Light Truck and SUV Blogs

In the past few months we have been talking a lot about new products, new ideas and new attitudes. It seems that many of us have been looking at the future with apprehension and trepidation.

Now is the time to look at every policy and procedure that we are working with and put them to the customer service test.

If what we are doing is not helping the customer or increasing sales it needs to be altered. We also need to look at increasing our efforts in marketing and products that will make a real difference to the consumer.

The only way that WE are going to succeed in these troubled times is if WE change ourselves. It is obvious that government cannot get us to success. If we are to be successful it is up to us!

I look forward to listening to your comments and ideas on how WE can change the future of the light truck accessory industry.

I have not heard the word voiced so much since I ordered truck caps from Century Truck Caps in the late 80’s and 90’s when I was operations manager for a distributor and retailer of pickup truck accessories.

When our president held his news conference to discuss his immediate plans for the economy and also take general questions I was glued to the TV set. It actually reminded me a bit of the “Special News Bulletins” from the early 1960’s. I was struck by what he had to say in particular to the RV industry. People in Elkhart told him that they can produce the units but consumers can’t get the credit to buy them.

Now truck caps, tonneaus and accessories are not the big ticket item that RVs are but, our light truck accessory sales have always been directly related to new pickup and SUV sales. So the message to me is similar, if we can get the economy moving in the mode that good credit rebounds, more cars and trucks will be purchased.

Another question looms on the horizon. That question is what will become of the pickup truck? We will always need pickup trucks for hauling and towing. Business and industrial use will, of course depend on them. Does the automotive industry have a plan to bring these back to where Americans can afford to drive them with regularity?

In the past we have seen the pickup being purchased and used as a second or even third vehicle. Americans love to personalize and accessorize their trucks, they have to be able to buy and fuel them to make that happen.

I know that to a large extent this will depend on gas and diesel prices but these seem to fluctuate at uncertain and unstable levels. Hopefully inventive and clever minds are hard at work in Detroit and seeking information from every available resource.

This year’s Detroit Auto Show has gone electric and while most of the focus is on cars, trucks can only be right around the corner. Rumors abound about a new Toyota Tundra hybrid in the making.

When it comes to cars, the Toyota Prius is boasting a mighty 50 mpg and actually gets better fuel economy in the city than on the highway. Honda released its Insight hybrid and went the other direction with better highway fuel economy. Ford is offering its new Fusion as the new hybrid muscle on the street with a 2.5 liter engine.

The question I have is, “how long will this hybrid train run?” Pure electric automobiles appear to be the finish line for where technology is heading. The only things holding them on the back burner are a nationwide infrastructure for supporting the vehicles and the fact that electric vehicles are still a little too pricy for most consumers.

In the eternal struggle to outdo each other, which is really what the Detroit Auto Show is all about, manufacturers will surely make the leap to affordable electric autos in coming years. Will it be five or 10 years? Who can say?

The one thing that is certain is mechanics across the country will need additional training to handle the new technology. Most shops are comfortable with all aspects of general auto repair but how many are prepared for when one of these hybrids is towed onto the lot? Will the auto shops and aftermarket part stores be cut out of this developing segment because of lack of preparation?

I think history has shown that consumers want options outside of taking their vehicle to a dealership. The question is, “what are you doing to prepare yourself?” Or is this so far down the road that we need not worry about it? It may be that small to mid-sized shops just like yours will become the “the new gas station” for electric vehicles if initiative is taken to build the infrastructure. That is how the auto industry started. It used to be that consumer’s only option was getting their vehicle repaired at the station that filled their tank. Will history repeat itself?

It looks like Congress has finally come to terms with the Bush Administration on bailing out the auto industry. I expect within days the deal will be officially announced. Some view this as an essential point to stave off U.S. economic Armageddon. Others view the bailout as robbing the U.S. population of their hard earned paychecks so companies with bad business models can continue to do everything a viable business should never do.

Environmentalists hate the deal because the money is to be taken from funds allocated to developing greener vehicles. Some of the money could also be used for the big three to continue legal battles with states who have adopted strict CAFÉ standards. Some environmentalists say we are essentially giving Detroit’s “big three” money to turn around and sue the hand that gave them the money.

Even the corporate leaders of the “big three” would face restrictions on their compensation, essentially eliminating some of the major perks included with being responsible for managing three of America’s largest businesses. Bye, bye corporate jets and golden parachutes.

It sounds like nobody is really very happy with this deal.

So why are we doing this? Many agree that allowing any one of them to fail would be catastrophic. Is this a sign that capitalism is a miserable failure? A shop owner called me yesterday stating that consumers have spoken with their wallets. He argued that Detroit is not making products consumers want and so asking consumers to then in turn support the companies with tax dollars is like forcing them to buy a vehicle without getting anything to put in the garage.

This is an issue that I am sure all of you have diverse opinion on. So let’s hear them. What do you think?

I recently received a press release from the Civil Society Institute (CSI) stating that they are urging Congress to mandate any Detroit automaker loan guarantee bailout be conditional on the auto industry dropping ongoing litigation against four states requiring stronger emissions standards.

