More Vehicles and Bad Roads Portend Growing Demand for Aftermarket Parts, Says Frost & Sullivan

    SAN JOSE, Calif.--July 16, 2001--In the last decade, more than five million passenger, multi-utility and commercial vehicles were sold in India.
    Unfortunately for their owners, the poor roads on which these cars drive and the low-quality fuel that they consume are leading to rapid wear and tear on steering, suspension, brake and engine systems. This forces owners to repair and replace a variety of parts, thereby accelerating demand for aftermarket components.
    According to new analysis by Frost & Sullivan (www.frost.com), "Indian Automotive Component Aftermarket Distribution Channel Analysis," the total market reached $1.87 billion in 2000.
    "The potential for both vehicle manufacturer components and component manufacturer parts is remarkable in the Indian aftermarket," says Frost & Sullivan Industry Analyst Huzefa Nulwalla.
    Nevertheless, vehicle manufacturers and component manufacturers will have to compete against one another as well as with alternate brands, which are popular for their low price. Vehicle manufacturers and component manufacturers must adopt pricing that takes into account the buying power of the Indian consumer.
    All participants will have to protect the market from the incursion of spurious parts. Spurious parts are defined as low quality parts disguised as genuine, and branded in the names of popular OE brands.
    "Counterfeit components account for as much as 45 percent of passenger car aftermarket sales and 15 percent of commercial vehicle aftermarket sales," says Nulwalla.
    Counterfeit parts are a great challenge to vehicle manufacturer and component manufacturer brands. They have a high share in aftermarket unit shipments and are present nationwide.
    In the long term, the threat of phoney parts should diminish as stiffer legal penalties are implemented and as component manufacturers and vehicle manufacturers work to increase customer awareness.
    Frost & Sullivan is a global leader in international strategic market consulting and training. This ongoing research is part of the Automotive Aftermarket Subscription, which also includes market analyses on Indian Car Owner's Service Channel Preference Analysis and Strategic Insight of the Indian Automotive . Frost & Sullivan also offers custom consulting to a variety of national and international companies.
    Executive summaries and interviews are available to the press.

Indian Automotive Component Aftermarket Distribution Channel Analysis
    Report: 4244-18