Going overseas for product safeguarded by one company

Earlier this year, our sister publication Aftermarket Business, looked into feelings about sourcing parts from low-cost countries (LCCs).

The majority of repair shop representatives who responded say they use more products made in LCCs now than they did a year ago. Distributors are more comfortable with stocking these products, and repair shops appear to be fine in using these parts on vehicles in their bays.

Controls across the board have been tightened to protect U.S. automotive aftermarket companies. Also, companies like Eastek International are making it easier for companies to make product overseas and for end-users to feel more comfortable in using the product.

Robert Wiegand is vice president sales and marketing for Eastek, a contract manufacturer. Eastek’s customers work with a lead engineer in Chicago, but much of the design work is done in China. This allows the customers to have a blended cost, but have the benefits of being in the same time zone and speaking the same language.

“Another way we differentiate ourselves is we offer what we call the Eastek Edge,” Wiegand explains. “We’ll design the product, we’ll manufacture the products and then we’ll warehouse the product.”

Eastek has plants in southern China and Hong Kong, and plans to open a new facility in northern China. They work with U.S. engineers and IP protection, and handle all communication with the plants, which are TS1649 and ISO certified.

“On top of that, we provide the engineering services. If they want to redesign a product or pull cost out of it or launch a new product, we offer the service that allows that to happen,” Wiegand says. “Most of our customers, nearly all of our customers are less than $50 million companies. They’re not a large corporation that has resources over in China, and so we’re an excellent fit for mid-capital or smaller companies that need to go to China. We provide the solution. Usually, companies that size don’t have the resources to put somebody over the experience.”

Wiegand notes that Eastek works hard to take care of freight, full packaging with marketing inserts, and focuses heavily on protecting intellectual property, which is what drew SCT Flash to Eastek when it wanted to go back overseas.

SCT Flash is a reprogrammer, an aftermarket tuner focused on the performance market. Rick Trudo, SCT president, tested Eastek’s performance with a small circuit board first and later had them redesign some plastic components.

“We were so impressed with the quality and support we got with the first one, we’ve given them six more jobs and almost locked ourselves in 100 percent with them on doing all our product,” he says.

Trudo says workmanship is a main reason SCT keeps its business with Eastek.

“The quality is better, workmanship is better, support is better,” he says. “They’ve got over 30 engineers. Communication from their corporate office is on top of everything, and the design is basically done here and sent over.”

SCT is just one company taking advantage of this new way to manufacture parts overseas and give a more at-ease feeling to the end-users.

“Basically, a company has a couple choices if they want to go to China. To be competitive in a global economy, to be competitive, manufacturers have to go offshore. They have a choice in starting to deal direct with a Chinese owned company or they can work with a company such as Eastek. We offer the model of a China plant with the local support,” Wiegand says. “And our customers, they’ve either gone to China directly with a manufacturer in China and had a terrible experience, and that’s very common, or they know they need to go to China and they don’t know how to go there or are afraid.”