Report: Vehicle Aftermarket Sector Rebounds

March 14, 2022

A recent report by Capstone Partners predicts a return to a normal supply chain in the second half of 2022.

 March 14, 2022 Capstone Partners released its February 2022 Vehicle Aftermarket Report, with an interesting summary of the sector's performance during the COVID pandemic. 

According to the report, when COVID first hit companies in Enthusiast and Do-It-Yourself (DIY) categories benefited from higher demand, while service providers and part manufacturers markets saw a drop in demand due to government-imposed lockdowns. However, the sector is poised to benefit from the rising number of registered vehicles and more miles traveled, the increasing average age of automobiles and light trucks. 

Several factors, including elevated e-commerce use, rising interest in DIY projects and growth in the Enthusiast category have created opportunities for aftermarket companies. While supply chain disruptions, raw material prices, and labor market shortages are expected to continue to challenge aftermarket companies in the near term, the report says companies will see a noticeable improvement in the second  half of 2022 as supply chains return back to normal.

The report also notes that mergers and acquisitions continue to move at a fast pace. The vehicle aftermarket segment presents a lucrative consolidation opportunity, with potential buyers seeking businesses in attractive geographies that serve high-growth end markets or offer complementary products or services.

“The aftermarket witnessed heightened M&A activity across virtually all subsectors in 2021. We expect this level to sustain through 2022 as aftermarket fundamentals remain strong and strategic and financial buyers continue to put capital to work through acquisitions,” Capstone Partners Senior Director Yogesh Punjabi says in the report.

About the Author

FenderBender Staff Reporters

The FenderBender staff reporters have a combined two-plus decades of journalism and collision repair experience.

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