Ford Motor Company is seeking to expand its presence in the rapidly growing global auto parts market, according to a report from Reuters. The American automaker is launching a new brand, named Omnicraft, to sell parts to Ford dealers and independent repair shops to fix competitors’ vehicles.
“Omnicraft is a significant benefit to any vehicle owner who needs parts or to have their vehicle serviced,” Frederiek Toney, president, Global Ford Customer Service Division, said in a statement. “Now, owners of non-Ford vehicles have access to quality parts at a competitive price, backed by Ford and installed by Ford’s world-class certified technicians.”
Toney said the global business for automotive parts, which is currently valued at more than $500 billion, will expand by 70 percent in the next six years or so. Ford’s new service could have a significant impact on this forecast, allowing dealers to service between 85 and 90 percent of competitive makes.
He was noncommittal when asked how much of the global market Ford hopes to capture, but said that in 10 years the company would be happy if 10 to 15 percent of its parts sales came from Omnicraft. Following this announcement, the Omnicraft parts will begin to be sold at Ford and Lincoln dealerships, of which there are 3,200 in the United States and 10,500 globally.
"As the average age of vehicles increases, especially in mature markets like the United States and Europe, there is more of a need for auto parts,” Toney said. It estimated that the average of a vehicle in the United States is more than 11 years.
This creates a lot of opportunities in the automotive aftermarket and Ford are not the only company to take notice. American e-commerce giant Amazon are the latest big name to bid for a piece of the market. The company has agreed contracts with the largest parts makers in the country - including Robert Bosch, Federal-Mogul, Dorman Products and Cardone Industries, sources told The Post. They are already selling parts for less than its brick-and-mortar rivals. But, according to one Wall Street analyst, Amazon could see its auto parts business expand more than 50 percent in 2017.
This comes on the back of a number of scandals involving car parts makers. Earlier this month, Japanese automotive parts company Takata agreed to pay one billion dollars in fines in the US for concealing information about faulty airbags.
The airbags have been blamed for a number of deaths and over 100 injuries across the world. Takata have agreed to pay a $25 million fine to settle the criminal charge, $125 million to people injured by the airbags and $850 million to carmakers that used them.
Ford itself has recalled 4,500 1.6-litre Kuga cars in South Africa after nearly 40 incidents in which vehicles were reported to have burst into flames.
For more information on this topic, and a full list of related reports, please visit the automotive parts section of our website.
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