Not all sectors of the auto industry are recovering at equal rates from the pandemic, with parts coming out significantly ahead of vehicle assembly, according to a new release by DesRosiers. Still, “Longer term questions abound about the future of both sectors,” said Andrew King, Managing Partner at DAC.
Taking into account all shipments, the motor vehicle parts and accessories industry has “been quite resilient despite the significant drop in the first three quarters of 2020”. The study showed that by the end of the third quarter of 2022, the dollar value of shipments for parts and accessories nearly returned to pre-pandemic levels, increasing approximately 25.3% from 2021.
The report found a much different picture for the assembly sector. Due to significant structural change as well as serious supply chain issues, the vehicle assembly industry is still far behind.
A combination of plant retoolings, the pandemic, and the semiconductor shortage have all impacted the industry. “However, with assembly volumes picking back up this year, shipments for the motor vehicle assembly industry have seen some notable growth, up 28.3% in the first three quarters of 2022 compared to the first three quarters of 2021,” said the report.
“While the ZEV product mandates for Canadian assembly plants are undoubtedly positive, the Canadian parts industry still has to move through its own structural change on this issue. It is important that the government and industry aggressively work together now to position the parts industry for the significant challenges it will face in the coming years,” said King.
