By Cindy Macdonald
Toronto, Ontario -- October 19, 2018 -- The Canadian light vehicle aftermarket seems headed for some of its best years as the market for out-of-warranty repair and maintenance continues to grow, according to the Automotive Industries Association of Canada's (AIA Canada) 2018 Outlook Study.
In 2017, the Canadian light vehicle aftermarket was valued at $21.6 billion, beating the previously documented record of $21.0 billion in 2015. Canada’s light vehicle fleet is aging. Of the 26.8 million light vehicles registered on the road in Canada, a total of 18.4 million in the fleet were 6 years or older. This population has grown 19.5 percent in the past five years and is expected to continue growing into 2022.
The 2018 Outlook Study reports the average age of a light vehicle in the Canadian national vehicle fleet was 9.71 years of age. This is the highest average age on record and “is a natural consequence of the technology and quality of vehicles improving over time.” Saskatchewan and British Columbia were the provinces with the oldest vehicles on average.
As a result of the growing number of drivers and vehicle fleet, the number of vehicles per driving age population has continued to increase and in 2017 reached an all-time high of 0.87 vehicles per driving age individual. In 2016, there were a documented 1.03 vehicles on the road for each licensed driver in Canada.
Costs for consumers rising
The price of operating a passenger vehicle in 2017 rose 5.5 percent, reports the AIA study. Gasoline prices saw the biggest increase across all categories, rising 11.8 percent between 2016 and 2017. From an aftermarket perspective, both labour (maintenance and repair services) and parts (parts, accessories, and supplies) experienced price increases. Labour costs rose 1.8 percent while parts costs reported a 1.5 percent increase.
On the subject of automotive industry disruptors, the study reveals registration counts for battery electric vehicles (BEV) continue to grow at a rapid pace as new product offerings continue to arrive for the domestic market. However, short term adoption may be hindered by the cancellation of BEV and BEV-related rebates in Ontario. The AIA study also examines other potential disruptors, including telematics and ride sharing.
This report provides a comprehensive picture of the current aftermarket industry, as well as forecasts and trends that will impact the aftermarket. It was prepared for AIA Canada by Desrosiers Automotive Consultants. Click here to download the free executive summary.