The Steering and Suspension Parts Aftermarket Winners
15 June 1998
Frost & Sullivan: Consolidation and Product Differentiation Distinguishes The Steering and Suspension Parts Aftermarket Winners
MOUNTAIN VIEW, Calif., June 15 -- Growth of the vehicle
population and the increasing average age of vehicles drive the U.S. steering
and suspension parts aftermarket. In addition, steering and suspension parts
are non-discretionary, which means they must be replaced immediately after
failure. Therefore, the market will continue to grow throughout the forecast
period 1998 to 2004, even if an economic downturn occurs.
According to strategic research conducted by Frost & Sullivan
(http://www.frost.com), U.S. Steering and Suspension Parts Aftermarket, market
revenues are expected to hit $584.8 million in 2004, as the sales of
aftermarket steering and suspension components grow at a slightly faster rate
than the growth of the U.S. vehicle population.
Opportunities for growth lie in technology and product differentiation.
New technological advancements, such as electric steering, can establish a
strong foothold into the aftermarket before low-cost remanufacturers can
react. This also serves the second opportunity, differentiation, which raises
product quality and lowers price competition. However, lack of
differentiation, especially in the rack and pinion market, has significantly
reduced prices and revenues.
"Customer demands have not changed since 1995," says David Yu, Frost
& Sullivan automotive analyst. As a result, the three most important factors
influencing purchasing decisions are price, quality and availability.
Consolidation is changing the structure of the market, and it can affect a
company's standing. Currently, a few major companies control most of the
steering and suspension parts market, and have the power to influence pricing.
However, through acquisitions, companies can gain access to new markets,
increase distribution and production capabilities, and expand product lines.
Over 400 companies compete in the steering and suspension parts
aftermarket. The market leaders are large manufacturers with access to the
four main distribution channels: Programmed distributors, retailers, new car
dealers, and others, such as national installer chains. Companies in this
industry are succeeding through consolidation, product innovation,
streamlining for efficiency and customer service.
Frost & Sullivan's study, U.S. Steering and Suspension Parts Aftermarket,
has been divided into five segments: Rack and pinion steering gears, ball
joints, tie rod assemblies, power steering pumps, and other steering and
suspension parts. This report includes revenue forecasts, market shares,
technology and market trends, competitive issues and strategies.
Cardone Industries has been awarded Frost & Sullivan's 1997 Market
Engineering Competitive Strategy Award. With this award, Frost & Sullivan
recognizes that Cardone Industries has created and implemented an effective
competitive strategy through integration of the strategic elements of product,
price, marketing and sales.
This automotive industry research has integrated the Market Engineering
consulting philosophy into the entire research process. Critical phases of
this research include: Identification of industry challenges, market
engineering measurements, strategic recommendations, planning and market
monitoring. All of the vital elements of this system help market participants
navigate successfully through the steering and suspension parts aftermarket.
The companies participating in this market include: A & G
Remanufacturing, AAR, AP North American Aftermarket Division, ARC
Remanufacturing, Inc., Arrow Automotive Industries, Inc., ATSCO Products,
Inc., Automotive Caliper Exchange, Inc. (ACEI), Cardone Industries, Central
Automotive Products, Crown Remanufacturing, Inc., CV Plus, Inc., Dana
Corporation, Dayton Parts, Inc., Durex/HTW Industries, Inc., Eibach Springs,
Elgin Industries, Inc., Federal-Mogul Corporation, Fenwick Automotive
Products, Koteck America, Inc., KYB Corporation of America, Moog Automotive,
Inc., Northstar Manufacturing, Perfection Automotive Products Corporation,
Plews-Edelmann, Power Steering Specialists, Inc., Rare Parts, Inc., Roto-Tech
Automotive Industries, Specialty Products Company, Suspension International
Parts Corp., Tokico USA, Inc., ZF Industries, Inc., Related Companies: Cooper
Industries, Inc., Federal Parts International, Inc., Foreign Parts
Distributors, Inc., TRW, Inc., Distributors: Acklands, Limited, Advance Auto
Parts, All-Pro/Bumper To Bumper, APS, Inc., AutoZone, Inc., Beck/Arnley
Worldparts Corporation, Bridgestone Firestone, Inc., Car-X Muffler and Brake,
Chief Auto Parts, Discount Auto Parts, Goodyear Tire & Rubber Company, H & H
Distributors, Hi-Lo Auto Supply, Installer's Service Warehouse (ISW), CSK
Auto, Inc., Meineke Discount Muffler Shops, Inc., Midas International
Corporation, National Automotive Parts Association (NAPA), O'Reilly
Automotive, PACCAR Automotive, Inc., Pep Boys, Strauss Discount Auto, List of
Industry Organizations: American Automobile, Manufacturers Association
(AAMA), Automobile Parts and Accessories Association (APAA), Automotive
Service Industry, Association (ASIA).
Frost & Sullivan is an international marketing consulting company that
monitors the automotive industry for market trends, market measurements and
strategies. This ongoing research is utilized to update a series of research
publications such as #5767-18 North American Automotive OEM: Undercarriage
Components, and to support industry participants with customized consulting
needs.
Visit Frost & Sullivan's web site: http://www.frost.com
Report: 5779-18 Publication Date: June 1998 Price: $2950