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http://www.moparmax.com/columns/moparreflections/vi_12-kratz-1.html
Aftermarket or No Market?
Last month I asked how Dodge can claim it has rediscovered the “performance” aspect of Dodge DNA if it locks us and all tuners out of the engine’s computer. Well, I’m not the only one worried and appalled by this. I’ve been talking with some CEOs of aftermarket performance companies, both on and off the record, and they’re all wondering if Mopar has lost its collective mind.
Let’s start with Kim Pendergast, CEO of Magnuson Superchargers. I got to speak with her at the SEMA show in Las Vegas last month.
“Look at the iPhone,” Kim says, “Would it have been the wild success that it is if Apple had decided that only they could provide apps for it and locked out all third party developers? What’s an iPhone without apps?” The question Kim is clearly asking is, What’s a performance car without aftermarket parts?
“I think Chrysler needs to recognize that the people who want to improve their car’s performance are not just customers,” Kim continues. “They’re Dodge’s best customers, the brand loyalists that know everything about the brand, love the brand, and don’t just love cars, they love Mopars.”
Dan Cragin, President of DC Performance, talked about how their performance Viper and late model Hemi customers won’t even consider driving a factory stock car—SRT or otherwise. “I’m in the position of having to tell my customers, look, I know you want the latest and greatest car, but I have to warn you, if you buy a new Viper or Hemi car, you can’t improve the performance, you can’t do heads and cam or a blower. Mopar is making me drive my best customers to a different brand, they aren’t going to settle for a stock SRT or just Mopar parts, they want their cars their way.”
We’re getting mixed messages here Chrysler. On the one hand, you sell the awesome, non-street legal Challenger Drag Pak, and the SRTs and R/Ts are great starting points for enthusiast owners. But you sell unlimited performance in one and now strictly limited-to-factory-specs performance in the others. On the one hand, you want to sell new cars, but the owner of a 1971 Challenger can buy all kinds of aftermarket parts for his old car, which generates no new car sales for Dodge. However, the enthusiast owner isn’t going to buy a new car that they can’t touch, you’re de-incentivizing them, you’re putting obstacles of your own creation in the path of their buying a new 2011 Challenger.
“People that buy Challengers, Chargers, SRTs, or Mustangs or Camaros for that matter, they’re in this car culture where their car is their hobby, their actual lifestyle,” Dan said. “They have to modify their cars, they have to make them fit their personality and style. If Dodge doesn’t let them modify their cars with this lock out thing, then I’m afraid the Ford and Chevy people are going to win them away from us and these good customers are going to switch brands. They may never come back after that. Dodge needs to be jumping on the bandwagon, not off it.”
“Hey,” another CEO told me on the condition of not being identified, “Dodge needs to recognize that aftermarket support of their brand is fragile. When we started to make parts for late model Hemi’s, some of my associates that run other aftermarket companies told me not to waste my time, just focus on Chevy and Ford. But I go to car shows, I go to races, I saw the passion of the Mopar owners and saw an opportunity to gain market share offering them product in a market where there’s not a lot of options. And now Dodge is doing everything it can to teach me that my friends were right. I got to tell you, if I have to flush my investment in Mopar [engine] parts, I’m going to remember that and I won’t look back.”
Kim chimed in on this concern too, “You know, I believed in Dodge, I invested in developing supercharger kits for late model Hemis, and right now I have 2011 kits, ready to sell, just sitting on shelves because my tuners can’t make them run on customer’s cars.” She went on to talk about how Dodge isn’t just burning her and her company, they’re in danger of burning bridges to the whole aftermarket community.
These aftermarket companies understand that mods can cause issues on warranties and liability, but I think Ms. Pendergast put it best, “You have to run your business based on your product. Legal departments are very important, I completely appreciate what the needs are from the legal perspective of the OEMs. But what they have to understand is that they sell cars, and what the lawyers and accountants and your tax experts do is try to protect you. But the leaders of the business have to run your company, because guess what? If you fail, they’ll walk away from you. You have to say, ‘I know my business and in order to be in this business I need the most loyal and influential customers in my base.’ You have to let them build upon the platform of your product.”
Dan adds, “I can respect [Dodge’s] concerns about warranty, but there are so many things they can do, they can look to other OEs, what they’ve done. For one thing, they have to be firm and consistent with their policy about what is warranteed and what isn’t. I’ve seen too many warranty repairs done where clearly the customer voided it, but Dodge let it through. So it’s their own fault there, and they could establish a reputation as ‘Fine, modify your car, but we’re not paying for it if breaks,’ and then that would save them money and let the customer willing to take the risk explore the envelope of performance on their cars, aware of this new reputation.”
