LAS VEGAS – Consumers' personal economic perceptions continue to be pessimistic based on surveys conducted by the NPD Group Inc.
With new vehicle sales continuing to fall below historic levels offset by slight increases in replacement parts sales and services, the industry may be experiencing a new “normal,” David Portalatin, NPD's director of industry analysis, told attendees at the Automotive Aftermarket Products Expo in Las Vegas.
The aftermarket can expect more of the same level of consumer spending in 2011 that they have seen so far this year. More consumers are holding on to their older vehicles and focusing on regular maintenance.
Few have plans to replace their vehicles, either with a new or used version.
The aftermarket will see sustained levels of maintenance and repairs. While parts unit volume may slip by an estimated 0.9 percent in 2011, compared with an increase of 1.4 percent in 2010, the average selling prices have increased 6 to 8 percent over the past few years.
“We expect a positive dollar value in 2011 over 2010,” he said.
Another positive forecast for auto repairers is the expectation that fewer consumers are interested in doing repairs themselves.
Mr. Portalatin described the old mindset among a majority of consumers was to keep a vehicle for no more than four years. Now the majority keeps their vehicles for five or more years.
“The consumer no longer looks at old vehicles as not worthy to repair,” Mr. Portalatin said. He said the 10 million to 12 million new vehicles sold annually in recent years could be the new norm.
The so-called Millenial generation, 16- to 30-year-olds, is becoming the largest generation of drivers and may be adopting this mindset of frugality, Mr. Portalatin said.
“This spending attitude will be more favorable to the aftermarket,” he said.