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North American Starting, Lighting, and Ignition (SLI) Lead Acid Battery AftermarketPublished by: Frost & Sullivan Published: Jun. 17, 2009 - 100 Pages Table of Contents
AbstractThis Frost & Sullivan research service titled North American Starting, Lighting, and Ignition (SLI) Lead Acid Battery Aftermarket provides revenue and unit market forecasts, distribution channel analysis, competitive analysis, and market drivers and restraints. The study analyses the current aftermarket competitive situation and identifies revenue figures by key end user application, country, distribution channel, installation and construction types, and voltage rating.Market Overview Replacement Demand Buoys North American SLI Lead Acid Battery Aftermarket The North American SLI lead acid battery aftermarket is at a mature stage with top vendors establishing global presence and other smaller regional/local vendors catering to the needs of consumers within the North American market. The ever expanding base of vehicles in operation and growing miles driven per year will be the major growth drivers for the North American SLI lead acid aftermarket. Demand for automotive replacement batteries is dictated by factors such as the number of vehicles in use, the average battery life, the average age of vehicles and their condition, vagaries of seasonal weather, the general population and the overall economic situation. "The average life of a passenger vehicle battery is 4 to 5 years; however the full range can vary from 2 to 9 years," notes the analyst of this research service. "Therefore, the increased passenger vehicle sales between 2003 and 2006 is likely to result in higher aftermarket battery shipments over the period 2007 to 2011." Prior to 2008, the ratio of batteries purchased to vehicles in use increased slightly due to higher average mile per vehicle logged, and the rise in the number of vehicles being operated in warm climates. In addition, the current economic decline is forcing consumers to hold back on new vehicle purchases and maintaining existing vehicles. Consequently, prospects for aftermarket battery replacements will look upbeat from 2009 to 2011. Fierce competition dominates the North American SLI lead acid aftermarket. Competition is based on price and competitive behavior in distribution channels. Three market participants occupy the higher rungs of the market and control 85.6 percent revenue market share. The industry has been reeling under continual price pressure in the form of volatile raw material costs, cyclicality of customer purchases, distribution channel category development shifts, and distribution channel consolidation or supplier transitions. The SLI lead acid battery aftermarket had earlier witnessed consolidation in its distribution channels, impacting both the customer and the battery manufacturer. In this scenario, individual distribution channels enjoy superior bargaining power with regard to price points, warranties, and credit terms. A unique aspect of the North American SLI lead acid battery market is the strength of private labeled batteries in comparison to the manufacturer brands that service the needs of aftermarket consumers. This demonstrates the robustness of the distribution networks, especially in the specialty battery stores, auto retailers, mass merchandisers and the discount stores categories. It is imperative for battery vendors to nurture strong distribution channel relationships to achieve rapid revenue growth and maintain unmatched levels of service to end users. Further, a highly competitive industry demands strong product differentiation. However, product differentiation is limited in the starting lead acid batteries segment, particularly for flooded lead acid battery types. Limited product differentiation constricts growth opportunities for market participants and to maintain pricing strategies, manufacturers then tend to focus on diminutive battery improvements to increase performance rather than revolutionary product modifications. "In the absence of product differentiation, the aftermarket distribution network has some liberty to change the source of the battery while retaining the brand name," says the analyst. "This will encourage the battery vendor to enhance the brand and ratchets up visibility of in-house brands." Get Full Details About This Report >> |
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