40MPG.org and TheCLEAN.org are both organizations under CSI who lobby against global warming by encouraging cleaner emissions standards. The states with legislation that the auto industry is battling are California, Vermont, Rhode Island and New Mexico.

Pam Solo, 40MPG.org founder and CSI president says, “Just because Detroit is pleading once again for another bailout is no reason for Washington to give these companies a ‘free ride.’ If taxpayers are going to be put at risk by guaranteeing new loans, then any such new help should be conditioned on the U.S. car companies ending their campaign to frustrate state-level efforts to clean up car and light-truck emissions that cause global warming. Further, Congress should insist that every penny of the $25 billion in new loan guarantees that Detroit is seeking be targeted to building the cars of tomorrow, not the gas-guzzling dinosaurs of yesterday. Business as usual for Detroit is a bad investment without the incentives for Detroit to do what it seems it cannot do for itself.”

According to CSI, since the election, President-elect Obama plans to move swiftly to overturn a U.S. Environmental Protection Agency (EPA) denial of a waiver being sought by California that would allow the state to move ahead with its tougher vehicle emission standards.

A total of 15 states have adopted regulations requiring automobile manufacturers to reduce significantly the greenhouse gas emissions of their cars and light trucks. Under the uniform set of regulations adopted by these states, automobile manufacturers must reduce new vehicle greenhouse gas emissions by 30 percent over 2002 levels. The reductions are phased in on model years 2009 through 2016.

The U.S. automobile industry has been waging a four-year legal battle against state emission standards. They prevailed upon the Bush EPA to deny California a Clean Air Act waiver in a decision that was contradicted by the analysis of EPA’s own staff. CSI says this denial will be reversed one way or another: California has sued EPA to obtain the waiver and, like other states, is faring well in court. President-Elect Obama also has promised to reverse the EPA waiver denial according to CSI.

My question for readers is, “Is this the time to put conditions on automakers to save their companies?” When one of our largest industries in the nation is over a barrel, do we stipulate any financial help they may get based major shifts in the products they produce just to accommodate a few states regulations? On the other side, are the current emission standards detrimental to our long term nation’s health and this is the perfect time for change? What would happen if the auto industry stood up to this type of regulation and said, ‘Hey, if you don’t want to drive our cars and trucks then we wont sell them in your state.” How do you think consumers would feel if they couldn’t buy a Ford 150, Dodge RAM or Chevy Silverado.

While it is no secret that things are rough for auto dealers right now, in fact, new unit sales are at the lowest level in 15 years, September’s new unit sales data is not all bad news. While recent falling gas prices didn’t necessarily boost sales as much as we would like, and financing of a vehicle has gotten much tougher, American manufacturers took back the lion’s share of new unit U.S. auto sales in September.

For the first time in six months, American auto manufacturing dominated new unit sales with a 52.3 percent market share compared to foreign competitors’ 47.7 percent. This is a big jump from the measly 45.3 percent market share American manufacturers held in August, a month earlier. That said, I would be remiss if I didn’t mention that overall sales when adjusted for business days dropped 26.6 percent and 12.8 percent year to date.

On a positive note, truck sales are the top performer for September. Due to recent incentives and falling gas prices, national light truck sales topped 485,342 in September. While this is down 21.8 percent from August of this year, cars fell even more when compared to the previous month with a 23.8 percent decline.

The hot model of the fall is the 2008 Chevy Silverado which has been the No. 1 selling vehicle for both August and September. That’s right, a pick up truck. For those who thought the truck would go the way of the station wagon due to higher CARB standards, guess again.

While larger SUVs may undergo significant changes to meet fuel economy standards, the pick up truck is ingrained in the American work culture. It’s not just a method of getting to work, it’s how many Americans get work done. Alas, I’m preaching to the choir.

Part of the reason Americans are back on top can be explained by the Nissan Altima that fell from the No. 8 spot of top selling vehicles to No. 12 in September. The Chevy Malibu has taken the Altima’s spot on the top ten list. The Toyota Camry which holds the No. 3 spot of top selling vehicles dropped 33 percent from August’s sales.

What do these numbers mean in the grand scheme of things? The final chapter on light trucks has not been written.

The news from Sema this week concerning the re-tooling of the Spring expo was long awaited.

As I read the news from Sema I was reminded once again of the atmosphere from the past of the brazen and progressive thinking that helped launch TCIA in the 80’s. By again recognizing the necessity for a dedicated and focused approach to education and innovation we are once again on the path to success. I whole heartedly applaud and support the LTAA and PRO councils for having introduced this new conference, (TSTC).

With the adaptations that are affecting our industry now is the perfect time to offer a different prospective to the members of the accessory and restyling communities. By sponsoring and endorsing this bright approach our dealers and manufacturers can build upon needed innovation and change. And, by taking the conference back to Florida, a venue that has long proven popular, I feel that they have struck a common thread to our former successes in taking advantage of a venue that has proven extremely triumphant and inspiring.

