The electric vehicle (EV) aftermarket is growing rapidly with the EV market. The EV aftermarket encompasses a range of products, services, and solutions tailored to fulfill the requirements of EV owners beyond what the original manufacturer provides. This spans routine maintenance, repairs, performance enhancements, and customization.
According to the BIS Research estimation, the global electric vehicle aftermarket is projected to reach $286.26 billion by 2032 from $44.52 billion in 2022, growing at a CAGR of 20.73% during the forecast period 2023-2032.
This blog post will focus on the world of the EV aftermarket, exploring the market's potential, highlighting key players, and discussing the latest trends shaping this dynamic industry.
With advancements in battery technology, a wider variety of electric vehicle (EV) models, and increased government incentives, the adoption of electric vehicles is skyrocketing.
Moreover, electric vehicles (EVs) are essential in the drive to cut carbon emissions from the road transportation sector, which contributes to about one-sixth of global emissions. It is vital to maintain and implement ambitious policies to promote the growth of the global electric vehicle market.
As more consumers switch to electric cars, the EV aftermarket is gaining momentum as a niche market with significant potential. Companies operating in the electric vehicle aftermarket are making substantial investments in research and development.
As electric vehicle demand soars, driven by government policies, subsidies, and automaker decarbonization efforts, the EV aftermarket is poised for significant demand growth.
There are a number of specific opportunities in the EV aftermarket, including:
Electric vehicle batteries play a pivotal role in EVs, but their performance may deteriorate as time passes. This opens up a significant aftermarket opportunity for companies specializing in battery upgrades and maintenance. Whether it's improving battery capacity or extending the lifespan of existing batteries, this segment holds great potential.
As the electric vehicle market expands, the need for more charging infrastructure becomes evident. Companies that invest in creating charging solutions catering to both residential and public needs are well-positioned to access a profitable aftermarket. This includes not only the manufacturing of charging stations but also the provision of installation and maintenance services.
Just as in the traditional automotive aftermarket, there's a demand for customization and accessories for electric vehicles. Companies that offer customization services to EV owners, such as high-performance tires and personalized interior upgrades, have ample opportunities for growth.
Specialized EV aftermarket companies focusing on software upgrades and sustainability-oriented solutions are well-positioned for success in the ever-changing landscape of the electric vehicle aftermarket.
EV aftermarket businesses are responding to EV-specific products and services demand by developing and offering a wider range. Many EV manufacturers are now shifting over-the-air (OTA) updates, offering the software and firmware on their vehicles without having to take them to a dealership. This is leading to a shift in the way that EVs are serviced and maintained.
Some of the leading EV aftermarket companies include:
Tesla: Tesla offers a variety of aftermarket products and services, including maintenance and repair, performance upgrades, and customization. Tesla's aftermarket business generated over $10 billion in revenue in 2022.
Bosch: Bosch is heavily investing in the EV aftermarket, offering a variety of EV-specific products and services, such as diagnostic tools, repair parts, and charging infrastructure. Bosch's EV aftermarket business is expected to grow at a CAGR of over 20%.
Delphi Technologies: Delphi Technologies specializes in offering EV-specific products and services, such as electric motors, power electronics, and battery management systems. Delphi Technologies' EV aftermarket business is expected to generate over $1 billion in revenue by 2025.
Magna International: Magna International offers body panels, chassis components, and battery packs for EV aftermarket. Magna International's EV aftermarket business is expected to grow at a CAGR of over 15%.
BorgWarner: BorgWarner’s EV-specific products and services include electric motors, transmissions, and cooling systems. BorgWarner's EV aftermarket business is expected to generate over $500 million in revenue by 2025.
According to Dhrubajyoti Narayan, Principal Analyst, BIS Research, “The electric vehicle aftermarket is growing considerably and is expected to grow relatively faster over the coming years during the forecast period.”
Moreover, the electric vehicle aftermarket is anticipated to grow due to the surging adoption of electric vehicles, a growing consumer desire for EV customization, and the increasing use of EVs in second-life applications.
