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Future of Automotive Retail & Aftersales

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The business of selling cars, parts and service is undergoing tremendous disruption at every level. From omnichannel retailing to digital dealers to Uberization of service, the downstream, automotive ecosystem is expected to be completely transformed in the next 10-15 years.

OEMs, suppliers and other traditional industry stakeholders are future-proofing themselves by adopting some of the emerging business models but the pace of disruption is being set by industry outsiders such as Amazon – who are increasingly threatening and dismantling accepted models.

So, what will the industry look like in 2020, or 2025? Here are some Frost & Sullivan predictions:

  • $50B worth of parts and accessories will be sold online globally by 2020
  • Over 1.3 billion vehicles will be in operation across the globe by 2020
  • More than 70% of vehicle sales leads will be digital by 2023
  • $500 million to $5 billion investments expected from several OEMs and selected dealer groups to improve in-store digitization in Europe and North America in next 3-4 years
  • Beyond 2020, digitization will enable lead conversion ratio improvements of more than 80%

These transformations present both opportunities and challenges. Frost & Sullivan’s global retail, aftersales and leasing group has the right experience and expertise to support your organization’s strategic imperatives, and help you identify the risks and unlock the potential.      

We can engage and partner with you through the following ways:

  • Growth Partnership Service: Provide access to individual reports or subscription service
  • Growth Consulting: Customized advisory services ranging encompassing research, strategy and implementation
  • Growth Workshops: On-site engagement and interactive brainstorming with your executive teams

We are global – with local experts and rigorous tracking of trends and markets in various regions including the Americas, Europe, India, China, ASEAN, Middle East and Africa.

Some of our most recent client collaborations include:

  • Development of Retail Toolbox for an European OEM
  • Dealership Assessment and Optimization in Russia for European Dealer Group
  • Development of global parts ecommerce strategy for US-based OEM
  • Parts pricing data collection and analytics in emerging markets for various OEMs
  • Development of online B2B platform for parts for global ecommerce company

Meet The Team

Sarwant_Singh_65.jpgSarwant Singh

Senior Partner, Head of Automotive & Transportation & Visionary Innovation Group

saini.jpgJulia Saini

Seniore Vice President

KumarSaha.jpgKumar Saha

Research Director

Stephen_65.jpgStephen Spivey

Program Manager

monga.jpgAnuj Monga

Global Program Manager

isla.jpgLorena Isla

Director

deubel.jpgKarsten Deubel

Consultant


Our Automotive Retail Group covers exciting research that include:

  • Digital retailing models and future evolution of car sales across OEMs
  • Analysis of changing dealership structures in key markets for new and used vehicle sales
  • Analysis of new business models (e.g. fintech) and disruptors
  • The team has published several strategic research reports on these topics and beyond for various global markets.

The Global Aftersales Group publishes numerous over thirty strategic reports every year covering a wide range of topics including:

  • Market analysis of various product categories
  • Assessment of new business models – ecommerce, telematics, connectivity, service aggregation – on aftersales
  • 360 aftermarket reports on emerging markets such as Asia, Latin America and Asia
  • Voice of customer surveys

The fleet, vehicle leasing and finance team provides research covering existing fleet vehicle parc and new business purchases for each year, broken down based on Ownership/funding type, Vehicle segment, Fleet size and customer segmentation. The analysis also includes market share analysis of leasing companies. Competitive analysis typically includes information about the market share analysis of major leasing companies with the below details.

Mobility: Automotive & Transportation Analyst Briefings

European Category Management Report Automotive Sensors Aftermarket, Forecast to 2023

The overall aftermarket replacement demand for the six automotive sensors (covered in this study) in Europe was estimated at 836 million in 2016; it is expected to grow at a compound annual growth rate (CAGR) of 3.5% between 2016 and 2023 reaching 1.06 billion by 2023. Oxygen sensors is the…

North American Class 1-3 Steering and Suspension Components Aftermarket, Forecast to 2023

This study covers class 1-3 vehicles steering and suspension aftermarket in terms of volume (in million units) and value ($ million) across the United States and Canada. It discusses unit shipment, revenue, average price, distribution channel share, and major participants market share for four…

North American Commercial Vehicle Tire Retreading Market, Forecast to 2025

The North American commercial vehicle retreading market is expected to grow marginally to 15.1 million units by 2025 from 14.5 million units in 2016. Some of the key factors currently influencing the retreading market are improved quality of tread life, high supply of casings, increasing labor…

