SEMA News—September 2021

INDUSTRY NEWS

Fast Facts

The Boninfante Group hired Tom Kundrik as ProTorque’s director of motorsports and sales. In addition to fielding customer service calls and offering technical support over the phone, Kundrik will also travel the country to attend drag-racing events and provide on-site service and support for customers. He will also facilitate the launch of several new product lines, including supercharger-specific torque converters for ProTorque. Kundrik comes from Mickey Thompson Performance Wheels & Tires as the motorsports manager.

Speedway Motors announced four recent promotions within the company. Richard Thomas (left) was promoted to director of operations. Thomas, who held various leadership positions in the U.S. Navy, first joined Speedway Motors in 2018 in the compliance department, where he helped oversee regulatory compliance. Andrew Boellstorff (second left) was promoted to director of digital product and technology. With more than 15 years of experience, he’s held positions at GT Exhaust, EMIT Technologies, Nebraska Book Company and Spreetail. Brandon Bisch (second right) was promoted to director of e-commerce. Bisch held numerous positions in the company since 2005. Kaitlin Mathison (right) was promoted to director of marketplaces. She first joined Speedway Motors in 2015.

Banks Power announced Matthew Gamble as its design, assembly and testing manager for its DMax engine programs. Gamble will help design, develop and launch the high-performance, turnkey variants of the Banks D866T engine in his new position, and he will also lead performance and durability demonstration events, among other duties. He arrives at Banks from Edelbrock, where he managed the company’s cylinder head and water pump lines. Previously, he managed 15 successful launch campaigns of Delta IV rockets at Rocketdyne and oversaw the health monitoring systems at Diablo Canyon Nuclear Power Plant.

Warn Industries announced the acquisition of substantially all of the assets of Fabtech Industries Inc., a manufacturer of aftermarket suspensions for light trucks, Jeeps and SUVs. Fabtech’s product offerings include suspension systems, shocks and leveling kits. The company was founded in 1989 as a custom fabrication firm specializing in racing suspension systems and prerunner builds, cages, bumpers and other products. Today, the company has more than 2,000 SKUs in its portfolio.

Holley announced that Dominic Bardos was appointed CFO. A financial executive with extensive public company experience, Bardos will serve as a member of the executive leadership team and report directly to President and CEO Tom Tomlinson. Bardos recently served as vice president of finance for Tractor Supply Co. He previously served as CFO for Cambridge Franchise Holdings. Additionally, he held several leadership positions at ServiceMaster, including three years as the divisional CFO for Terminix, its largest division.

Westin Automotive announced that Adam Trowbridge was promoted to COO, which will include responsibility for D.C. operations, product management and marketing. As Westin COO, Trowbridge’s experience and ability to execute will help drive the future success of the business as it grows.

ATI Performance Products announced the appointment of Vince Fourcade as chief transmission technology officer. Fourcade brings three decades of performance racing and automatic transmission building expertise to this new position. Fourcade raced in the Pro Stock, Pro Rear Wheel Drive, Top Sportsman and Top Dragster categories in the ’80s. He opened his own transmission shop in 1998.

The Wheel Group (TWG) announced Gerry Geronimo as its new marketing manager. His past positions were most recently leading the marketing efforts at Vision Wheel. Prior to that, he spent nearly a decade in multiple marketing functions at Wheel Pros as well as other companies outside of the industry. Geronimo will lead the marketing efforts for all 17 proprietary brands in The Wheel Group’s portfolio.

The National Hot Rod Association (NHRA) technical department announced the addition of Lonnie Grim as the new national tech director. Grim comes to the NHRA with more than 15 years of experience within the sport of drag racing. He most recently served as the competition/series tech director at the Professional Drag Racing Association. Grim joins the technical department led by NHRA Vice President of Competition Ned Walliser.

McCarthy Tire Service purchased the assets of Tire Sales LLC, an affiliate of The TSS Group LLC, which specializes in services to the mining and aggregate industries. Tire Sales’ product and service operations will be merged into McCarthy Tire’s current commercial locations in nearby Levittown and Trainer, Pennsylvania. The five key service team employees of Tire Sales will join McCarthy Tire Service. Financial terms of the deal were not disclosed.

Race Winning Brands Inc., a portfolio company of Kinderhook Industries LLC, announced the acquisition of Victory 1 Performance, a supplier of manufactured and forged high-performance titanium and alloy valves. Victory represents the eighth add-on acquisition for Race Winning Brands. Headquartered in Mooresville, North Carolina, Victory has been a source of valvetrain components for engine builders, cylinder head manufacturers and racers for nearly three decades.

MagnaFlow announced the hire of Cary Redman as director of retail sales. Before joining MagnaFlow, Redman served as vice president at Edelbrock, where he oversaw brand management activities along with the conceptualization and implementation of market segment strategies. Prior, he spent nearly 15 years in sales management with Prestolite Performance and Holley Performance. Redman reports to MagnaFlow Senior Vice President of Sales Kevin German.

Lubrication Specialties Inc. (LSI) announced the addition of Hollie Maxymillian, a veteran automotive retail marketing specialist, to serve as the company’s new Hot Shot’s Secret product manager. Reporting to LSI President Brett Tennar, Maxymillian will review all current Hot Shot’s Secret distribution to capitalize on retail advertising opportunities, co-op programs, shelf placement, in-store and e-commerce promotions.

