Aftermarket supply chains focus on orchestrating all activities associated with forecasting, procurement, manufacturing, distribution and sale of parts, accessories and associated services for equipment, automobiles and other machinery after their sale. Aftermarket is a very important business for original equipment manufacturers (OEMs), as it has a significant impact on customer experience and delivers high margins. The automotive and industrial value chain includes many organizations that are involved in the development, design, manufacturing, sales and marketing of motor vehicles, heavy equipment and other
products. The aftermarket is the part of the automotive industry sector comprising the services and parts businesses. The service business (maintenance and repair of vehicles) generates about 45% of total aftermarket revenues, while retail and wholesale of vehicle parts make up the remaining revenues.
While steady growth is expected over the next 8 to 10 years, the market is being reshaped by several macro forces. This requires OEMs to deliver high-quality customer service, navigate complex distribution networks, win over competition from new entrants and adapt to technology innovations, including autonomous, connected, electrified and shared. At the same time, OEMs must reduce costs, improve efficiencies and make progress on sustainability goals. The automotive aftermarket is undergoing dramatic changes with evolving customer expectations, acceleration of technological innovation and shifts in competitive power. These changes will reshape the way customers, automotive suppliers and other aftermarket companies think of cars, driving and how business in the automotive aftermarket is conducted and value is created. Thus, value creation and business models in the automotive aftermarket will also be fundamentally reshaped.
This article is posted at ibm.com
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