Still covered: A gradual increase in new car purchases will bolster industry demand

Operators in the Auto Extended Warranty Providers industry have benefited from strengthening economic conditions at the consumer level over the five years to 2017. Strong sales of new automobiles have lifted industry revenue as automobile purchasers chose to buy extended warranties at the time of their purchase. Over the next five years, industry revenue is expected to continue growing, albeit at a slower pace. Growth will hampered by competition from warranty plans offered by auto manufacturers and car dealerships. Nevertheless, the changing nature of extended warranty plans and the effects of positive trends in automobile ownership that persisted over the recovery are expected to boost industry revenue...purchase to read more.

Industry Statistics & Market Size
Revenue
$18bn
Annual Growth 12-17
3.1%
Forecast Growth 17-22
Profit
Employment
20,180
Businesses
1,768

Industry Threats & Opportunities

  • More consumers will purchase extended warranty plans as the economy improves
  • Despite a resurgence in car sales, the average age of the vehicle fleet has also been trending higher
  • Car dealerships will likely lower prices on their extended warranty plans to be more competitive
  • Industry Report - Industry Investment Chapter

    The Auto Extended Warranty Providers industry has a low-level of capital requirements. In 2017, for every dollar spent on labor, the industry spends about $0.11 on capital. The industry is primarily labor-intensive, relying on the skills of customer service professionals, underwriters, and claims assessors to sell, underwrite, assess and process claims. Capital expenses primarily take the form of technology upgrades. Providers are increasingly using information technology systems to track policies and payments, and manage and process claims. They are also continually upgrading their systems to provide higher quality customer service and a hassle-free claims process...purchase to read more.

    Additional Insights for the Auto Extended Warranty Providers Industry

    IBISWorld identifies 250 Key Success Factors for a business.The most important for the Auto Extended Warranty Providers Industry are

  • Claims processing service must be user friendly
  • Ensuring pricing policy is appropriate
  • Having a good reputation
  • IBISWorld analysts also discuss how external factors such as Average age of vehicle fleet and Number of motor vehicle registrations in the Auto Extended Warranty Providers industry impact industry performance..

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    What's in this report

    What is the Auto Extended Warranty Providers Industry?

    This industry provides automobile owners with extended warranty protection. These warranty plans are offered by the manufacturer or auto dealer at the time of purchase and are typically included in the price of the vehicle. Third-party warranty providers, who sell warranty plans after the initial purchase of the vehicle, are also included in this industry.

    Industry Products
  • Stated competent coverage
  • Powertrain coverage
  • Bumper-to-bumper coverage
  • Other coverage
  • Industry Activities
  • Basic coverage
  • Premium coverage
  • Table of Contents

    Industry Definition
    Main Activities
    Similar Industries
    Additional Resources
    Industry Statistics Snapshot
    Industry Structure
    Executive Summary
    Executive Summary
    Key External Drivers
  • Average age of vehicle fleet
  • Number of motor vehicle registrations
  • Per capita disposable income
  • New car sales
  • Regulation for the Property, Casualty and Direct Insurance Industry

  • Current Performance
  • Industry trends
  • Aging vehicles
  • Industry landscape
  • Chart: Revenue Growth

  • Industry Outlook
  • Warranty trends
  • Engines keep on running
  • Industry structure
  • Table: Auto Extended Warranty Providers Industry Revenue Outlook

  • Industry Life Cycle
  • Life cycle reasons
  • Chart: Benchmarking - Auto Extended Warranty Providers Industry Lifecycle vs The Economy

  • Supply Chains
    Key Buying Industries
  • Consumers

  • Key Selling Industries
  • Commercial Banking
  • Computer & Packaged Software Wholesaling
  • Telecommunications Resellers

  • Products & Services
  • Bumper-to-bumper coverage
  • Powertrain coverage
  • Stated competent coverage
  • Other coverage
  • Chart: Auto Extended Warranty Providers Industry Products and Services Segmentation

  • Demand Determinants
    Major Markets
  • Consumers aged 45 to 54
  • Consumers aged 35 to 44
  • Consumers aged 55 to 64
  • Consumers aged 18 to 34
  • Consumers aged 65 and over
  • Chart: Major Market Segmentation for the Auto Extended Warranty Providers Industry

  • International Trade
    Business Locations
    Chart: Business Locations by State
    Market Share Concentration
    Key Success Factors
    Cost Structure Benchmarks
  • Profit
  • Wages
  • Warranty coverage costs
  • Other costs
  • Chart: Cost Structure Benchmarking – Sector vs Auto Extended Warranty Providers

  • Basis of Competition
    Barriers to Entry
  • Table: Barrier to Entry Checklist for the Auto Extended Warranty Providers Industry

  • Industry Globalization
    The Warranty Group, Assurant Solutions,
  • Table: The Warranty Group - financial performance
  • Table: Assurant Solutions - financial performance

  • Capital Intensity
  • Chart: Level of Capital Intensity for the Auto Extended Warranty Providers Industry
  • Chart: Tools of the Trade: Growth Strategies for Success

  • Technology & Systems
    Revenue Volatility
  • Chart: Volatility vs Industry Growth

  • Regulation & Policy
    Industry Assistance
    Table: Industry Data for the Auto Extended Warranty Providers Industry
    Includes:
  • Industry Revenue (2008-2022)
  • Industry Gross Product (2008-2022)
  • Establishments (2008-2022)
  • Businesses (2008-2022)
  • Employment (2008-2022)
  • Wages (2008-2022)
  • Average age of vehicle fleet (2008-2022)

  • Table: Annual Percentage Change for Key Industry Data
    Table: Key Ratios for Industry Key Data
    Liability
  • The company's contractual obligation to the owner of a warranty plan.
  • Powertrain
  • Pertains to the parts of a vehicle that generate power, such as the engine, transmission and drive axle.
  • Premium
  • The specified amount of payment required by a warranty provider for coverage under a defined period of time.
  • What Our Customers Say

    Why buy this report?

    IBISWorld’s Industry Market Report on Auto Extended Warranty Providers is a comprehensive guide to market size and growth prospects. Ensure due diligence in your research with our strategic analysis of the factors influencing companies, including new product developments; economic, lifestyle and demographic influences; distribution and supply chain factors; and pricing issues.

    IBISWorld industry market research reports enable you to:
    • Find out about key industry trends
    • Identify threats and opportunities
    • Inform your decisions for marketing, strategy and planning
    • Quickly build competitive intelligence
    This report on Auto Extended Warranty Providers:
    • Provides Market Size information to assist with planning and strategic decisions.
    • Includes the necessary information to perform SWOT, PEST and STEER analysis.
    • Helps you understand market dynamics to give you a deeper understanding of industry competition and the supply chain.
    • Analyses key performance and operational metrics so that you can benchmark against your own business, that of your customers’ businesses, or your competitors’ businesses.
    The Auto Extended Warranty Providers market research report includes:
    • Historical data and analysis for the key drivers of this industry
    • A five-year forecast of the market and noted trends
    • Detailed research and segmentation for the main products and markets
    • An assessment of the competitive landscape and market shares for major companies
    • And of course, much more

    IBISWorld reports on thousands of industries around the world. Our clients rely on our information and data to stay up-to-date on industry trends across all industries. With this IBISWorld Industry Research Report on Auto Extended Warranty Providers, you can expect thoroughly researched, reliable and current information that will help you to make faster, better business decisions.

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