SEMA News—September 2021

INDUSTRY NEWS

May Indicators: Strong Tailwinds Drive U.S. Economic Recovery

The current outlook of the U.S. economy remains positive, with several tailwinds helping to drive the recovery, according to the latest “SEMA Industry Indicators.” States have lifted many COVID-19 restrictions as vaccination rates rise and consumers are responding. This, combined with loose federal monetary policy and stimulus payments, is spurring consumer spending.

As of May 2021, retail sales were nearly 18% higher than they were prior to the pandemic in February 2020—further helping the recovery. It will be difficult for retail sales to continue to grow at these historic rates in the coming months and years, as the increased opening of the service economy will likely pull away some of this growth later in 2021.

New-vehicle sales hit record highs in April. However, supply constraints are hurting production levels. The auto sector is racing to keep up with this historic demand, but supply-chain shortages may take some time before fully recovering.

For more information, download the latest “SEMA Industry Indicators” report today at www.sema.org/research.

New Hotels Available for 2021 on SEMA Show Block

The SEMA Show’s official housing partner, onPeak, has added several new hotels for this year. Showgoers are guaranteed low rates with no hidden fees when booking through onPeak.

Take advantage of door-to-door service and air conditioning by riding complimentary shuttle buses to get to and from the SEMA Show. All official hotels not within walking distance (more than half a mile away) will run shuttles to the Las Vegas Convention Center each day of the Show.

New hotel/casinos added for 2021 include the Conrad Las Vegas and the Las Vegas Hilton, both at Resorts World, and the OYO Hotel and Casino. Nightly rates start as low as $278 for SEMA Show attendees. Additionally, several non-casino properties are offering discounted rates, including the Hilton Grand Vacations and Residence Inn, both at the Convention Center, as well as the Renaissance, Las Vegas Marriott and others. Nightly rates start as low as $164.

All hotel information can be found at the Travel & Lodging page on www.SEMAShow.com, which features a real-time listing of the hotel deals and discounts available for the 2021 SEMA Show, which takes place November 2–5 in Las Vegas.

GM Breaks Ground on New Charlotte Technical Center

General Motors has broken ground on its new technical center in Charlotte, North Carolina. The 130,000-sq.-ft. facility will expand GM’s performance and racing capabilities and will accelerate strategic knowledge transfer between motorsports and production vehicle development.

Representatives of Chip Ganassi Racing, Richard Childress Racing and Hendrick Motorsports joined GM for the groundbreaking at the complex in Concord. The site was selected for its proximity to partner racing teams and major technical suppliers. The new technical center will support racing efforts across all series in which GM competes. The facility is a $45 million investment for GM and is scheduled to open in early 2022.

The center will also provide more opportunities for GM to recruit top talent in the fields of software engineering, computational science, electrical engineering and other technical skill sets. The new technical center will feature advanced virtual tools, including three state-of-the-art driver-in-the-loop simulators, aero development and other software-enabled vehicle modeling technology designed to enable faster analysis and iteration.

Longtime Pioneer Veteran Kevan Morris Passes Away

Kevan Morris, executive vice president of Pioneer Electronics (USA) Inc. and a longtime consumer electronics industry veteran, passed away on Saturday, June 26, 2021.

A respected member of the aftermarket community, Morris’s affiliation with Pioneer began in 1984. While working at Pacific Stereo selling car stereo components directly to consumers, he was recruited into the role of product specialist at NLS Marketing, a rep firm in Bellevue, Washington, selling Pioneer car electronics to retailers throughout Washington state.

In August of 1986, Morris officially joined Pioneer Electronics (USA) Inc. as a district sales manager covering car electronics in the Pacific Northwest territory. In the 35 years since, Morris quickly ascended the ranks of Pioneer and held numerous sales and management positions related to Pioneer’s car electronics, home electronics and television businesses, culminating as executive vice president, a position in which he served with distinction since May 2011.

He is survived by his wife, Mary, and his sons, Devon and Ryan.

SEMA News—September 2021

EVENTS

Achieving First-Time Success

Rookie Exhibitors From the 2019 SEMA Show Share Their Experiences and Offer Advice on How to Shine

By Chad Simon

The SEMA Show is back for 2021! Attracting more than 150,000 industry leaders, including 60,000 buyers from around the world, the annual Show, to be held November 2–5 in Las Vegas, is still growing. This year, it will expand into the Las Vegas Convention Center’s brand-new West Hall, providing an additional 1.4 million sq. ft. of exhibit space. Despite the Show having been canceled last year due to the COVID-19 pandemic, many companies industry-wide (including those that were first-time exhibitors in 2019) are reporting record sales over the past year, and those that struggled are now starting to bounce back.

We contacted three first-time exhibitors from the 2019 SEMA Show to find out about their experiences, strategies, what they learned and what advice they would offer to exhibitors who will be new to the Show this year. They included Bruce Couture, owner of Modern Driveline; Mike Jercan, owner of MFR Engineering; and Steven Balusik, general sales manager/head of product development for Cam Motion.

SEMA News: Why did you decide to exhibit in 2019?

