U.A.E E-Commerce Automotive Aftermarket Size & Share Analysis - Trends, Drivers, Competitive Landscape, and Forecasts (2024 - 2030)

U.A.E. E-Commerce Automotive Aftermarket Trends & Drivers

Increasing Customer Awareness and Convenience Drives Market

• The improved customer awareness along with better convenience act as a major driver for the e-commerce in automotive market. The availability of a wide range of products and hassle-free transactions, timely delivery as per consumers’ preference, and wide range of discounts result in a shift to online parts purchasing from traditional brick-and mortar stores.
• A large number of e-retail players, such as Amazon.com Inc. and Noon.com, are involved in selling automotive components on their portal, thus creating easy access for consumers.
• Moreover, vehicle compatibility requirements and product specifications in the products and services offered at physical stores make it trivial and complicated for regular customers to evaluate the product and estimate the cost of services against the value they would be deriving out of it. Hence, to avoid purchasing overpriced products, customers opt for e-commerce automotive aftermarket platforms because of the freedom allowed to them to navigate through the product offerings without getting affected by the sales tactics one needs to be wary of during an offline purchase, thereby bridging the trust deficit between the retailer and the customer.
• Furthermore, it allows extensive research and comparison on prices, features, compatibility requirements, specifications, delivery time, offers, and other aspects, which makes it easier for DIY and do-it-for-me (DIFM) customers to compare products from multiple online sources, unlike brick-and-mortar stores. These additional advantages over brick-and-mortar stores are driving e-commerce in the automotive market industry.

Increasing Number of DIY Customers

• With a ballooning trend of vehicle customization, the country’s e-commerce in automotive market is witnessing the emergence of a DIY culture, as customers and enthusiasts take up the task of upgrading their vehicles themselves. While mechanics and maintenance & service centers have traditionally been the core customer base, DIY enthusiasts have lately comprised of a significant percentage of the sales through e-commerce platforms.
• The automotive aftermarket is expected to benefit from the customer base now including car owners and enthusiasts apart from maintenance and servicing centers.
• Moreover, the high spending potential, high per capita income, and availability of a range of products on e-commerce platforms encourage customers to order online and customize or repair their vehicles themselves.

Rising Risk of Counterfeit Products

• for many years, challenges to consumer data protection have grown in step with the rising volume of domestic and overseas digital transactions and the proliferation of online shopping. As a result, the shipment volume of products has risen dramatically, which has led to a variable quality of products available at virtual marketplaces. Moreover, as per the International Chamber of Commerce and International Trademark Association, the global value of piracy and counterfeiting was to reach USD 2,300 billion by 2022.
• The automotive industry is also part of this epidemic. The number of fake automotive parts being distributed continues to rise in the country. The major counterfeit parts traded in large numbers include engine and drivetrain components, brakes, accessories, windscreen, and various child parts. Thus, the risk of the circulation of counterfeit products is hindering the market growth in the country.

U.A.E. E-Commerce Automotive Aftermarket Industry outlook

Type Analysis

• In the type segment, the product category generated the higher revenue, of USD over 0.3 billion, in 2023. With the rise in the number of DIY customers in the market, the demand for various automotive products bought online is continuously rising and has been composing a greater share. Due to the hassle-free transactions, availability of a wide range of products, and timely delivery as per consumer preference, the category is expected to witness significant growth in the e-commerce in automotive aftermarket in the country during the forecast period.
• Moreover, the emergence of the DIY culture in vehicle customization among customers and enthusiasts, which involves taking up the vehicle upgradation tasks by themselves, has been also supporting the market. Along with these, the other factors that have a positive impact on the market include a large number of road accidents and rise in vehicle sales.
• The service category is expected to witness faster growth, at a CAGR of 16.5%, during the forecast period, owing to time scarcity, wherein customers do not find themselves with sufficient time to engage in service activities and thus, become dependent upon service providers for attaining the same, and rise in internet penetration rate. Therefore, the ever-increasing internet penetration, coupled with the introduction of new business models, is further expected to drive the market in this category during the forecast period.

During the study, we have analyzed three consumer types in the report:

• Product (Larger Category)
• Service (Faster-Growing Category)

Component Insights

• In the component segment, the tire category accounted for the major market revenue share of around 40%, during 2024–2030. With the rapid urban expansion and the industrial and infrastructure development, there has been a significant rise in the demand for tires for commercial and passenger vehicles.
• Moreover, with technological advancements, coupled with time poverty, online services, where consumers can buy tires online and get them delivered and installed at their doorstep, have become popular. Moreover, it is supported by the ever-increasing internet penetration and adoption of online services in the country
• For instance, dial-a-tire.ae by QUICKPIT TIRE TRADING LLC is one of the online service providers in the U.A.E.
• The lubricants category is expected to witness the highest CAGR, of 16.8%, during the forecast period. This can be ascribed to the rising need to improve the performance of vehicles, and thus, it is necessary for owners to get the vehicles serviced at regular intervals for smooth running. Therefore, the demand for lubricants, such as engine oils, transmission fluids, and brake fluids, is expected to rise in coming years, mainly due to the fact that they increase vehicles’ fuel efficiency, improve performance, and reduce harmful emissions.

