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February 2007 Issue Highlights

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February 2007 Cover
February 2007 Cover

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CAWA Fall Meeting and Awards Dinner
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Eagle Automotive Acquired By Atlantis Holding
Dana To Sell Hard Parts Business
Pull'R Holdings Files Chapter 11
Hybrid Sales Will Rise 268% Says J.D. Power
How People Really Pick Mechanics

EAGLE AUTOMOTIVE ACQUIRED BY ATLANTIS HOLDING

Oceanside-based Eagle Automotive Group has been acquired by Atlantis Holding Corp, of Tustin, a financial holding company. Terms of the deal were not disclosed.

An established distributor of aftermarket accessories, Eagle Automotive is serving as the anchor of Atlantis Holding's Automotive Division. Under its new ownership, Eagle "will utilize the services of American Sales & Marketing, another recently acquired subsidiary of Atlantis Holding Corp, to promote these automotive products to the major automotive supply stores and warehouses, such as Sears, Auto Zone, CSK Auto, CarQuest, Parts Plus, Costco and Wal-Mart."

The company also plans to sell aftermarket accessories direct to the consumer via the internet as well as through a "kiosk-based point-of-purchase system."

DANA TO SELL HARD PARTS BUSINESS

Dana Corporation has announced that it will sell its "non-core engine hard parts business"to MAHLE GmbH for $157 million. The price includes $98 million in cash as well as the assumption of some of Dana's liabilities.

The engine hard parts business sold by Dana includes 39 facilities which manufacture piston rings, engine bearings, cylinder liners, and camshafts under the Perfect Circle, Clevite, and Glacier Vandervell brands. The division employs approximately 5,000 people in 10 countries and had annual revenues of approximately $670 million in 2005.

In connection with the deal, the companies have also agreed to a transition services plan as well as a distribution agreement for Victor Reinz-branded products.

Dana Chairman and CEO Mike Burns said the sale of the parts business "is an important step in implementing Dana's reorganization initiatives and sharpening our focus on our core axle, driveshaft, structural, sealing, and thermal products businesses for the automotive, commercial vehicle, and off-highway markets."

Closing of the transaction is subject to the approval of the United States Bankruptcy Court which has jurisdiction over Dana's Chapter 11 reorganization proceedings and government regulatory approval. The sale is expected to be complete by the end of the first quarter of 2007.

Aftermarket company MAHLE manufactures engine components and filters under its Mahle, Cofap, and Kencht brands internationally.

PULL'R HOLDINGS FILES CHAPTER 11

Specialty tool and work gear company Pull'R Holdings LLC has filed for Chapter 11 bankruptcy along with its sister company, Maasdam Pow'r Pull Inc. Both are based in Santa Fe Springs.

The company was formed in 2003 when it acquired Maasdam Pow'r Pull and followed that action with four other acquisitions. Pull'R Holdings was ranked 11th in the Los Angeles Business Journal's 2005 list of "Fastest Growing Companies" with a 209% growth over the previous year.

Pull'R's family of brands include Dead On, Eagle Tools, Maasdam Pow'R-Pull, Maasdam Jackall Jacks, and Bucket Boss.

HYBRID SALES WILL RISE 268%, SAYS J.D. POWER

With the high price of gasoline affecting consumer vehicle decisions, the sales of hybrid-electric vehicles are predicted to rise dramatically.

According to J.D. Power and Associates, sales of hybrid-electric vehicles in the United States will grow by 268% between 2005 and 2012.

The company predicted in its "Automotive Forecasting Services Hybrid-Electric Vehicle Outlook" that hybrid vehicle sales will increase from approximately 212,000 vehicles in 2005 to 780,000 by 2012. That increase will give hybrids a 4.2% market share by 2012.

"Future growth will be the result of more vehicle manufacturers entering the hybrid-electric market and a greater number of hybrid models," said Anthony Pratt of J.D. Power and Associates. "There are currently only 11 hybrid models available in the U.S. market, and by 2012 that number could increase to 52 models."

"Consumers tend to purchase within the vehicle segment that best suits their lifestyle," said Pratt. "When hybrids were first introduced in the United States, they were only available in sub-compact cars that were not practical for all vehicle buyers. This trend changed with the introduction of the Ford Escape in late 2004, and we anticipate this trend will continue in the future. By 2012, consumers will have the opportunity to purchase a hybrid vehicle in nearly all segments, including full-size pickups, minivans and luxury cars."

HOW PEOPLE REALLY PICK MECHANICS

How do people really pick mechanics?

Quality and trust were the top two criteria for consumers when selecting a service provider for their vehicle, according to a recent study by the Automotive Aftermarket Industry Association (AAIA).

The cost of service, which many technicians believe to be the leading factor, ranked seventh in the criteria that influence consumers.

"Repair shops who currently advertise and market on price alone should rethink their strategy to meet the expectations and motivations of today's more savvy motorist customer," said Kathleen Schmatz, AAIA president and CEO. "Convenience, speed of service and their past experience with a service provider are more important than cost of service to consumers."

The AAIA study, "The Aftermarket Consumer: DIY or DIFM," also found that quality ranked number one in importance among DIYers in selecting an outlet to purchase the parts and supplies used to perform vehicle service themselves.

About 68 percent of DIYers purchased their parts and supplies during the past12 months from an auto parts store.

The complete study is available to AAIA members for $295 and to non-members for $795. For more information or to order a copy, contact AAIA at 301-654-6664 or visit www.aftermarket.org.

Originally published in the February/March 2007 issue of Automotive Booster Magazine.
Copyright 2007 by KAL Publications Inc.

Covering the California auto parts aftermarket since 1928.