Future of Tire Retailing in North America and Europe, Forecast to 2023

The report discusses the future of tire retail in North America and Europe and covers Class 1-3 replacement tires in passenger cars. The aim of the study is to envision the Future of tire retailing for the automotive aftermarket in North America and Europe. It discusses the demand forecast…

Start-up Innovations Disrupting the Automotive Aftermarket

The automotive industry has witnessed incremental changes in the last five to seven years owing to technological developments and an ever-thinning line between the tech and auto industries

Evolution of OES Aftersales Channel in Automotive Aftermarket

The global aftermarket replacement parts revenue grew by approximately 4.7% in 2016. Aftermarket revenues of about USD 100 billion in North America and about USD 97 billion in Europe (2016) will provide OEMs enough impetus to target and grow in this sector.

Dashboard of Selected Automotive Aftermarket Parts, Forecast to 2020

This report covers Class 1-3 vehicles brake pads, brake rotors, batteries, air filters, oil filters, cabin air filters, spark plugs, starters, alternators and wipers aftermarket in terms of volume (in Million units) and value ($ Million) across United States and Canada. It discuss about unit…

North American Class 1-8 Turbochargers Aftermarket, Forecast to 2023

This report covers Class 1-8 vehicles turbochargers aftermarket in terms of volume (in million units) and value ($ billion) across the United States and Canada. It discusses unit shipments, revenue average price, distribution channel share, and market share. The base year for the analysis is 2016…

Strategic Overview of the Commercial Vehicle Aftermarket in Europe, Forecast to 2023

Commercial vehicles (CV) parc in the European market was estimated at 38.9 million in 2016 and is projected to grow at a compound annual growth rate (CAGR) of 1.9% to reach 44.2 million by 2023. Eastern European countries, Germany, and the United Kingdom are expected to witness the highest growth in…

Strategic Analysis of Waymo's Future Autonomous Disruptive Capabilities for the Automotive Industry

Waymo, the autonomous technology company under the Alphabet conglomerate, is at the forefront of developing autonomous driving software for cars. Vehicles powered by Waymo's software help Alphabet complete its ecosystem of connected devices by serving as a data collection node when users are on the…

growthstrategy-small.jpgWe help our clients navigate both their tactical and strategic imperatives essential for growing their business. From data-driven modelling of product demand and pricing to new retailing strategies, we can support client in the development and implementation of growth opportunities.

We works with car companies, dealership groups, tier-1 suppliers, aftermarket wholesalers & distributors, leasing and rental companies, corporate mobility service providers, finance giants and new technology pioneers to help them evaluate and pioneer new product and growth solutions using disruptive and innovative business models.

We engage with clients through customised consulting projects and strategy workshops. Projects typically involve several phases from discovery, inform, evaluate, analyse, develop and implement a business plan and growth strategy.  We use our research and industry experience coupled with well-defined tools and techniques to manage and deliver these projects.

Frost & Sullivan team can support your organization in each of the following areas:

  • Development, feasibility analysis and implementation of New Retailing Solutions
  • Business Model Benchmarking, Development and Adoption Scenarios
  • Competitor Benchmarking: What industry stakeholders are doing in retailing and aftersales, how competitors are disrupting your markets and gap analysis for your organization
  • Dealer Optimization and KPI Improvement
  • Go-to-Market Strategy: Product, pricing and competitive analysis
  • ·         Distribution Channel Optimization
  • Parts Pricing Analytics
  • Sourcing and supply chain development and market analysis.
  • Support parts manufacturers and distribution groups to develop assessments and strategies to penetrate emerging markets
  • Evaluate opportunities within fleet, leasing and finance markets

We specialise in running growth workshops with our clients which help us take a cross functional team of our client, within span of a day from information to implementation. The team has run several workshop, some examples below:

  1. Supported one of the world’s largest OEMs cross brand retailing team with a workshop on creating a new on-line/off-line customer journey which involved identifying best practices both within and outside the automotive industry
  2. Helped a Japanese OEM inform their senior executives through a workshop on the challenges and opportunities with the changing retailing landscape
  3. Simulated a war room workshop with a Fleet and leasing company on competitive analysis for rolling out a new product value proposition
  4. Supported a tier 1 supplier with a workshop to enter the Aftermarket in US

We have been very impressed by Frost & Sullivan. The team showed deep knowledge and understanding of the automotive industry and the international business development environment, the focus of our company. They have literally read our minds and after recommending a strategy that leverages our capabilities to solve market needs, they delivered a business plan that perfectly brings our vision to concrete, clear goals and actions.

