Why We Are Positive About the Automotive Aftermarket … and AAPEX
Monday, July 16, 2018
By Bill Long, President and Chief Operating Officer, Automotive Aftermarket Suppliers Association (AASA)
AAPEX, the Automotive Aftermarket Products Expo, is our industry’s annual celebration of the automotive aftermarket, connecting manufacturers, distributors, repair shops, marketers and retailers, small and large. The event is dedicated to providing the quality parts, products and vehicle service and repair for millions of cars and light trucks on the road today, globally. As the 2018 event fast approaches, I wanted to share with you the reasons why we are positive about the future of the aftermarket and AAPEX.
Let’s start with AAPEX 2018. In our annual post-event survey in 2017, an overwhelming number of buyers (90 percent) say they are likely to attend AAPEX again this year. In 2017, AAPEX also had nearly 10,000 shop owners and service providers attend and we are expecting an additional 5,000 aftermarket professionals from Auto Value and Bumper to Bumper this year as AAPEX again welcomes the Aftermarket Auto Part Alliance.
We all know our industry is changing, driven by new vehicle technology. That’s why at AAPEX, event co-owners AASA/MEMA and the Auto Care Association, will feature new technologies and the opportunities they will provide. At this year’s event, you’ll find:
- Mobility Garage, a technology-driven experience highlighting the latest products for the aftermarket, as well as electric cars and other alternative fuel vehicles
- AAPEX Technology of Tomorrow, a showcase of emerging products and new technologies
- New Product and Packaging Showcases, spotlighting all the latest innovations, products, and services
- Manufacturer In-Booth Product and Technical Training, sharing the latest tips.
- And much more!
AAPEX 2018 will truly be a great event and we look forward to seeing you there.
At various industry events, we sometimes hear anxiety about the future of our beloved industry. Some aftermarket professionals comment: “This is a great market … but I’m not sure it will be around for my kids,” or, “I’m glad I’ll be retired before all this new technology really hits.”
Raising these fears is understandable. Expressing these fears may even be positive.
Fear is not a bad thing, it’s a natural human reaction. It actually can be helpful if it makes us react, take the right steps, look to the future and be prepared for it. It is helpful if it pushes us to recognize the growth opportunities already being presented in our market and be ahead of the curve. If fear makes us show the entrepreneurial spirit and inventiveness that has always made the aftermarket great, then in our view that fear will be good – even productive.
Because the future for the aftermarket – in our view – is bright … if we as an industry make it so.
So, what does the future hold for the aftermarket? Gary Silberg of KPMG gave AASA supplier members and channel partner attendees at our 2018 Vision Conference a futurist’s view of vehicle autonomy.
Gary noted that, while there remains a lot of uncertainty about the timing of full and even situational autonomy, the big takeaway for the aftermarket is that autonomy – whenever it arrives in force – will mean more automobility. It will mean more miles driven as vehicle usage becomes more available to new categories of motorists (less effort to drive; time in the car freed up for entertainment, work or consumerism; more mobility for elderly and young drivers) and lower cost (shared mobility, greater safety).
And more miles driven is always good for the aftermarket.
The most transformative near-term trend may be in the changes in the distribution model such as e-tailing and omni-channels. For those of us who were in the aftermarket during the growth of retailers and the transformation from 3-step to 2-step distribution know this evolution of our channels is not a threat. There are opportunities for many players – the existing as well as the new value chain – to adapt, improve efficiencies, innovate and win. In the end, anything that ultimately makes it more convenient or appealing for customers to buy aftermarket parts and technologies has to be good for demand.
Earlier this year, AASA released a new landmark study, conducted with PwC’s Strategy&: “Aftermarket 2025/2030: The Impact of New Vehicle Technologies on the Aftermarket.” It examines the impact of emerging new vehicle technology – autonomous, electrified, connected and shared – and the opportunities and threats this new technology creates for the aftermarket. The report’s key takeaway is that there is good news, in that we are the aftermarket. The undeniable truth is we have this huge, slow-changing vehicle parc we sell into and we have time to adjust. We have real opportunities and product growth that are emerging now, as well as real long-term shifts and threats, particularly with electrification and increasing vehicle sophistication.
True, we are an industry facing a lot of change. It is sometimes a disconcerting amount of change as we look to the future.
In the face of this, it is worth remembering that change is good. In a future that looks as disruptive as this, we can find comfort in reminding ourselves of a key point from Economics 101: Without change, there is no profit.
We believe the aftermarket can and will respond to this change and thrive. What helped us win in the past – the assumptions and habits that grew our businesses – may be different in tomorrow’s market. This will require us to look forward, to adapt, to innovate. We believe it will require a new entrepreneurial spirit from the aftermarket.
But scrappy entrepreneurialism is what has always made the aftermarket great. It is not coincidence that the independent aftermarket captures 70 percent of the market for vehicle maintenance and repair. Post-WWII, it was a set of innovators who got the right parts to the right place at the right time faster, better and with more consumer appeal than the automakers could. Generations of great leaders built on that success and helped create our now $287 billion U.S. independent aftermarket in the United States.
We, again, need that leadership, that vision, that unmatched aftermarket entrepreneurial spirit to enable us to grow and thrive in our pending era of change and opportunity. We believe we have the people in the independent aftermarket who can achieve that. Together, we can make it so.
And that is why we are positive about the future of the aftermarket.