As an expert retail analyst and self-proclaimed "picky shopper," I‘ve spent countless hours studying the competitive dynamics of the auto parts retail industry. And let me tell you, it‘s a dog-eat-dog world out there. While Advance Auto Parts may be one of the big dogs, it‘s got plenty of feisty competitors nipping at its heels.
In this article, I‘ll take a deep dive into the competitive landscape of the automotive aftermarket, examining who Advance Auto Parts‘ biggest rivals are and how they stack up in terms of size, offerings, strengths, and weaknesses. I‘ll also share some insights and predictions on where the industry is headed and what Advance needs to do to stay ahead of the pack.
Just How Big Is the Auto Parts Market?
Before we get into the nitty-gritty of Advance‘s competitors, let‘s take a step back and look at the size and scope of the automotive aftermarket industry as a whole.
According to the Auto Care Association, the U.S. auto care industry was worth a whopping $380 billion in 2020. This includes replacement parts, accessories, tires, appearance products, service repairs, and more. The global auto aftermarket is even larger, valued at over $408 billion in 2021 by Grand View Research.
And it‘s not just a massive market—it‘s also a growing one. The Auto Care Association projects that the U.S. automotive aftermarket will grow 12% to reach $427 billion by 2024. Globally, the market is expected to grow at a compound annual growth rate (CAGR) of 3.8% from 2022 to 2028, per Grand View Research.
Several factors are driving this growth:
- The average age of vehicles on the road is rising (12.1 years in the U.S. as of 2021, according to IHS Markit), meaning more demand for replacement parts and repairs.
- The increasing complexity of vehicle components is boosting parts costs.
- Growing consumer preference for dealership alternative channels.
- Increasing disposable income in developing markets.
In short, the auto parts industry is large and getting larger. And that spells opportunity for retailers like Advance—but also fierce competition. So who are the main players vying for a piece of this $400B+ pie?
The Top Contenders
Here‘s a rundown of Advance Auto Parts‘ major competitors and how they compare:
| Company | 2021 Revenue | Store Count |
|---|---|---|
| Advance Auto Parts | $10.4B | 4,600+ |
| AutoZone | $14.6B | 6,400+ |
| O‘Reilly Auto Parts | $13.3B | 5,700+ |
| NAPA (Genuine Parts Company) | $18.9B | 6,000+ |
| Pep Boys | $6.0B | 1,000+ |
As you can see, AutoZone and O‘Reilly are Advance‘s closest competitors in terms of size and scale. NAPA is even larger by revenue but operates on a different model as a wholesaler and franchisor. Pep Boys is smaller but has been rapidly expanding.
Let‘s take a closer look at each of these rivals.
AutoZone: The OG Auto Parts Store
Founded in 1979, AutoZone is the OG of auto parts retailers and the largest in terms of store footprint, with over 6,400 locations across the U.S., Mexico, and Brazil. Its 2021 revenue of $14.6 billion also edges out Advance‘s $10.4 billion.
Like Advance, AutoZone targets both retail DIY customers and commercial garages and dealers (through its AutoZone Commercial program). It‘s known for its extensive parts catalog, helpful staff, and handy Loan-A-Tool program that lets customers borrow specialty tools for free.
One potential weakness of AutoZone is its relative lack of proprietary brands compared to Advance‘s Carquest, Worldpac, and DieHard. AutoZone‘s main private label is Duralast.
O‘Reilly Auto Parts: The Friendly Experts
O‘Reilly Auto Parts is another formidable rival to Advance, with 5,700+ stores across 47 U.S. states and 27 ORMA stores in Mexico as of 2021. O‘Reilly is neck-and-neck with Advance in terms of revenue ($13.3B vs. $10.4B).
O‘Reilly‘s brand identity centers around excellent customer service, with knowledgeable staff ready to assist DIYers and professionals alike. Its First Call Online system for repair shops and dealerships is a key differentiator.
However, O‘Reilly‘s focus on service and in-store experience may become a disadvantage as more sales shift online. Its professional market share also still lags AutoZone and Advance.
