Dealmaking in the auto aftermarket is gathering pace heading into 2026, with investors and operators signalling readiness to return to transactions after a quieter period, according to a global investment bank specializing in mergers and acquisitions and private capital advisory services.
Managing directors Joe Conner and Elliott Yousefian in Harris Williams’ transportation and logistics group said that the sector held up through supply chain disruptions, shifting tariff policies and uncertain consumer spending, with underlying value drivers intact.
“In today’s dynamic global trade environment, the foundations for auto aftermarket growth remain strong,” says Conner.
He pointed to fragmentation, dry powder and a supportive lending market as catalysts for increased activity as the economy stabilizes.
Conversations at AAPEX and SEMA this year underscored momentum and optimism.
“Our conversations at these shows reinforced our optimism,” Yousefian said. “Businesses and investors are both eager to get back to dealmaking.”
Growth‑focused investors are prioritizing companies with non‑discretionary demand and a track record of managing tariff turbulence through price pass‑throughs and supply chain diversification. Conner noted that record‑high vehicle ages are pushing repair and maintenance needs, drawing strong interest to tire and mechanical repair and collision services. These areas have minimal risk from EV adoption and clear benefits of scale.
Suppliers and distributors serving break‑fix demand are expected to lead renewed M&A within aftermarket products. Stable buying patterns support categories such as brakes, suspension components, tires, wheels, oils and fluids. Enthusiast segments are next.
“Buying patterns for break‑fix products tend to be most stable across economic cycles,” Yousefian said. He added that demand from enthuisiasts and investor interest should return as consumers grow more comfortable spending on performance, upgrades and accessories, with opportunities where upgraded parts can substitute for factory components.
Differentiation is becoming critical. Category leaders are leaning into innovation and digital transformation to broaden customer reach, sharpen value propositions and improve sales and profitability.
“The most sought‑after companies are adopting technology to automate complex workflows, enhance the customer experience, power cost‑saving initiatives, generate useful data, and streamline operational decision‑making,” Yousefian said, adding that companies that use data to guide strategy are separating from the pack.
Despite recent challenges, long‑term fundamentals remain strong and forces are converging to unlock more deal flow.
“For this sector, it’s a matter of when, not if,” Conner said. “Investors remain eager to deploy capital in the space, and we expect more actionable opportunities with scale to come to market in the near term.”
“Great auto aftermarket businesses can be sold in almost any market, and sophisticated platforms with differentiated technology, operational expertise, and proven tactics for navigating supply chain disruptions will continue to be well‑positioned to win,” Yousefian said.
Image credit: Depositphotos.com
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