Jim Lang: Rising Presence of Younger Vehicles to Increase Service Bay Volume
June 28, 2017—During 2015 and 2016, new car and light truck volume in the U.S. averaged a record 17.5 million units, the highest two-year total in light vehicle sales history, according to Jim Lang, president of Lang Marketing, reversing a trend that was spawned by the Great Recession of 2008.
"While sometimes overlooked in terms of their aftermarket impact, these younger vehicles are critical to future changes in the vehicle repair-age sweet-spot, a bracket of vehicle age groups that is important to overall car and light truck product volume," Lang wrote.
"The significant increase in vehicles five years old and younger will create additional service bay volume for dealers, which have expanded their bay business to include all-makes and all-years of vehicles," the report added. "As a result, this surge of younger cars and light trucks will provide dealer service bay with a DIFM (Do-It-For-Me) volume bonus."
New car and light truck sales in the U.S. were hit hard by the Great Recession of 2008, the report stated. From average annual sales of more than 16.5 million cars and light trucks between 2003 and 2007, annual new car and light truck volume in the U.S. plunged to 13.2 million during 2008 and bottomed at 10.4 million the following year.
Cars and light trucks five years old and under plunged from 83.1 million in 2007 to 61.1 million at mid-year 2013, a reduction of 22 million vehicles in just six years.
"Dealer bays were the first to suffer the brunt of this historic plunge in the population of cars and light trucks five years old and younger. Traditionally, light vehicles in this age bracket had been the mainstay of dealer service bay business," the report stated. "To compensate for this large and abrupt reduction in young vehicles, many dealers redesigned their service bay strategies to attract all-makes and all-ages of cars and light trucks."
Annual new vehicle sales in the U.S. climbed to 11.5 million in 2010, increasing annually to reach 16.3 million by 2014. Bolstered by the recovery of new vehicle sales, cars and light trucks five years old and newer began to increase in number during 2014. Over the next two years 12 million vehicles were added to this age group in the U.S.