“Why doesn’t Dodge partner with us instead of lock us out?” Dan asks. “We would put forth the effort to be part of a certified tuner shop program with Mopar, get certified, let them control who has [PCM] unlock keys and make sure we meet certain standards or guidelines. We won’t try to put things over on Dodge about warranties and they’d trust us to know their product and what we’re doing.”
Kim says Magnuson is already part of programs like this with Japanese OEMs, “[The Japanese] have been the worst about working with the aftermarket, locking us out of their engine controllers but, now they’re starting to get it, they’re coming to legitimate aftermarket companies and they’re willing to work with us. They’re letting us help them sell their product by letting us allow these market leading customers that want to develop their cars do so. So we’ve got Japanese manufacturer’s getting it, right when Dodge is losing it. I think Dodge is shooting themselves in the foot here.”
I asked Kim and Dan, if they could say one thing to Ralph Gilles, President and CEO of SRT brand, or Pietro Gorlier, CEO and COO of Mopar, what would it be?
Dan: “I believe that right now is a great opportunity for Mopar to get into aftermarket performance, a tremendous opportunity for that great Dodge performance history—going back many decades—for that history to become their image again. Dodge needs to look to the other OEs, at Ford and Chevy, at what they’ve done with the aftermarket and then do it even better.”
Kim (choosing her words carefully): “It is not in their company’s best interests to lock out legitimate participants in the aftermarket from improving the power and quality of their product, because that sells cars.”
There it is, bottom line, want to sell cars Dodge? We know that SRT and R/T cars are great cars; they have good power, handling and style for factory cars. The Mopar Nation loves these cars—as a starting point, a canvas upon which to paint their personal vision of what performance means to them—which is always different than the factory vision.
Chrysler, we believe you have two choices, work with your late model aftermarket and with them restore the performance image of your brands, nurture that DNA back to full roaring life. For goodness sake, we love our Maulin’ Magnum, 600+ supercharged horsepower, angers European “performance” car owners that can’t shake us off their rear bumper on the Angeles Crest Highway, gets groceries and hauls kids and gear during the week then pulls its own trailer to the races where we swap the tires and win round after round and bring home trophies from the bracket races. I don’t know exactly how many Dodge cars we’ve sold for you from this, but it’s more than a couple. But we couldn’t do this with a factory stock car.
Your other choice is to let the lawyers and accountants run the company and sell sewing machine reliable cars that safety freaks rave about and whose tires are never sullied with track goo and never taste victory crossing a finish line first.
Aftermarket or No Market?
Last month I asked how Dodge can claim it has rediscovered the “performance” aspect of Dodge DNA if it locks us and all tuners out of the engine’s computer. Well, I’m not the only one worried and appalled by this. I’ve been talking with some CEOs of aftermarket performance companies, both on and off the record, and they’re all wondering if Mopar has lost its collective mind.
Let’s start with Kim Pendergast, CEO of Magnuson Superchargers. I got to speak with her at the SEMA show in Las Vegas last month.
“Look at the iPhone,” Kim says, “Would it have been the wild success that it is if Apple had decided that only they could provide apps for it and locked out all third party developers? What’s an iPhone without apps?” The question Kim is clearly asking is, What’s a performance car without aftermarket parts?
“I think Chrysler needs to recognize that the people who want to improve their car’s performance are not just customers,” Kim continues. “They’re Dodge’s best customers, the brand loyalists that know everything about the brand, love the brand, and don’t just love cars, they love Mopars.”
Dan Cragin, President of DC Performance, talked about how their performance Viper and late model Hemi customers won’t even consider driving a factory stock car—SRT or otherwise. “I’m in the position of having to tell my customers, look, I know you want the latest and greatest car, but I have to warn you, if you buy a new Viper or Hemi car, you can’t improve the performance, you can’t do heads and cam or a blower. Mopar is making me drive my best customers to a different brand, they aren’t going to settle for a stock SRT or just Mopar parts, they want their cars their way.”
We’re getting mixed messages here Chrysler. On the one hand, you sell the awesome, non-street legal Challenger Drag Pak, and the SRTs and R/Ts are great starting points for enthusiast owners. But you sell unlimited performance in one and now strictly limited-to-factory-specs performance in the others. On the one hand, you want to sell new cars, but the owner of a 1971 Challenger can buy all kinds of aftermarket parts for his old car, which generates no new car sales for Dodge. However, the enthusiast owner isn’t going to buy a new car that they can’t touch, you’re de-incentivizing them, you’re putting obstacles of your own creation in the path of their buying a new 2011 Challenger.
“People that buy Challengers, Chargers, SRTs, or Mustangs or Camaros for that matter, they’re in this car culture where their car is their hobby, their actual lifestyle,” Dan said. “They have to modify their cars, they have to make them fit their personality and style. If Dodge doesn’t let them modify their cars with this lock out thing, then I’m afraid the Ford and Chevy people are going to win them away from us and these good customers are going to switch brands. They may never come back after that. Dodge needs to be jumping on the bandwagon, not off it.”
