The global aftermarket is an interesting mix of business conditions
Each quarter, the Overseas Automotive Council (OAC) of the Automotive Aftermarket Suppliers Association (AASA) collects insights from its international regional directors and its board of governors on current business conditions in the regions they cover around the world.
These quarterly “OAC How’s Global Business” reports provide first-hand reports on shifts and trends in markets throughout the world. Highlights from Q4 2013 “OAC How’s Global Business Report” are included here.
South American Markets
Mexico is an interesting mix of business conditions with some manufacturers reporting great success while others see a decline in business. The business fluctuations appear to depend upon specific product lines and regional economic conditions.
Conditions in Venezuela have diminished greatly due to difficulty of accessing dollars to pay for imported product and government rules forcing importers to reduce prices by 30 percent – or face imprisonment.
Colombia’s business conditions have improved since the free trade agreement with the United States was instituted in 2012. A new trade agreement with Korea has that country gaining significant market share.
There is great concern regarding Argentina as its government seems to be heading the way of Venezuela, making it difficult to get product into the country and to get money out.
Business in Brazil has slowed a little as it prepares for the Olympics and World Cup, but it remains healthy.
Chile appears to be stable – its economy is healthy and sales are up compared to the same time last year.
Parts of Central America are flat but the majority of the region appears to be stable. However, some OAC leaders are concerned that populist governments, such as in Venezuela, may gain ground in the region.
Asian Markets
Japan is considering supporting its exporters with $53 billion in incentives. If the Japanese government moves ahead with the plan, China is expected to give extra support to its exporters with an even larger amount of money.
Demand is growing in Israel for Western products instead of those made in China, as its consumers look more for name brand products.
As Australian manufacturing is impacted by the worldwide shift in sourcing, there could be an unprecedented consolidation in the number of the country’s warehouse distributors and auto parts retailers.
European Markets
European sales have been flat in 2013, and the influx of competition from China will make for tough selling.
Russia has been strong in 2013, as its growing and more affluent middle class spends money on vehicles.
Other Markets
There is growth opportunity in Puerto Rico as consumers spend money to maintain their current vehicles rather than replace them.
The implementation of strict labor laws in Saudi Arabia and Kuwait has led to a decline in repair capacity, resulting in a sharp drop in spare parts demand and skyrocketing labor charges.
Full reports on quarterly “How’s Global Business” are available to OAC members. For more information about OAC membership, visit www.oac-intl.org. The AASA Overseas Automotive Council works to keep members up-to-date on current global business conditions and emerging markets. For more information on these reports or OAC’s other programs and benefits, contact Curtis Draper, OAC executive director, at [email protected] or 919-406-8856.
Curtis Draper is the vice president of industry analysis, programs and member services at the Automotive Aftermarket Suppliers Association (AASA) and group executive of AASA’s international aftermarket councils: the China Aftermarket Forum (CAF) and the Overseas Automotive Council (OAC).
The AASA China Aftermarket Forum (CAF) is a consortium of full-service suppliers that meet on a quarterly basis to discuss opportunities within the Chinese aftermarket and to identify ways to address challenges in the growing segment. For more details about CAF programs and initiatives, click here.
The AASA Overseas Automotive Council (OAC) promotes the sale in foreign markets of automotive and heavy-duty products manufactured in North America. Those products include components, accessories, chemicals, hand and power tools, service maintenance and repair equipment, and paint and body supplies for both cars and trucks. OAC has more than 350 members in more than 40 countries. More information is available through its Web site, www.oac-intl.org.
AASA (www.aftermarketsuppliers.org) exclusively serves manufacturers of aftermarket components, tools and equipment, and related products. It is a recognized industry change agent – promoting a collaborative industry environment, providing a forum to address issues and serving as a valued resource for members. “AASA, The Voice for the Automotive Aftermarket Supplier Industry”
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