Auto aftermarket may feel the drop in Canadians’ driving during pandemic

The COVID-19 crisis continues to have a profound impact on British Columbia, Canada and the entire world. Besides the immediate health crisis we are facing, the pandemic is having a significant effect on the global economy — and the auto industry is no exception.

Many consumers are feeling the economic sting of the pandemic and this has affected their purchasing power. Consumers are also moving around in different ways due to travel restrictions and changes in how work is being conducted.

Desrosiers Automotive Consultants recently released a study about what we can expect from the automotive aftermarket industry due to the COVID-19 pandemic. The aftermarket is a vast and important area of the automotive parts and accessory industry and employs more than 190,000 Canadians, with more than 30,000 of those in this province. These individuals are involved in the maintenance and repair, along with sales, refurbishment and management of used vehicles. In DAC’s analysis, they note that the aftermarket operates in a different cycle than new-vehicle sales. This was seen clearly in the last recession, which saw a decline of new-vehicle sales in 2008-09, while the aftermarket remained resilient. The aftermarket has multiple and complex variables, which include things such as size of vehicle fleet, consumer replacement patterns, used-car-market refurbishing, kilometres driven, vehicle technology and more.

With regard to this current situation, there is one factor that makes the downturn more striking than previous recessions. This is that there was a sudden and unprecedented drop in

kilometres driven — which, with the age structure of vehicles, is one of the key drivers of market demand in the aftermarket.

According to DAC, mobility to workplaces was down 57 per cent for Canadians as of April 30. Workplace data is incredibly important to examine, as it is the preferred method of commuting across the country. A past analysis by DAC showed more than 78 per cent of Canadians prefer to commute by personal car.

DAC reports that early data for gas consumption showed a 17-per-cent decline for March and that figure would likely continue to deteriorate for April. That being said, as we see things begin to open up in B.C. and we see consumers going on short road trips and taking drives — all with the necessary precautions — we may see that number start to go up as we get into summer.

We are just in the early stages of analyzing the impact of COVID-19 and its implications for the aftermarket, but this early data is certainly fascinating and offers a snapshot into what is to come.

A positive take-away from this is certainly that privately owned vehicles seem to be the transportation of choice in countries that have relaxed restrictions — so we can safely predict we will see the same in Canada. As noted, more than 78 per cent of working Canadians prefer their private automobile as a method of commuting.

Though the future is uncertain for the auto industry and for so many other sectors, we will work to get through this together and come out stronger on the other side.

Stay safe out there and remember to follow all health guidelines as B.C. moves into the next phase of the restart plan.