GM offers customization

[ROX]

GM to Offer Customization
GM Goes After the Aftermarket


By Paul A. Eisenstein

Gary Greene saved a bundle when he bought a new Chevrolet Silverado over the summer, thanks to General Motors' employee pricing program. But Greene didn't let that money burn a hole in his pocket. Instead, he used it to dress up his new pickup, spending nearly $3500 on an array of aftermarket accessories, including a fiberglass bedliner, oversize chrome wheels, and a backseat entertainment system.

"I didn't want my truck to look like everyone else's," says Greene, who works on a suburban Detroit assembly line.

Greene is by no means unique. This is the era of automotive personalization. Last year, U.S. motorists spent $31 billion to customize their cars, trucks, and crossovers, according to the trade group, the Special Equipment Marketers Association. That's up from $18 billion as recently as 1998, according to SEMA.

Early next month, members of the organization will gather at the Las Vegas Convention Center for one of that destination resort's biggest annual gathering. The confab will include a variety of performance parts suppliers, wheel makers, appearance parts vendors - and Original Equipment, or OE, manufacturers, such as General Motors.

Surprisingly, carmakers like GM were slow to recognize the boom in the automotive aftermarket. Sure, customers could choose from plenty of options, and most dealers stocked the basics, like floormats and bedliners, but the vast amount of money spent on aftermarket accessories was rung up at local auto supply shops, regional specialty chains, and even "big box" department stores like Wal-Mart.

Now the carmakers want more of the action. That's not surprising, considering the way margins have tightened in the showroom. Competition has made it hard for makers like GM to recover the extra cost of all the content being added to today's vehicles.

"The margins in this (aftermarket) business are definitely better," said Nancy Philippart, executive director, GM Accessories, adding "This is more than a trend. This is an expectation."

Whopping Increases
At the beginning of the decade, the giant automaker reorganized its various aftermarket operations into the new GM Accessories unit, giving it a mandate to grow the company's share of the booming business. While GM officials declined to discuss precise dollar figures, they noted dealers who participated in a corporate training program reported a 134-percent increase in aftermarket sales last year alone.

Dealers are obviously the front line in GM's aftermarket push, and Philippart admits that not all retailers are actively participating. "It's been hit or miss," she said, noting that GM is staging its own, lavish Las Vegas event this autumn in an effort to encourage more dealers to actively participate.

Of course, it helps to have product to display at the more than 10,000 General Motors showrooms scattered across North America. Over the past three years alone, Philippart pointed out, GM Accessories has expanded its parts portfolio by 300 percent. And that doesn't fully reveal the growth.

"This is a fashion business," explained the GM executive. What's hot one year can be cold the next, so there's a constant churn in the catalogue, particularly of appearance parts. Wheels and tires are perhaps the single hottest segment of the aftermarket, thanks to high-profile rappers like 50 Cent and Snoop Dogg. But of one batch of ten truck wheels introduced by GM Accessories, six have already been replaced and the other four will soon be updated, said Philippart.

GM, she added, has a "first-mover advantage" that it long ignored. Take the new line of sport-utility vehicles, such as the '07 Chevy Tahoe, that will roll into showrooms early next year. It could take an independent vendor a year or more to buy one of those trucks, engineer a new line of custom parts, manufacture and then ship them to a vendor.

Prior to the formation of GM Accessories, General Motors worked much the same way. It often waited until the final stages of a vehicle program before developing its own accessories. Since its formation, the new aftermarket unit has become involved at a much earlier stage, so that its catalogue of accessories can be ready at launch, according to Glen Durmisevich.

"We had parts waiting at HUMMER showrooms even before they got their first H3s" earlier this year, boasted Durmisevich, the design manager of the new GM Accessory Studio.

Located in the suburb of Auburn Hills, the facility employs sixteen designers, engineers, and planners, but that relatively small team also has access to the broader GM styling and engineering network. Indeed, many of the parts developed by GM Accessories will go through the same sort of testing as original equipment to ensure performance, quality, and reliability.

An aftermarket grille, for example, might change the flow of air into the engine compartment, so GM Accessories must be sure it won't cause overheating or limit the way an engine can breathe. Parts sold under the corporate brand are then given the same warranty as the original bits and pieces they replace - an advantage over most parts sold by independent suppliers, Philippart underscored.

Dealers can also roll pieces from the GM Accessories catalogue into a customer's finance package, making it easier to pile on the accessories and spread the cost out over several years of monthly payments.

GM is by no means the only automaker looking to gain a larger share of the booming aftermarket. DaimlerChrysler's Chrysler Group and Ford Motor Co. have both launched initiatives. Toyota 's Scion brand has put an emphasis on personalization, emphasizing a large portfolio of parts sold at the dealership. BMW's Mini brand has also scored a big success, offering everything from aftermarket audio systems to Union Jack roof decals.

Independent vendors are likely to remain the dominant force in the aftermarket, but considering the boom in automotive personalization, OEs like General Motors will keep pushing hard to grow their share.

[ROX]

GM to Offer Customization
GM Goes After the Aftermarket


By Paul A. Eisenstein

Gary Greene saved a bundle when he bought a new Chevrolet Silverado over the summer, thanks to General Motors' employee pricing program. But Greene didn't let that money burn a hole in his pocket. Instead, he used it to dress up his new pickup, spending nearly $3500 on an array of aftermarket accessories, including a fiberglass bedliner, oversize chrome wheels, and a backseat entertainment system.

"I didn't want my truck to look like everyone else's," says Greene, who works on a suburban Detroit assembly line.

Greene is by no means unique. This is the era of automotive personalization. Last year, U.S. motorists spent $31 billion to customize their cars, trucks, and crossovers, according to the trade group, the Special Equipment Marketers Association. That's up from $18 billion as recently as 1998, according to SEMA.

