India Automotive Aftermarket: Industry Analysis and Forecast (2024-2030) Trends, Statistics, Dynamics, Segmentation by Replacement Parts, Certification, Service Channel, Distribution Channel and Region

India Automotive Aftermarket size was valued at USD 10.3 billion in 2023 and the total India Automotive Aftermarket revenue is expected to grow at a CAGR of 7.2% from 2024 to 2030, reaching nearly USD 16.76 Billion.
India Automotive Aftermarket Overview
The India automotive aftermarket is currently experiencing strong growth, thanks to the country's vehicle parc reaching 340 million, and expected to grow steadily at a compound annual growth rate of over 8% in the next five years, the market presents substantial opportunities. The Two-Wheelers and Passenger Vehicles segments are expected to witness significant growth, with projections indicating an increase from 257 to 365 million units and from around 47 to over 72 million units respectively over the next five years.

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The growing pre-owned car sales market is playing an important role in driving substantial growth of India Automotive Aftermarket, projected to achieve a compound annual growth rate of approximately 17.5% by the financial year 2030, driven by organized businesses and online platforms. On the international front, the Indian aftermarket industry is eyeing significant export opportunities, particularly in 10 major export markets. These markets, including matured ones like Indonesia, LATAM, Poland, Brazil, Columbia, and Bangladesh, as well as rapidly developing ones such as North Africa, South Africa, East Africa, West Africa, and the UAE, hold identified export potentials.

Trends

Transformative Trends in India's Automotive Aftermarket: Shifting Business Models and Revenue Sources

The India automotive aftermarket is experiencing an outstanding shift in its business models and revenue sources. Traditionally, aftermarket businesses followed a sequential selling approach, but now there's a transition towards direct distribution through e-commerce platforms, facilitated by partnerships between Original Equipment Manufacturers (OEMs) and online retail giants like Amazon and eBay. For instance, Robert Bosch's collaboration with TMall yielded a substantial Gross Merchandise Volume (GMV) of $290 million in 2015-16.

In terms of revenue sources, while wear-and-tear parts have historically dominated, their demand is anticipated to slow down due to improved part quality. Similarly, the prevalence of crash-relevant parts is expected to decrease with advancements in vehicle safety features. Consequently, growth in the aftermarket sector is projected to be driven by new offerings in diagnostics and services, particularly those leveraging digitization and car data. Connected vehicles and IoT sensors, for example, generate predictive data to forecast potential issues, enabling proactive maintenance alerts before part failure.

Driver

Increasing Vehicle Sales Growth boost, the India Automotive Aftermarket

The India Automotive Aftermarket is set to experience a substantial boost with the recent surge in vehicle sales growth. According to MMR Study Report in January 2024, overall vehicle sales soared by 15%, escalating from 18.49 lakh units in January 2023 to 21.27 lakh units in January 2024. This surge in sales is particularly prominent in key segments, with two-wheelers leading the charge with a robust 15% growth, followed closely by three-wheelers at an impressive 37% increase and passenger vehicles at a commendable 13% rise. Specifically, two-wheeler sales surged to 14,58,849 units in January 2024, marking a 15% increase compared to the same period last year. This surge is driven by steady demand, particularly in rural areas, buoyed by favorable agricultural conditions and government support initiatives. Three-wheelers also experienced a remarkable upswing, witnessing a staggering 37% increase in sales, reaching 97,675 units compared to 71,325 units in January 2023.

The passenger vehicle segment achieved record-breaking sales figures, reaching an all-time high of 3,93,250 vehicles in January 2024, surpassing the previous record set in November 2023. However, challenges persist in the form of high inventory levels, which linger in the 50-55-day range, posing significant challenges for auto dealers. Also, tractors witnessed a notable 21% increase in sales, reaching 88,671 units in January 2024. Nonetheless, the commercial vehicle segment experienced modest growth, with sales remaining relatively flat at 89,208 units. In India Automotive Aftermarket remains promising, with various factors contributing to this positive sentiment. These include ongoing marriage seasons, anticipated agricultural income, successful new model launches, and supportive post-Union Budget policies. However, challenges such as market uncertainty due to upcoming elections, persistent supply bottlenecks, and fluctuating market liquidity may temper the growth trajectory. The significant surge in vehicle sales growth presents lucrative opportunities for the India Automotive Aftermarket, provided industry stakeholders effectively navigate the accompanying challenges.



Restrain

Strict Regulatory Environment Limits the India Automotive Aftermarket Growth

The strict regulatory environment governing the Indian automotive aftermarket poses significant limitations on its growth potential. These regulations, which encompass safety and emission norms, certification requirements, manufacturing standards, and compliance with Automotive Industry Standards (AIS) and Bureau of Indian Standards (BIS) certifications, create several challenges for aftermarket businesses.



Challenges
Description


Compliance Costs
Significant investments in research, development, testing, and certification processes.


Complexity and Red Tape
Navigating through complex, frequently updated regulations, and ensuring ongoing compliance can be time-consuming and resource-intensive.


Barriers to Entry
Strict regulatory requirements deter new players, limiting competition and innovation.


Impact on Product Innovation
Stringent standards may hinder innovation as businesses prioritize compliance over R&D.


Market Fragmentation
Favoring larger, compliant players contribute to a less competitive aftermarket landscape.


Consumer Perception
Compliance influences consumer perception, affecting sales and brand reputation.


International Trade Barriers
Compliance with Indian standards hinder international trade and market.



The strict regulatory environment in India imposes various limitations on the automotive aftermarket's growth potential. While regulations are necessary to ensure safety, environmental protection, and ethical conduct within the industry, striking a balance between regulatory compliance and fostering innovation and market competition is essential to support the sustainable growth of the India automotive aftermarket.

