Aggressive Brand Advertising Vital for Growth in North American Wheel Aftermarket

PALO ALTO, Calif., June 5 -- Companies with strong brand image who target established niche markets are experiencing growth in the North American wheel aftermarket. Other factors contributing to their success are their emphasis on building efficient inventory management systems and maintaining lower costs to boost sales.

Frost & Sullivan (http://www.transportation.frost.com/ ) finds that the North American Wheel Aftermarket earned revenues of $802.0 million in 2005 and estimates to reach $863.0 million in 2012.

If you are interested in a virtual brochure, which provides manufacturers, end users, and other industry participants an overview of the latest analysis of the North American Wheel Aftermarket then send an e-mail to Tolu Babalola - Corporate Communications at tolu.babalola@frost.com with the following information: full name, company name, title, telephone number, e-mail address, city, state, and country. The brochure will be e-mailed to you upon receipt of this information.

"Aluminum wheels will continue to remain the most prominent market segment, dominating the light vehicle market, but is likely to lose a portion of is market share to styled steel wheels from 2006-2012," notes Frost & Sullivan Research Analyst Kyu-min Oh.

By incorporating micro-alloy steel manufacturing methods, wheel enterprises are able to manufacture steel wheels that match aluminum ones in their look and weight, all at a marginal manufacturing cost. Research also indicates that end-users consider steel wheels safer than aluminum ones.

Further, the North American automakers are in the process of introducing various new vehicle models equipped with styled custom wheels as part of their original equipment (OE).

With participants in the wheel aftermarket scouting for ways to decrease manufacturing costs, some companies are likely to switch over to producing styled steel wheels during 2006-2012.

Key issues for enterprises in the wheel aftermarket are the domination of aluminum wheels, limited sales and the high initial costs involved in starting a steel wheel manufacturing plant.

"Another vital concern for all wheel aftermarket enterprises in North America is the increasing competition from other countries with less labor costs," observes Oh. "This, coupled with the high degree of fragmentation in the wheel aftermarket, adversely impacts the participants' market share growth."

Therefore, it is crucial to manage the inventory efficiently and reduce the gap between design and shelf time, and wheel makers should protect themselves against overstocking wheels, as that can lead to higher inventory costs.

Overall, focusing on end-user demands and the resulting trends is important for both inventory management and growth of unit shipment. Wheel aftermarket companies need to arrive at the right combination of demand and supply to garner stable revenue growth. Moreover, they must follow a moderate growth approach, as a fast growth rate could adversely affect future costs.

North American Wheel Aftermarket is part of the North American Automotive Aftermarket Subscription, which also includes research in the following markets: Aluminum Wheel Manufacturing (Casting/Forging, Flow-forming, Semi- solid Forging), Steel Wheel Manufacturing (Micro-alloy Steel), and Finishes (Chroming, Polishing, Painting). All research services include detailed market opportunities and industry trends that have been evaluated following extensive interviews with market participants. For additional commentary, analyst interviews are available with the press.

Frost & Sullivan, a global growth consulting company, has been partnering with clients to support the development of innovative strategies for more than 40 years. The company's industry expertise integrates growth consulting, growth partnership services, and corporate management training to identify and develop opportunities. Frost & Sullivan serves an extensive clientele that includes Global 1000 companies, emerging companies, and the investment community by providing comprehensive industry coverage that reflects a unique global perspective and combines ongoing analysis of markets, technologies, econometrics, and demographics. For more information, visit http://www.frost.com/ .

                     North American Wheel Aftermarket
                                   F759

   Contact:
   Tolu Babalola
   Corporate Communications - North America
   P: 210.477.8427
   F: 210.348.1003
   E: tolu.babalola@frost.com

   Magdalena Oberland
   Corporate Communications - Europe
   P: +44 (0) 20 7915 7876
   F: +44 (0) 20 7730 3343
   E: magdalena.oberland@frost.com

   Alice Chia
   Corporate Communications - Asia Pacific
   P: +603.6204.5899
   F: +603.6201.7402
   E: alice.chia@frost.com

   http://www.frost.com/

Keywords in this release: wheel aftermarket, aluminum, styled steel, light vehicle, light truck, sport utility vehicle, SUV, micro-alloy, North America, original equipment, OE, research, information, market, trends, technology, service, forecast, market share