Bill Haas, vice president of the Automotive Service Association (ASA) presented a keynote address at the MEMA Technology Council Fall Conference in October titled "Future Vehicle Technologies and Their Affect on the Aftermarket." He elaborated on some of those technology topics with Aftermarket Business World.
What are some of the most important technological changes in the vehicle that will impact the aftermarket?
There isn't any system on the car that doesn't have some electronics on it now, so the components are more advanced, and the electric cars that are coming to market in the next few months will have a big impact, as well, like the Chevy Volt and the Nissan LEAF.
There's also the hydrogen technology that several car companies are working on. Honda has the FCX Clarity out there, which is essentially a live R&D project.
How are these technology changes going to affect aftermarket parts suppliers and distributors?
The key thing from the supplier side is this: if you aren't just taking the part out of the box anymore, how does that affect your business? There's a new piece of the business that you can't let escape. If the technician determines this module needs replaced, and I sell him the module, there's another piece to that in either the downloading of the software into the module, or the initialization or the whole idea of flash reprogramming. That's what the suppliers are struggling with.
I can sell a module, but there has to be a way for me to have a bigger role than to just the part. What's the next step? How can I support my customer? Are there ways I can help them download the information they need? That's what a lot of them are looking at today. We know the parts business will change. We may be looking at modules that may fit 15 different types of powertrains. That's helpful on the parts side by reducing inventory or the wide range of SKUs you had to have before, but everyone is looking for other things they can do to support that customer.
What I'm learning from them is they want to figure out a way to do those things as well, to be that resource for the repair professional. I think they'd all like to be able to have a role in that and I think there will be some great opportunities for people. But we're not there yet.
What sorts of issues will electric cars pose for suppliers?
In the electric car market, you're going to start out with a comprehensive, long standing warranty, just because it's new technology. So I think may be a while before some of it comes into play in the aftermarket, but I think there is probably a point where there will be some special circumstances that will present themselves.
I think there will likely be some special handling procedures when people start to deal with power packs and battery supplies. That's really something that has gotten very little attention at all yet. What are we going to do with these power sources when they fail? Even if it's 15 years from now, are they rebuildable? How do you dispose of them? We probably don't want them in landfills. There will be some very specific procedures that people are going to look at, implement and think about. These cars were developed with this large environmental concern, but we can't lose sight of the fact that at other end of the spectrum, the battery really does become an environmental problem.
Are there other vehicle changes that you seeing affecting the aftermarket?
One I think we'll see very quickly is the change in refrigerants. We now know there will be a new refrigerant within the next couple of years, and I think that depending on where you're at that could be an opportunity or might be a big challenge. The last time we had a major change in refrigerants, going from R-12 to R-134, they just set a date and every car manufactured after that date had the new product.
With the new 1234yf, the transition will be over a longer period of time. The challenge is that businesses will have to determine at what point do they invest in new equipment? Even from a supplier standpoint, at what point do you inventory the new refrigerant, and how much do you need? People will have to do some analysis of what's being sold in their market, and what's the market penetration of the new vehicles that use this refrigerant.
Bill Haas, vice president of the Automotive Service Association (ASA) presented a keynote address at the MEMA Technology Council Fall Conference in October titled "Future Vehicle Technologies and Their Affect on the Aftermarket." He elaborated on some of those technology topics with Aftermarket Business World.
What are some of the most important technological changes in the vehicle that will impact the aftermarket?
There isn't any system on the car that doesn't have some electronics on it now, so the components are more advanced, and the electric cars that are coming to market in the next few months will have a big impact, as well, like the Chevy Volt and the Nissan LEAF.
There's also the hydrogen technology that several car companies are working on. Honda has the FCX Clarity out there, which is essentially a live R&D project.
How are these technology changes going to affect aftermarket parts suppliers and distributors?
The key thing from the supplier side is this: if you aren't just taking the part out of the box anymore, how does that affect your business? There's a new piece of the business that you can't let escape. If the technician determines this module needs replaced, and I sell him the module, there's another piece to that in either the downloading of the software into the module, or the initialization or the whole idea of flash reprogramming. That's what the suppliers are struggling with.
I can sell a module, but there has to be a way for me to have a bigger role than to just the part. What's the next step? How can I support my customer? Are there ways I can help them download the information they need? That's what a lot of them are looking at today. We know the parts business will change. We may be looking at modules that may fit 15 different types of powertrains. That's helpful on the parts side by reducing inventory or the wide range of SKUs you had to have before, but everyone is looking for other things they can do to support that customer.
What I'm learning from them is they want to figure out a way to do those things as well, to be that resource for the repair professional. I think they'd all like to be able to have a role in that and I think there will be some great opportunities for people. But we're not there yet.
What sorts of issues will electric cars pose for suppliers?
In the electric car market, you're going to start out with a comprehensive, long standing warranty, just because it's new technology. So I think may be a while before some of it comes into play in the aftermarket, but I think there is probably a point where there will be some special circumstances that will present themselves.
I think there will likely be some special handling procedures when people start to deal with power packs and battery supplies. That's really something that has gotten very little attention at all yet. What are we going to do with these power sources when they fail? Even if it's 15 years from now, are they rebuildable? How do you dispose of them? We probably don't want them in landfills. There will be some very specific procedures that people are going to look at, implement and think about. These cars were developed with this large environmental concern, but we can't lose sight of the fact that at other end of the spectrum, the battery really does become an environmental problem.
Are there other vehicle changes that you seeing affecting the aftermarket?
One I think we'll see very quickly is the change in refrigerants. We now know there will be a new refrigerant within the next couple of years, and I think that depending on where you're at that could be an opportunity or might be a big challenge. The last time we had a major change in refrigerants, going from R-12 to R-134, they just set a date and every car manufactured after that date had the new product.
With the new 1234yf, the transition will be over a longer period of time. The challenge is that businesses will have to determine at what point do they invest in new equipment? Even from a supplier standpoint, at what point do you inventory the new refrigerant, and how much do you need? People will have to do some analysis of what's being sold in their market, and what's the market penetration of the new vehicles that use this refrigerant.
