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Report: Amazon Gearing Up for Parts Business

Online mega-retailer Amazon has reportedly signed contracts with the country’s largest parts manufacturers, which could align the retailer to join to aftermarket auto parts business.

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AmazonOnline mega-retailer Amazon has reportedly signed contracts with the country’s largest parts manufacturers, which could align the retailer to join to aftermarket auto parts business.

The NY Post reports Amazon has made deals with Robert Bosch, Federal-Mogul, Dorman Products and Cardone Industries.

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Steve Handschuh, chief executive of the Motor & Equipment Manufacturers Association, also told the NY Post it is possible that Amazon could also buy some regional parts distributors.

Automotive parts retailers such as O’Reilly Auto Parts, Advance Auto Parts, AutoZone and Genuine Parts, could potentially suffer after relatively prosperous years if Amazon is planning to sell auto parts online.

The NY Post said Amazon saw $128 billion in revenue in the 12 months ending Sept. 30 and the retailer could see its auto parts business expand more than 50% in 2017 to $5 billion, according to a Wall Street analyst.

Amazon has already added more name-brand parts at cheaper prices than brick-and-mortar stores. The investment bank Jefferies said in a September report that Amazon’s parts prices are about 23% less than O’Reilly, Advance and AutoZone, plus the retailer is offering same-day delivery for auto parts in 40 major U.S. cities.

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