According to John Waraniak, Vice President of Vehicle Techonology at SEMA, his organisation represents “the grass roots of the auto industry and everything you don’t necessarily need, but everything you want”. The aftermarket business is an industry worth around US$31bn a year, and the annual SEMA Show is the largest gathering of small businesses in the US. “It may be a small portion, perhaps 10%, of the overall automotive aftermarket,” says Waraniak, “but it’s the high margin, performance brands, products and accessories that people – particularly automotive enthusiasts – want on their vehicles.”
John Waraniak spoke to Martin Kahl shortly after his confirmation as a speaker for Automotive World’s Megatrends USA 2014 conference.
[quote align=”right”]There is a battle for the future of the car between Silicon Valley and Detroit
Has the interest in performance and customisation changed in recent years?
Over the last ten years the automotive industry has gone from commoditised to customised, and mass markets have shifted to more fragmented customer segments. Ten years ago, the breakeven point for a US assembly plant was around 80,000 vehicles. In terms of customisation, 80,000 is off the scale. Most niche, low volume special editions, like a Chrysler SRT or Ford SVT, are runs of fewer than 5,000. There is a tension in the line – you’ve got to have enough pull from consumers that want those vehicles. Ideally you would never want to produce one more than is wanted by consumers.
Many of our SEMA members work with the OEMs’ performance and aftermarket organisations to put their parts and systems on original vehicles. Successful companies and brands form emotional connections with consumers. SEMA companies like Eibach, Kicker, Hurst, Magnaflow and Nitto have tremendous brand equity, so when Ford, GM, Chrysler, or Toyota designs and builds a special edition vehicle, they typically reach out to the SEMA
member companies to provide those authentic brands and performance parts for them…
This interview first appeared in the Q3 issue of Megatrends magazine. To read the rest of this article, download your free copy today.
