While aftermarket retail sales may not hit the highs they saw in 2021, the industry is in a good place going forward, according to industry analysis.
This past year was probably the peak of aftermarket retail sales, suggested Nathan Shipley, executive director of The NPD Group, a market research company.
Reporting on the first half of 2021, DesRosiers Automotive Consultants found that retail sales at Canadian automotive parts, tires and accessories stores hit about $5.5 billion. In 2020, that number didn’t reach $4.5 billion. None of the three prior year numbers even hit $5 billion.
While 2022 doesn’t appear poised to beat those numbers, Shipley pegs the automotive aftermarket still finishing ahead of 2020 and 2019, up 8.5 per cent.
“This is a bullish forecast,” he pointed out. “This is suggesting that ’21 was the peak and things are going to keep trucking right along. But absent those big pushes that have pushed things higher, higher, higher, we’re going to settle in a little just underneath where we were this year.”
Keep in mind, growth of 2 or 3 per cent was considered a good year pre-COVID. To predict the industry will be up 8.5 per cent over 2020 and 2019 is a very good sign. “That’s a very healthy environment,” Shipley said.
The supply chain may dictate how things actually play out. However, Shipley suggested that some experts believe there isn’t necessarily a problem with the supply chain — it’s demand that is the problem. So as demand slows down, that should help alleviate the supply chain challenges being seen. But he couldn’t offer a guess as to when that may happen.
“I think the big takeaway is that the fundamentals of this industry are very, very strong. We and you should feel very, very good about where we are as an industry,” he said.