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This bodes well for the auto parts retailers because the growing used car market drives increased demand for aftermarket auto parts because sed cars need to be repaired and parts replaced to keep running. According to the 2021 Joint Channel Forecast Model from the Automotive Aftermarket Suppliers Association (AASA) and the Auto Care Association, U.S. light-duty automotive aftermarket sales are expected to increase more than 11% to $325 billion in 2021.
Given this backdrop, we think auto parts manufacturers O’Reilly Automotive, Inc. (ORLY), LKQ Corporation (LKQ), Autoliv, Inc. (ALV), and Dana Incorporated (DAN) could be solid additions to one’s portfolio now.
