Transportation & Logistics Industry Update
What We’re Reading
According to the U.S. Census Bureau’s Retail Sales Report, May sales for auto parts, accessories, and tire stores increased by 23.1 percent, and there was an additional 6 percent gain in June. (There is about a six-week lag, so the July sales number will come out in mid September.) The drop in sales during the lockdown has been erased, and sales are higher than they were before the lockdown. In fact, June 2020 sales are 10 percent higher than they were in June 2019.
Reduced OEM output of new vehicles and other factors related to COVID-19 might have prompted the current skyrocketing used vehicle costs. However, a CCC analyst earlier this month said the gains might not lead to a flood of vehicles falling below the total loss threshold. Used cars and trucks were up 5.4 percent over July 2020 — the “largest monthly increase since March 1969,” according to the BLS. Looking year over year, used car and truck prices are up 4 percent over the year ending Aug. 31, 2019.
The coronavirus pandemic has delayed the growth of electric vehicle sales by about two years, according to a new study. The total global stock of electric vehicles by 2040 has also been revised downward by about 2 percent, to 323 million, according to the study.
Everyone is aware that vehicle technology and business trends are moving forward at a constant pace. Things are changing so fast, in fact, that many automotive repair shops have had to devise strategies to help them keep up. The same can be said for the jobber business, where electrification, alternate fuels, and vehicle automation are causing incredible parts proliferation, forcing stores to rethink their approaches to inventory management and customer service. Technological advances will continue to change the dynamics, look, and day-to-day operation of aftermarket businesses. To succeed, repair shops and parts stores alike must have a plan for adapting to the latest developments.
Harris Williams is a leading advisor to the transportation and logistics M&A market. Our Transportation & Logistics Group serves companies in a broad range of attractive niches, including third-party logistics (3PL), truck, rail, marine and air transportation, transportation equipment, and the automotive and heavy duty vehicle market.
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