Bruce Couture: I’ve been going to the Show as an attendee since 2001, and we felt that it was the right thing to do for us as a company. We had grown to a point that we had enough product offerings and were prepared, so we wanted to take it to the next level. Before then, we didn’t feel that we were ready to take on that level of exposure.

Mike Jercan: I’ve attended the SEMA Show since 2014 or maybe even earlier. In 2019, I was opening my own business and trying to leave a footprint in this industry as a serious contributor to motorsports. It wasn’t something that we could avoid, being the new guy. A lot of people don’t understand why we use the material we use or why we do what we do, so we had to take that step and have a booth so people could come and ask the correct questions and not have social media kind of take over with the “he said, she said” type of thing. That’s why we pulled the trigger and invested the time and effort to do SEMA.

Steven Balusik: We’ve been exhibiting at the Performance Racing Industry (PRI) Trade Show since the beginning of time, but 2019 was the first year we did the SEMA Show. One of our friends over at American Racing Headers told us that he had good luck out there, and another friend from Scoggin Dickey told me that he didn’t see a lot of market overlap. He said a lot of the people he’s seeing at SEMA are a new audience for him, so he felt like he was reaching some people at SEMA that he wasn’t reaching at PRI.

SN: How would you describe your overall experience at the Show?

BC: Overall, it was a very good experience. We had a booth in the Performance Pavilion. The folks who worked with us were very helpful and made sure to stay in contact with us. The Exhibitor Summit we attended in June prior to the Show was also helpful, gave us a lot of information, put us at ease and got us to feel that SEMA was not this huge entity but an organization of people who cared.

I think having that information ahead of time and being engaged with the staff really made the difference in terms of being prepared, and having a timeline certainly helped us make sure that we were staying on track. Understanding what our requirements were for the booth was also helpful. We were encouraged to put products into the New Products Showcase, which we took full utilization of. In fact, we ended up winning that year’s Best Engineered New Product.

The New Products Showcase was beneficial to us because people may not have found us as a company, but they certainly found our products. We had eight products in the New Products Showcase; we took almost the entire display case.

MJ: It was a great experience as an exhibitor just being able to see what other industry people bring out, what their expectations are, who raises the bar and what’s next. We had a 20x40-ft. booth in the South Hall close to the Toyo Treadpass entrance/exit.

SB: We were in the Racing & Performance section, and it was a good Show. I think we actually had more new interest and fruitful interactions than we did at PRI, which was surprising. I fully expected to have to kind of develop into SEMA, but it just was an excellent Show right from the start. We came away with a lot of leads, and we got new customers that we hadn’t seen before going to the PRI Trade Show, so that was very nice for us.

SN: What were your expectations going in, and how did you prepare yourself?

BC: Our expectation was that the Show would be very good for us. It would certainly put us in the spotlight and give us more of an opportunity to interact with customers who perhaps hadn’t heard of us, and it certainly has done that.

MJ: We were mainly focused on making our booth as welcoming and warm as possible.

We spent a good amount of money trying to see what worked so that we’d know where we’re really going to focus and what to do differently coming into the next Show. We didn’t really have high expectations because it was our first year actually having a booth there. We didn’t want to have to leave the booth and go reach out and try to network with people because we might miss somebody who showed up at the booth.

SB: We really didn’t know what to expect. There were a lot of different types of products—everything from wheels to appearance products and truck accessories. We’re into hardcore racing, so PRI was always kind of our show.

The SEMA Show was so organized and had clearly defined sections, so if people are interested in racing and high performance, they can go straight to that section. Because they had done such a good job of organizing the enormity of the Show, I don’t think it deterred from our success. It was well enough sectioned and organized that we were able to reach the people we wanted to reach effectively.

SN: How did you promote your company to draw people to your booth?

BC: We did mailings with flyers, essentially to our database of people who we knew. We also had a vehicle outside the Las Vegas Convention Center. I believe we did do some type of advertising with SEMA, and we dedicated a page or a section on our website. We had just launched a new website prior to the 2019 SEMA Show.

MJ: We had three vehicles in our booth: a Porsche GT3 and an Acura NSX that we built, which actually got quite a bit of traffic, especially with Speed Hunters and a lot of the bigger social-media groups. We also debuted our widebody twin-turbo Challenger. Then we had a couple cars outside. I think there were a total of around 20 cars at the Show that we collaborated on, including a famous YouTuber’s car.

We also paid for banners outside of the Las Vegas Convention Center. We had a marketing team that helped us as far as networking at some of the post-Show meetings. We tried to make a presence. It was a stepping-stone for us and a great learning experience because now we know where to spend the money correctly. We did get compliments from a lot of big companies that we had one of the nicer booths at SEMA.

SB: We didn’t do anything differently. We let everyone know on Facebook and Instagram that we would be there, but that’s about it. We didn’t do anything beyond that. We simply had a 10x10, and this year we’ll have a 10x20. We had good results at the Show, and we were able to get into the main area. We were fortunate to be in the right place at the right time. The Show was packed. There were tons of people, and it was the right kind of people.

SN: How would you define a successful Show?

BC: I would say that we achieved all that we basically expected and probably a little bit more for our first Show. As a new exhibitor, to win a major award was really kind of surprising. I know that they’re changing the Show in the sense of the layout of the new hall that’s opened. I am hoping that our next experience is going to take us to the next level so that we can get exposed to more buyers who are in our field. I want to be a part of the core of the market that I am addressing.

