Dates and locations for several upcoming SEMA-sponsored shows and activities have been announced. Details are:

>> SEMA Webinar, "Inventory Management: Mark It Down, Move It Out and Make More Money," August 14, 2008 10:00 a.m.–11:00 a.m. (PDT)
>> SEMA Webinar, "25 Common Mistakes Made by SEMA Show Exhibitors," August 28, 2008 10:00 a.m. (PDT)
>> SEMA Show 2008, November 4–7, 2008, Las Vegas 
>> SEMA Dealer Day, November 5, 2008, Las Vegas

For association-related travel, contact Manya Petropaki (manya.p@travelstoreusa.com) at Travel Store USA, 949/930-9268.

Looking for Some Extra Publicity for Your Industry Event?
Publicize your events through the SEMA Online Calendar of Events located at www.sema.org/calendar. The calendar is stocked with information on events taking place throughout the year, broken down by month. Examples of events featured in the calendar include consumer shows and club events, educational and training workshops, conventions and trade shows, races and more.

To submit your event details for the calendar, e-mail company name and the date(s), location and name of the event to Shirley Presecan at shirleyp@sema.org.

Commuters across the United States are beginning to behave like those around the world in response to the high cost of personal transportation. Pinched by fuel prices and the growing acceptance of alternative transportation for daily travel, usage of motorcycles, scooters and mass transit systems within many large urban areas has swelled. Motorcycle sales, which include on-highway scooters, have increased yearly since the mid-'90s, peaking in 2006. Industry data shows motorcycle registrations are on the rise.

Arguably the most popular motorcycle manufacturer in the United States, Harley-Davidson plans to expand its operations into Europe, beginning with the purchase of Italian cycle manufacturer MV Agusta. Agusta's 500 dealerships, most of them centered in prime European cities, offer a solid foothold for the iconic American brand's expansion.

Harley-Davidson plans to buy Agusta for $109 million, which includes covering bank debt of $45 million, and gives the company ownership of both the MV Agusta (high-performance sport bikes) and Cagiva (lightweight motorcycles) brands.

Consumers pressed for immediate relief are changing their focus to smaller vehicles, including smaller motorcycles and scooters. According to the Motorcycle Industry Council, sales of scooters have jumped nearly 24% since the beginning of 2008. Yamaha and Vespa, two leading scooter manufacturers, are seeing record-breaking sales for the year.

For more specialty-market research and insight, visit www.sema.org/research.

With warmer temperatures and summer in full swing, DIY vehicle enthusiasts traditionally enjoy this season for making modifications and repairs to their vehicles. But the question that many manufacturers are asking this year is whether or not a struggling economy and volatile fuel market offset the traditional increases in summer sales of specialty equipment.

The answer? It depends what you’re selling.

Specialty-equipment sales have always been highly cyclical, with sales in winter months dropping to a mere 6% of the total yearly sales, while growing to 10% during the summer months. The latest research of vehicle enthusiasts who bought specialty equipment in 2007 repeats this historical pattern. 

Percentage of yearly sales of specialty equipment as determined by SEMA’s Automotive Lifestyle Survey (source: SEMA research).

Summer months and convenient weather promote DIY interests, and the car show season encourages enthusiasts to kick-start or continue their projects. Sales of certain equipment may be stifled by current economic conditions, but not all is lost.

“In our business, it is replacing parts as they go bad," Hamilton Burnett of General Parts Corporation tells Aftermarket Business. "A guy doesn’t replace his brakes until they go bad. I think the big industry that is going to be hurt is the recreation industry because the money you spend there is extra money, and now people don’t have extra money. However, our business overall remains pretty consistent."

For companies that service necessary repairs or general maintenance, this is a relatively comforting idea. But for the overall specialty-equipment market, SEMA members might not have the same summer opportunities they've enjoyed in the past. Enthusiasts are feeling the squeeze. They regularly comment that these types of unexpected hurdles only derail their plans temporarily, however, and through saving longer or cutting back on other expenditures, they make their hobby last.

For more specialty-market research and insight, visit www.sema.org/research.

Automakers are forecasting a production decrease by the end of the year to curb stale inventories, especially for lower-MPG vehicles. Estimates of the total car market put production and sales at their lowest levels since 1992.

Ford has been hit especially hard, forcing the manufacturer to continue production-level cuts and now curb 35,000 vehicles for the third quarter. Ford also plans to produce only 500,000 vehicles in the fourth quarter, a decrease of nearly 141,000 units compared to 2007.

Chrysler is also reconsidering its market strategy. Its third-quarter production estimates are down 23% compared to 2007. Weak demand for the brand has forced the value of its vehicles to lose money on leases and has caused Chrysler to issue a “no-lease edict,” essentially forbidding dealers from signing leases—an edict that has left many dealers shocked.

With the exception of Honda, which has offset poor American sales by focusing on international markets, the industry as a whole has lower forecasts this year compared to 2007. J.D. Power and Associates places the estimate for total unit sales to be 13.2 million—a sizeable decrease compared to prior year sales of 15.1 million units. 

For more specialty-market research and insight, visit www.sema.org/research.

