News: Uptake of Remanufactured Parts in the North American Automotive Industry Driven by Lower Prices
The large array of new, salvage and rebuilt parts has eroded the market for remanufactured engines, transmissions, clutches, CV driveaxles and fuel injectors. Remanufacturers of these products cannot recover their high production costs.
Wednesday, 9th April 2008
Fox Business reports on new analysis from Frost & Sullivan (http://www.automotive.frost.com). The Changing Face of the North American Automotive Remanufacturing Industry, finds that the market will generate significant revenue growth with the proliferation of products, continued demand for remanufactured engine control units and rack and pinion steering gears, rising popularity of higher priced technologically advanced products such as electric power steering, rack and pinion steering gears, and the rising popularity of higher priced diesel engines and automatic transmissions. Remanufacturers may also increase their revenues by better differentiating their products from new parts in their marketing efforts. For instance, remanufacturers could leverage their wide range of products, broader application coverage and the environmental benefits of the recycled parts. Competitively priced, durable and reliable parts for older and later model vehicles have helped remanufacturers cement their position in product categories such as engine control units (ECUs) and rack and pinion steering gears. Future technological advancements will enable aftermarket participants to increase their market presence in additional product categories. The remanufactured market will likely phase out manual transmissions due to the growing dominance of automatic transmissions at the OE level. This trend will drive demand for remanufactured automatic transmissions in the aftermarket. During the next five to seven years, remanufactured starters and alternators will become prominent aftermarket products due to their lower price point and competitive warranties. The Changing Face of the North American Automotive Remanufacturing Industry is part of the Automotive & Transportation Growth Partnership Service program, which also includes research in the following markets: North American remanufactured engine and transmission aftermarket, North American steering system hard parts aftermarket, and North American starters and alternators aftermarket.