NAPA: The Wholesale Heavyweight
While NAPA does compete with Advance in terms of retail auto parts, it operates on a different model. The bulk of its business comes from wholesale distribution to over 6,000 NAPA Auto Parts stores (which are independently owned) and 16,000+ AutoCare repair centers.
This gives NAPA an advantage in terms of B2B sales and an impressive total revenue ($18.9B in 2021). However, its retail consumer brand is less prominent than Advance or AutoZone.
Pep Boys: The Service Specialists
Pep Boys is the smallest of the "big four" auto parts chains, with around 1,000 locations as of 2022. But it‘s been growing rapidly, with revenue increasing from $2.1 billion in 2016 to $6 billion in 2021.
Pep Boys‘ key differentiator is its focus on service and tires. It‘s the largest independent auto service chain in the country, and 80% of its sales come from repairs, maintenance, tires, and fleet services.
This focus on service gives Pep Boys an edge as a "one-stop shop" for all automotive needs. However, it means the company is less competitive when it comes to retail parts sales.
Other Contenders
In addition to these major competitors, Advance also faces competition from:
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Online marketplaces like Amazon and eBay Motors, which offer a wide selection of parts at competitive prices with convenient shipping. However, they lack the specialization and expertise of dedicated parts retailers.
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General retailers like Walmart and Costco, which sell auto parts and accessories at steep discounts and offer basic installation services. But again, they don‘t have the depth of parts or know-how of an auto parts store.
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Auto dealerships, which sell original OEM parts (often at a markup) and offer repairs for their specific vehicle makes/models. But they have limited selection and high prices compared to aftermarket retailers.
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Independent local shops, which can offer more personalized service and niche expertise. However, they lack the scale and resources of national chains like Advance.
How Advance Is Pulling Ahead
So how is Advance Auto Parts navigating this complex competitive landscape? By leveraging its unique strengths and making smart strategic moves:
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Expanding its owned brands: Advance‘s exclusive DieHard batteries and Carquest parts help differentiate it from competitors and boost margins.
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Investing in e-commerce: Advance is enhancing its online ordering and shipping capabilities to keep up with changing consumer habits and fight off digital disruptors.
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Catering to commercial clients: Advance‘s Worldpac subsidiary and tech training give it an edge with professional mechanics and garages, which drive over 60% of its sales.
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Optimizing inventory: Using data analytics, Advance ensures its parts assortment is tailored to each local market.
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Partnering strategically: Advance is the exclusive parts supplier to Walmart‘s Auto Care Centers, giving it nationwide exposure.
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Streamlining operations: To boost efficiency, Advance is integrating DieHard logistics and using AI to automate back-end functions.
Going forward, Advance‘s top priorities to stay competitive should be:
- Enhancing its loyalty program to drive customer retention
- Expanding assortment of parts for hybrid and electric vehicles
- Improving in-store pickup and same-day delivery options
- Pursuing M&A to extend geographic reach (like its recent acquisition of Midwest chain Carquest)
- Continually upskilling employees to provide expert service and advice
The Road Ahead
Make no mistake—the auto parts retail industry is a tough one. With razor-thin margins, demanding customers, complex supply chains, and a constantly changing vehicle mix, it takes a lot to succeed in this business.
But for all the challenges Advance Auto Parts faces from rivals large and small, it has a strong track record of adaptation and resilience. By playing to its CARs—that‘s Convenience, Assortment, and Reliability—Advance is well-positioned to keep growing in the years ahead.
Sure, competitors may try to undercut Advance on price or poach its customers with flashy promotions. But at the end of the day, what keeps gearheads (like myself) coming back to Advance is the unbeatable combination of knowledgeable staff, quality parts, and stellar service.
As the average vehicle lifespan increases and older car models stay on the road, demand for auto parts and repairs will only grow in the coming decades. And as long as our cars keep needing new batteries, brake pads, and headlights, Advance Auto Parts will be there to help keep America running—no matter how many AutoZones or Amazons are gunning for its business.
