Industry analysis anticipates a boost in aftermarket brake systems parts sales, from $1.21 billion in 2007 to $1.58 billion by 2014, with revenues spurred by enhanced product line offerings from manufacturers.
A new Frost & Sullivan study, the North American Brake System Parts Aftermarket: Friction Parts, highlights the standardization of ceramic friction equipment on new vehicle models as a primary growth driver. But as gas prices hinder brake pad and shoe demand, manufacturers will be forced to push consumers toward higher-priced parts to yield increased profits at all business levels.
“With higher raw material costs and increased competition from foreign producers, manufacturers are looking for ways to improve the profit margins on brake pads and shoes,” says Stephen Spivey, senior industry analyst with Frost & Sullivan, a growth partnership study. “Moving customers in the low-priced product line into the mid-grade line, and those in the mid-grade line into the premium line, increases profits and allows manufacturers to invest in researching and developing the next generation of friction parts.”
Although increasing sales in higher-priced lines will enhance revenue, gas prices still remain as a restraint on parts purchasing because they has caused vehicle owners to drive fewer miles, therefore needing brake service less often.
“High gas prices have an exacerbated effect on the friction parts aftermarket because demand is closely tied to how much gasoline people buy and use,” Spivey says. “Because of high gas prices, vehicle owners are also postponing servicing their vehicles, which further slows market growth.”
Gas prices and the need for continued revenue demand that manufacturers emphasize product differentiation, customer service and profitability, the main pathways for suppliers to add value to their product offerings. This offers an incentive to distributors to purchase from one manufacturer instead of another. Additionally, suppliers should strive to offer full coverage of all vehicle makes and models as well as carry complementary products such as rotors and calipers.

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