The Automotive Industry Aftermarket is Growing Again

The 2014 Los Angeles Auto Show took place at the end of November. It’s an amazing showcase for new car models that auto manufacturers plan to unleash upon their global markets in 2015.

It’s also a showcase for a segment of the automotive industry that doesn’t get big attention outside the industry. It’s a segment in the US that was worth over $318 billion in 2013, contributing more than 2.3 percent of the country’s GDP.

I’m talking about the aftermarket, the secondary market of the automotive industry, concerned with the manufacturing, remanufacturing, distribution, retailing, and installation of all vehicle parts, equipment, and accessories, after the sale of the vehicle by the original equipment manufacturer (OEM) to the consumer.

That industry segment had a huge presence at this year’s LA show in a 162,000 square foot hall that was a showcase of the newest and most popular specialty accessories for automotive interiors and exteriors, advanced technologies and an array of internationally-renowned custom tuners – featuring everything from the cool to the ostentatious.

As the slogan on display in the hall has it:

It’s where things get personalized. Whether you travel by sedan, truck, van or SUV — this is your one-stop-shop to make valets’ jaws drop.

What this year’s LA Auto Show also underlines is that while car sales are on the rise again, so too is the aftermarket.

To be sure, it’s a very interesting market for new IFS customers like Morgan Motor Company (who I wrote about in September) and Wrightbus – UK-based OEMs that assemble vehicles and who are located at the end of the supply chain. It’s also a place for other types of IFS customers in the automotive industry, the so-called Tier-N suppliers, like US-based Magnaflow that are specialized in the aftermarket.

Passion and Enthusiasm for All Things Automotive

Magnaflow is running IFS Applications 8 tailored for the automotive industry that also changed their manufacturing system. They’re going to push tracking of items in the manufacturing process, because they have complex areas where products essentially “disappear” for periods of time in the system. That movement is now visible with the help of the IFS ERP solution.

They are pretty much a build-to-stock manufacturer. They’re using demand planning, and are adding multisite planning with IFS Applications 8, because they’re adding a facility on the US East Coast to meet increasing demands: customers want product in two days now, where once they were happy with seven days.

The logistics have changed, too.

A Magnaflow performance stainless steel muffler, featuring a free-flowing, straight-through perforated stainless steel core, stainless mesh wrap and acoustical fiber fill to deliver a smooth, deep tone.

Magnaflow has five distribution sites, with one more to come. They’re seeing a shift from pallet shipping to parcel-based shipping. Fewer companies want to hold stock now, so Magnaflow drop-ships to them when they have orders.

So, are you ready to personalize your car?