Reduced Number of Industry Participants Produces Opportunities
27 July 1998
Frost & Sullivan: Reduced Number of Industry Participants Produces Opportunities for Remaining Companies in CV Driveaxle and Boot Kit Aftermarket
MOUNTAIN VIEW, Calif., July 27 -- Driven by the shorter life
spans of constant velocity (CV) boots, growth in the vehicle population, and
the increase in average vehicle age, the market for CV driveaxles and boot
kits is expected to grow at a healthy rate, even if an economic downturn
occurs.
According to strategic research conducted by Frost & Sullivan
(http://www.frost.com), "U.S. CV Driveaxle and Boot Kit Aftermarket," in 1997 total
aftermarket manufacturer revenues grew to $451.4 million, and the market is
expected to grow at a rate slightly more than twice the rate of growth in the
vehicle population throughout the forecast period 1998 to 2004.
"Significant market opportunities exist in consolidation, the development
of industry standards, more vehicles with CV axles, and companies leaving the
market," says Frost & Sullivan Analyst David Yu. Intense competition has
reduced the number of industry participants. While consolidation has been the
main strategy to gain market share, several regional manufacturers have left
the market altogether, thereby providing opportunities for remaining companies
with strong competitive advantages.
In addition, changing driving styles have altered vehicle requirements.
Now, many new vehicles implement CV axles, such as sport utility vehicles, 4WD
vehicles, and RWD vehicles with independent suspension. This increase in cars
with CV axles will provide enhanced growth opportunities for manufacturers who
supply products to this market.
An interesting market trend is the increase in demand for complete axle
assemblies. In 1997, the price of complete axles dropped to a point where the
cost savings of buying individual CV joints over CV driveaxles were minuscule.
Moreover, installers prefer the labor-saving features of a complete driveaxle
over installing individual components. Over 80 percent of all CV repairs in
1997 involved replacing the complete assembly.
The CV driveaxle and boot kit aftermarket is comprised of over
700 companies. The market leaders are large manufacturers who have access to
the five main channels of distribution: Programmed distributors, two-step
distributors, retailers, new-car dealers, and others, such as national
installer chains. These leading manufacturers have succeeded through
consolidation, product innovation, streamlining for efficiency, and customer
service.
Frost & Sullivan distributes Market Engineering awards within the
automotive industry to recognize companies that have worked hard to make a
positive contribution to the automotive aftermarket. Winners are selected
from an in-depth analysis of the market competitors and interviews with those
companies that make up the industry. Frost & Sullivan is pleased to announce
that Car Component Technologies (CCT) is the winner of the 1998 Market
Engineering Leadership Award. This award is given each year to the company
that has exhibited leadership in the constant velocity driveaxle aftermarket
for being highly market oriented.
Frost & Sullivan's study, "U.S. CV Driveaxle and Boot Kit Aftermarket,"
divides the market into two segments: CV driveaxle assemblies and CV boot
kits. Included in this study are revenue forecasts, unit shipments, market
shares, market and technology trends, competitive issues, and strategies.
This report also describes the major competitors in the market, as well as
some of the strategies the market leaders use.
The companies participating in this market include: AAR, Air Pro Quality
Parts, Allied Eastern Company, American Axle and Manufacturing, American
Driveline Inc., Aragon Engineering, Inc., Automotive Caliper Exchange Inc.
(ACEI), Axle Exchange, Car Component Technologies, Inc., Cardone Industries,
Crown Automotive Sales Co., Inc., Crown Remanufacturing, Inc., CV Plus, Inc.,
Dana Corporation, Daytona Front Wheel Drive, Delta Automotive, Inc., Drive
Shafts, Inc., EMPI Inc., Federal-Mogul Corporation, Fenwick Automotive
Products, Foreign Parts Distributors, Inc., Fred's Drive Shaft, Inc., GCK
Industrial USA Co., Ltd., G.D.M. Bourne, GKN Drivetech, Inc., Gomet,
Interparts Industries, Inc., M&M Knopf Auto Parts Inc., Mevotech, Moog
Automotive, Neapco, Inc., Northeast Radiator Sales, Northstar Manufacturing
Company, Inc., Oliver Instrument Co., Powerline, Inc., Power Train Components,
Inc., R&B Inc. (Dorman/Motormite), Rockford Constant Velocity, Tarani
Rebuilders Inc., Related Companies: BRYCO By Carfel Inc., Constant Velocity
Systems, Inc., Cooper Industries, Inc., The Hastings Company, NPR of America,
Inc., S&S Truck & Tractor Parts Co., Inc., Distributors: Acklands, Ltd.,
Advance Auto Parts, All-Pro/Bumper To Bumper, APS, Inc., AutoZone, Beck/Arnley
Worldparts Corporation, Bridgestone Firestone, Inc., CARQUEST, Car-X Muffler
and Brake, Chief Auto Parts, Discount Auto Parts, Goodyear Tire & Rubber,
H & H Distributors, Kragen Auto Parts, National Automotive Parts Association
(NAPA), O'Reilly Automotive, PACCAR Automotive, Inc., Pep Boys, Strauss
Discount Auto, List of Industry Organizations: American Automobile,
Manufacturers Association (AAMA), Automobile Parts and Accessories
Association (APAA), Automotive Parts Rebuilder Association (APRA), Automotive
Service Industry Association (ASIA), Society of Automotive Engineers (SAE).
Frost & Sullivan is an international marketing consulting company that
monitors the automotive industry for market trends, market measurements and
strategies. This ongoing research is utilized to update a series of research
publications such as #5162-18 North American Class 6, 7 and 8 Truck OE
Powertrain Component Markets, #5779-18 U.S. Steering and Suspension Parts
Aftermarkets, and #5156-18 North American Import-Car Hard-Part Aftermarket,
and to support industry participants with customized consulting needs.
Visit Frost & Sullivan's web site at: http://www.frost.com.
Report: 5778-18 Publication Date: July 1998 Price: $2950