U.S. Power Tool Accessories Market - Industry Outlook & Forecast 2023-2028

MARKET INSIGHTS

The U.S. power tool accessories market size is expected to reach USD 4.87 billion by 2028 from USD 3.51 billion in 2022, at a CAGR of 5.61% during the forecast period. The market is largely driven by accelerated industrialization and rising applications in the residential and commercial sectors. These accessories are mostly employed in the automotive, aviation, building, electronics, and shipbuilding sectors. The need for cordless tools and batterie increased due to the rising use and demand for Li-ion batteries and infrastructure expansion.

AUTOMOTIVE INDUSTRY INSIGHTS

The demand for vehicles is anticipated to increase with the growing population and tech advances. Automakers and suppliers are one of the largest contributors to the U.S. manufacturing sector, contributing to around 3% of the total GDP. Therefore, it also generates the maximum number of jobs in the country. Over the past decade, auto manufacturers have exported over USD 1.2 trillion worth of automotive vehicles and parts.

The U.S. is a hub for leading automotive companies, including General Motors, Ford, and Tesla, which are aggressively developing. The demand for Tesla automobiles is particularly high. In 2020, the U.S. reported the production of over 8.5 million vehicles, a more than 18% decrease from 2019. In 2020, the revenue generated by motor vehicles and motor parts dealers was nearly USD 1.3 trillion. These numbers depict how crucial the automotive industry is to the United States. Further, the growth of the automotive industry is projected to support the U.S. power tool accessories market. Brands like DEWALT have an exclusive category of offerings customized for the automotive industry, including accessories.          

OPPORTUNITY & CHALLENGE ANALYSIS

Growing Demand For Prefabricated Buildings
Residences and commercial buildings made in preparation in a warehouse (often in components) that can be readily moved and integrated into the property are known as prefabricated or prefab houses and constructed dwellings. The idea combines panelized and modular building systems that are thoroughly designed and constructed before construction begins, and the framework is installed following a carefully throughout work site design. Prefabricated structures are becoming increasingly popular globally, notably in industrialized areas such as North America, especially in the United States. This, in turn, has increased the need from these construction producers for the power tools and accessories market.

Development In Lithium-Ion Batteries
Corded power tools have become predominant over the years and have reshaped the face of the power tool industry. It has also helped create and broaden new product lines in the battery-operated categories, which can further represent the U.S. power tool accessories market. The creation of Li-ion batteries has been one of the most significant growth drivers of the cordless power tool market. Numerous advances in battery technology have also enabled greater backup capacity due to the growing demand for long-lasting battery life. Consequently, the effectiveness and performance of li-ion batteries have significantly increased, and improvements in energy density, charging speed, stability, cyclability, and safety are being incorporated. Even though Li-ion batteries are more expensive to replace, more people choose to use them in electronic communication devices and electric vehicles, especially in the United States.

INDUSTRY CHALLENGE

U.S.-China Trade War
In March 2018, the U.S. government imposed a 25% tariff on steel and a 10% tariff on aluminum originating from China and exported to the United States. The tariffs impacted major industries as many of the steel and aluminum requirements of the U.S. manufacturers were met by cheaper imports from China. This increased the final output prices, passed on to end customers. Trade tensions have escalated since then and have impacted all major end-users.

These tariffs and other trade issues between the two countries negatively influenced most industries dependent on steel and aluminum. As a result, a cost escalation was witnessed across many steel and aluminum industries. This acts as a barrier for market players regarding scaling up options. The U.S. power tool accessories market will depend on these trade and economic variables during the forecast period and is expected to face challenges in value and volume.

SEGMENTATION INSIGHTS

INSIGHTS BY DISTRIBUTION CHANNEL
The offline distribution channel dominated the U.S. power tool accessories market, accounting for a revenue share of  66.10% in 2022. It is expected to grow significantly during the forecast period due to high customer preference to comprehend the functionalities and uses of the product before making the final purchase decision. Moreover, since power tool accessories have very specific usage and purpose, the preference for the offline channel is high to minimize the risk of receiving incompatible products.

