As Europe slumps, Australian car parts manufacturers are set to rise

The Victorian Government is set to take advantage of slumping European car markets in order to push Australian exports in aftermarket car parts.

The Victorian Government is set to take advantage of slumping European car markets in order to push Australian exports in aftermarket car parts.

According to a report commissioned by the Victorian Government, Automotive Aftermarket Opportunities in Europe, new trade opportunities are emerging as the European car market begins to age and consumers choose to replace parts rather than buy new cars.

Particularly focusing on France and Germany’s aging car fleets, the report anticipates a greater demand for parts and accessories. Stringent maintenance requirements and reduced mandates for original equipment parts and services will also improve the long-term outlook for the independent aftermarket in these countries.

According to the report, niche products such as performance and 4WD parts and accessories will provide the best opportunities for Australian car manufacturers.

Specialist performance parts are amongst those in highest demand, with the French tuning market estimated at 1 billion Euros in 2007 and Germany ranking as the biggest car tuning market in Europe with an estimated value of 4.6 billion Euros in 2008. This market is expected to shrink by 10-15% in 2010 but it is expected to remain positive due to the desire to keep motor vehicles in good condition.

The French 4WD market is also tipped as a strong growth opportunity for Australian manufacturers.

Victorian auto parts company, Don Kyatt is taking advantage of the current automotive climate, having recently opened a warehouse in the south of France.

Frank Hutchinson, Managing Director of the Don Kyatt Group says the company found its niche market years ago and today, through its Terrain Tamer 4WD parts and accessories range, distributes Toyota, Nissan and Suzuki parts, including gears, bearing kits, engine parts and accessories like 4WD suspension and winches.

“We could see that 4WD vehicles were going to be the thing of the future. So nearly 30 years ago we adapted our business, initially sellng spare parts and accessories for Land Rovers, then Land Cruisers. Now we are Australia’s number one supplier of aftermarket parts and accessories for almost all makes of 4WD vehicles,” he said.

“Focusing on the 4WD aftermarket has allowed us to grow our business steadily. In 1986, we expanded the business into New Zealand and from there, into Fiji. But after saturating local markets, we wanted to go further.”

Since taking the next step and expanding to the European market, the company expects good returns.

Given the high number of diesel vehicles in Europe, Hutchinson is also excited about the potential market for the company’s fuel additives and engine lubricants.

“We are very confident about this next step. Once you have started your export journey, each experience gives you more and more confidence that you can do more. There are opportunities out there for all sorts of products and services,” he said.

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