Comprehensive Guide to Auto Replacement Components
This article offers an in-depth overview of automotive replacement parts, covering manufacturing, market trends, OEM tiers, and purchasing options. It highlights industry impacts from past recessions and explains how consumers and suppliers interact in this vital sector, emphasizing the growth of online sales channels and the classification of auto parts into accessories and replacements.
The auto parts manufacturing sector plays a vital role in the national economy. The demand for replacement automotive parts directly correlates with new vehicle sales. Nearly 70% of the parts produced are intended for original vehicle assembly, while the remaining 30% serve the aftermarket, including repair and specialty items.
The 2008 financial crisis significantly impacted vehicle sales, affecting industry giants like Ford, GM, and Chrysler. International automakers had already gained market share prior to the recession, giving them an advantage over domestic manufacturers.
During September 2008, suppliers faced rising raw material costs amid declining demand from both consumers and automakers. Post-recession, industry experts recommended operating at around 80% capacity for profitability; however, in 2009, capacity utilization dropped to 50-60%.
Auto replacement parts are categorized into OEM (Original Equipment Manufacturer) parts and aftermarket components. OEM parts are used in the manufacturing of vehicles and are supplied to service networks. OEM suppliers are classified into three tiers: Tier 1 supplies finished parts directly to automakers, Tier 2 provides components or materials to Tier 1, and Tier 3 supplies raw materials or parts to either Tier 1 or Tier 2, sometimes selling directly to vehicle assemblers. Production of OEM parts accounts for approximately 65-75% of total auto parts manufacturing.
Auto parts are divided into accessories and replacement parts. Accessories include items for performance enhancement, comfort, customization, safety, or convenience. Replacement parts are remanufactured or built to replace worn or damaged original parts.
Consumers now have multiple options for purchasing auto replacement components, including physical retail stores and online platforms. Major online sellers like Amazon and eBay Motors dominate the aftermarket sales, which reached an estimated $10 billion in 2018, excluding used parts and auctions.
