Rodney Pierini has been the President and CEO of the California Automotive Wholesalers Association (CAWA) for the past 17 years. The CAWA a non-profit trade association representing automotive aftermarket parts manufacturers, jobbers, warehouse distributors and retailers in California, Nevada, and Arizona. The organization was formed in 1955 and serves as the voice of the aftermarket parts industry in the West. We sat down with Pierini recently to discuss his organization and how its role affects and impacts the aftermarket/warehouse parts business within the collision industry in the three states he represents and also on a national level.
ABN: While representing your membership, how do your goals feed into the collision industry and how do you support your membership in these areas?
RP: The collision industry is a segment of the automotive aftermarket and as such we are in the business to promote and protect the industry, particularly, in the government affairs arena. Through legislative and regulatory alerts we keep our membership apprised of what is happening in government that will impact their business. Many of our members supply the collision industry with parts and products required to service customers in a qualitative and timely fashion, as well.
ABN: Why do you think business professional groups like the CAWA help the industries they serve and maybe cite some specific examples?
RP: As an automotive aftermarket trade association, CAWA was founded by members of the aftermarket industry to collectively speak as one voice, to promote training for themselves and their employees and to come together to improve their purchasing power in business service programs and products, e.g., business insurances.
ABN: You’ve been the President/CEO of the CAWA for many years and have seen the automotive parts industry change. What are the most significant changes your members have encountered?
RP: Consolidation and a more intense and sophisticated competitive business environment.
ABN: There’s an on-going push and shove when it comes to the aftermarket/recycled/re-manufactured parts industry vs. the manufacturer’s OE parts industry. Talk about how the aftermarket parts sector has become more efficient and responsive to changes within the market and how the quality is equal with OE parts, in many instances.
RP: In many cases, the major OE supplier is also manufacturing replacement parts in the aftermarket. These parts are as good as, if not better than the part that rolls off the assembly line (because of the improvement in manufacturing post assembly). Also, the remanufacturing segment is at the forefront of reduced emissions and a greener industry footprint in the automotive sector of today’s economy. In the government affairs process we continuously stress the quality of aftermarket replacement parts and their contribution to the overall economy and public good, i.e., the aftermarket gives the consumer the choice of where to purchase their parts and where to have their vehicles serviced.
ABN: If you wanted to give any feedback or advice to body shops or the manufacturers of aftermarket collision parts, what would you tell them?
RP: Look to the CAWA membership who offers quality collision parts and products. Also, see the hard parts manufacturers, manufacturer representatives, distributors and retailers as an ally in promoting and protecting the collision segment of the industry. This notion strengthens all segments of the industry.
ABN: What changes do you think will occur in the auto repair industry overall within the next 10-20 years that will impact the aftermarket parts industry?
RP: Parts generally are manufactured and re-manufactured to high quality standards today and will continue to improve as the industry adapts and changes to new technologies and the vehicles of the future. As technology becomes more sophisticated, we’ll see more repair specialization that will require the parts industry to remain nimble and responsive to this emerging trend. New vehicle technology will also add to the ever-changing future and the parts industry will adapt and , as always, find ways to respond to the yet unforeseen future of the automobile.
ABN: New legislative bills emerge all the time, and if passed, they can greatly affect your membership. Tell us how you play a role in staying on top of these proposed bills/laws and how you stay vigilant on these developments as they arise?
RP: Perhaps the greatest service we provide to the aftermarket industry is our legislative work. If CAWA were not in California, Nevada and Arizona, the industry would feel the void in uncontested intrusion through legislation and the regulatory powers of all levels of government. If the aftermarket voice is not heard in these state capitols, business owners would find themselves helpless to the governments’ presence in the conduct of daily business. CAWA monitors legislation, regulation and other government programs to assure our members and the industry are not ill served by these processes and the insatiable financial appetite of political operatives. And we promote legislation that supports our members and makes doing business more palatable in the face of government politicians and bureaucrats throughout the western states.
ABN: How have aftermarket/warehouse parts businesses figured out how to survive the collapse of 2008 and has it become a more competitive market as a result?
RP: There is no doubt that the market is more highly competitive today and has been so for several years. That’s one reason we still see parts warehouses and jobber stores going out of business. Those that are purchasing right, managing right, constantly monitoring revenues and expenditures and going to market in an efficient manner will continue to be successful. Those not up to the challenges of todays and tomorrow’s competitive environment will not be around in 5-10 years. Those that have survived have also created alliances with other aftermarket business to strengthen their buying power and position in the market place. There are many very competent and entrepreneurial owners and managers in this industry that adapt well and quickly to survive and stay competitive.
ABN: You’ve been working closely with other organizations and sponsored a joint series of meetings between the CAWA and ASCCA earlier this year. What is the purpose for this partnership and how has this alliance worked?
RP: As you know, ASCCA represents the mechanical repair garage owners in California. We have enjoyed a very rich and long termed relationship with them. We meet regularly with our lobbyists to assure we are speaking with one voice at the Capitol and, if not, we understand why and respect each other’s positions on issues. Parenthetically, being on opposite sides of an issue is very rare and virtually non-existent.
About four years ago, the boards of directors of both associations wanted to strengthen the relationship among the volunteer leaders of both groups. So, an Industry Summit was developed whereby the leaders and members of both associations would come together for a dialogue of contemporary issues affecting the industry and to better understand each segment of the industry. Since then it has developed into one of the premiere industry events in California. So much so, that more groups and associations want to co-sponsor the 2014 Industry Summit. The national Automotive Aftermarket Industry Association (AAIA), the California Automotive Business Coalition (CalABC), the California Automotive Teachers (CAT) will join with CAWA and ASCCA to sponsor next year’s Industry Summit.
ABN: In the collision industry, there has been a trend where MSOs (Multiple Shop Operators) are flourishing, while many small independent body shops are struggling to survive. It’s all about centralization and the convenience of dealing with one large entity rather than 10-15 smaller ones. Is this also happening in your industry?
RP: Yes, unfortunately the smaller distributors are, for the most part, struggling to survive. Unless they are specialized, in a niche market or geographically situated with less competition, they are challenged to continue. It’s not unlike other industry evolutions, however. When I think of all the past and future family business that did not or will not survive it makes me sad. My father had his own family business and I remember the nights when mom and dad struggled to “make ends meet”. Somehow, though, his business survived and he retired at 70 with no regrets. Like my father’s business was to the aircraft industry, aftermarket family businesses are important to this industry and there will be those that do survive and continue the tradition embodied within this great industry!