Increasing vehicle age sustains growth in brake rotors, drums, and calipers aftermarket

North American consumers are spending more on parts and service because they are keeping their cars and light trucks longer due to prolonged economic uncertainty. The increasing average age of vehicles — which currently stands at 10.5 years — will drive the aftermarket for brake rotors, drums, and calipers. Suppliers should still concentrate on maintaining and expanding market share as a wave of mergers and acquisitions are expected to heighten competition in the market.

New analysis from Frost & Sullivan, “North American Brake Rotors, Drums, and Calipers Aftermarket,” finds that the market earned revenue of $1.39 billion in 2013 and estimates this to reach $1.64 billion in 2020. Rotors account for about two-thirds of the total market revenue.

The continuous entry of new stock-keeping units into the aftermarket also is increasing the potential of this market as distributors add them to their inventories. In addition, manufacturers are raising the price of vehicle parts to cover the rise in cost of raw materials and transport, boosting market revenues.

However, large auto parts retailers in North America, which exert significant power in the automotive aftermarket by virtue of their size and consolidated two-step distribution channel, are driving the migration to private-label brands. They also are putting pressure on manufacturers to reduce the prices of brake rotors, drums, and calipers and accept lower margins in return for market share.

The accelerating trend of consolidation among large distributors is reducing the number of distributors in the market. This is intensifying the competitive pressure on manufacturers to make additional concessions in order to gain shelf space in the retail stores and stay in business. Manufacturers that are not aligned with one or more of the large retail or wholesale distribution groups will not be able to establish a strong presence.

"Manufacturers may, however, find increasing success using e-commerce sites like eBay and Amazon.com. Consumers and installers are expected to purchase 10 percent of the total spare parts through such channels by 2020," noted Stephen Spivey, Frost & Sullivan automotive and transportation aftermarket program manager.