Why Parts Inflation Looks So Uneven

Inflation is hitting new and recycled parts, but not the aftermarket. PartsTrader Chief Industry Relations Officer Greg Horn examines why that's happening in his latest blog. 

Initial thinking was that aftermarket parts, primarily made in Taiwan, would be the most affected by President Trump’s announced tariffs in April 2025. However, new OEM parts experienced the greatest price inflation, with recycled parts following a very similar trajectory. Aftermarket parts did not see an increase until a small uptick in November. 

Horn said an estimated 44% of new OEM collision parts are produced outside of the U.S., making them subject to tariffs. Recycled parts have seen nearly identical inflationary rates because that pricing is tied to the corresponding OEM part list price. Additional pricing pressure on recycled parts has also come from a weakened dollar exchange rate. A weaker dollar increases the likelihood that total loss vehicles are exported, and those that remain in the U.S. for parts harvesting can become more expensive. 

While visiting Taiwan last year, Horn noticed that many U.S. parts distributors were purchasing significantly larger quantities in advance of Liberation Day to lock in lower costs. Many bought roughly a year’s worth of inventory at that time. Now that this stock has been depleted, replacement inventory includes the tariff cost, but that cost may not be passed along to the collision repairer. 

Read Horn’s full thoughts here.