Las Vegas--As more motorists drive older vehicles longer, more of them recognize the need to perform regular maintenance in 2010, releasing pent-up demand from deferred repairs. That sentiment was expressed on Nov. 3 during the 2010 Aftermarket Outlook, part of the Automotive Aftermarket Product Expo (AAPEX) at the Sands Expo and Convention Center held Nov. 3–5.
The aftermarket will see an increased demand for vehicle consumables such as oil, fluids, tires, and other maintenance-related parts, said presenter David Portalatin of The NPD Group, adding that high levels of unemployment have forced motorists to forgo new vehicle purchases and keep older ones running longer.
“Thirty percent (of surveyed motorists) say, ‘I have to do more to maintain my vehicle,’” Portalatin said. “Consumers may want to use better oil to hang on to their car longer.
“In our business, we have seen at least four years of declining core motor-oil sales,” he said, adding that in September 2009, motor oil sales were up 6 percent.
In a recent survey by NPD, Portalatin said, motorists said in 2010 they plan to spend 11 percent more on tires, 9 percent more on motor oil, 8 percent on parts, and 7 percent on professional repairs.
Vehicle parts and service purchasing decisions are contingent on expense, performance, and quality, Portalatin said, adding that the majority of people are clearly focused on performance and quality.
“Our industry is in a place where you’ll see people spend more,” he said. The aftermarket must do a good job at differentiating themselves from the competition, communicating clearly, and offering better value, he said, adding that a declining franchise dealer bay count also spells opportunity.
Spending attitudes have shifted from parts and service centered on fuel economy to regular, scheduled maintenance, Portalatin said. The absence of $3-a-gallon fuel prices has also influenced the trend, he said. “They’re not nearly as enthusiastic about spending money on fuel savings.
“Many consumers have already put (vehicle maintenance) off as long as they can,” he said, adding that although there’s a recognized need for vehicle maintenance, high unemployment continues to suppress consumers’ ability to spend and also reduces the amount of miles driven, which typically increases 3 to 5 percent annually.
“The last 24 months has had a lasting effect,” he said. “It just doesn’t change overnight.”
Some motorists choose to save money with do-it-yourself (DIY) repairs, which have increased at a higher rate than the professional installer in 2009, Portalatin said, but the work that group can perform is limited.
“Many consumers say they want to do it themselves, but in reality they may not be equipped to do so,” he said, adding that this will continue to translate into increased sales for the do-it-for-me (DIFM) market.
“When you ask people about spending, they’re still down to 2008 levels,” he said, pointing out that they still recognize the need to make their vehicles last longer. “The reality is they have to start spending money. The challenge is to intersect those two mindsets.”
In 2010, there will be moderate growth in nondiscretionary spending, Portalatin predicted, adding that the automotive industry will receive a good potion of that. Automotive is doing well compared to other industries, such as consumer electronics and restaurants, he said. “This industry will lead the rebound.”
