Aftermarket

The aftermarket refers to the market providing spare parts, accessories, and components for maintaining or improving an original product, typically an automobile. In other words, it refers to the market offering automobile replacement parts and accessories. The word automotive aftermarket is used to mention the secondary market of the automotive industry.

In both developed and developing economies, aftermarkets are a priority. Innovative services like telematics, mobility toolbox, and sales services present additional opportunities to increase business revenue and represent a rising portion of the aftermarket. In addition, more and more innovative technologies are incorporating these services; hence, the scope is getting wider, offering a great growth prospect.

Key Takeaways                                                               

• The aftermarket is a marketplace for spare parts, accessories, and equipment for maintaining or improving the original product, typically an automobile, after the client has purchased it.
• Aftermarket auto parts are made by manufacturers other than the vehicle's original manufacturer. They are known as "generic" or "non-OEM" parts.
• These marketplaces provide avenues for the distribution of extra goods or services that support and improve the usage of relatively durable equipment that has already been purchased. Purchases could also be made for upgrading the equipment after the initial purchase.
• Generic parts are generally classified into cosmetic and structural parts.

Aftermarkets or "secondary markets" refer to "markets for complementary goods about the original products. The products are commonly referred to as "secondary products or services," as they are frequently acquired after the purchase of the original products or the primary product. 

These marketplaces provide avenues for the distribution of extra goods or services that support and improve the usage of a relatively durable product like a vehicle that has already been purchased. Purchases are commonly made for upgrading the product after the initial purchase. Add-ons are complementary products in the aftermarket and can be multimedia units, parking aids, new mufflers, services and repair parts for automobiles, etc. Apart from examples from the automobile sector, other examples include razor blades for shaving, ink cartridges for printers and photocopiers, etc.

A network of resources for after-sales services, secondary market trades or business activities, suppliers, and product recovery procedures is known as aftermarket support. In addition, the different business-to-business (B2B) and business-to-customer (B2C) interactions and relationships in the aftermarket are elaborated under the support. Altogether all these activities enhance the aftermarket ecosystem. 

All actions involved in sustaining a product, like a vehicle, after its initial sale, and through its lifecycle are included in aftermarket operations, which encompass a wide range of activities and the use of replacement parts and accessories. Generic parts and services are other names for the relevant operations. Furthermore, "aftermarket" refers to parts and services for light- and heavy-duty vehicles bought after the initial purchase, such as accessories, replacement parts, cosmetic goods, and service repairs. 

Aftermarket or generic parts are made by manufacturers other than the vehicle's original manufacturer. They are known as "generic" or "non-OEM" parts. When making repairs to the vehicle, these parts can be utilized as a substitute for the original parts because they are made to serve the same purpose.

Aftermarket auto parts are generally categorized into cosmetic and structural. Cosmetic parts enhance the appearance or functioning of the vehicle but do not add or improvise any safety attributes. Its examples include car fenders and door skin. At the same time, structural parts are added to enhance the safety features.

For example, a cage protects passengers during a crash by absorbing the force of a crash. Structural parts are usually made in line with high standards and guidelines for generic parts set by governing entities.

There are two primary supplier model categories in the automobile or automotive aftermarket:

• Independent aftermarket (IAM): Companies other than the original products manufacturer create and market the parts in the independent aftermarket. Large quantities of the parts can be made, and they can be customized to match the requirements of various vehicle kinds, not just one specific automobile brand or model. As a result, they are comparable to OEM parts and are considerably less expensive.  
• OEM network: The manufacturer produces and markets the parts rather than a third party in the OEM network. As a result, these parts cost more than those obtained from the independent aftermarket since they are made to the specifications of a specific make and model. Most OEMs use a three-tier distribution network, which includes an entry warehouse, a central warehouse, and minor regional distribution centers to support the entire network. However, other smaller OEMs use 2-tier or direct distribution networks. Ford, Daimler, Volvo, Volkswagen, BMW, and other manufacturers are some examples of OEM networks in the automotive aftermarket.