The global chip shortage and supply chain disruptions have severely affected automobile production over the past one-and-a-half years, leading to a surge in prices of new and used vehicles. Logistical disruptions caused by the recent Russia-Ukraine war and higher loan costs due to the Federal Reserve’s policy tightening have further dampened the industry’s prospects.
However, rising fuel costs and government incentives is encouraging consumers to transition to electric vehicles, as evidenced by a 60% rise in the U.S. EV registrations in the first quarter of 2022. This should drive the performance of auto parts manufacturers even if the traditional auto market struggles. The global auto parts and accessories market is expected to grow at a 2.8% CAGR to$2.64 trillion by 2027.