Foresight

"Our project involved attempting to quantify the market size and growth trends in all major markets of the world for the business niche we compete in, including emerging markets. Frost & Sullivan was able to reach out to their vast global resources to conduct first hand, on the ground interviews, synthesize all of the inputs and assimilate large amounts of data into an easy to follow high level summary that pulled it all together.

"If detail was needed to validate the high level findings Frost & Sullivan could easily explain what data was acquired, what assumptions were made, how the data was interpreted and how their final product was delivered.

"Their strength comes from access to all major markets and the ability to dive into the specific industry with local experts and extract what is truly important toward meeting the deliverable.   We believe we have a solid look at our industry and are already making strategic decisions based on the findings."

Vice President Global Business Development and Marketing-VSG, Vehicle Services Group, VSG, A Dover Company

"One of the key strengths of Frost & Sullivan is their ability to cover with their global network global market demands. This gives us as a global acting company a really big benefit."

VP Collision Repair VSGNSA, Vehicle Services Group, VSG, A Dover Company

"The most significant aspect of the project for me was to validate size of market and the potential opportunities. I believe the strategy slides were especially beneficial as to assigning prioritization of efforts going forward."

Director Mktg. IT VSGE, BlitzRotary GmbH

Frost & Sullivan’s team helped us in considering current and future mobility trends, their impact to the UK, and future growth potential...Their detailed insight has been utilised by my team both internally and externally, and I would not hesitate in considering them for future mobility related assignments

IM, Rail & Marine, and Technology Strategy Board

Frost & Sullivan facilitated a Mega Trend, "macro to micro" workshop with the corporate strategy group of SMMT which comprises some of the most senior executives of vehicle manufacturers suppliers in UK. The feedback from all participants was terrific and they were particularly impressed by both the scope and depth of Frost & Sullivan's knowledge. We will be working with Frost & Sullivan further to implement some of the new initiatives identified.

SMMT

Frost & Sullivan’s team were a pleasure to work with and exceeded the already high expectations we had for this project. It’s very refreshing to work with a high group that not only 'get' your business model but are able to challenge intelligently and help crystallise your thinking...we wouldn’t hesitate to use them again

Frost & Sullivan's unrivalled research, consulting, and network positions Frost & Sullivan as a leading authority on Mobility, able to support on you on several assignments.


Expertise Areas

Frost & Sullivan's expertise in car retailing, aftersales & service research and consulting includes work in the following strategic and operational areas.

retailing.jpgRetailing

Dealer Network Development Strategies and KPI Anlysis
  • Analyzing the performance and efficiency of established dealer networks based on pre-defined and new (digital) KPIs, to include geographic position and resulting ‘halo’ effect into the network
  • Defining strategies to enhance the dealer network performance throughout the entire sale process, both online and offline
Pilot Retail Project Design

Design, development and roll-out of pilot projects to test and re-align new strategies to customer perception

Evaluation of Different Digital Options
  • Benchmarking of different digital options and best practices from various industries outside of the automotive sector
  • Redesigning the customer journey in automotive, evaluating digital touchpoints both in the click and brick environment
  • Pre sales, sales and aftersales across North and South America, Europe, Middle East, India and China
Sales Process & KPIs Analysis

Data gathering and analysis of KPIs to take corrective actions on distribution network

Channel Strategy Development and Pilot Management
  • Design and development of new sales and channel strategies within different retail formats and geographies
  • Roll-out of pilot projects to test and re-align new strategies to customer perception and pilot feedback
  • Dealership roll-out/implementation and training programmes
Change Management Implementation

pie.jpgAftersales

Product and Service lines Market Analysis

Strategic analysis of products such as brake parts, filters, wipers, and impact on industry on developing technologies.

Future  Technologies

Analysis on areas such as remote diagnostics/ prognostics, mobile apps for service scheduling and management, e-retailing and Telematics.

