DesRosiers Automotive Consultants, working in conjunction with the Automotive Aftermarket Retailers of Ontario (AARO), reports that the Canadian automotive aftermarket, in particular shops in Ontario, will continue to overcome headwinds and continue to grow sales in 2024.

DesRosiers Automotive Consultants (DAC) has collected direct industry feedback on the performance of this Canadian automotive aftermarket segment in 2023 as well as their outlook on how 2024 is expected to develop.

“In recent years, the automotive aftermarket had maintained strength even as significant portions of the auto industry witnessed significant setbacks,” commented Andrew King, Managing Partner at DAC. He continued, “Despite lingering parts availability and pricing issues, the aftermarket saw significant success in 2023 with more growth expected in 2024, this time in step with a recovering new light vehicle sales market.”

DAC Compared sales results between 2023 and 2022, with aftermarket service providers overwhelmingly indicating growth.

While half of the respondents cited single digit sales increases between 2022 and 2023, some 37% reported growth above %10. Only 12% of responses said they’d seen a drop in sales, with 2% reporting no change in slales volume.

Taking a longer period into account by compared with pre-pandemic sales, 60% said sales were greater, with 29% saying they were at the same level. Only 12% said sales were below pre-pandemic levels.

Outlook for 2024

While shops predicted growth, the predictions are relatively modest. More than two-thirds (69%) said they expected single-digit growth in 2024. (See lead graph at the top of this story.)

Still, some 8% said growth would exceed 10%.

Among the less optimistic,12% of respondents said they expected little change,

About one in eight shops said they thought business would dip in 2024. The majority of this group–making up 10% of total respondents–said the decrease would be modest,l but 2% (about one in 50 shops) said they though a significant downturn in sales was in the offing.

Supply issues improving

According to aftermarket shops, parts supply issues remained the norm from both jobbers and new vehicle dealers. However, compared to survey results for the first half of 2023, respondents noted some improvement.

In the previous survey, 67% of respondents cited parts supply issues stemming from jobbers with this figure dropping to 52% for 2023 as a whole. From new vehicle dealers, 85% of respondents pointed towards parts supply issues for the first half of 2023 against 80% for the year overall.

For 2023, aftermarket retailers largely pointed towards increased parts prices compared to 2022 overall. From jobbers, 52% of respondents pointed towards price increases of between six and ten percent with 48% of responces pointing towards the same with parts prices from new vehicle dealers. While the results clearly show an inflationary environment, respondents indicated a slight moderation in the rate of price increases from the first half of 2023.

Visit DesRosiers Automotive Consultants

Contact Automotive Aftermarket Retailers of Ontario