MJ: Return on investment. I am pretty confident that our second experience will be even better because we will take advantage of what we learned for sure and the ROI will definitely be a lot better.

SB: A successful Show for us is always two things: First, we want to have an opportunity to see and spend some time with our existing customers; and second, we want to reach out and try to find new customers who are in our ideal target market.

SN: How do you think you can improve upon your experience at this year’s Show?

BC: We’ve looked into getting a different type of booth; instead of a 10x40 in an aisle, we opted for a 20x20. We’ll do whatever kind of promotion ahead of time that we can within reason and budget. I do intend to look at getting a hanging sign, like I see so many other companies doing, so at least when you’re on the floor, you can look up and say, “Hey, there’s a company that I need to see.”

MJ: I would definitely spend a lot more money and effort on directing people to our booth. I’d also look into the different advertisement options that SEMA offers.

SB: We’re going to have a bigger and better-quality display this year.

SN: What advice would you offer to a first-time exhibitor this year?

BC: I would certainly follow the path that I took, which is to get involved, be informed. I definitely would recommend entering a product in the New Products Showcase. It’s a big show to get prepared for as a small exhibitor. Try to pace yourself. Set your expectations on a realistic level. The Show is a top-quality, world-class-type show.

MJ: Be a little bit more open on the advertisement side. I’ve been doing SEMA for so many years, so I kind of went into this thinking I had the gist of it, but it’s a whole different ballgame when you’re an exhibitor. Let people know where you are, what you do, and drive people to your booth.

SB: Go to the Show first, get familiar with it, understand how it works and see how you can be effective.

Surviving COVID-19

SEMA News: How has your company been affected by the pandemic?

Bruce Couture: We saw a 25% increase in business last year. We also sell truck transmissions, and we announced a new product that has been selling like crazy, which has made us extremely busy. Our sales are up because people aren’t traveling. They’ve got time on their hands, and if they have money, they’re building cars.

Mike Jercan: It’s been a rollercoaster ride. We’ve been blessed not to have closed. We had continuous orders, but it’s been a little crazy. Some months are great, and then others we’re in the red because we don’t have enough traffic. Our products are on the higher end and are very niche.

A lot of the teams we work with weren’t racing because everything was shut down, so we weren’t producing products for the guys who were going out and beating up their cars. We pushed through, and we’re still pushing and hoping that we can continue to move forward. If certain things that we have planned work out, we’ll be back at the Show and hopefully stronger than we were in 2019.

Steven Balusik: I think a lot of recreational, outdoor and leisure companies have done quite well. It seems like the entire performance industry has basically been selling everything that they could make ever since the pandemic started. People who normally would have been busy doing other things spent time on their hobbies, and that included the high-performance and racing market. We just have literally been nonstop ever since the pandemic started.

SEMA News—September 2021

RESEARCH

The “2021 SEMA Market Report”

Despite the Pandemic, Automotive Specialty-Equipment Sales Grew to $47.89 Billion

By Chad Simon

Even in the face of a pandemic that ravaged livelihoods and economies globally, the automotive specialty-equipment market somehow managed to continue its steady growth trend, up to $47.89 billion in 2020—a 4% increase over 2019, according to the recently released “2021 SEMA Market Report.” Slower growth is expected to continue into 2022 as more businesses reopen and compete for consumer dollars before taking off again in late 2022 or early 2023.

The COVID Effect

While some businesses felt pain, the COVID-19 pandemic didn’t hurt the automotive specialty-equipment industry as much as one would have thought. The market was expected to contract to some degree with the economic disruption that took place in 2020, according to Gavin Knapp, SEMA director of market research, but many businesses reported record sales in 2020.

“March and April were a big shock to the entire economy, but a lot of businesses were able to adapt and find ways to keep selling products,” said Matt Kennedy, SEMA market research manager. “At the end of the year, we finished with strong growth that rebounded quickly and continued forward from that initial shutdown period.”

Despite layoffs and high unemployment, consumers still spent money on the items that were available to them because certain things were considered out of bounds, according to Knapp. They couldn’t spend money on entertainment, travel, food and hospitality, but they could spend it on their cars, so a lot of people started engaging in their hobby.

One such instance was performance-related products, which did well last year at $11.47 billion.

“We began to see people be of the mindset that, ‘I don’t have to drive my car every day if it’s a daily driver,’ or ‘I’ve got this project, and now I have the time to work on it, so I can do more intricate, even more expensive upgrades,’” Knapp said.

Industry-wide, sales were up around 4% last year. In 2019, the industry reached $46.2 billion in retail sales. In 2020, that number increased to $47.89 billion, and sales are forecast to reach $57.16 billion by 2024.

“When you take the disruption—and some companies did have poor years—it all balanced out by those that saw record growth,” Knapp said. “Ultimately, the overall industry stayed close to what’s been our growth trend over the last five years.”

Specialty-Equipment Retail Sales $ Billions

Industry Segments That Took a Hit

As with the entire economy, the second quarter into the middle of 2020 was a challenging time for the automotive specialty-equipment industry due to supply-chain disruptions and also because some businesses had to close their doors while the rest were required to comply with social-distancing policies, according to Knapp.