The U.S. power tool accessories market by the online channel was valued at USD 5.2 billion in 2022. Power tool accessories are also sold largely through dealership websites and online retailers. Many offline distributors are moving the sale process online by incorporating e-commerce solutions and enterprise resource planning systems.

INSIGHTS BY ACCESSORY TYPE
The drill bits accessory type dominated the U.S. power tool accessories market and generated a revenue of  USD 502.41 million in 2022. Some of the best-selling drill bits in the market include titanium-coated DeWalt drill bits to provide a longer shelf life, Drill Hog, Irwin Tools, Drill America, and Bosch. As impact drills are among the common tools for household applications, it is always recommended that the vendors offer bits ideal for all end-use applications. They can also maximize their retail and online presence to ensure supply chain feasibility as demands are expected to surge further during the forecast period.

Circular saw blades were the second-dominant segment in the U.S. power tool accessories market by accessory type. These tools are mostly used for wooden and metal works that need precision cutting. They are also used in DIY activities, as most vendors offer user-friendly cutting tools for home improvement and wood-crafting activities. While various players in the market specialize in the segment, features such as expansion slots, gullets, number of teeth, size, laser cut features, price, coating, warranty, and design can be more influential.

INSIGHTS BY END USERS
The industrial end-user segment accounted for 74.20% of the U.S. power tool accessories market revenue in 2022. Cordless power tools are widely used in automotive, aerospace, electronics, energy, construction, shipbuilding, and other industries. The energy sector is estimated to be one of the major revenue generators due to the rise in sustainable energy being promoted and widely accepted across the globe activities. Also, the construction industry generated revenue close to USD 737.58 million, which can be attributed to the rapid infrastructural developments across multiple U.S. areas.

The U.S. aerospace power tool accessories market is projected to witness the highest CAGR of 9.37% during the forecast period in the industrial end-user segment. Some of the common power tools used in the industry include fasteners, drillers, grinders, routers, and demolition tools, to an extent. Other major power tools include nut runners, riveting systems, sanders, and screwdrivers that stimulate the huge replacement of accessories like bits, chisels, and fasteners once worn out. In the future, the useful applications of the tools and accessories can be more concentrated in assembly operations like wing, tail, engine, and final assembly. Vendors such as Atlas Copco offer a both cordless and pneumatic range of tools, thereby expanding the scope of utilizing accessories.

REGIONAL ANALYSIS

Several factors have contributed to the growth of the U.S. power tool accessories market in the South region. The region is home to many manufacturing centers for power tools and accessories, making it easier for companies to produce and distribute these products. Moreover, government spending on infrastructure projects in the region, such as highways, bridges, and public buildings, has also driven demand for power tools and accessories.

The western region of the US has experienced strong economic growth in recent years, which has led to an increase in construction activity and a corresponding rise in demand for power tools and accessories. The region has seen strong demand for new homes and home remodeling, which has driven growth in the power tool accessories market. Further, the region is home to many manufacturing centers for power tools and accessories, making it easier for companies to produce and distribute these products. Such factors have contributed to the U.S. power tool accessories market in the western region.

COMPETITIVE LANDSCAPE

The U.S. power tool accessories market is characterized by low market concentration and intense rivalry among competitors. Vendors are forced by the current situation to modify and improve their distinctive value propositions to have a significant market presence. The U.S. power tool accessories market is fragmented and controlled by companies such as Stanley Black & Decker, Bosch, and TTI. Further, many domestic tool makers offer attachments in various sizes, shapes, and styles that match those made by a reputable vendor. In parts of North America, these significant merchants are present on a global scale. Other sellers provide goods at discount rates with comparable technical details, such as length, breadth, and cutting methods. The pricing competition between sellers is projected to worsen throughout the forecast period.

The market's future will rely on the new product features and brushless motor technology. For instance, Bosch is the only vendor that offers cordless power tools that support inductive charging techniques. This enables tools to be charged without removing the batteries. It is also equipped with Foreign Object Detection (FOD), which can detect any object other than the power tool during the charging time.