AAPEX & SEMA 2025: Quiet Auto Aftermarket Revving Up

Featured Professionals: Joe Conner, Elliott Yousefian, Tyler Tripp, Michael Meyer, Chris Flight

Although auto aftermarket M&A has been relatively quiet due to supply chain disruptions, shifting tariff policies, and consumer spending uncertainty, the sector is seeing increasing momentum as we end 2025 and is well-positioned for a much busier 2026.

Despite economic uncertainty tied to trade policy, inflationary pressure, and the pace of interest rate reductions, the aftermarket has demonstrated resilience, and its underlying value drivers remain intact. “In today’s dynamic global trade environment, the foundations for auto aftermarket growth remain strong,” says Joe Conner, a managing director in our Transportation & Logistics Group. “Fragmentation, dry powder, and a supportive lending market will support more dealmaking activity as the economy continues to stabilize.”

This year’s AAPEX and SEMA conferences shed light on today’s auto aftermarket dynamics, excitement for the sector’s next stage of expansion, and the brewing enthusiasm for M&A. “Our conversations at these shows reinforced our optimism,” says Elliott Yousefian, a managing director in our Transportation & Logistics Group. “Businesses and investors are both eager to get back to dealmaking.”

Entering the Fast Lane

“Specifically, growth-focused investors are prioritizing companies with non-discretionary demand and a demonstrated ability to manage tariff turbulence through passing along price increases and supply chain diversification,” says Conner.

Categories linked to non-discretionary repair and maintenance are poised to lead the sector’s rebound due to the record-high ages of vehicles on the road today. “Tire and mechanical repair and collision services are seeing particularly strong investor interest due to these areas having minimal risk from EV adoption and offering clear benefits of scale,” notes Conner. And while the car wash subsector has seen a relative lack of M&A activity, the factors are in place for a resurgence for operators with strong market density, consistent site-level performance, and infrastructure to support growth.

Along these same lines, suppliers and distributors serving non-discretionary break-fix demand will likely be the first to see renewed M&A activity within the aftermarket products segment. These categories include items that are routinely replaced or repaired over a vehicle’s lifespan, such as brakes, suspension components, tires, wheels, oils, and fluids. Enthusiast subsectors are next in line. “Buying patterns for break-fix products tend to be most stable across economic cycles,” says Yousefian. “Enthusiast aftermarket demand and investor interest will come back in force as consumers become more comfortable spending on vehicle performance, upgrades, and accessories. There’s also an opportunity for enthusiast businesses to capitalize on break-fix demand by offering a product that’s viewed as an upgraded alternative to a factory component.”

For all auto aftermarket businesses, differentiation in a competitive market is becoming more critical to generate sustainable growth and investor interest. A host of category leaders are doing so through innovation and digital transformation focused on improving customer reach and value proposition while increasing sales and profitability.

“The most sought-after companies are adopting technology to automate complex workflows, enhance the customer experience, power cost-saving initiatives, generate useful data, and streamline operational decision-making,” adds Yousefian. “Those able to utilize data to make strategic decisions are often separating themselves from the rest of the market.”

Rolling Forward

While the auto aftermarket has endured a challenging period, its underlying fundamentals and long-term value drivers remain strong. And with several forces converging to unlock more deal flow, market participants are optimistic about what lies ahead.

“For this sector, it’s a matter of when, not if,” says Conner. “Investors remain eager to deploy capital in the space, and we expect more actionable opportunities with scale to come to market in the near term.”

“Great auto aftermarket businesses can be sold in almost any market, and sophisticated platforms with differentiated technology, operational expertise, and proven tactics for navigating supply chain disruptions will continue to be well-positioned to win,” says Yousefian.

To further discuss auto aftermarket M&A, please contact our senior professionals.