January 31, 2014
Earlier this month I wrote a detailed feature on the State of the Aftermarket. The article featured a comprehensive evaluation of 2013 and the projections for the market moving forward in 2014.
During Heavy Duty Aftermarket Dialogue Monday, Jan. 27 before Heavy Duty Aftermarket Week (HDAW) in Las Vegas, Stu MacKay of MacKay & Co. tackled this topic again with great detail.
Looking back at the numbers he presented, the outlook once again looks good for the heavy-duty aftermarket.
According to MacKay, Class 8 utilization has hovered at 83 percent since 2010. MacKay is projecting that number increases to 84.4 percent in 2013, climbing as high as 84.9 percent in 2017.
Aftermarket demand also appears to be strong. Total United States’ aftermarket sales were up 2.9 percent in 2013 to $22.7 billion in sales. MacKay says his projections show 2014 coming in even higher at $23.5 billion.
Business is even better up north. Canadian fleet utilization stood at 84.3 percent in 2013 and is projected to rise to 84.7 percent this year and 86.4 percent by 2017. MacKay says sales also are expected to rise from $3.5 billion to $3.7 billion this year.
And all of this growth is coming with less total vehicles on the road.
“The market is becoming more and more efficient,” MacKay notes in his projections. “It is taking about 73 percent fewer Class 6-7 and 46 percent fewer Class 8 trucks to move the same value of goods (in nominal dollars) compared to the marketplace in the 1970s.
But as his numbers show, less equipment does not equate to less sales. With utilization and average annual miles slowly rising, MacKay still anticipates the aftermarket to grow by 3.3 percent in 2014.
In Las Vegas terms, I’d argue that’s a jackpot.