Early next month, members of the organization will gather at the Las Vegas Convention Center for one of that destination resort's biggest annual gathering. The confab will include a variety of performance parts suppliers, wheel makers, appearance parts vendors - and Original Equipment, or OE, manufacturers, such as General Motors.

Surprisingly, carmakers like GM were slow to recognize the boom in the automotive aftermarket. Sure, customers could choose from plenty of options, and most dealers stocked the basics, like floormats and bedliners, but the vast amount of money spent on aftermarket accessories was rung up at local auto supply shops, regional specialty chains, and even "big box" department stores like Wal-Mart.

Now the carmakers want more of the action. That's not surprising, considering the way margins have tightened in the showroom. Competition has made it hard for makers like GM to recover the extra cost of all the content being added to today's vehicles.

"The margins in this (aftermarket) business are definitely better," said Nancy Philippart, executive director, GM Accessories, adding "This is more than a trend. This is an expectation."

Whopping Increases
At the beginning of the decade, the giant automaker reorganized its various aftermarket operations into the new GM Accessories unit, giving it a mandate to grow the company's share of the booming business. While GM officials declined to discuss precise dollar figures, they noted dealers who participated in a corporate training program reported a 134-percent increase in aftermarket sales last year alone.

Dealers are obviously the front line in GM's aftermarket push, and Philippart admits that not all retailers are actively participating. "It's been hit or miss," she said, noting that GM is staging its own, lavish Las Vegas event this autumn in an effort to encourage more dealers to actively participate.

Of course, it helps to have product to display at the more than 10,000 General Motors showrooms scattered across North America. Over the past three years alone, Philippart pointed out, GM Accessories has expanded its parts portfolio by 300 percent. And that doesn't fully reveal the growth.

"This is a fashion business," explained the GM executive. What's hot one year can be cold the next, so there's a constant churn in the catalogue, particularly of appearance parts. Wheels and tires are perhaps the single hottest segment of the aftermarket, thanks to high-profile rappers like 50 Cent and Snoop Dogg. But of one batch of ten truck wheels introduced by GM Accessories, six have already been replaced and the other four will soon be updated, said Philippart.

GM, she added, has a "first-mover advantage" that it long ignored. Take the new line of sport-utility vehicles, such as the '07 Chevy Tahoe, that will roll into showrooms early next year. It could take an independent vendor a year or more to buy one of those trucks, engineer a new line of custom parts, manufacture and then ship them to a vendor.

Prior to the formation of GM Accessories, General Motors worked much the same way. It often waited until the final stages of a vehicle program before developing its own accessories. Since its formation, the new aftermarket unit has become involved at a much earlier stage, so that its catalogue of accessories can be ready at launch, according to Glen Durmisevich.

"We had parts waiting at HUMMER showrooms even before they got their first H3s" earlier this year, boasted Durmisevich, the design manager of the new GM Accessory Studio.

Located in the suburb of Auburn Hills, the facility employs sixteen designers, engineers, and planners, but that relatively small team also has access to the broader GM styling and engineering network. Indeed, many of the parts developed by GM Accessories will go through the same sort of testing as original equipment to ensure performance, quality, and reliability.

An aftermarket grille, for example, might change the flow of air into the engine compartment, so GM Accessories must be sure it won't cause overheating or limit the way an engine can breathe. Parts sold under the corporate brand are then given the same warranty as the original bits and pieces they replace - an advantage over most parts sold by independent suppliers, Philippart underscored.

Dealers can also roll pieces from the GM Accessories catalogue into a customer's finance package, making it easier to pile on the accessories and spread the cost out over several years of monthly payments.

GM is by no means the only automaker looking to gain a larger share of the booming aftermarket. DaimlerChrysler's Chrysler Group and Ford Motor Co. have both launched initiatives. Toyota 's Scion brand has put an emphasis on personalization, emphasizing a large portfolio of parts sold at the dealership. BMW's Mini brand has also scored a big success, offering everything from aftermarket audio systems to Union Jack roof decals.

Independent vendors are likely to remain the dominant force in the aftermarket, but considering the boom in automotive personalization, OEs like General Motors will keep pushing hard to grow their share.

[MotorsportsAuthority aka Dragon]

dealers already do this with local aftermarket shops such as ours. in addition, southern comfort has offered this through gm.

[SoonerBoarder]

<BLOCKQUOTE class="ip-ubbcode-quote"><div class="ip-ubbcode-quote-title">quote:</div><div class="ip-ubbcode-quote-content">Prior to the formation of GM Accessories, General Motors worked much the same way. It often waited until the final stages of a vehicle program before developing its own accessories. Since its formation, the new aftermarket unit has become involved at a much earlier stage, so that its catalogue of accessories can be ready at launch, according to Glen Durmisevich. </div></BLOCKQUOTE>

It doesn't take aftermarket companies much time at all to make accessories. I can guarantee you the most popular items (bug shields, vent visors, nerf bars, etc) will be ready for the new Tahoe very shortly after launch.


Only problem with dealer installed accessory items is the dealer installed accessory item price. Usually it's tons more than aftermarket.

[ROX]

<BLOCKQUOTE class="ip-ubbcode-quote"><div class="ip-ubbcode-quote-title">quote:</div><div class="ip-ubbcode-quote-content">Only problem with dealer installed accessory items is the dealer installed accessory item price. Usually it's tons more than aftermarket. </div></BLOCKQUOTE>
Yes, but some of the cost reflects their willingness to cover these "accessories" under warranty. (That's not to say the profit margin isn't still high.) The consumer needs to remember this when they get an accessory that doesn't have a nice fit and finish.