Automotive E-commerce Market Size, Share & COVID-19 Impact Analysis, By Component Type (Infotainment & Multimedia, Engine Components, Tires & Wheels, Interior Accessories, and Electrical Products), By Vendor Type (OEM Vendor and Third-party Vendor), By Vehicle Type (Passenger Car, Commercial Vehicle, and Two-wheeler), and Regional Forecast, 2022-2029

The global automotive e-commerce market size was valued at USD 66.34 billion in 2021. The market is projected to grow from USD 75.28 billion in 2022 to USD 213.08 billion by 2029, exhibiting a CAGR of 16.02% during the forecast period. Based on our analysis, the global market exhibited an average growth of 4.5% in 2020 as compared to 2019.

Most OEMs are experiencing a few bottlenecks in their business operations such as supply chain disruptions, the decline in the import and export of automobile components, and restrictions on the transportation of non-essential items. The market is driven by the growth of the global e commerce industry, increasing automotive sales, and the digitalization of interfaces and channels. In addition, the growth in per capita income of consumers and increasing penetration of the internet have led to the growth in online sales of automotive parts and components, subsequently fueling the market growth over the forecast period.

Consumers are shifting from manual to automatic or semi-automatic operations of vehicle automation. Another factor that is predicted to drive the growth of the market is technological advancements. Automotive power window systems must also be able to operate quietly. Automatic or powered windows are a form of system that requires little or no force to operate, and this feature is projected to drive the market forward.

Moreover, the global automotive e-commerce market growth is attributed to the increased demand for automotive components and parts as the aging of the vehicle fleet is increasing. Factors such as higher price transparency, the convenient shopping experience, and greater diversity of parts have driven customers to online purchases. Further, multiple online offers, a low pricing strategy, and the facility of comparing parts online based on guarantee, price, and specification are further fueling the growth of the market.

COVID-19 IMPACT

Growth of Automotive E-commerce Market Will Slow Down During COVID-19 Pandemic

The pandemic has caused immense uncertainty and panic in the industry for all industrial value chain members involved. To avoid the spread of COVID-19, governments worldwide have adopted robust policies. Moreover, with social distancing rules in place, the demand for automobiles reduced, affecting the market. Lockdown measures caused production and demand disruptions to automobile manufacturers and their sub-contractors. Furthermore, restrictions were lifted across different sectors and countries at a different pace, which resulted in input shortages in the automobile sector’s complex value chains. According to the International Organization of Motor Vehicle Manufacturers (OICA), in 2020, production declined by 16% globally to less than 78 million vehicles, equivalent to sales levels in 2010.

In addition, the coronavirus pandemic has significantly affected manufacturing operations across the world. The supply chains are in jeopardy, and product shortages are becoming evident owing to lockdowns imposed in various parts of the globe. Businesses that were earlier using offline sales channels are now turning to digital operations. Though the majority of business sectors worldwide have experienced the negative effects of the pandemic, automotive e commerce can bring businesses back on track as it provides better safety and ease of purchase for customers.

LATEST TRENDS 

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Increasing E-commerce Spending on Automotive is a Prominent Trend

The emergence of automotive e-commerce offers significant new sales opportunities for OEMs, dealers, and other digital car sellers. The online shopping of automotive parts and components through third-party vendors, such as Amazon.com, Inc., O’Reilly Auto Parts, and Alibaba Group Holding Limited, is expected to show the fastest growth in this industry over the forecast period.

DRIVING FACTORS

Increasing Demand for Omni-channel Insights to Drive the Growth of the Market

The availability of a broad range of automobiles, auto parts, and components online is driving the market growth. Today, automotive customers increasingly prefer to shop for auto parts and components online. Therefore, the automotive industry is witnessing a major shift toward automotive e commerce platforms. The market is quite competitive, and the vendors are concentrating on offering services, including vehicle service appointments, used vehicle purchases, and trade-ins. Furthermore, they are aiming at competitive pricing models to gain an advantage over traditional retailers. For instance, Tesla, Carvana, Vroom, and Walmart have positioned themselves to fill the gap left by traditional vehicle makers and dealers in fulfilling the rising demand from online car buyers. Tesla offers new and used vehicles directly to customers; Carvana and Vroom sell used cars directly to customers; and Walmart sells new and used cars through a network of dealers representing all major manufacturers. In addition, the availability of a broad range of automobiles and auto parts online, lower cost than the traditional retail, 24X7 access, and price transparency will considerably drive the growth of this industry. Moreover, rising investment by third-party e commerce companies in automotive components and vehicle sales online will boost market growth. For instance, third-party vendors, such as Amazon.com, O’Reilly Auto Parts, and Alibaba Group Holdings Limited, are expected to showcase the fastest growth.