“Hey,” another CEO told me on the condition of not being identified, “Dodge needs to recognize that aftermarket support of their brand is fragile. When we started to make parts for late model Hemi’s, some of my associates that run other aftermarket companies told me not to waste my time, just focus on Chevy and Ford. But I go to car shows, I go to races, I saw the passion of the Mopar owners and saw an opportunity to gain market share offering them product in a market where there’s not a lot of options. And now Dodge is doing everything it can to teach me that my friends were right. I got to tell you, if I have to flush my investment in Mopar [engine] parts, I’m going to remember that and I won’t look back.”
Kim chimed in on this concern too, “You know, I believed in Dodge, I invested in developing supercharger kits for late model Hemis, and right now I have 2011 kits, ready to sell, just sitting on shelves because my tuners can’t make them run on customer’s cars.” She went on to talk about how Dodge isn’t just burning her and her company, they’re in danger of burning bridges to the whole aftermarket community.
These aftermarket companies understand that mods can cause issues on warranties and liability, but I think Ms. Pendergast put it best, “You have to run your business based on your product. Legal departments are very important, I completely appreciate what the needs are from the legal perspective of the OEMs. But what they have to understand is that they sell cars, and what the lawyers and accountants and your tax experts do is try to protect you. But the leaders of the business have to run your company, because guess what? If you fail, they’ll walk away from you. You have to say, ‘I know my business and in order to be in this business I need the most loyal and influential customers in my base.’ You have to let them build upon the platform of your product.”
Dan adds, “I can respect [Dodge’s] concerns about warranty, but there are so many things they can do, they can look to other OEs, what they’ve done. For one thing, they have to be firm and consistent with their policy about what is warranteed and what isn’t. I’ve seen too many warranty repairs done where clearly the customer voided it, but Dodge let it through. So it’s their own fault there, and they could establish a reputation as ‘Fine, modify your car, but we’re not paying for it if breaks,’ and then that would save them money and let the customer willing to take the risk explore the envelope of performance on their cars, aware of this new reputation.”
“Why doesn’t Dodge partner with us instead of lock us out?” Dan asks. “We would put forth the effort to be part of a certified tuner shop program with Mopar, get certified, let them control who has [PCM] unlock keys and make sure we meet certain standards or guidelines. We won’t try to put things over on Dodge about warranties and they’d trust us to know their product and what we’re doing.”
Kim says Magnuson is already part of programs like this with Japanese OEMs, “[The Japanese] have been the worst about working with the aftermarket, locking us out of their engine controllers but, now they’re starting to get it, they’re coming to legitimate aftermarket companies and they’re willing to work with us. They’re letting us help them sell their product by letting us allow these market leading customers that want to develop their cars do so. So we’ve got Japanese manufacturer’s getting it, right when Dodge is losing it. I think Dodge is shooting themselves in the foot here.”
I asked Kim and Dan, if they could say one thing to Ralph Gilles, President and CEO of SRT brand, or Pietro Gorlier, CEO and COO of Mopar, what would it be?
Dan: “I believe that right now is a great opportunity for Mopar to get into aftermarket performance, a tremendous opportunity for that great Dodge performance history—going back many decades—for that history to become their image again. Dodge needs to look to the other OEs, at Ford and Chevy, at what they’ve done with the aftermarket and then do it even better.”
Kim (choosing her words carefully): “It is not in their company’s best interests to lock out legitimate participants in the aftermarket from improving the power and quality of their product, because that sells cars.”
There it is, bottom line, want to sell cars Dodge? We know that SRT and R/T cars are great cars; they have good power, handling and style for factory cars. The Mopar Nation loves these cars—as a starting point, a canvas upon which to paint their personal vision of what performance means to them—which is always different than the factory vision.
Chrysler, we believe you have two choices, work with your late model aftermarket and with them restore the performance image of your brands, nurture that DNA back to full roaring life. For goodness sake, we love our Maulin’ Magnum, 600+ supercharged horsepower, angers European “performance” car owners that can’t shake us off their rear bumper on the Angeles Crest Highway, gets groceries and hauls kids and gear during the week then pulls its own trailer to the races where we swap the tires and win round after round and bring home trophies from the bracket races. I don’t know exactly how many Dodge cars we’ve sold for you from this, but it’s more than a couple. But we couldn’t do this with a factory stock car.
Your other choice is to let the lawyers and accountants run the company and sell sewing machine reliable cars that safety freaks rave about and whose tires are never sullied with track goo and never taste victory crossing a finish line first.
