Auto Service World
News   July 31, 2001   by Auto Service World

Starter and Alternator Demand Set to Rise, Says Study

Demand for starters and alternators is set to rise, says a report by research firm Frost & Sullivan.
The research says that as the automotive industry continues to experience high sales, car owners are using their vehicles for shorter and more frequent trips, causing engine components to wear out quickly and increasing aftermarket demand for starters and alternators.
According to new analysis, North American Starter and Alternator Aftermarket, the total market reached an estimated $1.48 billion U.S. in 2000 and is expected to increase to $1.66 billion in 2007.
Despite the opportunities for new aftermarket sales, market participants are facing reduced profit margins. National retailers are usurping market share, gaining buying power, and forcing suppliers to curtail prices.
"Retailers favor large remanufacturers that can supply in volume, operate efficiently, and meet retailers’ low price expectations," says Frost & Sullivan industry analyst Matt Vestervelt. "Some remanufacturers are willing to take losses on sales, and some suppliers are using price to undercut competitors."
However, by identifying which products are most in demand and command the highest prices in the aftermarket, smaller regional remanufacturers will have a strong chance to sustain market share against national companies.
"With vehicles becoming more complex to repair, the ‘do it-for-me’ market has grown," says Vestervelt. "To best serve their customers and minimize bounce-back replacement work, professional installers are demanding remanufactured alternators and starters of the highest quality."
At stake is installers’ time and money, as well as the reputation of the remanufactured parts industry. Low-quality units that fail the consumer in a short time will cause the consumer to think twice before buying additional remanufactured components for their vehicle.

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