The repair-and-replacement side took somewhat of a hit because shutdowns forced people to stay home. However, it also gave consumers an opportunity to have both time and disposable income that they weren’t using on things such as vacations to spend on their cars, even though they weren’t necessarily wearing out parts by driving a lot.

“Sometimes when people need to replace a part, they upgrade, and that’s part of our industry,” Kennedy said. “That was offset by how people suddenly had disposable income but fewer things to throw it at, so working on their cars or trucks remained an option for them. There were competing and odd dynamics in play.”

Mobile electronics was another segment where sales were flat at $3.24 billion—not due to COVID-19 but largely because cars now come with a quality sound system or an integrated system that you can’t swap out anymore, according to Knapp. Advanced driver-assistance systems (ADAS) are still growing, but not nearly as fast as they’ve grown on the OEM side, where all new cars have multiple ADAS products installed, so there’s less of a need for add-on products.

Because new-vehicle sales were down last year, sales of utilitarian products such as racks that consumers add on at the dealership dropped a bit from $0.80 billion in 2019 to $0.76 billion in 2020, according to Kennedy. Apart from a few isolated cases that are tied to the decline in vehicle sales, everything else has been following the consistent upswing seen over the past several years.

2020 Consumer Purchase Estimates by Sales Channel % of Sales

Online Sales Increase

One trend that stood out when analyzing data from the “2021 SEMA Market Report” was an increase in online purchasing. COVID forced people to shop online, but not exclusively by any means, according to Kennedy. In fact, a sizable share of sales came from retail stores because many auto-parts businesses were considered essential during the pandemic. As a result, they weren’t forced to shut down as much as some other retail businesses, and that allowed the industry to continue with in-person sales. However, those who weren’t comfortable entering to a store turned to online sales channels.

“It wasn’t a drastic increase in online sales, but we’ve been ahead of the curve for a while, so when sales tip over to a little more than half online, that’s an increase from about 35% to 40% previously,” Kennedy said.

Parts sales channels vary by vehicle segment, but it’s often more related to the part than anything else. For instance, motor oil is easy to buy online and ship, but it’s one of those things that people buy in a store when they need it.

“Certain parts really lend themselves to online purchases,” Knapp said. “Are they easy to ship? Are they easy to install? Does it make much more sense for you to know what you want and purchase it online? Other products may require a more complicated installation or they’re heavy, so they are difficult and expensive to ship.”

It used to be true that hardcore enthusiasts who had an understanding of what they were looking for preferred to shop in stores versus online, but that’s all changed.

“When I first started in the industry, people used to say, ‘Our guys don’t go online; they’re just in the garage,’” Knapp said. “Obviously, that’s not true at this point. Our guys are doing their research and shopping online—especially the most hardcore guys, because they have the most understanding of what they want. Although they may not buy online, they go there to look up specs and prices.”

As for the general market, if customers are going after a big purchase, they’ll probably take a somewhat similar path. They are usually armed with less internal knowledge, so they may be more likely to go into a store and talk to salespeople. However, many of their purchases are also going to be on a whim, according to Knapp.

2020 Consumer Purchase Estimates by Vehicle Segment % of Sales

Non-Enthusiasts vs. Enthusiasts

The SEMA Market Research team continues to see that younger consumers are the more dynamic and daring participants in the automotive specialty-equipment industry. For a hobby that transcends generations, the data indicates that people tend to slow down as they get older. Among accessorizers, about 60% are under the age of 40.

In addition, while non-enthusiasts still hold the upper hand in terms of sales, enthusiast purchases are catching up.

“The population didn’t really shift regarding who made changes to their vehicles; it’s still a narrow split in favor of non-enthusiasts,” Kennedy said. “But if you analyze who is actually spending money, enthusiasts spend more dollars, but non-enthusiasts didn’t drop out of the market all of a sudden.”

With the pandemic keeping people in their homes and doing more do-it-yourself projects, a larger shift toward enthusiast purchases was expected, especially in the amount of purchases made. However, the SEMA Market Research team expects non-enthusiast sales to accelerate in 2021 and beyond as those consumers get back into their cars and start thinking about the things they’d like to do to personalize them.

2020 consumer purchase estimates $ Billions

Motivation Behind Customization

The SEMA Market Research team found three motivating factors behind vehicle customization. The first is appearance and utility. Next is lifestyle (those who are in car clubs and post their vehicles on social media). Finally, there are the classic upgraders or hobbyists who enjoy wrenching on their cars in their garages.

People will customize or modify any type of vehicle up to a point, but pickups are a huge slice of the market, representing 28% of dollars spent in 2020 among both enthusiasts and non-enthusiasts. SUVs (13%) and CUVs (16%) are also popular targets for customization. On the other end of the spectrum, electric and alternative-power vehicles make up only a small fraction of total vehicles on the road and represent just 1% of automotive specialty-equipment market sales.

“There are certain vehicles that really lend themselves more to the aftermarket, either because of their type or a lifestyle or culture around them,” Knapp said. “Pickups are the ultimate platform, because you can do anything to them. On the off-road and utility side, you’ve got SUVs and CUVs. You’re going to see a lot of customization in any vehicle that’s considered off-road-capable, starting with the Jeep Wrangler. On the traditional car side, we see some of the smaller compact cars still getting accessorized, but the key ones right now are the ones you might consider the new musclecars—Mustang, Camaro and Challenger. Then there’s a whole range of classics, which are always going to be a good spot for our industry.”

