LONDON--(BUSINESS WIRE)--The global spare parts logistics market is expected to grow at a CAGR of close to 6% during the period 2018-2022, according to a new market research study by Technavio.
The report presents a comprehensive research of the global spare parts logistics market based on end-user (automotive, electronics, industrial, and aerospace). The report also determines the geographic breakdown of the market in terms of detailed analysis and impact, which includes key geographies such as APAC, the Americas, and EMEA.
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Market driver: aging operational on-road vehicles increasing demand for spare parts
The average lifespan of vehicles is increasing because they are manufactured with quality parts. As of 2016, the average lifespan of a vehicle was around 15 years, however some owners also use the vehicles beyond the 15-year mark. In the US, in 2016, there were more than 40 million on-road vehicles whose average age range was between 16 and 24 years. Moreover, the high cost of ownership is deterring people from purchasing new vehicles.
Similarly, the average age of vehicles in Europe has also been rising. In the European Union (EU), as of 2015, the average age of operational cars in the EU was more than 126 months. This was an increase by more than 18%, compared with the 2010 average car age.
According to a senior analyst at Technavio for logistics research, “The average age of commercial vehicles such as trucks, trailers, and tractors is also high. The growing age of vehicles has been increasing the demand for spare parts to facilitate smooth functioning. This, in turn, is expected to increase the demand for spare parts logistics during the forecast period.”
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Market trend: emerging electric vehicles expected to disrupt automotive aftermarket logistics
Electric vehicles are gaining popularity to the extent that by 2030, electric vehicles will have more than 25% market share in Europe. In North America, the sales of electric vehicles are expected to be more than 30% by 2030.
The rising popularity of electric vehicles will affect the spare parts logistics market negatively. This is because electric vehicles will have fewer parts and components compared with vehicles with normal internal combustion engines. An electric vehicle will have around 15-25 major parts and components compared with around 1,500 in a normal combustion engine vehicle. This will lead to a slump in the sales of spare parts, decreasing the need for logistics services to transport spare parts.
Market challenge: growing demand for warehouses increasing cost for logistics providers
The demand for warehouses is increasing globally. One of the reasons for this growth is the rising e-commerce sales. In the US, the vacancy rate of the industrial space fell to an all-time low of 4.5%-5.2% in 2017. Industrial spaces include warehouses, factories, office spaces, multi-use buildings, and light manufacturing buildings. The increased demand for these spaces raised industrial rents by more than 1.5% in the fourth quarter of 2017, compared with that in the previous quarter. The rising industrial rents are adversely affecting spare parts logistics players.
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