Auto Care Association Unveils First-Ever State Of The Auto Care Industry Report At Inaugural Industry Forum In Washington, D.C.

Auto Care Association Unveils First-Ever State Of The Auto Care Industry Report At Inaugural Industry Forum In Washington, D.C.

Auto-Care-Association-Report-Speakers-All-300x154The Auto Care Association unveiled its first-ever annual State of the Auto Care Industry Report April 29 at the inaugural State of the Auto Care Industry Forum at the U.S. Chamber of Commerce in Washington, D.C.

Marcus Jadotte, Assistant Secretary of Commerce for Industry and Analysis for the International Trade Administration, U.S. Department of Commerce, was the keynote speaker and was joined by VIP presenters from Google, UPS, AAA and IHS Automotive and NASCAR driver and team owner, Michael Waltrip.

Mary DellaValle, editor of ImportCar, was at the event in Washington on April 29. She collected the following key takeways from presenters:

Behzad Rassuli, VP, Market Intelligence, Auto Care Association:

• Our industry stays strong, even when the economy doesn’t. It does so by continuing to provide parts and services to all cars on the road, even during periods of new car sales declines.

• Average vehicle age (11.5 years), annual miles driven per car (11,244) and total miles driven annually (3 trillion miles) are key drivers of our industry’s strength.

Mark Seng, Global Aftermarket Practice Leader, IHS Automotive:

• The automotive industry is “back” with new light vehicle sales hitting 16.5 million units in 2014; the first time that number has been more than 16 million since 2007. This is the aftermarket’s “pipeline” for repair and service opportunities.

• Even with average vehicle age projected to remain steady at 11.5 in 2015, vehicles in the “new to 5-year-old” range are expected to grow by 32% and 12-plus-year-old vehicles will grow by 15 percent – an exciting trend for the aftermarket, as these vehicles are primarily serviced at independent repair facilities.

• New technology, especially in the areas of more complex powertrains, sensors and electronic controls, handling packages and infotainment systems will fuel opportunities for the aftermarket. Start/stop idle technology is on 16 percent of today’s vehicles and that number will rise to 50 percent by 2021, as the OEMs look for ways to hit fuel-efficiency targets. Also trending will be four-cylinder vehicles equipped with turbochargers. This is great news for the aftermarket that is very adept at developing service solutions for next-generation vehicles.

Nicolle Pillartz, Head of Industry, Automotive, Google

• Fifty-eight percent of drivers keep their car as long as they can and they go online for their auto care needs.

• Auto care industry professionals also go online and have fueled e-tail purchasing growth. In 2013, e-tailing by independent service providers accounted for $6 billion; with that number expected to rise to $13.2 billion in 2018 and $28.8 billion in 2023. That’s 6 percent, 11 percent and 20 percent of total aftermarket replacement parts sales, respectively, making e-tailing the fastest-growing retail sector in the auto care industry.

Camille Kielty, President, Enterprise Accounts, UPS

• As U.S consumers embrace multi-channel shopping experiences, the logistics industry is working with the Auto Care industry to provide an enriched sales experience for customers.

• The logistics industry also is a big contributor to the Auto Care industry with $1 billion per year being spent on parts and labor for its delivery vehicle fleet.

John Nielsen, Managing Director, Automotive Engineering & Repair, American Automobile Association (AAA)

• When we ignore the growth of telematics in our industry, it becomes a “threat.” When we embrace telematics, it becomes an “opportunity.”

• By 2020, 250 million cars will have connectivity; 150 million drivers will actually use their connectivity; and this market represents $14.5 billion in revenue.

Keynote speaker, Marcus Jadotte, Assistant Secretary of Commerce for Industry & Analysis, International Trade Administration, U.S. Department of Commerce

• The auto industry has led the U.S. economic recovery and is a leader in creating U.S. jobs.

• The Department of Commerce’s growth agenda includes a focus on exports. In 2014, auto parts exports accounted for $81 billion and 11.7 million jobs are supported by exports (roughly the population of the state of Ohio).

• There also will be a focus on strengthening global competitiveness and connecting U.S. businesses with opportunities around the world.

• Bolstering fair trade opportunities will open more markets and have a positive impact on the U.S. economy.

After the various speaker presentations, a roundtable discussion with the group ensued on the topics of “how” can we best connect with Millennials, the need for improvements in our road infrastructure, reacting to industry data and channeling it into growth opportunities, the consumers’ demand for service immediacy and how the industry can best manage those expectations to enhance their service experience.

In summary, Kathleen Schmatz, President & CEO, Auto Care Association offered these thoughts:

• The Auto Care Industry has always risen to the challenge of the industry’s new technology and the newest “black box.”

• It turns out that it is “rocket science” and we’re taking even more steps to recruit and retain highly skilled technicians to service today’s and tomorrow’s highly complex, computer-controlled vehicles.

• We need to tell our story to the right people and showcase the passion we have for our great business where we make our living.

• Our industry is growing in sophistication, is fiscally strong, is a strong contributor to our economy and provides an optimistic outlook for the future.

“The overwhelming feedback from attendees and participants at the forum about the valuable content of the report, and the high quality and insightful presentations by the industry thought leaders, makes a very strong case for the State of the Auto Care Industry Forum to truly become an annual event,” said Kathleen Schmatz, president and CEO, Auto Care Association.

The forum was attended by policymakers and regulators, automotive-related trade association leaders, business and financial experts and media.

Preceding the forum were two key events designed to promote the auto care industry including a Congressional briefing hosted by Rep. Robert Pittenger, R-N.C. at the Cannon House Office Building, and a Congressional reception, hosted by the association at the Rayburn House Office Building. Two-time Daytona 500 winner Michael Waltrip was a featured speaker at the briefing and was the special guest at the reception, where he took photos with staffers and guests and signed autographs. More than 250 people attended the reception.

Click here to view the State of the Auto Care Industry Report.

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