The automotive aftermarket business is committed to retail, distribution, reprocessing, and installing car components and equipment after selling the vehicle. The European automotive aftermarket business is predicted to grow consistently with the increased production demands. The automotive aftermarket and aftersales industry is a more challenging ballgame. It is multi-faceted and covers diversified segments, covering the complete repair, service, and maintenance spectrum from parts supply to servicing and fitment. The industry is also highly competitive and robust, supporting the network for a large volume of cars, trucks, buses, and vans across the European region.
These vehicles are a rich source of data. Millions of cars that are transported generate voluminous information that automakers identify in how to monetize it. Creating business value out of corresponding vehicle data is a major technical challenge. Technologies like Machine Learning, AI, and data analytics solutions can help the industry solve and proceed with growth. Failure to collect vast data stores from losing value-added for customers might result in loss of revenue and business intelligence.
Market Insights – Automotive Aftermarket EU
The automotive aftermarket is a part of the automotive industry with services and parts businesses. The service businesses are majorly on maintenance and repair of the vehicles, which generate more than 45% of the total aftermarket revenues in Europe. Simultaneously, retail and wholesale vehicle parts make up the remaining 55% of revenue. These businesses are significant in the overall automotive industry and deliver substantial income. Getting into the product side, the aftermarket executives have indicated that nearly half of the revenues come from wear and tear parts, crash-relevant parts, diagnostics products, and services. Due to increased quality, mobility, and price pressures, wear-and-tear parts are anticipated to slow down.
According to an online data forecast by a leading research firm has revealed that the automotive aftermarket was valued at $256 billion in 2021 and is expected to rise to $369.2 billion by 2026, recording a growth CAGR of 3.1%. A report published by Frost and Sullivan has said that the European aftermarket is worth over 100 billion Euros for components from Ireland to Russia, showing a 2.4% yearly growth in overall sales.
Value of Data in Automotive Aftermarket
Apart from the numbers, one major challenge the automotive industry faces is handling silos. There is much data about thousands of vehicles and millions of automotive parts, and you might have encountered the terms ACES and PIES and how businesses solve their data problems.
After checking these words, you might be an independent business in the aftermarket parts if you feel the pressure. It is about more than just the standards; however, many other challenges are also involved. But companies in the automotive aftermarket look for the best solutions available for every problem they’re going through.
Now, first things first…
What are ACES & PIES?
ACES or Aftermarket Catalog Exchange Standard and PIES (Product Information Exchange Standard) are standardized data formats present in the automotive industry. These two standards manage and exchange the data of automotive application fitment and product parts. If you adhere to these standards, managing and handling large data silos will be easy.
However, the truth is that ACES and PIES data are not online tools or master databases of parts or fitment data, and manufacturers don’t use these standards completely.
Challenge with Data Silos
The vehicle parts dealers want a simple eCommerce website that makes it easy for the customers to buy, and businesses expect an automated purchase process. They would also aim to reduce the total returns owing to incompatibility existing in the vehicle parts and fitments, alleviating the problems in customer service.
To get this aligned, businesses need to manage timely, accurate product information about all the parts, vehicles, and parts fitments. The data is the major problem, and the other one is choosing a good eCommerce platform to support large volumes of data and keep good vehicle fitment options for customers. Only when standardization is sorted will businesses face many challenges in cleaning up the data and mapping out different databases and information from various sources.
Quick Snapshot of Data Challenges
- Lack of enhanced vehicle information and identification – Merchants are losing revenue due to improper data about the vehicle as customers return them due to lack of fitment. If merchants have this accurate data, they can reap benefits.
- Car configuration issues – Data is unorganized and unable to trace the right brand, model, variant, equipment, price, and manufacturer codes in the data set. The lack of good APIs to access accurate data leads to confusion and makes the process very complex.
- Inaccurate information for dismantling, damage assessment, and auto parts – management of data about dismantling, lack of good online sources and data leads to warehouse, integration, and market mismanagement.
Solution for Uncovering Data’s Hidden Value
Various comprehensive and leading databases are readily available for purchase. However, they might need to be more important for practical implementation and solutions. Finding the best DaaS provider is the best option for most automotive industry merchants to address data-related challenges.
What Can You Expect from DaaS Providers?
DaaS service providers help you handle a large amount of data in an organized way. For example, it helps you with the spare parts catalogs, market volumes, prices, and technical information. The data sources can be combined and laid as the base for all the analytics is enriched with the information.
Unlocks the Potential Benefits
- Provides adequate vehicle management support
- Helps in visual damage assessment
- Solves the dismantling and used parts data challenges
- Simplifies integration and eases handling warehouse management
- Intelligent data management and remarketing solutions
- Workshop maintenance solution
- Insurance handling and more
Trends Disrupting the Automotive Aftermarket
As per McKinsey’s report, the overall global aftermarket industry is expected to grow at 3% per annum till 2030, thus shaping the European region’s new growth.
The following are 6 top trends identified by McKinsey that will change the aftermarket domain-
- Easy access to car-generated data
- Higher transparency in price and diversity in supply for customers
- Enhancing digital channels and interfaces
- Aggressive expansion of OEMs into aftermarket
- Consolidation of spare parts distributors
- Influence of digital intermediaries
Wrapping Up
The European market has a more extensive scope for innovation and growth. Getting the hands ‘dirty’ by blending perfect strategy using data’s value brings significant results. Your organization can embrace its complete potential by changing its aftermarket strategy and connecting the good DaaS services to unlock the data’s potential in a better manner. The hidden value of data is unboxed only if you connect with the right technology solutions for your business which helps you grow beyond the limits.
So, how ready are you to handle challenges related to data? What DaaS or databases are you using, and how well is it working for you?
Well, have a word with AutoFacets’ team of experts about your Data Monetization needs, and we would love to hear about your experiences.
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