Capstone Partners, a middle market investment banking firm, released its May 2025 Automotive Aftermarket Sector Update, reporting that several secular trends have bolstered sector growth and merger and acquisition (M&A) activity.

Automotive aftermarket M&A has accelerated through early March 2025, rising 30.8% year-over-year (YOY) to 51 transactions from 39 in year to date (YTD) 2024. Dealmaking figures have shown considerable strength despite persistent inflation and tightness in the consumer wallet over the past two years, with transaction volume tracking peak levels in 2021 and 2022. Capital has become more accessible, and compression of bid-ask spreads has alleviated some pressure on transaction activity. Overall, automotive aftermarket M&A activity has remained elevated from pre-pandemic volumes and seen a substantial YOY increase with volume expected to further accelerate in the coming quarters as any additional rate cuts will likely relieve some burden on consumer credit and encourage businesses to expand operations.