Annual surveys of vehicle owners and service technicians

Owner attitudes and behaviours towards key areas such as Automotive Maintenance, Tools Market and Replacement Parts Preferences

360 Degree Perspective Analysis

Covering growth, impact and developments across all regions;  North America, Latin America, Europe, China, India, ASEAN and Australia.

Strategic analysis of OEMs

Understanding  OEM strategies, their role in the aftermarket, including vehicle financing analysis.

Fleet and leasing market analysis

Analysis of the Aftermarket industry within this area; strategies and developments concerned.

Price benchmarking

Product, Services, OEM and Supplier price analysis and comparison.

Global Aftermarket Outlook
  • Get the macro-level view of the aftersales environment across various regions with actionable data and forecasts on market revenue, vehicles in operation, and disruptive trends
  • Regions include: North and South America, Europe, Middle East, India, China and other APAC countries (ASEAN, Australia)
  • 360 degree deep-dive analysis of high-priority individual regions and countries, particularly emerging markets
Parts Category Management
  • Data-driven modelling of market demand and revenue by various parts category
  • Competitive analysis and outlook for parts categories
  • Parts categories include: Filtration, Brakes, Starters & Alternators, Engine Management, Chassis, Sensors, Electronics, Wipers, Others
Voice of Customer Surveys
  • Comprehensive, annualized tracking of buyer behavior in purchase of parts and tools
  • Survey respondents include installers, fleets and vehicle owners
Competitive Profiling of Aftersales Stakeholders
  • Detailed benchmarking of various OEMs, suppliers and distributors / retailers
  • Content around future strategy analysis – private labelling; economy line parts; eretailing; new business models
Digital Transformation in Aftersales
  • Tracking evolution of disruptive forces in aftersales – telematics; ecommerce; digital retailing; advanced technology in the bay; big data; emerging business models
  • Detailed analysis of new market actors – startups; tech companies; mass eretailers
Parts Pricing Analytics
  • Data collection and analytics modelling in major global markets – particular expertise in emerging markets
  • Customizable, interactive digital platform for data delivery and analytics
 
 

ride_sharing.pngFleet, Vehicle Leasing and Financing

Operating Lease

A contract, also known as a Full Service Lease or Long-Term Rental, where the Lessor accepts both the financing and residual value risk. The Lessee is responsible for selling the vehicle once the lease contract ends or when the Lessor no longer requires the vehicle (contract may be terminated early or extended beyond the initial agreed contract length)

Finance Lease

A contract whereby only the financing risk is accepted by the Lessor with the Lessee accepting the residual value risk related to depreciation (and the Leasing Vehicle Provider bears the financing risk.)

Retail Lease

A contract entered into by an individual rather than a business. Most lease contracts are taken by businesses but retail or personal leasing is a growing sector of the market being explored by Frost & Sullivan

Vehicle Finance

All forms of funding used to secure a vehicle (either outright or on a long-term contract of use). Vehicle finance is undergoing rapid disruption with new business models being introduced offering improved customer convenience (self-service, transparency) and experience (product unbundling). Frost & Sullivan is exploring this evolving market and competitor landscape

Global Fleet Market Outlook
  • Get the macro-level view of the fleet & leasing environment across various regions with actionable data and forecasts on vehicle registration, vehicles in operation, competitors environment and disruptive trends
  • Regions include: Europe including Turkey, Russia, North and South America, India, China and other APAC countries (ASEAN, Australia), North and South Africa
  • 360 degree deep-dive analysis of high-priority individual regions and countries, particularly emerging markets
  • Fleet market trends and dynamics - Emerging markets analysis, future of industry, growth opportunities/areas
Market Data Analysis
  • Online, customizable and interactive platform with actual and forecast data provides funding analysis with a focus on company cars (true fleet) vehicles
  • Data available for products such as operational leasing, financial leasing, fleet management and private/retail leasing
  • Analysis on portfolio volumes of leading leasing players based on product types such as operational leasing, financial leasing and fleet management.
  • Vehicle types analyzed are passenger vehicles and light  commercial vehicles (up to 3,5 tons)
  • Data available for 35 countries globally
  • Customizable additional data analysis on fleet markets by powertrain, customers and vehicle type
Competitive Analysis
  • Detailed benchmarking vehicle financiers such as OEMs, leasing companies, mobility service providers and other vehicle financiers such as banks
  • Content around future strategy analysis – Future positioning of companies in the ecosystem, consolidations, mergers, acquisitions, and partnerships analysis.