ANALYSIS: Vehicles in operation — United States versus Canada

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Regardless of where automotive professionals are located, understanding the vehicles on the road, specifically which segments are most prevalent, will help them to stay informed on the latest trends and have additional insight on what the aftermarket industry may entail in the near future.

To gain a more comprehensive understanding of the vehicles on the road and how they may differ in the United States and Canada, Experian’s Automotive Market Trends Report: Q2 2022 took a deep dive into the data.

VIO trends

When comparing light-duty vehicles in operation (VIO), data shows the U.S. has substantially more vehicles on the road than Canada. In fact, there were 284.4 million light duty VIO in the U.S. through Q2 2022, while Canada had 26.1 million. 

Furthermore, of all vehicles on the road in the U.S. today, 87.9% fell within the current 20 model years and 95.1% were within the current 25 model years through Q2 2022. In comparison, Canada had 93% of vehicles fall within the current 20 model years and 96.7% within the current 25 model years this quarter.

With Canada having approximately 6% more current model years than the U.S., this may indicate that the vehicles in Canada are somewhat newer and there are a limited number of older models, of course by percentage.

Additionally, with U.S. domestic brands not being as popular in Canada, 57.5% of all light duty vehicles in Canada are non-U.S. brands or imports, while the remainder 42.5% were domestic through Q2 2022.

There was a similar trend in the U.S., where import brands comprised 50.1% of all light duty VIO in the U.S. through Q2 2022, surpassing domestic brands for the first time, which came in at 49.9%.

Analyzing multiple data points will give automotive professionals a better understanding of what vehicles consumers are currently opting for so they can market strategically, as well as prepare for potential parts and services that may be needed now and in the future.

Current top vehicle segments

When looking at the top vehicle segments on the road, there are three categories that break down the metric—the vehicle type, size, and class.

In the U.S. luxury class, full-size pickups were the leading segment at 16.3% through Q2 2022, followed by midsize vehicles at 14.1% and crossovers at 11%. In addition to that, trends for the non-luxury class in the U.S. were similar this quarter—with midsize vehicles coming in at 16.4%, followed by full-size pickups (16.3%) and crossovers (13.6%).

Meanwhile, in Canada, the compact vehicles in the luxury class comprised 17% of the total VIO through Q2 2022. Rounding out the top three were full-size pickups (15.2%) and midsize crossovers (13.7%). Similarly, compact vehicles were the leading segment in Canada’s non-luxury class—followed by midsize crossovers (16.4%) and full-size pickups (15.2%).

It’s important for automotive professionals to have insight on the types of vehicles currently in operation, so they are better equipped when catering to a consumer’s needs. Furthermore, analyzing the other metrics—such as the aftermarket “sweet spot”—will paint a fuller picture when preparing for what’s ahead in the aftermarket industry.

Aftermarket sweet spot continues to grow

The sweet spot consists of vehicles between six-to-12 model years old and are still considered to be in good condition but have aged out of general OEM warranties for repairs. Through Q2 2022, the model years that landed in the sweet spot were between 2011 and 2017.

Breaking the data down further, the U.S. sweet spot made up 35.1% of total VIO through Q2 2022, an increase from 33.2% the previous year. As more vehicles are expected to enter in the coming years, the continuous growth sheds a positive light of potential revenue and market activity.

In comparison, 38.3% of total VIO in Canada landed in the sweet spot; and similar to the U.S., there is projected growth over the next few years as lower volumes of older vehicles transition into the post sweet spot and new vehicles enter the market.

Staying up to date on the vehicle trends as well as analyzing what the aftermarket currently looks like and what it’s anticipated to be will help automotive professionals in both countries have a better understanding as they plan to assist consumers now and in the months to come.

Marty Miller is Experian’s director of data for automotive.



Source : AutoFinanceNews