Lifestyle to utility, key factors shaping up India's automotive aftermarket

India's automotive aftermarket accessory industry is growing quickly, keeping pace with the bulging passenger vehicle market in the country. Here's an
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BYD Seal interior
India's automotive aftermarket accessory industry is growing rapidly, keeping pace with the bulging passenger vehicle market in the country. Here's an analysis of what are the driving forces behind this growth. (Representational image)
BYD Seal interior
India's automotive aftermarket accessory industry is growing rapidly, keeping pace with the bulging passenger vehicle market in the country. Here's an analysis of what are the driving forces behind this growth. (Representational image)

It's a basic human instinct to be distinctive from others. For automotive enthusiasts too, the instinct remains the same and they try to make their respective vehicles distinctive as well. While many car owners opt for cosmetic enhancements, some go for mechanical upgrades. The carmakers often offer a wide range of accessories to their customers, which the car buyers can choose from while buying the vehicle or after purchase as well, but these accessories come at a premium. Hence, the most popular and widely adopted way to accessories a car is aftermarket.

India is the third biggest car market in the world and it is growing rapidly. The Indian passenger car market was valued at $65.1 billion in 2023 and is likely to reach a whopping $102.11 billion by 2028. In 2023, the Indian passenger vehicle market registered sales of 41,00,258 units, an 8.3 per cent growth over 2022. This was the first time annual sales of passenger vehicles in India surpassed 40 lakh units milestone. Luxury car sales also reached a record high of 42,731 units last year, recording a 20 per cent increase from the previous year. Clearly, these figures denote how big and fast-growing the Indian passenger vehicle market is. What it doesn't tell is the tale of the Indian automotive aftermarket, which is equally widening at a rapid pace.

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According to the Global Automotive Aftermarket Research Report by the Automotive Component Manufacturers Association (ACMA) in collaboration with Ernst & Young (EY), the automotive aftermarket in India is anticipated to reach approximately $14 billion by 2028. The study further revealed that India is looking at an export opportunity of more than $35 billion, which could be a major shot in the arm for the country's dream of becoming a $5 trillion economy.

What's propelling growth in India's automotive aftermarket?

The Indian consumers' needs and dreams of owning a personal vehicle have evolved drastically over the last few decades. Increased exposure to globalisation, the influx of a wide range of new products, and increased expenditure capability have fuelled the aspirations of the Indian consumers multifold. This trend has been reflected in the auto industry as well. Gone are the days when a basic mundane car used to be enough for an average Indian car buyer. With the rapidly evolving consumer preferences, the modern car buyers of the country have been focusing on owning upmarket vehicles, which come loaded with a plethora of advanced technology-aided features.

While the auto OEMs have started offering a wide range of tech-enabled features in their vehicles, the cost of ownership for such vehicles too has increased multifold. However, to satiate the aspirations of a feature-packed car, many consumers take the aftermarket route, where degradation or accessorisation of vehicles can be done at a much more affordable price compared to buying a vehicle from the OEM directly loaded with the same features or accessories.

For example, a set of door edge guards for Maruti Suzuki Celerio from the Maruti Suzuki Genuine Accessories store costs 1,690, while the owner can purchase door edge guards from aftermarket at a much cheaper price. In another example, a Hyundai Grand i10 owner needs to shell out 1,513 to purchase an in-car humidifier, while he or she can easily purchase one from aftermarket at a cheaper cost. This way, the automotive aftermarket industry in the country is offering car owners a choice to decorate or accessories or give a distinctive treatment to the vehicle at a cheaper rate, while at the same time, they get a wider range of options as well.

Apart from that, the availability of a wider range of aftermarket accessory products online buoyed by the increased exposure to the internet is also propelling growth in this segment.

Dashcam
Dashcams have been finding an ever-increasing popularity among automotive aftermarket accessories in India over the last few years.
Dashcam
Dashcams have been finding an ever-increasing popularity among automotive aftermarket accessories in India over the last few years.

Vehicular safety awareness a key driving factor

In the last couple of years, vehicular safety inside and outside the cars has gained traction like never before. While various automakers have started offering multiple airbags, ABS, and EBD as standard fitments in their respective vehicles, features like 360-degree cameras, dashcams, rear parking cameras etc have been finding more prominence. The core reason behind this is the increased consumer awareness about vehicular and road safety.

While fitment of features like dashcam, 360-degree surround view camera, rear-view camera, and Tyre Pressure Monitoring System (TPMS) in the vehicles by OEMs comes at a premium and with limited options for the car buyers, they can easily opt for aftermarket solutions with hundreds of companies offering their products in the segment. This is fuelling growth in the segment.

Speaking on this to HT Auto, Ashish Dixit, Founder of Nex Digitronix, which sells a range of dashcams and other car accessories, said that the Indian automotive aftermarket accessory market has seen significant growth in recent years, driven by factors like increasing disposable income, a growing car ownership culture, and a desire for personalization. “There's a trend towards more advanced technology and customization options, such as smart infotainment systems, advanced safety features, and aesthetic enhancements. Dashcam is now leading the accessory segment in comparison to other accessories and witnessing a more than 100 per cent YOY growth," he added.