Increasing Consumer Comfort with Online Purchasing to Positively Influence the Growth of the Market

Consumers have grown accustomed to the speed and convenience of online shopping. They have more trust in the processability to get a fair price and return the product when buying online. A recently conducted survey of buyers in the U.S. by Cox Automotive revealed the key observations, including consumer satisfaction with car buying has increased with digitization, reaching an all-time high of 72% in 2020, up from 60% in 2019. Today, 80% of consumers say that they want to do at least part of their vehicle purchase online. 64% of car buyers want to handle more of their purchases online compared to the last time they purchased a vehicle. In 2021, 25% of consumers stated they would purchase entirely online. Hence, these factors will drive the growth of the market during the forecast period.

RESTRAINING FACTORS

Increasing Share of Counterfeiting of Automotive Parts Will Be a Restraint for the Market Growth

The increasing availability of counterfeit auto parts and components is expected to restrict the market growth. Various manufacturers produce replicas of genuine/original auto parts and retail at lower prices. The counterfeit market generally targets segments that are easy to copy and have a high turnover rate such as tie rods, steering arms, windshields, tail lamps, headlamps, bumpers, and filters. Counterfeit auto parts demand is growing worldwide due to a surge in the number of auto part manufacturers. These components are of low-grade quality and break down very often. It builds a negative image, thus affecting automotive e-commerce sales. The biggest downside to automotive e commerce is security. People are afraid to provide personal and financial information, although there have been some improvements in data encryption. Certain websites cannot perform authentic transactions. The fear of giving information about credit cards and identity risk are limiting the growth of electronic commerce. People rely on electronic images to buy products. Sometimes the product does not match the electronic pictures when it is delivered as it may not meet the needs of buyers. The lack of "feel and touch" prevents people from buying through automotive e commerce.

SEGMENTATION

By Component Type Analysis

Engine Components Segment to Lead Backed by Rising Number of Aging Vehicles

Based on component type, the global market is segmented into infotainment & multimedia, engine components, tires & wheels, interior accessories, and electrical products.

The engine components segment holds the major share in the market due to constant surge in the aging of vehicles and vehicles in operation. The auto parts covered under engine components are pistons & rings, bearings, engine block & cylinder heads, and valves & filters. Moreover, tires & wheels require frequent replacement as they wear out quickly, thereby propelling the segment growth.

By Vendor Type Analysis

Ability to Provide Rapid Delivery Service Will Propel the Third-party Vendor Segments

Based on vendor type, this market is segmented into OEM vendor and third-party vendor.

The third-party vendor type segment accounts for the major market share and is also projected to dominate the market during the forecast period. This is attributable to the ability of third-party vendors to fulfill customer expectations through rapid delivery and exceptional service network, and they are also engaged in discount programs to attract customers.

By Vehicle Type Analysis

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Passenger Car Segment to Remain at Forefront Due to Increasing Sales Worldwide

Based on vehicle type, this market is segmented into passenger car, commercial vehicle, and two-wheeler.

The passenger car segment accounts for the major market share and is also projected to dominate the market over the forecast period. This is attributable to the growing sales of passenger vehicles. E-retailers use optimized and advanced search engines to improve customer experience. End-users can use such search engines to select passenger cars by applying filters on several parameters such as vehicle specifications, price, vehicle trim, vehicle make, vehicle features, and exterior color. Most vendors also enable end-users to compare various passenger cars, which helps in the customer buying decision. All these parameters are increasing customer propensity for automotive e-retail, which is driving the segment growth.

REGIONAL INSIGHTS

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Geographically, the market is segmented into North America, Europe, Asia Pacific, and the Rest of the World. 

