Vehicle electrification is disrupting the automotive business as it’s known today. The new mobility is embracing several changes and updates in the vehicle powertrain, components, and electrical and electronics systems. It means the aftermarket businesses must get prepared for significant changes in revenue, market share, and services within this decade.
Analyzing the aftermarket companies, suppliers, and overall businesses, the main areas in which Electric Vehicles will impact the after-SOP industry are:
New powertrain components: EVs use electric motors, power electronics, and high-voltage battery packs, which increases electric components, high-voltage cables, and other components demand. EVs eliminate the traditional internal combustion engine (ICE), resulting in a reduced number of complex mechanical components, such as pistons, crankshafts, transmission.
Reduced maintenance needs: EVs have fewer moving parts when compared to ICE vehicles. They don’t require oil changes, air filter replacements, or other maintenance tasks typically associated with ICEs. Consequently, some aftermarket businesses, such as brakes replacements, oil changes, welding and refurbishment and mechanic tool shops may experience a decline in demand.
Specialized Services: A surge in specialized EV service centers and repair shops is expected. These businesses will focus on EV-specific maintenance, repairs, software updates, and battery-related services. They may require expertise in electric drivetrains, battery diagnostics, and charging infrastructure. It requires specialized tools, employee training, vehicle communication and diagnostics, and software skills.
Battery Maintenance and Replacement: The battery pack is a crucial expensive component which may degrade or require replacement over time. Aftermarket businesses could potentially offer battery diagnostics, maintenance, and replacement services. Additionally, battery recycling and repurposing could become new profitable avenues for aftermarket companies.
Charging Infrastructure: a robust charging infrastructure has become increasingly important. It brings big opportunities in installing and maintaining charging stations, both for private and public use, plus installation services, repairs, and upgrades.
Software and Connectivity: EVs are software-defined with high connectivity features (at least are walking in this direction). An important way to support EV owners is by providing software updates, performance enhancements, customization options, and downloadable automotive apps from the cloud, as seamless as it is done on a smartphone. They may also offer connectivity-related services, such as integrating EVs with smart home systems or assisting with over-the-air updates.
New Product Opportunities: New business opportunities are endless in this new automotive electrification market. It could include accessories like charging cables, battery management systems, range extenders, custom lighting solutions, and other specialized components, or features that enhance the electric driving experience.
Therefore, while some products and services of the aftermarket industry may experience a steep revenue dip in this decade due to the shift to Electric Vehicles, there are many new opportunities emerging in a specialized EV market which companies can proactively move ahead and prepare themselves to increase their sales revenue.
