LEVELING THE FIELD FOR QUALITY SPARE PARTSSat, 09/01/2018 - 11:02
Q: What is INA’s role in making sure quality components have an even playing field to compete against cheap, low- quality imports?
A: Considering the country is more price sensitive than the US or Canada, many users prefer to keep their vehicles, trucks and buses on the road by using low-quality parts even if it is only for short periods and puts the vehicle at high risk of breaking down. INA is pushing for quality norms in Mexico that regulate the entrance of cheap, low-quality products into the Mexican aftermarket. As an association that represents Mexico’s auto parts companies, INA works with the Ministry of Economy’s General Directorate of Norms to develop these standards.
Several norms to regulate vehicle security standards and emissions have already been introduced. Norms on brake pad quality are in place and we are working on a new norm for vehicle dampers. These norms will ensure imported auto parts meet basic standards and will act as a nontariff barrier against the sale of low-quality spare parts. We cannot produce norms for every component family in the Mexican aftermarket, so our main focus is on critical parts that impact passenger and pedestrian safety.
Q: What aftermarket segments and components have the most pressing regulatory needs?
A: INA works toward the development of regulations that focus on important products for the aftermarket. In collaboration with the Ministry of Economy, we have developed voluntary technical norms or NMXs on filters and brakes that we expect will soon become an official and compulsory norm or NOM. The next norms will focus on dampers and tie rod ends and eventually vehicle lighting systems.
Q: How can stricter emission regulations in Mexico impact the local aftermarket?
A: These norms have a positive effect because vehicles will have to be thoroughly repaired in a timely manner to be allowed on the road. Using the wrong spark plug or a bad catalytic converter will prevent these vehicles from passing inspections. This process will boost sales of ignition, exhaust and injection system components in the Mexican aftermarket.
Q: How might the downturn in sales of new vehicles that started in 2H17 impact the Mexican aftermarket?
A: Changes in light-vehicle sales normally impact the aftermarket after three years. During their first three years of use, vehicles demand simple maintenance such as change of oil and regular components such as filters and perhaps brake pads. Repairs also generally take place in dealerships that use original equipment parts. After this and when vehicles lose their warranty, users start taking their vehicles to independent shops and use components from independent brands. At the moment, the vehicles going through this transition are those that were sold in 2015, which was a good year in terms of sales and thus will generate large revenues for the aftermarket. Since 2016 was a record year with sales of 1.6 million units, 2019 will also be a great year for independent brands and workshops in the Mexican aftermarket.
Q: How important is the development of e-commerce for the Mexican aftermarket?
A: For a domestic market with sales of approximately 1.5 million vehicles per year, Mexico has a huge variety of brands, models and vehicle versions. Knowing what spare part is necessary for each vehicle plays a key role in the aftersales market and access to digital catalogues is essential for consumers.
Q: What do Mexican auto parts manufacturers need to do to supply more cost-competitive components to OEMs?
A: There is no such thing as a bad automotive supplier since companies without the necessary standards rarely survive for more than two years. Good Mexican auto parts companies wanting to become excellent suppliers need to make constant reinvestments. All players must remain updated in areas of quality and cost, which means they cannot allow themselves not to invest in new equipment. Any company wanting to remain afloat needs to deliver enhanced productivity at lower costs.