If the current economic situation continues, how do you see that affecting shops' spending on technology solutions?
We've already seen a change in shops' spending. In this day and age, shops can't afford to spend thousands of dollars on big box tools for every tech in the facility. We're seeing longtime technicians and student alike purchasing and using more affordable handheld onboard diagnostic (OBDII) tools. One industry veteran tells us he uses our INNOVA® 3100 CanOBD2 Tool – priced around $100 – at least a dozen times each day. He loves the emissions readiness monitors, and also likes that it simplifies his test drive and repair confirmation.Of course, techs can be more productive using the right tools, but what else can you suggest for greater productivity?
These days, having the right information is every bit as important as using the right tool. The old saying goes, "time is money." Techs can save time by joining professional organizations and tap into repair solution networks to get help and help others solve tough repair problems. These don't necessarily have to be expensive, either. Two tools that we offer in this area are OBDfix.com and RepairSolutions® at CanOBD2.com. OBDFix is an online resource for technicians across the United States to find out exactly what their counterparts are doing to repair vehicles.
RepairSolutions, which is included with all of our INNOVA® OBD tools, gives do-it-yourselfers and professional technicians alike online the option to access a complete repair solution by simply plugging their tool into the vehicle then connecting the tool to their PC. Without the need for training, any user can now gain access to most likely VIN specific fix; parts needed and repair procedures of how-tos. It's like having a digital dictionary with tough fixes at your fingertips.
How has the globalization of information and markets affected how Equus pushes its diagnostics processes forward? Has it made product development easier or more difficult?
We believe that globalization has its pros and cons. On the positive side, the world is moving toward a global OBDII-style standard related to safety issues such as SRS and airbags. Called ISO 14229, this measure is calling for unified diagnostics services with a single tool and single protocol anywhere in the world. This is good for the automotive repair industry, for the safety of drivers, for consumer education and for manufacturers to increase volume to keep costs down. It also promotes competition, which we welcome provided they are quality manufacturers and not just fly-by-night vendors trying to copy a tool at the expense of quality.
However, we have also learned that it is very hard for one country to adapt to another country's standards. At this moment, EOBD2 and OBDII (U.S.) have differences. The best way to be successful in a new territory is with a continuous commitment and investment to engineering and troubleshooting – there are no shortcuts. We learned this when we entered the Japanese market with our 3111J, which has since become the best selling on-board diagnostic tool in Japan as well.
What new technologies are being offered by Equus?
We are very pleased to announce that earlier this year we became the first automotive aftermarket manufacturer to offer a line of tools that solve both "Check Engine" light warning s and ABS light issues in one. The much-anticipated INNOVA® 3150 ABS + CanOBD2® Diagnostic Tool (MSRP $249 U.S.) and INNOVA® 3160 ABS + CanOBD2® ScanTool ($349 U.S.) have been a welcome addition to the industry. Both the 3150 and 3160 include all of the value-packed features and functions that help make the INNOVA® line of handheld OBD2 tools best sellers, plus the ability to diagnose anti-lock brake problems. For 2010 our team of engineers and ASE Certified technicians are working on several new technologies and products; however, this information is still proprietary.
How do your product offerings take advantage of wireless communication between vehicles and tools?
We are currently in development on several wireless and telematics products that are being designed with our end-user's needs in mind, all of which are proprietary at this time. However, we are moving cautiously in this arena because there still seems to be some resistance to telematics in the marketplace due to product costs, subscription fees and privacy concerns. Just look at how over a decade of push, On-Star is still struggling, with its used-car subscription rate at almost zero.
At best, on-board diagnostics via telematics will be limited, costly, cumbersome and present to the driver with symptoms and problems only. Without knowledge-based solutions, this will only add to the driver's frustration level. We believe there are alternatives with lower cost and more user-friendly solutions available in the market today. In fact, the future of on-board diagnostics will focus much less on the hardware (telematics or not) and much more on the information-based knowledge and solutions. It will go beyond diagnosing a current problem to predictive diagnostics, which can essentially determine a possible problem before it happens. Of course telematics does has its advantages.
With telematics on-board, OEMs (original equipment manufacturers) will be able to monitor each system on the vehicle, query a database for acceptable parameters, set a threshold and notify their dealer or vehicle owner about a pending problem. This technology will even enable OEMs to watch degradation based on mileage and conditions, and predict when parts will be needed. Imagine the possibilities if OEMs will be willing to open this information to professional technicians, vehicle owners, parts stores and even insurance companies. We believe that our job and challenge as suppliers will be to provide the market with needed knowledge-based information and solutions to work with the future hardware (i.e. telematics, etc.) to capture the bulk of future market share.
Which products, in what markets and with what kinds of businesses performed well for the company in the first half of the year? What is your strategy as we move through the second half of the year and beyond?
Our relationships with the tool warehouses have grown significantly since Equus Products, Inc. began to move into the more professional, higher-end diagnostic tools. These customers appreciate the value of the tools we provide, along with the sales and support efforts we offer. The fact that our tools have an extremely low return rate and stay sold also helps their bottom line.
During the first half of 2009, our top-selling product is the always popular INNOVA® 3100 CanOBD2 Tool, which recently reached its 500,000-piece sales milestone, which is unprecedented in this category. Other top-selling products include our 3130 and 3140 scan tools, and our new 3150 and 3160 dual-use ABS and OBD2 tools. During the first part of the calendar year we focused our advertising and marketing efforts on promoting the new ABS tools. Our strategy as we move through the year is to celebrate our half-million milestone and continue to build on promoting the cradle-to-grave products and information that we offer to help diagnose and solve check engine light problems.
In your view, what are the biggest obstacles that shops face this year – and what can they do to overcome them?
Some of the many obstacles that shops face this year include increased costs for information and continuing education, along with reduced consumer spending. However, with dealership closures and a more difficult process to get a new car loan, owners are also holding on to their vehicles longer, which results in the need to make sure they are running properly. We at Equus Products, Inc. realize that it takes a big financial and time commitment to become a professional automotive technician. We know that it's not always possible for each technician in the shop to afford thousands of dollars worth of scan tools, updates, upgrades and training. So we have made a concerted effort to develop a line of scan tools that are in the "under $500" category.
We also continue to pass along updates to the tools at low or no cost so our end users are not forced to throw out an obsolete tool or purchase an expensive upgrade every year. And with the addition of our RepairSolutions program, we give our customers a cost-effective way to pinpoint the solution they need, rather than purchasing an encyclopedia of repair data they may never use. We also know that in this economy it is more important than ever for technicians to be swift, accurate and affordable with their diagnosis and repairs. Each of our OBD tools includes plug-and-play technology and a patented single-screen display to help speed up the repair process. Our tools also include PC-Link™ software that lets shops create and store diagnostic reports that can be shown to the customer to help educate him or her on the necessary repairs.
As the market changes and our customer's needs change, we are committed to listening to their needs and developing products that help everyone navigate the often tough road ahead.
