Automotive Collision Repair Market Is Estimated To Witness High Growth Owing To Rising Motor Vehicle Accidents And Availability Of Advanced Collision Repair Technologies
The automotive collision repair market is estimated to be valued at USD 203.85 Bn in 2024, exhibiting a CAGR of 4.1% over the forecast period (2024-2031). The market is witnessing high growth owing to the rising number of road accidents globally and increased availability of advanced collision repair technologies. Furthermore, the implementation of stringent safety regulations for vehicles involved in collisions is boosting the market growth.
Market Dynamics:
Rising motor vehicle accidents globally is a major driver fueling the growth of the automotive collision repair market. According to WHO, road traffic accidents account for around 1.35 million deaths annually worldwide. The increasing demand for repair and maintenance services arising from such accidents is prompting more people and repair shops to undertake collision repairs. Additionally, availability of advanced collision repair technologies such as modular mechanical splicing methods, adhesive bonding, and self-piercing riveting is accelerating the market growth. These technologies help in reducing labor time and costs involved in collision repairs significantly. For instance, adhesive bonding technology replaces around 75% of welding operations, resulting in up to 50% reduction in repair cycle time.
Market Drivers
Increasing Number of Road Accidents Globally
The number of road accidents has been rising significantly around the world every year. According to WHO, road traffic injuries claim around 1.35 million lives across the globe annually. The increasing road accidents are leading to more vehicles requiring collision repairs. Insurance companies are increasingly covering collision repairs, fueling growth in the automotive collision repair industry.
Growing Average Age of Vehicles on Roads
As people are holding on to their vehicles for longer, the average age of vehicles on roads has been rising steadily over the past decade. Older vehicles are more susceptible to collision damages due to worn-out parts. This is increasing the repair requirements and driving opportunities for collision repair shops and body shops. Additionally, collision parts suppliers and manufacturers are also benefiting from the rising lifespan of vehicles.
Market Restraints
High Cost of Advanced Equipment and Technology
Transitioning to advanced repair technologies, such as ADAS calibration equipment, requires significant upfront investments. The rapidly evolving vehicle technologies are posing the challenge of collision repair shops investing frequently in costly new equipment and training programs to fix modern vehicles. This high initial cost of equipment is a major restraint for small repair shops.
Fragmented Nature of Collision Repair Industry
The collision repair industry landscape is highly fragmented with many small independent body shops. The bargaining power of these small players is less against the automakers and suppliers. This fragmentation makes it difficult to achieve economy of scale. It also limits investments in cutting-edge technologies, hindering growth opportunities.
Market Opportunities
Increasing Demand for Certified Pre-Owned Vehicles
With the growing preference for certified pre-owned vehicles offering warranty and financing benefits, more vehicle buyers are opting for CPOs. This is driving more certified collision repairs and raising quality standards in repair work. It is opening new growth opportunities for well-equipped shops able to provide OEM-grade repairs for CPO vehicles.
Emerging Technologies such as ADAS Calibration
Advanced technologies such as Advanced Driver Assistance Systems (ADAS) present a lucrative opportunity for collision repairers willing to invest and train technicians in ADAS calibration. With more vehicles incorporating such driver-assist technologies, the demand for ADAS calibration after collision repairs will continue rising in the coming years.
Link: https://www.coherentmarketinsights.com/market-insight/automotive-collision-repair-market-4524
Key Developments:
- In July 2023, BMW North America became a part of I-CAR's Sustaining Partner Program. This initiative assists in funding support initiatives and collision repair education, aiming to reduce training redundancies within the industry. It also allows partners to demonstrate advocacy and provide financial backing for industry-wide efforts facilitated by I-CAR.
- Classic Collision announced its acquisition of the Dayton Collision Center in Dayton, Tennessee, in July 2023, signaling an expansion of its operations within the state. This move follows the successful operational expansions undertaken by the company in other states like Minnesota, Georgia, Texas, Colorado, and Florida in the U.S. throughout 2023.
- In March 2023, DENSO Products and Services Americas, Inc. expanded its aftermarket ignition coils range with nine new part numbers, covering over 9 million vehicles in operation. This expansion enhanced DENSO's offering of high-quality replacement ignition coils for various Buick, BMW, Cadillac, GMC, Infiniti, Lincoln, Ford, Nissan, Chevrolet, and Volvo models.
Key Market Players:
Key companies covered as a part of this study include 3M, Automotive Technology Products LLC, Continental AG, Denso Corporation, Faurecia, Federal-Mogul LLC, Honeywell International, Inc., International Automotive Components Group, Magna International, Meritor, NAP San Diego, National Auto Parts, National Auto Parts-Oakland, Palladium Equity Partners, PPG Industries, Saint-Gobain, Siemens, Tenneco, TRW Automotive, and ZF Friedrichshafen AG.