Wheels and tires have long been considered the “gateway drug” into the automotive specialty-equipment industry, according to Knapp. Whether performance tires or off-road, oversized tires are a large piece of the market.

“They are among the things you can do right away, and they’re very simple,” Knapp said. “They give you a lot of bang for your buck in terms of changing the look and even performance. From there, people tend to take a couple different paths. One might be aesthetics and changing the look of your vehicle. The other is performance—for example, suspension parts or lift kits, which are big for the truck category.”

2020 Consumer Purchase Estimates $ Billions

What the Future Holds

Despite all the doom and gloom, 2020 actually turned out to be a profitable year for many companies, according to Knapp. However, he expects slowed growth over the next couple of years.

“As the economy begins to reopen and there are more options regarding where people can spend their money, will we see a little pullback in spending on our industry? I think the answer will be yes, but I don’t think it’ll be an overwhelming yes,” Knapp said. “People will actually expand their spending due to the fact that the rate of savings in this country is greater, so they’ll say, ‘What I’m doing here is still cool, but I also have this savings that I’m going to use to go on a vacation.’ So our expectation is that we’ll see some slower growth, flattening a little in late 2021 into 2022, and then we’ll ramp back up to our normal level.”

Even with consumer spending higher at this time than it was in 2019, there are still some areas to watch. For instance, despite high unemployment, more companies are looking to hire, which Knapp said indicates a labor shortage. In addition, supply-chain disruptions and the availability of raw inputs and input parts have led to price inflation.

“Because we also have high savings rates, consumers will have even more money to spend going forward, as they will typically spend down their savings somewhat, so we could also see the economy take fire here in the second half of the year,” Knapp said.

“2021 SEMA Market Report” Fast Facts

• In 2020, the automotive specialty-equipment market hit a new high of $47.89 billion in total parts sales.
• Sales are projected to increase to nearly $57.16 billion by 2024.
• Among accessorizers, 60% are under the age of 40.
• Pickups once again make up the largest vehicle segment with a 28% market share.
• Just over half of dollars spent in 2020 went through online channels. n

Source

The “2021 SEMA Market Report” is free and a benefit of SEMA membership. Along with a host of other free industry reports, it can be found at www.sema.org/market-research. The SEMA Market Research team is also available to help the industry directly. If you have any specific questions, contact SEMA Market Research Manager Matt Kennedy at mattk@sema.org or 909-978-6730.

SEMA News—September 2021

LEGISLATIVE AND TECHNICAL AFFAIRS

Law and Order

By Stuart Gosswein

FEDERAL UPDATE

RPM Act: The SEMA-backed Recognizing the Protection of Motorsports Act of 2021 (RPM Act; HR 3281) was reintroduced in the House by U.S. Representatives Patrick McHenry (R-NC) and Raul Ruiz (D-CA). The bill would protect Americans’ right to convert street vehicles into dedicated race cars as well as the motorsports parts industry’s ability to sell products that allow racers to compete. In 2015, the U.S. Environmental Protection Agency (EPA) stated that this activity was illegal under the Clean Air Act. The legislation would confirm that conversions are permitted along with the sale of race parts used to make the conversions. A massive grassroots campaign has generated more than 1.3 million letters sent to members of Congress urging passage of the RPM Act. The legislation has been subject to previous committee hearings and inclusion in a 2020 energy bill passed by the House but never taken up by the Senate. Consideration of HR 3281 is pending in the House Energy and Commerce Committee, and a companion bill will soon be introduced in the U.S. Senate. For more information, visit www.sema.org/rpmact.

Duties on Tires From Southeast Asia: The U.S. International Trade Commission (ITC) confirmed that U.S. industry is being harmed from imports of passenger and light truck tires at less than fair value (“dumping”) from South Korea, Taiwan and Thailand. The ITC also found and that Vietnamese tire producers have received unfair subsidies from the country’s “undervalued currency.” The ITC dismissed the antidumping investigation for tires from Vietnam as being negligible. The U.S. Department of Commerce had previously calculated the dumping duties to be assessed range from 14.72% to 27.05% for South Korea, 20.04% to 101.84% for Taiwan, and 14.62% to 21.09% for Thailand. The subsidy rates for tires from Vietnam range from 6.23% to 7.89 %. The duties are collected by U.S. Customs and Border Protection.

STATE UPDATE

Missouri—Historic Vehicles: The Missouri Senate failed to consider SEMA-supported legislation that would have allowed historic vehicles to be issued license plates without an annual mileage restriction, so the legislation died as the legislature adjourned. Current law limits historic vehicle owners to 1,000 mi. of driving for personal use per year. The Senate Committee on Transportation, Infrastructure and Public Safety previously passed the bill.

Texas—License Plates: The House Transportation Committee failed to consider prior to adjournment SEMA-supported legislation that would have allowed the display of only a single, rear-mounted license plate for passenger vehicles if the vehicle is unable to display a front license plate. The Senate previously passed the bill.

By Ashley Reyes

Electric cars and advanced vehicle technology are hot topics for the automotive aftermarket industry. As the landscape continues to evolve, it’s important for SEMA members to stay up-to-date on how electrification, alternative power and emerging technology will impact the future.  

