Older vehicles boosting aftermarket demand

Cars and light trucks are lasting longer and being scrapped less, a trend that is driving growth in aftermarket product use, according to a new report.

According to Lang Marketing, two factors are working together to keep vehicles in operation at record-high ages: Improved longevity and moderate scrappage rates. The group projected that both trends will continue through this decade, increasing the number of older vehicles on the road and their annual mileage.

“Vehicle longevity will continue to rise through this decade, and scrappage will remain moderate,” the report stated. As a result, aftermarket product growth will accelerate, it noted.

Advances in materials and manufacturing have extended vehicle life compared to models built in the 1990s and early 2000s. High used-vehicle prices, which surged during the pandemic and remain elevated, also encourage owners to maintain older vehicles, raising the age threshold for scrappage.

New vehicle sales have struggled since COVID-19, putting downward pressure on scrappage rates. Over the past decade, scrappage has remained modest even as sales rebounded after the Great Recession, with only a slight uptick in recent years.

The average age of cars and light trucks has climbed by nearly 1.5 years over the past decade, more than double the historical rate of increase. Vehicles at least 14 years old represent one of the fastest-growing segments of the vehicle population and require more aftermarket products per mile than newer models. Many are also being driven more miles than older vehicles were decades ago.

The report noted that internal combustion engine vehicles will dominate the car parc for decades, even if electric vehicle sales grow, because ICE models make up more than 99 per cent of vehicles over five years old. Their extended presence will further boost aftermarket product volume, as older ICE vehicles consume more parts and services than EVs.

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