Over the Counter: January 2004

Dana Corporation Announces Intention To Divest Aftermarket Group

In a move to sharpen Dana Corporation’s focus on the original equipment marketplace, the company announced that it intends to divest the company’s Automotive Aftermarket Group.

The announcement was made in early December, less than two weeks after a continually rebuffed ArvinMeritor called off its aggressive takeover attempts.

Commenting on the announcement, Dana’s acting president and chief operating officer, Bill Carroll, said, “This move will enable us to leverage our historic strengths in product and process technology to the benefit of our OE customers and ultimately, our shareholders.”

Dana’s Automotive Aftermarket Group produces and markets a broad line of replacement products, employs more than 15,000 people worldwide, and had reported sales of approximately $2.2 billion U.S. in 2002. In February, Dana agreed to sell a significant portion of its underhood aftermarket business to Standard Motor Products.

The proposed divestiture of the remaining aftermarket business does not involve Dana’s Clevite distribution and marketing activities, based in Ann Arbor, Mich., or its related operations in Churubusco, Ind., Collierville, Tenn., and Olive Branch, Miss.

“Ultimately, we believe the Aftermarket Group’s future opportunities will be optimized under new ownership that is principally dedicated to the automotive aftermarket,” said Caroll. The company says that it expects to complete the divestiture in 2004.

British Auto Supply Celebrates 100 Years

Toronto jobber British Auto Supply is celebrating 100 years of business this year, putting its roots squarely at the beginning of the automobile as we know it.

British Auto Supply, which was founded by Jacob Schwartz, began as a repair business for the horse and carriage trade as much as automobiles, and evolved into a wrecking yard business selling used parts on a site where the CN Tower now reaches skyward. There were a few locations over the years, but the business’s main store has been in the same location for the past two decades.

“We’ve been on Ossington for 20 years,” says David Schwartz, who alongside his brother Michael, comprises the third generation of the family to run the business. Their father, Abe, retired over a decade ago after having worked in the business for some 70 years. “It doesn’t seem like that long ago. It seems like it just went past,” says David.

Though formal anniversary celebrations are scheduled for September 2004, to mark the beginning of the anniversary year family and staff gathered at a Toronto restaurant just prior to the holiday season, where everyone was presented with gifts and sincere thanks.

“All have come to contribute over the years,” Michael told those present. “Jobbing is very much a part of who we are. Without you we wouldn’t be the success that we are.”

The speech went on to detail many of the individual contributions of long-serving staff members and was followed by impromptu speeches by staff members offering their support and thanks.

Remanufacturer Marks Two Decades in Business

Canadian-owned Canamotive Remanufacturing has announced that it is celebrating its 20th anniversary this year.

The family operation was begun in 1994 by Paul Meleca and partner Luciano Cinello in 1984 in a 2,000 square foot unit.

Meleca, who took sole ownership of the business in the late 1980s, says that the best thing to happen was for the partners not to know what they were in for. “Come hell or high water we were going to go for it,” he says. “We’re pretty thankful that things worked out this way.”

Meleca says that he has been careful to manage the growth of the company and is not anxious to grow just for the sake of growth.

“We’ve been pretty successful over the years, but have not grown too big. I am a firm believer that if you’re going to do something, do it well. We’re pretty good at calipers, and so we did that well. We added water pumps in 1988, and we’ve been pretty lucky with one or two lines.

“I am sure that one day with new blood we may get into something else, but right now we’re okay.”

Growth over the years has been strong, however, and the company now boasts a 36,000-square-foot facility, which the company has occupied since 2001.

Greg Meleca, son of Paul, says that he still considers the company to be a medium-sized player that has stayed close to its roots. Both his father and founding partner Cinello were experienced remanufacturers, from their days at Cantire Products.

“Everything we do here on the production line is based on what they learned then,” he says, though he adds that there have certainly been changes in the business.

While the company started life primarily as a supplier to other aftermarket suppliers, it has since evolved into a supplier to the aftermarket distribution network in its own right.

“The big guys are always out for us, but when you’re small and flexible, I think you can cope,” says Paul Meleca. “But we never stop talking about growth.”

