O’Reilly Automotive continues to enjoy increased sales, and hopes to expand, amid a slump in car purchases.
The auto parts retailer announced in an earnings release on Wednesday (February 8) that it had posted 9% growth in sales in the latest quarter and 6.4% for the year.
“As we look to 2023, we believe the long-term drivers of demand in our industry remain strong,” CEO Greg Johnson said in the statement.
The company, which has 5,190 stores in the United States and 28 in Mexico, expects to add 180 to 190 new locations this year, according to the statement.
The results came a day after preventive vehicle maintenance provider Valvoline also reported an increase in sales and said it plans to increase the number of its company-owned and franchised locations from the 1,746 it now has to more than 3,500.
Valvoline said this growth was due to both a greater number of vehicles in service and a wider range of services beyond oil changes.
As PYMNTS has written, auto parts and auto repair retailers have seen sales increase in recent months as consumers hold on to older cars. There are more vehicles on the road, fewer cars are being scrapped and their average age is increasing.
This trend helped generate record revenue for O’Reilly last year, thanks to increased sales among its professional customers.
And AutoZone reported in December that its sales increased among professional repair shops and DIYers.
Meanwhile, new car prices are rising, and some dealers say already hesitant customers have become even more hesitant to make major purchases.
“My concern is that if supply doesn’t come back, new cars will be priced out of the reach of middle-class households,” JP Garvey, dealer principal at Garvey Automotive Group, a chain of dealerships, previously said in New York State. this week.
Last year, US car sales fell to 13.7 million, their lowest level in more than a decade. A JD Power/LMC Automotive report earlier this year projected sales to remain below pre-pandemic levels of 17 million by 2023.
The used car market is also facing tough times, with dealers specializing in used vehicles seeing sales decline.
“After a big acceleration in 2021, last year was a reality check,” Chris Frey, senior director of economic and industry information at Cox Automotive, said in late January. “The second-hand market now faces a difficult year as demand weakens.”
His firm’s research found used car values to fall 14% in 2022, with a further 4% drop expected this year.
For all PYMNTS retail coverage, subscribe to the newspaper Retail newsletter.
Subscribe to the PYMNTS.com newsletter for updates on the best stories and viral hits.
PYMNTS Data: Why Consumers Are Trying Digital Wallets
A PYMNTS study, “New Payment Options: Why Consumers Are Trying Digital Wallets,” finds that 52% of US consumers tried a new payment method by 2022, with many choosing to try digital wallets to first time.
