In an effort to boost technology-enabled insurance, India’s insurance regulator, the Insurance Regulatory and Development Authority of India (IRDAI), in July this year permitted general insurance companies to introduce concepts such as “pay as you drive” and “pay how you drive” for own damage (OD) coverage. Following the announcement, activity in the usage-based insurance (UBI) space, a type of motor insurance that tracks mileage and driving behaviors, has picked up and should gather p...

India’s automotive aftermarket industry returned to growth in fiscal year (FY) 2022 (April 2021–March 2022) after coming under pressure in the previous FY owing to the slowdown in the auto component and the overall automotive industry. In FY 2022, the aftermarket industry revenue grew at the fastest pace in five years, indicating a return to normalcy with the industry size surpassing pre-pandemic levels.   In FY 2022, the turnover of the automotive aftermarket stood at INR74,203 cror...

The US automotive aftermarket (consisting of light vehicles) has shown resilience and agility in the face of the downturn in demand and vehicles miles traveled (VMT) caused by the COVID-19 pandemic since 2020. In 2020, the automotive aftermarket decreased by 5.3% to USD286.2 billion, a stronger performance than originally predicted (down 8.8%). In 2021, it is estimated to have rebounded by a robust 14.8% to USD328.5 billion, considerably higher than previously forecast (11.2%), according to the ...

As the shift toward battery-electric vehicles (BEVs) gains momentum in key automotive markets around the world, the lifespan of BEVs vis a vis that of internal combustion engine (ICE) vehicles is increasingly coming into focus. Typically, ICE vehicles that have completed about 12–15 years of registration are designated end-of-life (EOL) in most countries. However, because electric cars are still relatively new to the market, it is still early to arrive at tangible data on how long an electr...

Vehicle miles traveled (VMT), which refers to the total annual miles of vehicle travel in a state or an urbanized area, is often looked at as a key indicator for the aftermarket. In addition to being a primary indicator of travel for policymakers and transportation professionals, VMT can be leveraged to derive opportunities for the vehicle service and maintenance sector. How the pandemic-induced work from home impacted VMT The year 2019 was the sixth consecutive year during which the US wi...

The average age of light vehicles in operation (VIO) in the US rose to 12.2 years this year, increasing by nearly two months over the prior year, according to new research from IHS Markit. This is the fifth consecutive year that the average vehicle age in the US has risen. This year’s average age marks another all-time high for the average age, even as the vehicle fleet recovered, growing by 3.5 million units in the past year. The global microchip shortage, combined with associated supply c...

The remanufacturing industry has existed for several decades, but while operations began as small businesses, the past few years have seen participation from OEMs and tier-1 suppliers, which have begun to see its economic and environmental benefits. Remanufacturing makes an important contribution to achieving the carbon dioxide (CO2) reduction targets that the European Commission is striving for with the Green Deal, and its role has been recognized in the European Commission’s Circular Economy...

The automotive industry of the future will need to be more integrated and offer on-demand and personalized services. In their quest to better position themselves in that environment, vehicle manufacturers have started looking at blockchain technology to better track and protect vehicles' true identities. If adopted widely, this is expected to affect the traditional model of service and repair. Blockchain technology offers several benefits such as improving supply chain processes, streamlining...

The battle over access to vehicle repair information has been playing out in the court of the Commonwealth of Massachusetts, United States over the last few years and has gained further momentum in the past year. The commonwealth has delayed implementing the proposed law, which would require motor vehicle owners and independent repairers to get expanded access to vehicle maintenance and repair data, until a final ruling from the US District Court judge for the District of Massachusetts, whose de...

The European Commission on 14 July unveiled its much-anticipated roadmap designed to support the European Union's (EU’s) commitment to reduce net greenhouse gas emissions by at least 55% from 1990 levels by 2030. Dubbed "Fit for 55", the legislative package sets the EU on course to become the first climate-neutral continent by 2050. If fully implemented, the Fit for 55 proposals would imply an emissions reduction of 42% from 2019 levels by 2030. Until then, they are just that—proposals. T...

The global shortage of semiconductors began a few months into the pandemic, setting off a perfect storm in the auto industry from Asia to Europe to the US. Driven by the continued parts shortages caused by chip supply constraints, carmakers were forced to cut production with no early solution in sight. VW stopped production of various models in Europe, China, and North America with 10,000 employees furloughed. A...

The mobility ecosystem is driving several megatrends such as connected services, vehicle autonomy, shared economy, and electrification. The role of tires in this future mobility environment will involve delivering a safer, smarter, efficient transportation experience, while also improving social and environmental outcomes. The convergence of these megatrends will place unique demands on tires beyond the ability to roll at high speeds and maintain grip under any road condition. Tires will also...

The automotive aftermarket in India is undergoing a significant change with consumer sentiments, mobility requirements, and supply chains all experiencing transformation. There is an enhanced focus on localization and the pandemic has brought to the fore a need to have innovative solutions. To be successful, it will be important for each stakeholder to understand the impact of the disruptive effects and recognize the opportunities that the automotive aftermarket presents. Aftermarket overview...

So far battery swapping has been unable to make the transition from being a niche offering to a mass-market service. Battery swapping offers many advantages to customers, including the potential to overcome range anxiety and slow charging times. According to the IHS Markit Consumer Survey in 2019—conducted in eight major automotive markets with 8,000 participants—35% of consumers expect their vehicle to fully charge in less than 30 minutes, out of which 11% wanted a full charge in less than ...

Mainland China is the world’s largest market for battery electric vehicles (BEVs) and is expected to remain for the foreseeable future. The continued push toward new energy vehicle (NEV) adoption both for corporate and private Chinese buyers along with heavy subsidies by the central government have, to a large extent, driven this quick transition to electrified vehicles. In the Chinese context, NEVs refer to BEVs, plug-in hybrid electric vehicles (PHEVs), and fuel-cell electric vehicles (FCEVs...

The car repair and service segment in India can be broadly divided into three verticals that cater to the Indians car owner’s maintenance needs. According to Mahindra First Choice Services, a chain of organized workshops, which quoted data from a 2016 aftermarket study by Automotive Component Manufacturers Association (ACMA), these verticals are the unorganized garages, which account for about 64% market share; OEM-authorized repairers, which constitute approximately 32% of the market; and org...

The United Kingdom recently announced its plans to ban the sales of petrol and diesel cars and vans by 2030, superseding the previous goal to ban new internal combustion engine (ICE) vehicle sales by 2040. The sale of plug-in hybrid (PHEV) cars and vans that have zero-emission driving capability will be allowed until 2035. While the government’s announcement is seen as a step in the right direction, it is going to impact the plans of automakers, electric vehicle (EV) charging point operators (...

China, the world’s largest auto market, has for long grappled with air pollution. Many of its key cities such as Shanghai, Beijing, Guangzhou, and Shenzhen have seen air quality deteriorate over the years. A rising number of vehicles on its roads is seen as one of the main factors contributing to the air pollution. Emissions from around 6.2 million vehicles were responsible for 45% of Beijing’s concentration of small, breathable particles known as PM2.5, a key indicator of air pollution, acc...