The Automotive Collision Repair Services Market: Trends and Growth Prospects

PRESS RELEASE
Published January 31, 2024

Market Overview

The automotive collision repair services market has been witnessing significant growth in recent years, driven by various factors such as increasing population, rising per capita income, and a significant demand for automotive vehicles. These factors have led to an increase in vehicular traffic on roads, which, in turn, has fueled the growth of road accidents and vehicle collisions. In this article, we will delve into the key drivers, market analysis, and growth prospects of the automotive collision repair services market.

According to a report by Persistence Market Research, the Automotive Collision Repair Services Market revenue totaled US$ 123.9 Billion in 2022. This growth can be attributed to the increasing development in shop technology and servicing equipment. As customers increasingly expect to enhance the lifespan of their vehicles, the market is expected to expand with a higher growth rate in the upcoming years, reaching an estimated US$ 230.4 Billion by 2033. This growth represents a Compound Annual Growth Rate (CAGR) of 6.4% from 2023 to 2033.

Key Factors Driving Market Growth

Several key factors are boosting the growth of the automotive collision repair services market. One of the primary factors is the increasing number of young and educated customers who understand the importance of maintenance and repair to enhance vehicle performance and lifecycle. Additionally, the growing vehicle parc (the total number of vehicles in use) and the lack of infrastructure development in many regions have resulted in an increased number of accidents, thus driving the demand for vehicle repair activities.

Moreover, the rising rate of vehicle insurance due to government regulations has supported market growth. Vehicle owners with insurance are more inclined to repair their vehicles after accidents, further boosting the demand for automotive collision repair services.

In a nutshell, the Persistence Market Research report is a must-read for start-ups, industry players, investors, researchers, consultants, business strategists, and all those who are looking to understand this industry. Get a glance at the report at-https://www.persistencemarketresearch.com/market-research/automotive-collision-repair-services-market.asp

Market Analysis

Historically, the Automotive Collision Repair Services sales experienced a Compound Annual Growth Rate (CAGR) of 1.9% from 2017 to 2022. The Europe and East Asia regions held a significant share in the global market due to the increasing number of vehicles on the road in these regions. The introduction of new technologies in the automobile service sector has led to the expansion of aftermarket maintenance activities, resulting in a transformation of the automotive repair, maintenance, and service sector.

The automotive collision repair services market is expected to grow at a CAGR of roughly 6.4% over the forecasting period. Factors such as infrastructure development, increasing sales of passenger vehicles, and the implementation of laws and regulations for vehicle repair and maintenance are expected to drive the demand for automotive collision repair services on a global scale.

Country-wise Analysis

The United States holds a prominent share in the global market, accounting for around 85% of sales generated from the North American market. The high rate of road accidents in the United States, with approximately 13 car accidents happening every minute according to the U.S. Bureau of Labor Statistics, has contributed significantly to the growth of the collision repair services market. Furthermore, there are more than 40,000 collision repair shops in the U.S., generating substantial sales for collision repair services.

Key players in the market are focusing on expanding their network of authorized repair shops in the U.S., further driving market growth in the country.

China is also a lucrative market for automotive collision repair service providers. China is a hub for the automotive industry, with profitable opportunities for automobile part manufacturers, suppliers, and service providers. Despite a slowdown in new vehicle sales, the collision repair services market in China is experiencing incremental growth due to the presence of a large and older vehicle fleet.

Category-wise Insights

The passenger vehicle segment holds the prominent share in the global market for automotive collision repair services. With an increase in per capita disposable income worldwide, the sales of passenger vehicles have seen significant growth in demand. Passenger vehicles represent around one-third of sales share across the globe. The rising number of passenger vehicles and the high rate of maintenance activities after collisions or accidents are driving overall market growth. Owners of passenger cars are more inclined to maintain their vehicles, contributing to the excessive demand for collision repair services in this segment.

By product type, parts and components dominate the market. Components such as condensers, bumpers, door handles, fenders, grilles, lights, mirrors, radiators, and radiator supports have a higher replacement rate in case of accidents or collisions. Original components manufacturers have expanded their supply chains to provide original components in the aftermarket, creating lucrative growth opportunities for the parts and components segment.

Service providers from authorized dealers are in high demand, representing around 37.8% of the total market in 2022. OEM parts and components from specific manufacturers are sold and repaired by authorized dealers. As consumers increasingly prefer original replacement parts for passenger cars, manufacturers are expanding their dealer networks. However, authorized dealership shops tend to be more expensive than small, independent, locally-owned stores. Authorized dealers must provide competitive pricing to customers, particularly for vehicles under four years old.

Competitive Landscape

The automotive collision repair services market exhibits a perfectly competitive environment in terms of market structure, with an excess supply from global players. The market is highly fragmented, with over 70% of the global market for automotive collision repair services held by small- and medium-sized players.

In recent years, market participants have adopted various expansion strategies, including acquisitions, mergers, and collaborations, to increase their revenue share in the automotive collision repair services market. Additionally, industry participants are creating new growth strategies by offering subscription-based maintenance services to their customers

About Persistence Market Research:

Business intelligence is the foundation of every business model employed by Persistence Market Research. Multi-dimensional sources are being put to work, which include big data, customer experience analytics, and real-time data collection. Thus, working on "micros" by Persistence Market Research helps companies overcome their "macro" business challenges.

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