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Pro Analysis

Amazon to disrupt auto parts industry: Jefferies

Auto parts
René Mansi | Getty Images

Jefferies warned investors that Amazon and other online sellers have reached the critical mass to hurt the big three auto parts retailers' profit margins.

The big three are Advance Auto Parts, AutoZone and O'Reilly Automotive.

"We perform an online price study & find that discounts at AMZN & RockAuto [online retailer] ... could place limits on historically positive gross margin trajectory at traditional retailers," analyst Bret Jordan wrote in a note to clients Wednesday.

"A surprisingly robust branded hard-parts offering also leads us to believe AMZN may become a longer term competitor in 'traditional' auto parts."