Australia's automotive aftermarket has reached a significant milestone, with parts imports hitting $4.05 billion in 2023-24.
According to recent research commissioned by the Australian Automotive Aftermarket Association (AAAA), this represents a 50 per cent increase over the past decade (up from $2.70 billion in 2013-14), although the growth has really occurred since 2019-20, with the market largely static over the preceding period.
The increase in value is clearly outpacing natural car parc growth says AAAA, meaning that despite the increasing complexity of modern vehicles it can’t all be associated with increased volumes for standard consumable parts. While the sector can see increases in these categories, it also talks to the increasing amounts being spent on vehicle upgrades and improvements and the associated opportunities for aftermarket providers servicing the Australian market.
Crosshead: Surge in suspension component imports reflects growing demand for vehicle upgrades
The Australian automotive aftermarket has witnessed a significant increase in suspension component imports, rising approximately 80% since 2019-20 to an annual landed value of around $145 million. This surge aligns with feedback from Australian 4WD brands and other suppliers, indicating heightened consumer interest in suspension upgrades and enhancements.
Additionally, road wheel imports experienced robust growth between 2019-20 and 2021-22, increasing by about 70 per cent during this period, before stabilising at approximately $105 million over the past year. In contrast, disc brake pad imports have shown steady progress, consistent with overall car parc growth, maintaining an annual import value of around $50 million.
A notable development is the emergence of automotive glass imports as a distinct category. Recently separated from broader classifications, the annual value of front windscreen and other automotive window imports now exceeds $20 million, reflecting the evolving dynamics of the automotive parts import sector.
Crosshead: China's automotive parts evolution: meeting australia's diverse needs
Over the past decade, China's role in supplying automotive parts to Australia has been transformed. In 2013-14, the US led as Australia's primary source of automotive parts imports, totalling $498 million. By 2023-24, China had surged ahead, more than doubling its exports to $915 million annually off the back of substantial enhancements in the quality and reliability of Chinese-manufactured parts.
While China was historically recognised for providing cost-effective automotive components, its manufacturers are now leveraging advanced manufacturing processes and improved quality control measures to deliver a more comprehensive product offering that lets Australian workshops select parts that align with specific customer needs and budget constraints.
In contrast, traditional automotive manufacturing nations have experienced mixed outcomes in their export relationships with Australia. For instance, South Korea has seen a decline in its market share, highlighting the challenging nature of the global automotive parts industry.
In conclusion, Australia's automotive aftermarket is experiencing significant growth, with parts imports reaching $4.05 billion in 2023-24 – a 50 per cent increase over the past decade. This surge, particularly from China, reflects advances in quality and a diversified product range that meets the varied needs of Australian mechanics. For aftermarket suppliers and workshops, maintaining flexible sourcing strategies is essential to capitalise on emerging opportunities in this dynamic global market.
This article was prepared for AAAA by Fifth Quadrant.
For more information contact Ben Selwyn at ben@fifthquadrant.com.au