The access issue
Mar 1, 2008 12:00 PM, BY RICK WEBER
“Why should they be forced to give those away for free?” she said. “They pay a lot of money for research & development. They have a team of engineers that are schooled. They pay for MBA and doctorate degrees. Why should they give that information away? They have to prove theories, find prospects, and they have to develop engines to meet EPA standards for 2007, 2010, and onward. They have patents pending. And why should they have to share those with independents?
“And they develop software — highly technical software — and they pay huge dollars through IT and very expensive equipment. Why should they have to share this when they pay the price? There is no free ride. And they have to get a return on investment. Will-fits and independents don't feel they have to contribute to that huge investment but the OEMs and Tier Ones have to continue to get a payback. In the value proposition, the OEMs and Tier One suppliers are very concerned when independents do things such as reverse-engineering of components, the rebuilding and remanufacture of core capture. Or the unauthorized use of manuals and training.
“Sometimes fleets sell that information. Sometimes dealers sell that to independents. And that's what they consider stealing a customer base because dealers believe if they sold to that customer, it's actually their customer and not the independent's customer. And when the competition gets hot and heavy, the price and margin are reduced, especially on proprietary products and components. And the OEMs object to that.”
She said that if customers demand greater technology, reliability, and dependability, the OEMs must be able to afford to support these demands without the proliferation of competitive independents.
“Think about the money the OEMs had to spend in the last couple of years to meet EPA standards and the 2010 coming on,” she said. “It is a huge investment. Every dollar that the independents steal from them the fleets have to pay in upcharges to put that technology in the trucks. “Through technology, the automotive manufacturers were able to ‘knock out’ the independent service stations that are now Quik Marts. I was in the auto industry at Toyota when the attack came on because Toyota refused to share information and technology, and they did a certain thing with specialized tools and training. This is quite a déjà vu to see this happening in the trucking industry.
“Will the OE truck manufacturers do the same? Will they have special tools? What is the future of the independents, especially with legislation enactment? Look at the Long Beach port. They are taking older trucks out of the port. That's your bread and butter. They are paying the owner-operators to sell and trash their trucks and put new technology in, based on emission. As older trucks and components become extinct, the big question is, will the independents become dinosaurs?”
Pete Pasdach, president of Midway Truck Parts, said he does not pretend to be a technological expert on this issue, but he is a concerned independent heavy-duty distributor. He said the issue, left unchecked, will have an “adverse affect on all of us.”
He said it is a industry issue, but first and foremost it is a right-to-choose issue.
“Access to information, and the lack thereof, will have a negative effect and present challenges to the entire industry: the truck owner/ fleet, independent repair channel, independent parts distributor, and OE component manufacturer/supplier,” he said.
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The truck owner/fleet. “They deserve the right to choose a service entity. In my opinion, a single proprietary system could not and will not be able to supply the increased demand of our customers for their parts and service needs. The results will be drastically increased downtime for the truck owner, and that will adversely affect cost per mile. Our customers do not need any more adverse challenges created by someone other than themselves.”
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Independent repair channel. “It affects the ability to compete, limits the type of services offered, and will ultimately increase the cost of repairs.”
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Independent parts distributor. “It affects the ability to compete, limits the type of products offered, and increases the cost of doing business.”
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The OE component manufacturer/supplier. “It will severely limit the type of products offered — specifically to the independent channel — and increase the cost of doing business and limit or eliminate the possible customer base.”