During the study, we have analyzed four components:

• Tire (Largest-Growing Category)
• Lubricant (Fastest-Growing Category)
• Battery
• Car Part

Consumer Insights

• In the consumer segment, the B2C category is projected to have the highest revenue, holding a share of 55%, in the market in 2030. This is attributed to the increasing trend of DIY, wherein enthusiasts and consumers have started taking the vehicle upgradation task by themselves.
• Additionally, the rising number of tourists in the U.A.E. has increased the demand for passenger vehicles, which has further accelerated the establishment of small businesses, leading to the growth of the market in this category.
• On the other hand, sometimes, a B2SB consumer does not possess sufficient capital to purchase products in bulk from major distributors, wholesalers, or manufacturers; therefore, they often resort to purchasing products online. Thus, they will contribute significantly to the market growth.

During the study, we have analyzed three consumer types in the report:

• B2C (Largest and Fastest-Growing Category)
• B2SB
• B2BB

Service Providers Analysis

• In terms of value, the automotive dealership category held the largest market share, of 35%, in 2023. This is due to the reliability on these brands among customers, which has already created brand value and helped customer retention.
• The specialty shops category is expected to advance at the highest CAGR, of around 17.0%, during the forecast period. This can be mainly attributed to the scope for price negotiations, presence of multiple brands, and less time requirement for customers, as they can directly approach the component-specific stores.

Below are the major service providers for e-commerce automotive aftermarket:

• Automobile Dealerships (Largest Category)
• Franchise General Repairs
• Specialty Shops (Fastest-Growing Category)
• Locally Owned Repair Shops/Body Shops
• Tire Shops
• Others

Market Nature - Moderately Fragmented

• The U.A.E. e-commerce in automotive aftermarket is moderately fragmented in nature, with different players and third-party retailers offering automotive products and services through their online platforms. The key players in the market have taken significant strategic measures to gain a competitive edge and cover the untapped potential of the market, owing to the high penetration of the internet and e-commerce boom across the country.
• The strategic moves range from product launches and acquisitions to business expansions and partnerships. To gain a competitive edge over other players in the market, companies are focusing on improving their existing aftermarket products and working in collaboration with other market.
• Moreover, the government and officials of the country are aggressively taking initiatives to promote online shopping for increasing digitalization. For instance, in March 2020, the U.A.E.’s Ministry of Economy advised companies other involved entities dealing in e-commerce to register with the economic departments in their related emirates enable close monitoring of the delivery and quality of goods. This initiative is aimed at enhancing confidence among the customers in purchasing products through e-commerce websites. These steps are encouraging retailers and office players to sell through e-commerce websites and their own online portals.

U.A.E. E-Commerce Automotive Aftermarket Industry News

• Nissan KSA has deployed its latest online service to integrate digitalization across its functions and services, providing customers with the convenience of booking their car servicing needs online.
• Continental has launched a web portal for the automotive aftermarket, which contains relevant information on its product and service offerings. This will allow workshops and parts dealers to see all Continental products, services, and brands for the independent aftermarket. The products include tires, electronics, drivetrain components, diagnostic solutions, and brakes.
• EZDubai, a strategic business community that promotes the growth of businesses through a range of facilities and smart solutions, inked a strategic partnership with Noon.com to enhance e-commerce and trade in Dubai. The latter utilizes the former’s range of logistical facilities and customized business solutions to support the growth of local and small businesses.
• Noon.com announced a long-term strategic partnership with Mashreq, a financial institution in the U.A.E., to redefine the digital experience of customers in the country. Under this agreement, a Visa card will be launched to offer a complete digital solution to the country’s customers. Various offers, such as free delivery and extra discounts, will be provided for a time period to augment the number of orders including auto parts from the e-commerce website.
• Mastercard Inc. and Amazon.ae have announced a strategic partnership under which customers in the U.A.E. are offered exclusive access to enhanced shopping experiences. Additionally, the partnership is expected to increase the volume of online orders by rolling out different discounts and other benefits.
• The Dubai Economy Solutions of the U.A.E. launched new e-commerce platform service for assisting small and local companies in selling their goods online. These companies include home businesses, small and medium businesses (SMEs), and large companies.
• Amazon.com Inc. has officially launched a local commerce website for the U.A.E. The official e-commerce website, named Amazon.ae, competes against the existing online suppliers and companies.