Here’s wishing everyone in the industry the very best for the future.

Company Uniforms and the Aftermarket
BY DANA NELSEN

While at a recent distributor show, I met a dealer from Montana who told me of a really interesting new program he has implemented regarding company uniforms at his shop.

The dealer contacted a variety of aftermarket companies and asked them to sponsor a particular day of the week by supplying employee shirts for that day. Each day’s shirt features both the aftermarket company’s logo and the dealership’s logo embroidered on the shirt. Each week day a different colored shirt with a different aftermarket logo is worn by employees. A weekly schedule was given to the employees to explain what shirt should be worn on what day to ensure everyone matches.

Not only do the employees look professional with an ever-changing but matching uniform, but the dealer saves on the expense of providing uniforms. The aftermarket companies that supply the shirts get high-value advertising at a next-to-nothing price. It appears to be a win/win situation for everybody.

There is a whole host of shops out there with company uniforms but this is the first time I have heard of this done with the aftermarket. Can you image walking up to an shop employee to ask a question about tonneaus and prominently seeing a “Penda,” “Truck Covers USA” or “Leer” logo on his, and every other employee at the dealership’s shirt? Would that influence your buying decision? What about the employees? Would they be more apt to steer customers to a particular brand if they were wearing that brand on their clothing? I think so. It would be hard to recommend “Brand A” when “Brand B” is on your left front shirt pocket.

Customers would naturally ask questions about the brand and employees would learn a great deal of product knowledge about that company merely out of necessity. Expert product knowledge would equate to increased sales and more profit for the shop.

My question for shops is do you see this as a positive and innovative idea or are there downsides to it? Would wearing the logo of a single company cause problems with distributors that offer competing brands? Would having more than one brand on a single shirt be appropriate? They sure don’t seem to have a problem with it in NASCAR. What are the pros and cons of a program like this?

If you’ve been around for a couple decades, you may remember those old Maytag repair man commercials where it showed the Maytag repair man bored out of his blooming skull as he waited for a Maytag product to break down. The commercial gave the impression that the poor sop had been there doing nothing for a long time and would continue to be idle indefinitely. As a kid, I remember thinking, “Man this guy needs to fix other types of appliances that break down more often.”

With new truck and SUV sales in a double digit slump this year, I’m guessing there are a number of shops out there who are feeling a little like the Maytag repair man. Are you sitting waiting for new unit sales to increase so you can sell accessories and bolster your bottom line? If so, you may be waiting awhile. It seems that the “new” truck and SUV segment may continue to be slow for awhile. This doesn’t mean that there isn’t an active market out there for aftermarket products.

As trucks and SUVs get traded in for hybrids, the ole’ used car lots are going to be chuck full of these types of vehicles. I believe this will present tremendous opportunity as these vehicles become more affordable and the prices on them drop. The consumers buying them will be people who either need the utility they provide, or people looking for a toy. Both groups are prime aftermarket targets. Partnering with used car lots before and after the sale of used vehicles could turn into a gold mine. I know many of you do this already, so I wanted to see if any of you could share successful marketing ideas you have tried in regard to the used market. If we can get the creative juices flowing, maybe all of us can take a few good ideas away to try. Besides, it’s better than sitting around playing solitaire like the Maytag repair man.

Last week there was news of GM closing Midwest plants that build light trucks and SUVs. This forecast of decreased production, along with the higher cost of fuel, has triggered a reflection on similar circumstances we have experienced in the past. Higher fuel costs have plagued us for some time now. In the midst of this adversity the automotive and aftermarket industries have adapted and brought about change in the light truck and SUV industry, both from the OEMs and the accessory suppliers. There is very little doubt that we will need to build our vehicles and accessories lighter, stronger and much more fuel adaptive and efficient.

We experienced a revolution in products and vehicles in the late 1980s and 1990s when GM redesigned their pickups. The other manufacturers followed suit and the result to date has been more advanced, safer, lighter, user-friendly and significantly more economical vehicles. Now it is projected that the 2009 models are following this formula.

The only way we are going to transcend the difficulty and “challenges” we face is to match these changes with innovation, modernization and the desire to create a new climate to supply new and improved products and to find advanced ways to communicate these changes to the public. I recently had a discussion with a supplier who was prototyping a new product specifically geared to addressing the problem of better fuel economy for the outdoor market; it will also have impact in the light truck market. It is this enterprising innovation that we will again need to call upon from our industry. One of the challenges he stated was, “How do I get the word out?”

I am optimistic that we are creating and witnessing a revolution of sorts, not only in the materials, processes and improvements used to manufacture vehicles and aftermarket accessories, but also in our methods of marketing, selling, advertising and communication to both consumers and business-to-business clientele. It is to this particular aspect of change that I propose a new paradigm for the marketing and communication aspect of our industry. If we are asking the manufacturers and dealers to transform their approach then we must also be a part of the solution to these “challenging times.”

Please share your thoughts on your own of revolution of sorts.