The future of automotive parts: electric vehicles and market trends

Insights from our recent interview with Partmaster CEO, Alex Polaschek.  Part two of a three-part series.

We recently interviewed Alex at Partmaster, an Endeavour client since 2021, to understand how they are managing in the current economic environment. 

How Endeavour is helping Partmaster navigate the shifting automotive parts landscape

The automotive parts industry is facing a significant shift as Electric Vehicles (EVs) become a larger part of New Zealand’s vehicle market. With fewer moving parts than traditional internal combustion engines and a fundamentally different service model, EVs are reshaping demand for parts and maintenance. At the same time, economic pressures are pushing businesses to rethink costs and efficiencies.

For Partmaster, staying ahead of these shifts isn’t just about reacting to market changes. It's about having the right technology and data-driven insights to remain a step ahead. That's why they’ve teamed up with Endeavour to supercharge their forecasting, stock management, and overall ability to stay competitive in an ever-evolving market.

How smart technology helps manage pressures and optimise operations

Rising costs, inflation, and workforce shortages drive heightened scrutiny of all input costs – from salaries and import costs to leases, rentals, and IT infrastructure – leading to cost minimisation and deferral wherever possible. For Partmaster, while many initiatives were deferred recently, the company recognises that strategic technology investments remain crucial for long-term operational efficiency.
To address these pressures, Partmaster has implemented smart cost management. These include reducing stock levels to optimise working capital and increase liquidity. The business has also implemented technology-driven solutions, including advanced demand forecasting and enhanced data-driven decision-making, integrated through its ERP system.

These include: 

 Smart Cost Management - Reducing stock levels to optimise working capital and increase liquidity.

 Tech-driven decision making – Implementing advanced demand forecasting and data-driven insights via their ERP system.

EV market trends are reshaping the automotive parts industry 

Demand for EVs in recent years accelerated due to government subsidies. As the subsidy ended, this prompted a rush on sales. Now, with the subsidy no longer in effect, EV sales have dropped significantly. 

The long-term trajectory points to EVs becoming an increasingly significant part of the vehicle mix in New Zealand alongside plug-in electrical vehicles, internal combustion engines and, looking further into the future of automotive technology, hydrogen-powered vehicles. As demand increases again, the effects of EVs on the automotive parts industry will be felt. 

EVs have around 20 moving parts, whereas standard internal combustion engines have closer to 2,000. In an EV, there’s no drive change, no clutches, no oil filters, and no fuel filters. This fundamentally different engineering will have a lasting impact on the car parts market. For businesses like Partmaster, this will force further assessment of different supply and distribution methods and ever more efficient cost models to remain competitive.

The nature of these EV market changes for the after-service parts market won’t be linear and the supply chain can be long and complex. It takes a couple of years before the parts start to wear down and need replacing and almost every part is imported. As the industry adapts, accurate demand forecasting, automated replenishment and intelligent stock management are essential in this evolving landscape. 

Overcoming automotive industry challenges with Endeavour’s ERP solutions

At the same time, growing environmental concerns are giving businesses an opportunity to provide more sustainable product options. Partmaster saw a chance to introduce fully non-metallic brakes to New Zealand, which have no heavy metals that can harm our environment.

This forward-thinking approach helps Partmaster stay ahead of the curve and grow their market share while offering customers more sustainable choices. Introducing new products efficiently requires the right technology. Partmaster’s Microsoft Dynamics ERP, enables a seamless process for trialling and scaling new parts. Once demand for a new part is identified, the system automatically triggers reordering and demand-side planning, making the entire process smooth and efficient.

Partmaster’s digital transformation to meet market changes

To respond to the evolving and restricted market, Partmaster are pursuing efficiency gains through increased use of smart technology focused on reducing distribution costs and improving access to parts through a seamless customer experience. Central to their digital transformation is to strengthen their online presence to reduce their distribution footprint and provide real-time stock visibility.

Mechanics need to see Partmaster stock on hand at any time. Not only at a single branch, but at surrounding branches and into Partmaster’s virtual warehouse. Real-time part visibility is a critical enabler to give them the parts they need fast, irrespective of where it’s located. With more than 120,000 parts stocked, it’s no simple task to deliver on the Partmaster promise of getting the right part to the right place at the right time.

Innovative solutions like virtual warehousing have been integral to Partmaster’s digital transformation. Virtual warehousing allows their ERP system to see into Partmaster’s suppliers’ stock as well as their own, to show customers everything available to them in real-time.

A sophisticated backend, where the Partmaster website is fully integrated with their ERP system, is the engine behind the scenes. Microsoft Dynamics ERP runs 13 different algorithms continually looking at historical data. Matching the best predictors of last month, then applying that algorithm to predict for next month, assessing seasonality, growth rates, regional variations for different vehicle parts and more. The demand forecasting is second-to-none.

The seamless integration and management of Microsoft Dynamics by Endeavour enables Partmaster to keep stock on hand and the associated capital costs down.

Accelerating success in the EV era with strategic ERP solutions

Endeavour’s solutions empower businesses like Partmaster to not only adapt to the growing electric vehicle (EV) market but also position themselves for long-term success. Through strategic ERP systems, Endeavour helps businesses optimise operations, manage shifting demand, and make smarter decisions that drive growth in the evolving EV landscape.

Ready to accelerate your business? Let’s talk about how Endeavour’s ERP solutions can help you streamline operations, manage costs, and build resilience as the future of transportation unfolds. Contact us for a tailored consultation and check out our case study with Partmaster to see how we’ve supported businesses like yours in navigating the shift to electric.

If you haven’t read the first blog in this series make sure to go check it out: Navigating economic challenges in the automotive parts industry.