SEMA members are invited to join a live webinar on September 15, at 11:00 a.m. (PDT) to learn about the future of electric vehicles, other alternative fuels and emerging technology. Participants will receive the latest information on the vehicle landscape and how it’s changing, and walk away with:  

• An outlook and sales forecast for electric and other alternative energy vehicles.
• The latest research on electrification.
• Insight on the challenges and barriers to electric vehicle adoption.
• A look at the latest technology being developed for vehicles, including ADAS and autonomous driving.
• Potential impact on the specialty-equipment aftermarket. 

Participants will also get an early preview of the upcoming Alternative Power Report from SEMA Market Research, which will be released September 2.  

Learn more and register here for the September 15 “Emerging Trends: Electrification, Alternative Power and Advanced Technology” webinar. 

By Ashley Reyes

Having a diverse workforce brings new ideas, innovations and, ultimately, greater success to a team.   

SEMA members are invited to an upcoming webinar to learn how individuals with disabilities can bring valuable diversity to the workplace, and how to support and respond when a direct report discloses that they have disabilities.

The webinar will provide managers with information that is not typically provided when being trained for a management position. After the live presentation, there will be an opportunity to network through a virtual breakout.

Learn more about and register for “The Value of a Diverse Team” taking place September 14, at 12:00 p.m. (PDT).

By Ashley Reyes

SEMA members have until September 3 to submit nominations for the 2021 SEMA Council and Network Awards.  

SEMA Council and Network Awards honor the dedication and passion that drives the automotive aftermarket industry by recognizing companies and individuals who have made exceptional contributions to the niche automotive aftermarket segments that they represent.  

If you know of a council or network member who has significantly enhanced the stature and growth of the industry, nominate them for an award today so that they may have the chance to get the recognition that they deserve.  

Nominations are open for the following councils and networks:

• Automotive Restoration Market Organization (ARMO)
• Hot Rod Industry Alliance (HRIA)
• Truck & Off-Road Alliance (TORA)
• Motorsports Parts Manufacturers Council (MPMC)
• Professional Restylers Organization (PRO)
• Wheel and Tire Council (WTC)
• Young Executives Network (YEN) 

  

The SEMA Data Excellence designation recognizes the companies that have worked with SEMA Data to recreate and relaunch industry-leading product data sets. Here are products from current SEMA Data members that have achieved data excellence.

BoostLine Diesel

 

 

BoostLine diesel connecting rods are designed specifically for high-torque, turbo diesel applications. The patented design and forged steel construction maximize strength and minimize weight, making BoostLine rods ideal for high-cylinder pressure engine builds. After all, the fun only begins at four-digit torque numbers, right?

• Patented three-pocket design provides 60% improvement in bending strength and 20% tensional stress reduction compared to common H-beam designs.
• Forged from ultra-strong, 4340 steel.
• Standard-equipped with 12mm ARP 2000 fasteners providing 23% more clamping force over 7/16-in. ARP 2000 fasteners.
• Duration tested on the dyno at more than 2000 lb.-ft. of torque
• Machining and honing specs held to the tightest tolerances and QC-tested for consistency with 25-point CMM inspection.
• Available for GM Duramax and Cummins diesel applications.

www.racewinningbrands.com
PN: GM6418-358 (Duramax) and DO7559-575 (Cummins)

AutoMeter
DPSS Shift-Lights, 0-16,000 RPM, Black/Silver

 

 

AutoMeter tube-style shift lights feature programmable shift points, digital RPM display, numerous LED color options, playback, memory, multiple shift points, launch light, and a progressive shift light. Available in black and silver finishes and include the innovative A.I.M. swivel mount for precise viewing angles. Compatible with an array of engine types and calibrates from 0.5 to 6 pulse ignition signals (1-12 cylinder engines). The shift light features a single programmable digital shift point with seven LED colors to choose from and is adjustable by 10 RPM increments to optimize use of your engine’s power band and improve vehicle run performance. For race applications, activate the trigger wire to start up the launch light feature, multiple RPM shift points, a progressive shift light, and the ability to record up to 80 seconds. Additional fine-tuning with adjustable brightness allowing for daytime and nighttime driving.

www.autometer.com
PN: 5343 and 5344

ZyCoat
8-Cylinder Housing

 

 

ZyCoat Coating Services will coat your 8 Cylinder Turbo Housing only with ZyBar high temperature heat dissipation coating is designed to reduce radiant heat, reduce under hood temperatures, offers outstanding corrosion resistance, provides lasting color stability under the most extreme engine conditions and extends the life of your components. ZyBar is rated to internal temperatures well in excess of 2000 F. ZyBar is a single component, durable polymer coating that far out performs ceramic paints, wraps and heat tapes. ZyCoat LLC has opened a Coating Services Division and will coat components for you. ZyCoat will ship you the “One-Stop” box, all shipping is prepaid and return to you coated and cured components—all for one price.  

zycoat.com
PN: 8C010

JMS Chip & Performance
JMS PedalMax Terrain

 

 

Designed for the off-road market, from trucks to UTVs, the JMS PedalMAX Terrain can increase or decrease the throttle sensitivity to match any driving conditions on the fly. Throttle response and acceleration are improved, turbo applications see a big lag reduction, all leading to more power and torque. Quick and easy installation, this plug and play product utilizes a control knob to “save” your throttle setting into the unit. PedalMAX Terrain units are fully waterproof, made with high-quality ruggedized components backed by a lifetime warranty, and made in the USA.