Sources:
-"A jittery industry stomps on the brakes," Jesse Snyder, Automotive News, July 28, 2008
-"No-lease edict stuns Chrysler dealers," Bradford Wernle, Automotive News, July 28, 2008

Despite vehicle sales and certain specialty-equipment sales being down in a market plagued by recessionary fears and rising gas prices, certain specialty-equipment sales for niche markets are still going strong. According to Chad Simon of Styling & Performance, the markets for racing, hot rods, musclecars and compact-performance vehicles have been relatively unaffected by recent socio-economic trends.

The market for certain specialty-equipment parts this year has been unforgiving and can be especially felt in the SUV and light-truck market, where large custom wheels and lift kits are the norm. The market for smaller vehicles has not seen the negative impacts. Simon notes that “smaller 16-, 17- and 18-inch wheels for compact cars are currently thriving in the marketplace, not only because of the bling factor, but because they are more fuel-efficient.”

Other markets that do not relate specifically to the sales of fuel-efficient vehicles have also not experienced sales declines. The market for racing and performance products has not experienced the same sales reductions, and the same goes for the market for accessories and appearance products.

Sales for upsized wheels and tires have been hit hardest, but the general market has bright spots. This is good news for SEMA members who can still benefit from the markets for racing and performance parts and the avenues for accessories and appearance products. Those two markets jointly represent 75.5% of the total market for specialty equipment and nearly $28 billion in annual sales, according to SEMA research.

For more specialty-market research and insight, visit www.sema.org/research.

The Dodge Challenger evokes nostalgia for past styles.

For more than 50 years, hot rodding has been an integral part of the specialty-equipment industry, and with automakers' revival of past styles and growing market sales, it is clear that this hobby has managed to stay current and is far from fading.

In 2007, retail sales for street performance reached $2.19 billion. Retail sales for street rod/custom and restoration reached $1.06 billion and $1.49 billion, respectively. Retail sales for each of these niches grew more than 3.5% from 2006.

The popularity of hot rodding has prompted automakers to revive nostalgic styles in the past 10 years, such as with the Dodge Challenger. The reintroduction of the Chevrolet Camaro, set to go on sale in 2009, is much anticipated by hot rodders and baby boomers alike. The Chevrolet Corvette has remained a popular sports car and musclecar since its introduction in 1953.

Each year, SEMA conducts its Automotive Lifestyle Survey. More than 3,300 automotive enthusiasts completed the survey. Approximately 26% of the total respondents were hot-rod enthusiasts. Of this group, 87% purchased custom parts and accessories for a vehicle within the past year. Of those, 42% purchased custom parts for Chevrolets; 25% purchased parts for Fords; 5% purchased parts for Dodge cars; and 6% purchased parts for Pontiacs. 

The top accessories already purchased by this group include: performance air filter replacements; exhaust kits; exhaust headers; intake manifolds; camshaft/valvetrains; cold air intake conversions; brake kits (performance); transmissions (performance upgrade); braided engine hoses; pistons/connecting rods/rings/crankshafts; and performance plumbing.

"The racing and performance side continues to be a cornerstone of the specialty-equipment market," said SEMA Market Research Special Projects Manager Megan McKernan. "The results of the Automotive Lifestyle Survey show that many of the top-selling products purchased by hot-rod enthusiasts are performance-related."

For more specialty-market research and insight, visit www.sema.org/research.

The Swiss government is considering federal legislation making it illegal for consumers to fit aftermarket wheels to their vehicle that are sized different from the original equipment. The European Tuning Organization (ETO), of which SEMA is a member, has been working closely with the Swiss aftermarket association to modify the legislation.

For more information about SEMA international services and initiatives, please visit www.sema.org/international.

As of January 2009, all new packaging sold in Germany must be registered with an officially recognized German recycler or risk a fine of 50,000 Euros (USD $77,855 ). 

As a basic rule, anyone introducing packaging materials to be discarded by the end user will be required to participate. The importer, not the manufacturer, is generally responsible for meeting the recycling and packaging requirements. Yet U.S. companies will likely face a new hurdle in selling into the market, as importers will be liable for all products they carry. Importers of overseas products are typically offering to register the packaging, though the cost of that registration is typically passed onto the manufacturer.  

For copies of the law and a question-and-answer document that SEMA has translated into English, contact Linda Spencer at lindas@sema.org.

Here’s a meaningful and timely session that will review strategic ways to make more money on your inventory, increase the turn rate for the sale of your merchandise, determine inventory needs for the year and decide how much cash to set aside for the purchase of new inventory. Attend this eye-opener session presented by Tom Shay to increase your bottom line.

Title: Inventory Management: Mark It Down, Move it Out & Make More Money
When: Thursday, August 14, 10:00 a.m.–11:00 a.m. (PDT)
Presenter: Tom Shay, Profits+Plus

SEMA's Webinar Program
The SEMA webinar program brings the world-class business seminars featured during the SEMA Show Education Week right to your desktop. Different business-building sessions are constantly added to the program, offering members the latest insight and practices from today’s leading speakers.

All SEMA webinars are conducted live and are open to all employees of SEMA-member companies free of charge. To participate, all you need is a computer with Internet access and a telephone. All previous SEMA webinars are available for download by clicking here. To view upcoming presentations that you can attend via telephone and Internet, click here.

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