Original Equipment or Aftermarket, Which One Is Better?
|   Wednesday, September 24, 2014
For the last three decades or more, a debate has raged across the parts of the automotive business. It is very simple: which parts are better, original equipment or aftermarket?

This is no small matter because of the simple the fact that aftermarket parts are more inexpensive to purchase than original equipment parts. On average, the difference between aftermarket and original equipment parts is 40 percent. So, if an original equipment part costs $100, the aftermarket price of the same part is $60 and you can buy from

If you consider that there are 254 million cars on the road, according to a report published by the Department of Transportation last year, you can see that the potential market for car replacement parts is astronomical. By the same token, the cost for repairing the result of accidents to those vehicles is also astronomical. You can thus see why this argument continues to rage.

In this argument the lines are fairly easy to find: on the side of the aftermarket parts are the insurance carriers versus primarily the "auto industry" – dealers, used-car dealers and the factories – and, believe it or not, consumer advocacy groups.

The insurance carriers support aftermarket parts like rear axle bearing because of the potential to save the insurance industry substantial amounts of money.

The auto industry is in favor of original equipment parts, obviously because they can increase their income substantially through the sale of OE parts. (In the car business, nothing is free. For example, dealers have to pay for their vehicles, even though they are franchised by a specific automaker. Dealers are also charged for parts in this manner: the base cost plus factory profit equals the dealer cost. The dealer cost is lower than the price customers pay. The markup is effectively the base factory cost plus factory cost and dealer cost).

That the factories and dealers favor OE parts is self-explanatory, however, to have consumer advocates favoring OE parts is somewhat surprising (see analysis of this issue).

The central issue in this argument is which parts are better: OE parts or aftermarket.

The industry would have you believe their parts are better because they say so. The studies they have used to support their claims that their parts are better are based on hearsay and anecdotal evidence.

The insurance carriers have two scientifically conducted studies that show there is no difference.

That's the crux of the argument.

The industry and its lobbyists have managed to convince legislators, jurists and even consumer advocacy groups that their parts are the best. Their lobbyists have managed to convince state legislators across the country of this. In two or three court cases, industry lawyers have also convinced judges that their parts are best. Consumer advocates have jumped on the industry bandwagon, believing that the industry's claims are correct, even though there is no real evidence, other than anecdotal, that OE parts are better.

Insurance carriers, who were at first successful in convincing lawmakers and legislators, argue that there is no difference between parts. They point to scientific studies that proves there is no difference between the parts.

The carriers used their argument to roll back prohibitions on using aftermarket parts across the country. They pointed to their studies and the potential savings for consumers.

However, the industry did fight back and, using their lobbyists and lawyers, managed to convince states to reverse any attempts to use only aftermarket parts. However, this push was dulled, a bit, by giving consumers a choice, so the industry didn't totally push aftermarket cars off the table, so to speak.

So, which is better, factory or aftermarket? It depends on who you listen to. As noted, this argument has raged for years and it is likely to continue for the foreseeable future.
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