www.jmschip.com
PN: RC1418P01

Compiled by SEMA Editors

Hagan Wins All-Dodge Charger SRT Hellcat Funny Car Final at Brainerd International Raceway

It was an all-Dodge final at the 39th annual Lucas Oil NHRA Nationals with Don Schumacher Racing (DSR) pilot Matt Hagan powering the Mopar Dodge Charger SRT Hellcat to his first victory at Brainerd International Raceway by defeating fellow HEMI-powered driver Cruz Pedregon. It was Hagan’s 38th career Wally trophy and his second win of the 2021 NHRA Camping World Series season. After qualifying No. 4 on the eliminations ladder, Hagan put together a string of consistent runs and round wins over Dale Creasy Jr., Paul Lee and Bob Tasca III to advance to his 69th career final round. That paired him with No. 2 qualifier Pedregon and his Snap-on Tools Dodge Charger SRT Hellcat for their first final round showdown in more than 10 years. Hagan’s quick 0.051-second reaction time gave the DSR Mopar Dodge Charger SRT Hellcat an early lead from which he never looked back on his way to a 3.923 second elapsed time run at 327.98 mph to defeat Pedregon’s 0.106-second light and solid 3.935 sec./324.83 mph pass and capture his second win in five national events. The last race of the regular season will be the 68th edition of the NHRA’s cornerstone event and world’s biggest drag-racing competition—the Dodge//SRT U.S. Nationals in Indianapolis on Labor Day weekend.

IndyCar to Return to Iowa for 2022 Doubleheader

After a one-year hiatus, the NTT IndyCar Series will return to Iowa Speedway in 2022 as part of a doubleheader event set for July 23–24. The series will return as part of a wide-ranging partnership with Hy-Vee—a grocery chain based in the Midwest. The NTT IndyCar Series was among the first to race on the D-shaped layout when it made its debut in Newton, Iowa, in 2007. A fan favorite for fans and drivers, IndyCar has held 15 races at the track known as “The Fastest Short Track on the Planet” since it opened in 2006. The Hy-VeeDeals.com 250 will take place Saturday, July 23, and the Hy-Vee Salute to Farmers 300 will occur Sunday, July 24. Officials say the entire 2022 Series calendar will be announced at a later date. For more information, visit indycar.com.

Albon Celebrates First DTM Career Win With Nürburgring Masterclass

Thai driver Alex Albon celebrated the first DTM win of his career in his #23 Ferrari 488 GT3 Evo 2020 in last Sunday’s race eight at the Nürburgring circuit to move up to fourth overall in the title race. He crossed the line after 38 laps with a lead of 4.6 seconds to record his first DTM series career victory and third 2021 trip to the podium following third-place finishes at Zolder and Monza. The points awarded for pole position and the race eight win see Albon move up now to fourth spot in the 2021 drivers’ standings with 82 points. After eight races, Red Bull AlphaTauri AF Corse has scored 162 points and is in second place in the team standings with the next DTM stop from September 3–5, at the Red Bull Ring in Austria.

Formula 1 Cancels 2021 Japanese Grand Prix

The Japanese Grand Prix will not take place in 2021, Formula 1 has announced. Race organizers have cited “ongoing complexities” related to the pandemic. The event—which was set to be part of a tripleheader with the Russian GP and the Turkish GP—was also canceled in 2020.

A statement from Formula 1 read: “Following ongoing discussions with the promoter and authorities in Japan, the decision has been taken by the Japanese government to cancel the race this season due to ongoing complexities of the pandemic in the country.”

Formula 1 is now working on the details of the revised calendar and will announce the final details in the coming weeks. For more information, visit formula1.com.

Pacific Raceways Breaks Ground on New Innovation Center

Pacific Raceways—the multi-purpose motorsports facility in Kent, Washington—has broken ground on the new Pacific Innovation Center and Pacific Motorsports Park, part of a $200 million expansion. The expansion will total 200,000 sq. ft. and be used as a garage/shop, business, innovation center and retail space. Racers, retailers, enthusiasts and technology-development companies will be able to utilize prototype manufacturing, storage and workspace steps away from the track. The groundbreaking ceremony at Pacific Raceways was attended by more than 100 notable guests, including elected officials, representatives, sponsors and fans. For more information, visit the Pacific Raceways website.

NHRA Set to Return to Wild Horse Pass Motorsports Park in 2022

NHRA has teamed up with Wild Horse Pass Motorsports Park and the Gila River Indian Community to announce the return of the NHRA Arizona Nationals, slated for February 25–27, 2022. The NHRA Arizona Nationals traditionally serves as the second event on the NHRA Camping World Drag Racing Series tour. The facility has seen record-breaking performances and is a fan-favorite of the circuit. Updates for 2022 include free event parking with the purchase of an NHRA Arizona Nationals ticket. Ticket renewals for 2020 ticket holders will begin in September, with new ticket sales opening in October. NHRA officials plan to announce the full 2022 NHRA Camping World Drag Racing Series schedule in the upcoming weeks. For more information, visit nhra.com.

For more racing news, visit Performance Racing Industry’s (PRI) website.