North American Brake Rotors, Drums, and Calipers aftermarket

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  • 1. Increasing Age of Vehicles Sustains Growth in North American Brake Rotors, Drums, and Calipers Aftermarket Research PREVIEW for the North American Brake Rotors, Drums, and Calipers Aftermarket
  • 2. Sample of Key Highlights  Total manufacturer-level revenue will increase by 2.3% annually over the 2013-2020 period.  The average manufacturer-level price is expected to increase by only 0.2% annually, reaching $14.48 per unit by 2020.  Warehouse distributors (WD) represent half of the total revenue (50.5% of 2013 revenue), but large retail chains continue to gain share.  Brake Parts Inc., CARDONE Industries, and Winhere Brake Parts were the top suppliers in 2013. Source: Frost & Sullivan analysis.
  • 3. Drivers and Restraints The impact of market drivers will slightly outweigh restraints, resulting in low market growth. Total Rotors, Drums, and Calipers Aftermarket: Key Market Drivers and Restraints, North America, 2014–2020 DriversRestraints DriversRestraints Rising Raw Materials and Transport Costs Decreasing Service Life of Parts Severe Weather Conditions New SKUs Enter the Aftermarket Increased Direct Sourcing Consolidation of Distributors Slow Economic Growth Growth of Private-label Brands Denotes long-term impactDenotes current impact Source: Frost & Sullivan
  • 4. Key Conclusions and Future Outlook The large volume of low-cost imported products in the aftermarket makes it difficult to drive market growth higher. 4 Parameters Current Future Market Status • Market fully recovered from the 2008 to 2009 financial crisis (economic recession) that had caused vehicle owners to decrease non-essential maintenance activity • Stable growth rates • Stable growth of 2 to 4% annually, based mainly on increasing unit shipments • Older vehicles supporting demand growth Pricing • Rotor prices declining • Drum prices up due to flat, declining demand • Caliper prices flat • Prices to remain flat or slightly decreasing for high-volume rotor SKUs • Prices up 1 to 2% annually for drums and calipers Technology • Increasing installation of all-disc brakes • Use of drum brakes continues to decline • Continued market share decline of drum brake components Source: Frost & Sullivan
  • 5. Key Conclusions and Future Outlook (continued) Some suppliers are reducing the number of product lines they offer in order to increase profits. 5 Parameters Current Future Product Positioning • Rotors: two lines for most suppliers (economy and premium). Original part may be sold as premium. • Drums: single line for most suppliers. OES also carries original part for warranty. • Most suppliers offer loaded calipers line (with brake pads) in addition to a standard semi- loaded offering. • Brand consolidation, with more manufacturers and distributors offering a single rotors line Key Competitive Factors • Price • Quality • All-makes-and-models coverage • Price • Quality • All-makes-and-models coverage Source: Frost & Sullivan
  • 6. Details of the Full Analysis
  • 7. The Full Analysis Features the Following Content Section Slide Numbers Executive Summary 4 Research Scope, Objectives, Methodology, and Background 16 Definitions and Segmentation 23 Market Overview 28 Total Brake Rotors, Drums, and Calipers Aftermarket – • External Challenges: Drivers and Restraints 31 • Forecasts and Trends 45 • Market Share and Competitive Analysis 58 Brake Rotors Segment Analysis 62 Brake Drums Segment Analysis 72 Brake Calipers Segment Analysis 82 Conclusions and Future Outlook 92 Appendix 96
  • 8. Research Aims and Objectives Aim  The aim of this study is to identify the size and direction of the North American passenger vehicle brake rotors, drums, and calipers aftermarket, and to identify growth opportunities. Objectives • Calculate aftermarket size through primary research interviews with leading market participants • Determine aftermarket direction over the next 5 to 7 years by analyzing market drivers and restraints • Understand the competitive structure of the aftermarket and identify the key success factors • Identify the main competitors and analyze their market strategies • Highlight shifting product preferences in the aftermarket and how they affect competitors’ growth prospects • Recognize competitive shifts within the distribution channels to determine which suppliers are best positioned for growth 8
  • 9. Product Segmentation 9 Brake Rotors Brake Drums Economy Premium Total Brake Rotors, Drums, and Calipers Aftermarket Total Brake Rotors, Drums, and Calipers Aftermarket: Product Segmentation, North America, 2013 Semi-loaded Others* Brake Calipers *Others include loaded, unloaded, and bare calipers. Source: Frost & Sullivan
  • 10. Market Structure 10 OES Auto Parts Retailers Internet/Mail Order OEMExporter Parallel Importer New Car Dealer Service Departments Retailer Service Bays Offshore Manufacturer Mass Merchandisers US Parts Manufacturer Remanufacturer Programmed Distribution Groups Body Shops Collision Parts Distributors Independent Installers Service Chain Outlets WD Service Chain Distribution Centers • The 3-step structure evolves into a 2-step structure as large auto parts retail chains gain power. • Small jobbers and independent installers are increasingly acquired by larger competitors. Step 1 Step 2 Total Brake Rotors, Drums, and Calipers Aftermarket: Distribution Structure, North America, 2013 Vehicle Owners Step 3 Co-manufacturer Source: Frost & Sullivan New Car Dealer Parts Departments Jobbers
  • 11. Key Distribution Groups Compared in this Study 11 Group OEMs WD NAPA, CARQUEST, Federated, Aftermarket Auto Parts Alliance, Automotive Distribution Network OES General Motors Service & Parts Organization, Ford Customer Service Division, Mopar Group OEMs Retail AutoZone, Advance Auto Parts, Canadian Tire, Sears, Wal-Mart Others Includes co-manufactured parts (sold to other manufacturers for resale in brake kits, loaded calipers) as well as Internet/direct mail/catalog sales The distributor groups compared in this study are as follows: Note: OEMs lists are not comprehensive. Source: Frost & Sullivan
  • 12. Interested in Full Access? Connect With Us Name Jeannette Garcia Corporate Communications (+1) 210.477.8427 Jeannette.Garcia@frost.com Research Authors Stephen Spivey Aftermarket Program Manager Automotive and Transportation http://www.frost.com/reg/people-finder- result.do?id=16576 Twitter Handle: @FS_Automotive Facebook https://www.facebook.com/FrostandSullivan LinkedIn Group https://www.linkedin.com/company/frost-&-sullivan SlideShare http://www.slideshare.net/FrostandSullivan Twitter https://twitter.com/Frost_Sullivan
  • 13. Global Perspective 40+ Offices Monitoring for Opportunities and Challenges
  • 14. Industry Convergence Comprehensive Industry Coverage Sparks Innovation Opportunities Automotive & Transportation Aerospace & Defense Measurement & Instrumentation Information & Communication Technologies HealthcareEnvironment & Building Technologies Energy & Power Systems Chemicals, Materials & Food Electronics & Security Industrial Automation & Process Control Automotive Transportation & Logistics Consumer Technologies Minerals & Mining