The North American region will dominate the market due to rising demand for hassle-free purchasing, presence of well-developed infrastructure, growing preference of regional consumers for online shopping, and high demand for premium and luxury cars.

In Asia Pacific, the market is expected to emerge as one of the most lucrative regional markets due to the presence of key automotive e-commerce companies such as Alibaba Group, Amazon.com, eBay Inc., and Flipkart Internet Private Limited. Government initiatives, such as Digital India, and partnerships between brick & mortar stores and e-commerce platform providers are further anticipated to boost the market.

Moreover, in terms of growth, Europe is expected to become the second-fastest-growing market with a CAGR of 16.6% during 2022–2029. Europe is one of the main markets for automotive e-commerce due to the growth in e commerce.

The rest of the world is expected to register average growth from 2022 to 2029. Factors such as the continuously evolving e-commerce market in Latin America, the Middle East and Africa, along with the development of advanced channels offering superior logistics support are expected to fuel the market growth in those regions.

KEY INDUSTRY PLAYERS

Key Market Players to Focus on Collaborations and Partnership Strategies to Gain Competitive Edge

This market is highly competitive and fragmented in nature, with the presence of key market players such as O’Reilly Auto Parts, Amazon.com, Inc., Alibaba Group Holding Limited, AutoZone, Inc., Advance Auto Parts, Delticom AG, eBay Inc., and Walmart. The major companies are focusing on acquisition, expansion, and collaboration strategies to strengthen their position in the industry. For instance, in December 2019, Advance Auto Parts announced the acquisition of DieHard. The acquisition gave the company the rights to sell DieHard batteries on its e-commerce platform. The acquisition enabled Advance Auto Parts to improve its offering in the automotive aftermarket part and accessories category.

Amazon is One of the Leading Players in the Market 

Amazon is a leading multinational e-commerce company based in America. Apart from e-commerce, the company also focuses on cloud computing, digital streaming, and artificial intelligence. Additionally, it is also one of the leading companies in the IT industry of United States. Moreover, Amazon also manufactures and sells electronic devices globally. The company offers various automotive aftermarket replacement parts, tools, and accessories through its online retail shopping services. Amazon is rapidly growing as an automotive aftermarket e commerce platform by collaborating with major automotive parts and service providers to offer its customers a wide range of in-demand auto parts and installation convenience.

LIST OF KEY COMPANIES PROFILED:

• O’Reilly Auto Parts (U.S.)


• Amazon (U.S.)


• Alibaba Group Holding Limited (China)


• AutoZone, Inc. (U.S.)


• Advance Auto Parts (U.S.)


• Delticom AG (Germany)


• eBay Inc. (U.S.)


• Walmart (U.S.)


• Bosch Auto Parts (Germany)


• Flipkart (India)

KEY INDUSTRY DEVELOPMENTS:

• July 2021 - MasterBeat Corporation announced that its JTEC Autoworld launched the Amazon retail segment of its online automotive parts platform. JTEC is planning to utilize Amazon and other e-commerce platforms to accelerate its marketing & sales.


• January 2022- Amazon and automaker Stellantis announced a strategic partnership to develop cars and trucks with Amazon software in the dashboards and deploy nd made by Stellantis on Amazon's delivery network.


• October 2021- Autodoc announced its dominance in the European automotive e-commerce market as the largest online automotive store in 2020. Within Germany, the online sales of automotive parts and accessories were worth around USD 3.7 billion in 2020. This was 13% of the overall market value of USD 27.9 billion.


• November 2021- Wipro introduced Click-Shift-Drive, a new automotive e commerce solution that allows dealers and automakers to offer online services ranging from product comparison, loan approval, buying, and delivery.


• October 2020 - BMW signed an MoU with Alibaba. According to the MoU, Alibaba and BMW will jointly launch the first online sales and services businesses engaging dealers among premium auto brands to create a smooth end-to-end online-to-offline digital experience.

REPORT COVERAGE

An Infographic Representation of Automotive E Commerce Market

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The report provides a detailed analysis of the market and focuses on key aspects such as leading companies, product types, and leading applications of the product. Besides this, the report offers insights into the automotive e-commerce market trends and highlights key industry developments. In addition, the report encompasses several factors that have contributed to the growth of the market in recent years.

Report Scope & Segmentation