on vehicle technology will most greatly impact how you repair vehicles, and what tools you’ll need in the shop over the next 10 to 20 years.
By 2030, vehicle manufacturers are expected to reach 86 mpg average fuel efficiency for their fleet based on CAFE and global standards. To put this in perspective, every OE must improve fuel efficiency by 5 percent per year.
Hybrid vehicle adoption for the general consumer is forecasted to make up less than 8 percent of the vehicles on the road by 2021. This means to achieve these standards, OEs will continue to look to the traditional internal combustion engine to reach this goal, with features such as gasoline direct injection (GDI), turbochargers, start/stop battery technology, cylinder deactivation, AWD disconnect, more efficient transmissions and more, combined with lightweighting techniques like incorporating aluminum or carbon fiber into vehicle bodies.
In particular OEs will focus on GDI and start/stop because these technologies are currently the most cost-efficient to implement on vehicles. According to Seng, also by 2021, half of vehicles will have start/stop capabilities and two-thirds of vehicles will have GDI.
If that weren’t enough, there’s a continued evolution of electronics used in a vehicle, with advanced driver assistance systems as we move toward vehicle autonomy. With increased vehicle sensors for safety features such as lane departure warning systems or back-up cameras, these features are driven by control modules that will require increased knowledge of electronics and diagnosing capabilities for technicians.
