What to expect in the automotive world in 2021?

As the world adapts to the post-COVID-19 environment, the automotive world is facing rapid changes.

We are speaking with Alexander Gruzdev, an international automotive intelligence expert. 

Alexander, your experience in market intelligence exceeds 25 years, and you do a market analysis for more than 20 countries. How is automotive world doing during the pandemic? 

The COVID-19 pandemic has already transformed the automotive world in ways that would have seemed impossible just 12 months ago. New car sales are down nearly in every country in the world. Europe shows one of the worst results, with some countries drop by 1/3 of its 2019 results and the most significant European market. Germany is down by nearly 20%. Asian markets are not so grim, with China decrease in sales by less than 7% and South Korea even increased by almost 6%. The US market is going to stay in line with the world’s average results of 15% fewer car sales than in 2019. 

It is surprising, not every market decreased in 2020.

Yes, it is important for international companies to choose the correct markets and strategies.

Mr. Gruzdev, your company, specialized in the analysis of the automotive aftersales market. Does it follow the same trends as new car sales?

No, not at all. Aftersales business is much more stable because it depends not on new car sales, but on the number of vehicles on the road. Last year, the world faced restrictions, and we’ve seen fewer cars moving, which means less mileage. Although there are drivers that increased their cars’ use because of less use of public transport inside the cities and planes and trains to travel between the cities, we still face the decrease in average annual mileage in most of the countries in the world. This will have a negative effect for the volume of the aftersales business. When the COVID situation will improve, and restrictions are lifted, people tend to drive more, which will mean more service and wear and tear parts. Still, pre-COVID mileage figures probably will not return until 2022. 

I know that you do very deep analysis of the markets. What are the other 2020 takeaways of the automotive market? 

Of course, 2020 brought many changes related to the Internet. Communication moved to the Internet and purchase behavior changed. That’s why traditional brick and mortar shops are under pressure now and lose the share to online shops. In all industries, e-commerce boomed in 2020 and will continue in the following years. The automotive aftersales market is not an exception. Sales of parts will move to online shops, and Amazon is one of the great examples, as in 2020, it made the new record sales of automotive parts. 

Your business is to provide information, help to adapt to the new reality, understand the trends and predict the future. What are the critical changes in your business? 

First of all, we need to understand the needs of the client. Entering the market strategy is different than increasing the share. Changes in different countries are not the same. For example, for emerging markets, price surveys are still the most popular as 2020 brought significant exchange rate shifts. Many emerging markets depend a lot on imports, so the prices changed, and market players need to act accordingly. On the other markets, volume estimation is one of the key interests. But the whole world is now struggling to understand how the customer journey changed? What is the new point of contact? What are the drivers of purchase? All of these questions we at Gruzdev-Analyze can answer. Using innovative market intelligence methodologies such as online communities and social media analysis, we help our clients to make the right decision based on precise data, saving time and money. Customer journey map and customer experience are top topics for the clients in 2021. 

As we move into the post-COVID world, effective market intelligence will be crucial in helping businesses grow in the changing environment. Every company needs data-driven insight to make informed decisions, and Gruzdev-Analyze is here to provide that information, ensuring they can stay ahead of their competitors.”

Thank you, Alexander. To find out more about Gruzdev-Analyze, visit here or connect on LinkedIn.