Ontario Ushers in Diesel Emissions Rules

Ontario will have the toughest emission limits in North America for large diesel trucks and buses when new standards take effect next April.

In an announcement by Environment Minister Leona Dombrowsky, Ontario joined 15 other jurisdictions in North America with stiff diesel emissions rules.

“With these new standards, we will be identifying more dirty vehicles and ordering them cleaned up. The result will be cleaner air and healthier communities,” Dombrowsky said. The new limits apply to all large school buses, regardless of age. The minister also announced that heavy-duty diesel vehicles which voluntarily achieve a very low emissions level will be allowed to have tests every two years, instead of each year.

An anti-idling strategy will also be developed for large trucks and buses. The Ontario School Bus Association, the Ontario Trucking Association, and Pollution Probe were consulted on, and strongly support, the new measures, according to the ministry.

The heavy-duty diesel standards, which limit the amount of particulate matter (PM) in exhaust emissions, will be tightened in two stages, on April 1, 2004 and April 1, 2005. Between 2000 and 2002 Drive Clean resulted in a reduction of nearly 1,100 tonnes of particulate matter from heavy-duty vehicles.

World Automotive Kicks Off Shad’s Campaign

World Automotive once again made its contribution to Shad’s R&R charity fundraiser.

For the past several years, World Automotive, a warehouse distributor in Toronto, has opted to make the contribution in lieu of gifts for its customers.

“Every year, we have made the challenge to others to do the same,” says Harvey Presement at World Automotive, “but so far there have been no takers.”

Shad’s R&R chairman, John Vanstone, said that he is aware that many in the aftermarket do the same for other causes, but asked that companies consider Shad’s R&R, which has raised millions for research into muscular dystrophy.

The company has never revealed the size of the contribution, only saying that it is “substantial.”

Remanufacturer Moves

Remanufacturer Reda-Tech Automotive & Tredex Automotive has moved to 7634 Kimbel St., Unit 1 through 9, Mississauga, Ontario. The new facility can be reached at 905-677-0996 or 1-800-644-3077; Fax : 905-677-4226 or 1-800-706-4456.

Hella Expands

Hella Lighting Corporation will expand production at its York, South Carolina, plant by more than 50% during the coming year.

During 2004, the company plans to increase annual production of automotive headlamps and fog lamps from 1.8 million units to more than 2.5 million units. The York plant is one of North America’s most advanced headlamp production facilities and supplies lighting components for DaimlerChrysler, General Motors, Ford Motor Company, and Mercedes-Benz.

Speedy Parent Acquired

SMK Speedy International Inc. has entered into an agreement with 578098 Alberta Ltd. (operating as Minute Muffler & Brake) that will see Minute acquire all of the issued and outstandin
g common shares of SMK for approximately $83 million. SMK Speedy operates the Speedy Auto Service chain. Minute, a Lethbridge, Alberta-based auto service centre franchise operator, is controlled by Dorsy Asplund, a pioneer in the automotive aftermarket industry in Western Canada. The transaction was expected to close on or about January 7, 2004.

Equus Inks Deal With Canadian Tire

Canadian Tire Corporation has selected Equus Products, Inc. as the sole supplier of its automotive test and tune category.

This two-year exclusive agreement includes Equus and Innova- branded code readers, timing lights, mechanical testers, digital multimeters, and electrical testers. The planned assortment features a selection of regular items as well as some new promotional items.

Obituary

Gordon E. Davenport, founder of Gord Davenport Automotive Inc., and the 1994 Jobber News Jobber of the Year, died peacefully at home in late December surrounded by his family.

Davenport, who was a strong supporter of a number of industry initiatives, was a well-respected member of the jobbing community.

The Jobber of the Year award, formally the E.J. and A.E. Wadham Memorial Award, was presented to Davenport for his longtime support of his community, the success of his business, and his involvement with the automotive aftermarket industry.

In the profile following his award, Davenport told readers that competition with others and within a company is a path to success. “Competition is good for all parties. It gives you that desire to do better. The real competition is, I think, your own company. You have to keep looking for better ways to do things.” Davenport was effectively retired from the business at the time of his passing.

He was also a well-respected member of the Orangeville community and will be missed by industry and community colleagues alike.