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A Mid-Year Aftermarket Update

This blog post is from GenAlpha's partner, MacKay & Company. Since launching in 1968, MacKay & Company has specialized in marketing research and management consulting for the commercial trucking, construction, and agricultural equipment industries. The company’s primary focus has been delivering market analysis of components, distribution channels, and market trends for both original equipment and the aftermarket in all three respective markets.


We are in the sixth month of the year, which means we have a good chunk of data on how the year is trending. 


Earlier this year at Heavy Duty Aftermarket Dialogue (HDAD), we forecast the 2024 parts aftermarket to be up 4.3% compared to 2023, including, as in recent years, a sizable contribution from price increases. In fact, three of the 4.3 points are the impact of price — lower than the last few years, but still above the average seen in the last 30 years. So, with no price impact, the forecast for parts sales is up 1.3%.


We will update this forecast again in early August and included in our forecast will be what has happened this year. 


One reference point is our component manufacturers’ Aftermarket Index. Each month, 20 companies provide us with their aftermarket sales to distribution points. Through April, the index is down 3.3% compared to last year. Independent channels are faring a bit worse than truck dealers, but both are down. This is one reference point and accounts for about 10% of total parts aftermarket. 


Another MacKay & Company report, DataPulse Plus, profiles the monthly business activity of dealers, independent parts distributors, and fleets.  Looking at parts sales for truck dealers and independent parts distributors, year-to-date through April, truck dealers are down 1.5%, and independent distributors are basically flat. Fleets report revenue miles are down 1.4% year-to-date. 


Published quarterly, DataPulse highlights fleet utilization; utilization is down slightly in Q1 compared to Q4 of 2023. Fleets also are forecasting a little more fall off in the second quarter.


Our economist, Dr. Robert Dieli, continues to tell us we are recession-eligible, as many of the signs of a recession in the forecast are still prevalent. Note: The pandemic seems to have put some funk in the timing of many precursor indicators. 


So, where will we be in August, and when we update the forecast? We still have a couple more months of data points to collect, and we will be completing pricing surveys with folks in the industry to understand how price has impacted the first six months and will impact the outlook for the balance of the year. 


At this point, our best estimate is a slight downward revision for the year, but no significant changes. 


Keep in mind that our forecast is for total U.S.—all hard part products. It certainly doesn’t mean for your products or your region, or that you can’t outperform our forecast and the economy.


For more information on this report and other research completed by MacKay and Company please reach out to John Blodgett at john.blodgett@mackayco.com.

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