Ask many Aussie drivers to name an aftermarket parts brand and ARB will be the answer. But a new report has revealed the aftermarket business has gone from riding high on the market to seeing the price of its shares slump by 42 per cent this year – and the dramatic shift to EVs has played a big part.

ARB is expected to be on the end of a flat result this year after its earnings fell in three of the past four years, according to the Australian Financial Review. That’s quite a contrast compared to how the company was faring during the pandemic when Aussies spent up big as they bolted accessories onto their 4x4s, making the firm one of the “unsung heroes” of the Aussie share market.

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The Aussie car market has changed so much in the following years that it’s becoming almost unrecognisable: EV makers have made massive inroads, ute sales are down (despite the HiLux and Ranger’s success in the VFACTS figures for October) and the price of petrol and diesel has skyrocketed. According to experts who spoke to the AFR, it all amounts to something of a perfect storm for ARB.

JP Morgan analyst Donald Carducci told the publication that the shift to EVs, many of which are made in China, plus tighter emissions standards that are hurting sales figures for some of the models ARB does the most business with, have “created headwinds” for the business. Throw in penny-pinching among Aussies due to inflation and interest rates rises and the situation gets worse.

Toyota, Ford and Isuzu are ARB’s biggest partners and the report found that their market share has decreased by 4.1 per cent this year. The situation isn’t helped by ARB’s rival, Ironman 4×4, signing deals with BYD and Chery to make aftermarket parts for the Shark 6 and Stockman.

“If Toyota volumes do not recover as expected, and if elevated interest rates continue to burden Australian consumers, the challenging environment will continue for ARB,” Carducci told the AFR. That challenging environment saw the company’s revenue drop last year for just the second time since 1996.

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ARB chief executive Lachlan McCann rejected worries might have pulled the wrong rein by not diversifying enough to take advantage of the rise of Chinese brands, pointing out that the company does make gear specifically for BYD models, and has lightweight bullbars that suit EVs.

“We’re really proud to be manufacturing in Australia,” McCann said, adding, “Our government doesn’t make it easy to retain manufacturing.”

WhichCar by Wheels has contacted ARB for comment.

ARB isn’t the only automotive business that’s dealing with big challenges. Bapcor, the company behind Autobarn, suffered at $431 million loss this year and closed stores. A restructuring effort is already bearing fruit with CEO Chris Wilesmith saying that despite an 85 per cent drop in profit attributable to shareholders, the group has “improved trading momentum”.