10
Auto Care Industry
Key market trends
The long-term outlook for gas prices remains unchanged. Prices did increase higher than expected in 2017
and will continue to rise in 2018 before falling back in late 2018 and 2019. The rise likely helped slow total
miles driven last year.
After growing almost 2.4 percent in both 2015 and 2016, total miles driven increased just 1.2 percent in
2017 . Employment market strength and rising consumer spending should get drivers moving again a
nd
help get miles driven growth back up over 2 percent for the year.
New vehicle sales peaked in 2016 and came back nearly two percent in 2017. While annual sales should
continue to fall each year through the forecast, they will remain a
bove 16.5 million in 2021. Even with five
consecutive years of declining sales, the volume will remain h
igh enough to keep demand strong and
prevent any trough of aging vehicles similar to what was seen shortly after the 2008 recession.
While vehicle sales peaked in 2016 and will decline going forward, total vehicles in operation (VIO) shows
no sign of slowing. For 2018 VIO should increase nearly 2.5 percent to just under 279 million. Growth will slow
going forward but by 2021 there is expected to be more than 294 million vehicles on the road in the U.S.
Consumer spending remains the driving force of economic growth. The 3-month average to start 2018 for
the consumer sentiment index was the highest since 2001. This level of optimism should continue as the
job market remains strong, wages continue to inch upwards and the housing market keeps improving.
Auto care industry segmentation
The automotive segment of the auto care industry includes parts, accessories, chemicals, tires, and
non-warranty service for passenger cars and light trucks (i.e. pickup trucks, vans, minivans, and sport utility
vehicles). The professional service segment, the Do-It-For-Me (DIFM) segment consisting of the professional
repair, maintenance, and installation of automotive products at both independent auto care outlets and
vehicle dealerships totaled $228.1 billion (80 percent) of the total in 2017. The balance of the industry, the
Do-It-Yourself (DIY) segment, is comprised of customers who repair, maintain, and accessorize their own
vehicles, which totaled $55.7 billion (20 percent) of the total $285.8 billion industry in 2017.
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