The average age of light vehicles in the United States reached 11.6 years by the end of 2016, up almost 17 percent from 9.9 years in 2007. The increase is expected to slow but continue, edging up to 11.8 years in 2019, according to a report jointly published by the Automotive Aftermarket Suppliers Association and Auto Care Association.
The trend in shifting vehicle demographics will continue, the study found, as vehicles within the traditional sweet spot of 6 to 11 years old will continue to decline, while numbers of vehicles less than five years old and older than 12 both continue to grow.
An appendix to the report indicates that revenue for automotive oil change and lubrication shops reached $5.9 billion in total sales for 2016, edging up 5.4 percent from $5.6 billion in 2015. The channels sales are forecasted to increase 4.8 percent to almost $6.2 billion in 2017 and to grow almost 17 percent to $6.9 billion in 2020.
The U.S. overall market for automotive aftermarket parts and materials is expected to grow at a compound annual growth rate 3.3 percent from 2016 to $316 billion in 2020. That would represent an increase of 14 percent from $277 billion in 2016.
While the fundamentals of the aftermarket are strong enough to drive the market forward, the leveling off of traditional market drivers will hold the rate of increase below recent years, the reports overview stated. It is forecast that the market will grow in size because of the increasing cost of parts as they incorporate new technology and become more complex. The report noted this increased cost of parts will account for more than 90 percent of growth. Growth in the vehicles population is expected to remain solid but level off in the next four years. The report further noted that while steep increases in the number of miles driven since 2012 helped push parts sales during that period, the rate of increase through 2020 is forecast to slow down.
The study forecasts that 272 million vehicles will be on the road in the U.S. by the end of this year, up 1.8 percent from the end of 2016. While growth is expected to slow in the coming years, the number of vehicles in operation should top 284 million by 2020, IHS Markit forecasts, which would be more than 40 million higher than the number in 2010.
Citing Federal Highway Administration data, the study found that the annual distance traveled by all vehicles totaled more than 3.2 trillion miles in 2016, a 2.8 percent increase. This increase trails only 2015s growth of 3.5 percent as the highest annual growth rate seen in 20 years. With payroll employment growth expected to moderate going forward, along with an uptick in gas prices, its likely this growth rate falls back to closer to 2 percent annually, going forward, the report stated.
Economic and market information firm IHS Markit conducted the market sizing and forecast on behalf of the two associations. The Aftermarket Size and Forecast Report is based on data from the U.S. Census Bureaus Economic Census, Industrial Marketing Research and proprietary IHS data, economic analysis and forecasting models.