Vanesh Naidoo, Founder and Director at SafeCams echoed similar thoughts. He also revealed that the company witnessed the sale of dashcams doubled in the past two years. Speaking about the factors fuelling growth in the segment, he told HT Auto that the rise in vehicle ownership in India is one of the core factors behind the heightening demands for aftermarket products and services. “Consumers often tend to opt for lower-spec cars initially, with the intention to customize them with accessories like infotainment systems, dash cameras, alloy wheels etc. This customization trend significantly fuels the aftermarket segment, delivering consumers with customized solutions for their vehicles," he added.

In use case scenarios, the 360-degree surround view cameras provide a convenient driving experience in congested traffic or tricky conditions. The dashcams ensure keeping video footage that can be used in favour of the car owner's insurance purposes. Besides that, the dashcam enhances one's vehicular safety as well. Also, the dashcams act like a video capturer for many people who like to drive and make vlogs about them. The reverse parking cameras help the drivers conveniently park their vehicles while revering in a tight spot.

Sushil Kumar, Founder of Haryana-based TPMS brand Skyshop, said that while 60 per cent of tyre-filling machines in India come with variations and car drivers blindly trust and fill the air from them, having a TPMS onboard enhances the safety of the vehicle and its occupants by showing near correct data. Now, if a car buyer seeks to buy a car with OEM-fitted TPMS, it comes at a hefty price and is not available in a large number of mass-market passenger cars. However, such devices can be easily purchased from aftermarket and installed through the DIY method.

Air purifier
Since the outbreak of the Covid-19 pandemic, awareness about in-car hygiene has grown significantly, boosting growth for accessories like air purifiers.
Air purifier
Since the outbreak of the Covid-19 pandemic, awareness about in-car hygiene has grown significantly, boosting growth for accessories like air purifiers.

Hygiene awareness plays a key role

Since the outbreak of the Covid-19 pandemic, awareness about in-car hygiene has grown significantly, which in turn has boosted the growth of sales of aftermarket accessories like in-car air purifiers and car vacuum cleaners. These products come specifically designed for usage inside the vehicles and can be easily carried, serving the requirement of car owners who need to use such products anywhere anytime. With this preference, the demand and sales of such products are growing at a fast pace over the last few years.

Pavan Puri, Founder and Managing Director of Greencore Electronics which makes a wide range of in-car accessories, told HT Auto that the rising demand for customisation and surge in offerings ranging from performance upgrades to aesthetic modifications and tech integrations will likely boost more growth in the coming years. “The growth in consumer sentiment and demand in the car accessory market, particularly for products like car air purifiers and vacuum cleaners, can be attributed to several factors. For starters, growing concern about air quality and pollution has prompted customers to look for ways to enhance the air they breathe, even while driving. The rise in urbanization and traffic congestion has exacerbated concerns about air pollution, driving the demand for car air purifiers," Puri added.

Volkswagen ID 2all
A touchscreen infotainment system not only enhances style inside the cabin of the vehicle but also allows the driver and occupants to see and access a wide range of information, and entertainment elements through the digital screen.
Volkswagen ID 2all
A touchscreen infotainment system not only enhances style inside the cabin of the vehicle but also allows the driver and occupants to see and access a wide range of information, and entertainment elements through the digital screen.

Comfort and convenience a major driver

In various automotive enthusiasts groups in social media a major discussion happens around the light upgradation. The car owners often seek more illumination on road by upgrading their stock headlamps or fog lamps to aftermarket products. The driving factor behind this upgradation is seeking more driving comfort and convenience.

The availability of wider range of automotive lighting products online are another driving factor in this space. Equally, the technology-driven comfort and convenience enhancing features like touchscreen infotainment systems, audio systems sold in the aftermarket are finding a growing sales footprint overt the last few years. To simplify, a touchscreen infotainment system not only enhances style inside the cabin of the vehicle, but also allows the driver and occupants to see and access a wide range of information, entertainment elements through the digital screen. Many car buyers purchase a lower trim of a specific model and upgrade the vehicle with aftermarket audio system, touchscreen infotainment system. This helps them save money by not paying hefty additional amount to the OEM, while at the same time serve the same purpose or upgrading the vehicle.

Sanjeev Kulkarni, Vice President of Automotive Business at Harman India, a major player in the in-car infotainment systems, told HT Auto that rapidly changing consumer preferences and technological advancements along with rising demand for personal vehicles, promising capabilitis of Indian automotive aftermarket players are fuelling growths in the segment. “Innovations such as connected car devices, smart infotainment systems, and advanced safety features are increasingly gaining traction among consumers. We have recently witnessed that these solutions are being smartly integrated by OEMs more often compared to aftermarket solutions. This ensures that safety, regulatory and EnCap requirements are qualified," Kulkarni added.

Indian automotive aftermarket accessory market: What lies ahead

The Indian automotive aftermarket is growing at a rapidly keeping pace with the bulging passenger vehicle market. Rising number of vehicle ownership, increasing awareness about vehicular safety, aspirations to own upmarket cars, increased availability of aftermarket accessories on e-market platforms would further propel growth in the segment. At the same time, the locally manufactured products in the segment buoyed by the Indian government's Make-in-India program would help in boosting growth in this space.

First Published Date: 20 May 2024, 06:15 AM IST
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