While it’s hard to find another point in history that was this volatile, Applegate says there is a silver lining.
Market declines and market recoveries are generally symmetrical, and while it is going to take a long time to get back to the cycle peak, when it does, it will be big, he said. “Once you make the return it tends to be robust and quite front-loading. You tend to get a big pop in the first part of the rebound,” said Applegate.
Applegate was one of more than 15 speakers who gave their insights into the future of the U.S. economy and the automotive aftermarket Wednesday at the 2009 Global Automotive Aftermarket Symposium (GAAS) in Chicago.
While the entire country – businesses and individuals alike – look for the economy to recover, the aftermarket shouldn’t sit on its hands, warns the Specialty Market Equipment Association’s John Waraniak. Using a sailing analogy, Waraniak, who leads SEMA’s advanced vehicle technology strategy, programs and initiatives, said “You can’t wait for another wind before you take action” in his presentation titled, “Don’t Waste this Crisis.”
Situational awareness and speed to adapt are the characteristics that will define winners from the losers in the future, said Waraniak.
This recession will be a little different and will take a lot longer to recover from but innovation is what will drive the numbers back up, Waraniak stressed.
“It’s going to be tough over the next 12 to 18 months but it’s not all gloom and doom,” he said. “No industry is tied more to technology than the automotive industry. … Driving green connected safe and cool are the four mega trends that SEMA sees happening in the future.”
The key, Waraniak said, is to develop strong new business plans now in order to capitalize on future technology opportunities. “You have to process information faster than your competitors and take action,” he added.
Bill Haas, vice president of education for the Automotive Service Association, agrees.
From the Bugati Veyron, which can go from zero to 60 to zero miles per hour in less than 5 seconds, to the Lexis 600 HL hybrid, new vehicle technology is moving incredibly quickly today.
To put it in perspective, Haas noted during his GAAS presentation that German parts maker Robert Bosch applies for approximately 14 patents a day. “That’s just a measure of the speed of development today and it’s not going to slow down,” says Haas.
New technologies and advanced vehicles are being developed so quickly and are so costly that many of them will never make it onto the road. But having said that, there are some viable technological advances designed to improve vehicle safety, fuel economy and emissions that are just around the corner and the independent service sector needs to be prepared, says Haas.
“Vehicle technology directly impacts the profitability of the shop,” says Haas. “That’s why the service sector needs to prepare for what’s coming around the corner. We really need shops to evolve and accept those technologies. If they evolve, they will remain profitable.”
In addition to developing these new vehicle technologies, suppliers need to play a role in their implementation in the future as well, said Joe Pomaranski, vice president, North America Aftermarket for Tenneco.
“Focusing on the near-term, there are going to be thousands upon thousands of dealers closing and we need to provide the necessary information to techs on how to attract that business and provide training. It’s up the suppliers to be a part of that solution,” Pomaranski said. (Tire Review/Akron)
