Consumers Are Keeping Cars Longer
The last few years have seen the automotive repair market grow by leaps and bounds. Why? A shift in economic conditions is forcing the average American to limit discretionary funds, therefore minimizing large capital expenditures such as new cars.
Hear what experts are saying about the automotive repair industry:
“Where drivers in the past would scrimp on maintenance and repairs, they are now looking at the cost of trying to purchase a new vehicle...so in relative terms that $1,000 repair to keep a $2,500 car running may be an attractive alternative.” - CNN.com, March 14, 2009
The Neighborhood Repair Shop is Coming Out Ahead
The trend of keeping cars longer seems to be working out in favor of the neighborhood repair shop. With fewer new car purchases, the dealers are suffering, along with the dealer repair departments.
“The 2009 closing of at least 2,000 car dealers in the U.S., mostly domestic auto outlets, will provide the independent (non-dealer) automotive aftermarket with an unprecedented $7 billion annual growth opportunity in parts and service volume.” - MSNBC.com, March 17, 2009
“76% of automotive mechanics expect to see more work in 2009 than 2008.” - USA Today, February 9, 2009
“The Automotive Service Association reports an overall increase in auto repair customer count, ‘People are coming in and wanting repairs.’” - Wall Street Journal, January 14, 2009
Why The Automotive Repair Field?
As you can see, the automotive repair industry is stable and enjoying unprecedented growth. As our economy continues to shift, industries that fulfill basic needs such as auto repair and healthcare are bound to leave other, less vital industries in the dust.
Industry Data from the 2009 Automotive Aftermarket Industry Association Fact Book:
- 2007 U.S. automotive aftermarket grows 4.0% to $285.5 billion with additional growth anticipated for 2008 of approximately 1.8%
- The Do It For Me (DIFM) market increases to nearly $150 billion
- Average age of a vehicle reaches 10.4 years old
Industry date from U.S. EPA Website:
- Average Miles driven estimated at 12,000 miles annually (2009)
- Body Paint and equipment sector increases to $42.4 billion in 2007
- The Paint and Body industry has grown every year since 1999
- Vehicle registration increases 1.7% in 2007
2009 Lang Report and Lang marketing data:
- Although the Do It For Me (DIFM) market soared by $15 billion from 1998 to 2008, the automotive repair industry has yet to catch up
- The average number of U.S. vehicles per service bay has increased from 160 cars per bay in 1998 to over 200 cars per in 2008
- It is anticipated that some 2,000 automotive dealerships will close their doors in 2009 reducing the number of service bays by an additional 30,000 which will result in the increase of vehicles to service bay ratio
At Driven Brands, we believe our concepts are well positioned in today’s economy. While U.S. car dealerships are closing their doors at an unprecedented rate, our franchisees are well prepared to service the anticipated overflow.
