Caleb Andrew's blog : Canada Automotive Aftermarket: Understanding OEM and Aftermarket Parts

What is an OEM?

An OEM has usually been described as a company that manufactures products that serve as components to a finished product of another company which is then sold as a finished product to the end user. These OEMs collaborate with automobile manufacturers as they are one of the most important players in the production and servicing of vehicles in the automotive sector. However, OEMs are known to not brand their components, but some of them now brand their replacement components which are sold to independent repair shops and car dealers.

What parts do automotive OEMs manufacture?

OEMs usually produce an extensive range of components and hardware for vehicles such as exhaust systems, brakes, glass, and various electrical parts.

What is an aftermarket part?

Aftermarket parts are replacement components and are not produced by the original equipment manufacturer. Typically, replacement parts are installed on a vehicle that has components that are damaged, missing, or dysfunctional.

As per GMI Research, the Canada Automotive AftermarketMarket size is estimated to reach USD 29.0 billion in 2032

What sets OEM parts apart from aftermarket?

Generally, when you take your car to a mechanic for a repair, the mechanic will ask you whether you want to use an OEM part or an aftermarket part. The way I see it, OEM parts are to aftermarket parts as name brand pharmaceuticals are to their off brand generic counterparts. They perform the same function, so which one you choose is all based on preference. The primary catch is that aftermarket parts are typically the least expensive of the two, which is why a lot of consumers settle for aftermarket parts when they can.

A lot of the time aftermarket parts are much more plentiful. Aftermarket parts tend to be manufactured to fit a wide range of different cars like a one size fits all. Because of this, they tend to be far more abundant. In fact, a lot of the time aftermarket parts are the only type of parts that consumers have access to. This is often the case because OEMs have stopped making certain parts and components, especially for older vehicles, aftermarket parts tend to be the only option that consumers have.

Availability of aftermarket parts for automobiles raises the question of whether this question of quality vs aftermarket component availability is settled. It is all too common to believe that aftermarket parts are of lower quality than OEM parts. Although this belief is hearsay and can be correct given the context, it should hardly be the overriding belief.

Greater availability of many aftermarket components is one of the many reasons which support this belief. Over the past few decades, the number and range of challenges faced by OEMs have escalated at an unparalleled rate. In the face of rapidly increasing globalisation, perhaps the most severe of logistics challenges faced by OEMs is reputation.

The need to strengthen one's reputation is indeed the most difficult and most frequently overlooked. OEM's, as well as manufacturers of aftermarket parts, face the greatest difficulty in accomplishing something that should optimistically be achievable. Such is the difficulty in transporting valuable and fragile equipment, by achieving damage-free freight, delivered on time, without failing to meet the deadline, from Point A to Point B. In this context, in order to meet and satisfy their customers, OEM and VAR organizations should rely on a strategic partner to supply the best logistics services.

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