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The aftermarket sector is benefiting from the resurgence of traffic levels

Capstone Partners, a leading middle-market investment banking company, released the February 2022 Vehicle Aftermarket Report, explaining the sector’s performance across COVID-19. During the pandemic, enthusiastic and DIY category companies benefited from increased demand, while service providers and component manufacturers servicing the Do-It-For-Me (DIFM) market , To close the store imposed by the government. However, according to Capstone, the sector is ready to benefit from the positive trends of macroeconomic drivers, including an increase in the number of registered vehicles, an increase in the average age of cars and light trucks, and a resurgence in mileage. … apparently …

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In addition, according to Capstone’s research, stagnant demand, increased use of e-commerce, increased interest in DIY projects, and growth in the enthusiast category have created opportunities for aftermarket companies. Supply chain disruptions, raw material prices and labor market shortages are expected to continue to challenge aftermarket companies in the short term, but as the supply chain normalizes, difficulties in procuring parts abroad will be difficult in 2022. It is expected to weaken in the second half of.

Recognizing the resilience and growth potential of the sector, buyers have shown great interest in this area and M & A activities are progressing at a blazing pace throughout 2021. Given the fragmentation between subsectors, VehicleAftermarket is an acquirer looking for a business in an attractive region that serves high-growth end markets and offers complementary products and services.

Most of the 2021 trading activities, led by private equity (PE) add-ons, were financial buyers. PE-backed companies have leveraged private equity financing to pursue roll-up opportunities to scale. This is very common throughout the aftermarket service sector, including general repairs, crashes, car washes, oils and lubricants.

“In the aftermarket, M & A activity was active in almost all subsectors in 2021. Aftermarket fundamentals remain strong, strategic and financial buyers continue to invest capital through acquisitions at this level. Is expected to continue until 2022, “said Capstone Partners Senior Director. YogesupanjabiThe main contributor to the newly released report.

Also included in this report:

  • Breakdown of key macroeconomic drivers that determine sector demand
  • An overview of meaningful trends affecting the sector
  • EBITDA Trading Multiple and Aftermarket Company Evaluation Driver
  • Summary of recent notable M & A transactions

To access the full report click here.. The aftermarket sector is benefiting from the resurgence of traffic levels

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