Opportunity

Technological Advancements in the automotive sector create multiple growth opportunities for the India Automotive Aftermarket

Technological advancements in the automotive sector are driving significant growth opportunities for the India Automotive Aftermarket. With innovations such as connected vehicles, electric vehicles (EVs), and advanced driver assistance systems (ADAS), aftermarket businesses can develop and offer compatible products and services, including diagnostics, software updates, and specialized components. The increasing adoption of connected vehicle technology enables aftermarket players to offer solutions for remote diagnostics, predictive maintenance, and fleet management, enhancing efficiency and reducing downtime for vehicle owners. Furthermore, the transition towards EVs presents opportunities for aftermarket businesses to provide charging infrastructure, battery management systems, and retrofitting services for conventional vehicles.

The integration of ADAS features such as lane departure warning systems, adaptive cruise control, and collision avoidance systems opens up avenues for aftermarket installation and calibration services, catering to both OEMs and vehicle owners seeking to upgrade their vehicles' safety features. Also, technological advancements in materials, manufacturing processes, and 3D printing enable aftermarket businesses to develop custom components, accessories, and performance upgrades tailored to individual preferences and vehicle specifications. By embracing these technological advancements, the India Automotive Aftermarket can drive innovation, enhance competitiveness, and capitalize on the evolving needs of vehicle owners in the rapidly transforming automotive landscape.
India Automotive Aftermarket Segment Analysis
Based On Replacement Parts, the tire segment dominated the India Automotive Aftermarket in the year 2023. Tires are essential components of vehicles, experiencing regular wear and tear, leading to frequent replacements. With India's large and diverse vehicle parc, ranging from passenger cars to commercial vehicles and two-wheelers, there's a substantial and consistent demand for tires across various segments. Also, the Indian automotive aftermarket has witnessed significant growth in recent years, driven by factors such as increasing vehicle ownership, rising disposable incomes, and urbanization. This growth has translated into higher demand for aftermarket products and services, with the tire segment benefiting immensely from this trend. The tire market in India is characterized by intense competition, leading to innovations in tire technology, product offerings, and distribution channels. Companies in the tire segment have focused on expanding their product portfolios, enhancing manufacturing capabilities, and optimizing supply chains to meet the diverse needs of customers across different vehicle categories and usage patterns.


Regional Analysis of India Automotive Aftermarket
The Northern region dominated the India Automotive Aftermarket in the year 2023. The northern region, including states like Delhi, Uttar Pradesh, Punjab, and Haryana, constitutes a significant portion of the aftermarket demand. This is driven by high vehicle density in urban centers such as Delhi-NCR, as well as agricultural activities in rural areas. Demand in this region is diverse, ranging from passenger vehicles to commercial vehicles and agricultural machinery.

States such as Maharashtra, Gujarat, and Rajasthan are key contributors to the automotive aftermarket. The presence of major cities like Mumbai and Pune fosters demand for aftermarket products and services, particularly in the passenger car and commercial vehicle segments. The industrial hubs in Gujarat drive demand for commercial vehicle parts and components. The presence of automotive manufacturing clusters boosts demand for aftermarket products and services. The growing urbanization and higher disposable incomes in cities contribute to increased aftermarket spending. The aftermarket in this region is still evolving compared to other parts of the country, presenting opportunities for market growth and penetration. The diverse nature of the Indian automotive aftermarket, with each region presenting unique opportunities and challenges for aftermarket businesses. Understanding regional dynamics is crucial for targeted marketing strategies and efficient distribution network optimization.
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India automotive aftermarket


Report Coverage
Details


Base Year:
2023
Forecast Period:
2024-2030


Historical Data:
2018 to 2023
Market Size in 2023:
US $ 10.3 Bn.


Forecast Period 2024 to 2030 CAGR:
7.2%
Market Size in 2030:
US $ 16.76 Bn.


 Segments Covered:
by Replacement Parts
Tire
Battery
Brake Parts
Filters
Body parts
Lighting & Electronic Components
Wheels
Exhaust components
Turbochargers
Others


by Certification
Genuine Parts
Certified Parts
Uncertified Parts


by Service Channel
DIY (Do it Yourself)
DIFM (Do it for Me)
OE (Delegating to OEM’s)


by Distribution Channel
OEMs
Repair Shops
Wholesalers & Distributors



India Automotive Aftermarket Key Players:
1. Bosch India
2. TVS Group
3. Mahindra & Mahindra
4. Exide Industries
5. Tata Motors
6. Minda Industries
7. Amara Raja Batteries
8. Ashok Leyland
9. Hero MotoCorp
10. Maruti Suzuki
11. Motherson Sumi Systems
12. JK Tyre & Industries
13. Lumax Industries
14. Sundram Fasteners
15. WABCO India
16. Gabriel India
17. Ceat Ltd.
18. SKF India
19. MRF Limited
20. Apollo Tyres

FAQs:
1. What are the growth drivers for the India Automotive Aftermarket?
Ans. A growing middle class and rising disposable incomes, there's an increasing demand for vehicles across various segments, and this is expected to be the major driver for the India Automotive Aftermarket.

2. What is the major opportunity for India's Automotive Aftermarket growth?
Ans. Rising Demand for Parts and Accessories Revolutionizing the India Automotive Aftermarket Industry.

3. What is the projected market size and growth rate of the India Automotive Aftermarket?
Ans. India Automotive Aftermarket size was valued at USD 10.3 billion in 2023 and the total India Automotive Aftermarket revenue is expected to grow at a CAGR of 7.2% from 2024 to 2030, reaching nearly USD 16.76 billion.

4. What segments are covered in the India Automotive Aftermarket report?
Ans. The segments covered in the India Automotive Aftermarket report are by Replacement Parts, Certification, Service Channel, Distribution Channel, and Region.