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Middle East and African automotive aftermarket valued at US$61 billion in 2018

May 12, 2019

Whitepaper ahead of Automechanika Dubai 2019 exhibition points to upward trend in emerging markets

Dubai, UAE: The Middle East and Africa’s auto aftermarket was worth a combined US$61 billion in 2018, while a projected rise in car sales, and more manufacturing bases will steer the wider region toward six percent annual growth over the next six years, a newly published report said.

Saudi’s decision to allow women to drive in 2018 and increasing online spare parts sales coupled with growing demand for vehicle modifications are other factors that will accelerate growth in the Middle East’s aftermarket, which was valued at US$28.14 billion in 2018, according to a May 2019 whitepaper by global analysts TechSci Research. 

This is estimated to grow at a Compound Annual Growth Rate (CAGR) of 5.8 percent over the next six years, valuing US$39.6 billion in 2024, while in Africa, demand for aftermarket spare parts and services, valued at US$33.17 billion in 2018, is tipped to increase at a CAGR of 6.25 percent over the same period, valuing US$47.73 billion.

TechSci’s Middle East and Africa Automotive Aftermarket report was prepared exclusively ahead of Automechanika Dubai 2019, the wider region’s largest international trade fair for the auto services industry, which takes place next month from 10-12 June at the Dubai International Convention and Exhibition Centre.

The report details engine parts such as electric components, radiators, and exhausts comprising a 51 percent share of the Middle East’s aftermarket in 2018, followed by tyres (26 percent) and lubricants (11 percent). Axles and transmission components comprise four percent of the market, while air and oil filters, suspension systems, batteries, and brakes each make up two percent of the market.

Those shares will remain much the same by 2024, though at a far higher value, fuelled by in new vehicle sales across the region.  According to TechSci, 2.3 million Passenger Vehicles (PVs), and 430,000 Commercial Vehicles (CVs) were sold in the Middle East in 2018, with this figure estimated to reach 3.68 million (3.07 million PCs, 610,000 CVs) in 2024.

Total vehicle parc (CVs and PVs on the roads) in the Middle East currently stands at 41.6 million, already presenting huge demand for aftermarket spare parts and services, all of which will be on show by more than 1,800 exhibitors from 60-plus countries at the 17th edition of Automechanika Dubai next month.

“In the coming years, demand for both passenger and commercial vehicles will rise across the Middle East and Africa, driven by recovering economic conditions, government incentives to boost regional production plants, increasing per capita income, and ongoing construction activities,” said Mahmut Gazi Bilikozen, Show Director of Automechanika Dubai.

“This in turn impacts the aftermarket and Automechanika Dubai, with its trans-regional reach, is the ideal platform to meet and interact with key players and buyers in this market.  With the biggest names in the business present this year, the exhibition is a great place for buyers, industry professionals, distributors and government representatives to get a feel of market trends, developments and the way ahead.”

Country-wide, Saudi Arabia and the UAE are among the biggest Middle East markets for vehicle parc according to Techsci’s report, with Saudi contributing 7.49 million (5.11 million PVs, and 2.38 million CVs) to the region’s fleet, and the UAE 2.57 million (1.96 million PVs, 610,000 CVs).

Meanwhile in Africa, vehicle parc currently stands at 43 million, including 32.7 million PVs and 10.3 million CVs.  With more assembly plants, government initiatives to improve domestic manufacturing, and growing construction and infrastructure projects, vehicle sales volume in the world’s second largest continent is projected to reach 1.56 million units by 2024, growing at a CAGR of 4.68 percent during 2018-2024.

The make-up of the African auto aftermarket in terms of component shares by value is very similar to the Middle East, however the two regions differ significantly in how passenger vehicles are serviced.

TechSci’s report says 58 percent of PV services are carried out at authorised service centres in the Middle East, 36 percent at independent multi-brand service centres, and six percent at gas stations.  In Africa, 50 percent of services are carried out in multi-brand centres, followed by authorised service centres (30 percent) and gas stations (20 percent).

Car owners in both regions are fairly diligent in ensuring their vehicles are in top shape, with 80 percent of owners in the Middle East and 78 percent in Africa servicing their cars as per the service schedule.  However, eight percent of cars are serviced in African only once they’ve broken down, compared to one percent in the Middle East.

Looking forward, key growth factors for the regional auto aftermarket include a growing demand for spare parts for vehicle modifications; increasing investments in new channels of customer engagement such as quick delivery modes and online spare parts sales.

The second hand auto spare parts market in the Middle East has also developed into a full-fledged multi-million dollar industry, boasting more than 100 small and medium-sized enterprises spread across the region. The UAE is the major supplier of automotive spare parts within the Gulf region as well as for Iran, the CIS, Indian sub-continent and Africa.

TechSci’s Middle East and Africa Automotive Aftermarket report is available to download for Automechanika Dubai 2019 pre-registered visitors and exhibitors

Organised by Messe Frankfurt Middle East, Automechanika Dubai covers the six product sections of Parts & Components; Electronics & Systems; Accessories & Customizing; Repair & Maintenance; Car Wash, Care & Reconditioning; and Tyres & Batteries.  The 2019 edition will feature four new sub-sections of Agricultural Parts & Equipment; Body & Paint; Motorcycle Parts & Components; and Oils & Lubricants.

A key returning highlight is the Innovation Zone, a dedicated area at the centre of the show floor featuring presentations and product showcases that are steering the course for the regional and global automotive aftermarket.

Other features include the Truck Competence initiative, where more than 1,000 exhibitors will showcase their products dedicated to the entire value chain in the truck sector, from truck parts and accessories, to workshop equipment, body repairs and care. 

The Automechanika Academy (AA) also returns, featuring key presentations such as Dubai’s auto parts and accessories trade in 2018 by the Dubai Customs, along with the findings of a survey exploring innovations in the Middle East automotive industry by global research company Explori.  Other AA highlights include a series of sessions by AMENA and Tiqani, as well as AfriConnections, which explores rising opportunities in the African aftermarket.

More information about is available at: www.automechanikadubai.com.