Observer: The Brake Pad Upsell
Though many product categories are suffering the effects of a weak economy, all signs point to a strong brake product marketplace.
In fact, drivers are more likely to "trade up" for premium brands and materials, especially ceramic brake friction products, according to a Frost & Sullivan report.
Analysis from "North American Brake System Parts Aftermarket: Friction Parts" states the friction parts aftermarket earned $1.21 billion last year, and Frost & Sullivan estimates a $1.58 billion market by 2014. Some manufacturers have considered this projection wishful thinking, but agree that growth exists in the brake parts category, especially with brake pads.
"The raw material costs are going up," says Dan Lelchuk, president of Centric Parts, makers of the StopTech and Power Slot brands of brake components and systems. "Price increases are occurring from all segments of the market, not just brakes."
"Moving customers in the low-priced product line into the mid-grade line, and those in the mid-grade line into the premium line, increases profits and allows manufacturers to invest in researching and developing the next generation of friction parts," says Stephen Spivey, Frost & Sullivan senior industry analyst.
Jim Kelley, director of sales and marketing for Honeywell Friction Materials, corrects the "upselling" assumption, instead clarifying that Bendix-brand brake products are introduced at the premium level first.
The trend with brake work these days appears to be premium friction with standard-grade rotors, asserts Lelchuk. This means more rotors are being replaced along with regular brake pad changes.
Lelchuk also attributes the driver's need for less brake dust as a factor in selling premium friction materials. However, brake dust may not always be connected to the friction material. At times, "the dust you see is not pad dust but dust from the brake rotors," he adds.
Overall, even brakes as a category can stand to improve. Lelchuk says Centric's distributors have seen single-digit increases, "pretty much where they were last year."
Where the slowdown occurs, he adds, is in preventive maintenance.
— Chris Miller
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