1. Since you came on board, Tenneco has made some bold moves in the aftermarket. What is behind the boldness?
Our customers are asking for boldness. The market is demanding it. Our customers asked for a premium ride performance product. We gave them Monroe® OESpectrum®. The market asked for extended warranty. We now offer five years on OESpectrum shocks and springs and three years on Walker® emission control products. The aftermarket asked for increased coverage for Japanese and Korean cars. Tenneco has the largest aftermarket coverage available for Japanese and Korean cars in Europe today and approximately 30 percent of Tenneco’s global annual shock absorber production is original equipment (OE) parts for Japanese and Korean cars. Coverage is set to increase as we continue to leverage our global expertise and manufacturing footprint to rapidly introduce new Japanese and Korean parts.
The aftermarket is changing. It’s being challenged on many fronts and is asking suppliers to take a leadership position in accelerating the change so it can continue to grow. At Tenneco, we are uniquely positioned to do this because of our size, our experience as an OE manufacturer, our ability to actively invest in growing the aftermarket and our global reach. Bold moves such as these are just the beginning. We have many more initiatives lined up. Our full value package is all about helping the aftermarket to sell better and sell more. We’re all in this together. If the aftermarket makes money, so does Tenneco. Being bold brings business to all of us.
2. At Automechanika you said you were redefining the premium segment with Monroe OESpectrum. Why the premium segment, and why now?
We asked our customers what they wanted. They told us they wanted a “game changer”, an aftermarket shock absorber for premium vehicles outside of the warranty period that did not compromise on quality and ride performance. So we created OESpectrum, an advanced product that features patented Monroe valve technology to provide virtually instantaneous feedback and response to changing driving conditions for exceptional road-holding capability, a smoother ride and increased driver control and confidence. By choosing this advanced technology, our aftermarket partners will be able to offer their customers a superior driving experience. And it comes with a five-year warranty. No one has been able to offer all of this on an aftermarket shock before. This is a true revolution.
3. Five-year warranty on Monroe OESpectrum and three-year warranty on Walker exhaust parts are major commitments for an aftermarket supplier. How can you justify this?
We are confident that our products are among the best in the world and this is our way of showing it. As a global OE leader, we are held to very high standards of engineering expertise, materials quality, workmanship and product performance. This warranty commitment can be seen as further reassurance to workshop owners, mechanics and their customers that each OESpectrum unit is designed and built to deliver a superior driving experience and that every Walker product is fully homologated in accordance with the most stringent government regulations to help restore and/or maintain proper engine performance and protect the environment from harmful emissions.
4. Tenneco appears to be investing significantly in the aftermarket. What is the strategy behind this?
The independent aftermarket is probably one of the sectors that has been hit hardest by the 2008-2009 crisis and has been slow to recover. We never lost confidence in the aftermarket and have continued to invest in initiatives that help bring us closer to our customers and respond to their needs. “Independent but not Alone” refers to our commitment to sharing our knowledge, technical resources and marketing expertise to provide the aftermarket with powerful growth drivers. We help the installers remain competitive via our advanced online technical training platforms – Techline and TADIS -- that are unique in the industry and accessible free of charge and in all European languages, and back this up by a large and efficient master trainer network. For example, in the last ten years we have trained more than 92,000 installers. We’ve stepped up our training efforts this year and are on target to have trained an additional 18,000 people. The number of master trainers is up to almost 50 and more than 130,000 people are connected to Tenneco via our state-of-the-art technical platforms.
In terms of products, we are investing heavily in G+, our dedicated aftermarket shock manufacturing facility in Gliwice, Poland where we plan to double our shock manufacturing capacity. Add to this the shocks we source from our ride performance, elastomer and spring manufacturing facilities in North America, India, China and Australia where we are also investing for growth, and you can see that Tenneco is probably the only supplier in the world with the global engineering know-how and manufacturing footprint to supply shocks, springs, steering and suspension SKUs for virtually every light vehicle and many of the commercial vehicles produced by today’s global car and truck manufacturers. The company’s global footprint also opens further opportunities for the aftermarket in Russia, the Middle East and Africa. On the clean air side of our business, we are expanding our capabilities in hot- and cold-end exhaust, leveraging our engineering expertise, global supply chain and manufacturing capacity to bring the best, most cost-effective emission control solutions to the aftermarket.
5. If you had the opportunity to talk to all of your customers individually, what would you say to them?
We are on a journey that starts, and ends with our customers. Our customers’ success is our success, and our commitment to them is that they should never regret choosing Tenneco as their business partner.
6. What in your opinion, makes Tenneco different from other players in the aftermarket?
The aftermarket is a global business. Tenneco is a global company. We ask ourselves three questions: Where are all the cars that are manufactured in the world going; which ones do we need to have coverage for and where are we going to make it? Tenneco’s leadership position in OE and the fact that we supply virtually every vehicle manufacturer in the world with suspension and/or emission control products provides the reassurance that all Tenneco aftermarket products are designed, engineered, tested, manufactured and homologated to the same demanding standards as our OE products. This, combined with our commitment to supporting the independent aftermarket with a full value package including e-catalogues, sales and marketing materials, on-site promotional support, all the information and training necessary to work on the latest generation of advanced vehicles and all of this backed up by a large and efficient customer support network, provides a competitive advantage.
7.Where do you see your product categories in the next ten years?
When you are part of an OE business, the future is being created today. For example, Tenneco’s ride performance business is at the leading edge of creating intelligent suspension systems that could be fully integrated into connected and autonomous vehicles. Our clean air business has already developed the emission control technologies that go beyond the requirements of Euro VI and can be applied to cars and on- and off-road commercial vehicles. Tenneco’s ability to transfer today’s advanced OE ride performance and clean air technologies into tomorrow’s aftermarket products means we will always maintain our aftermarket customers at the leading edge of the industry. So we’re pretty well covered for the future.
Our focus right now is on strengthening our existing offering across both our product lines – suspension and exhaust – with the two distinct objectives of improving coverage and positioning our products into three distinct categories of good, better and best, in line with what the market needs and with technologies that fit every budget. In ride performance that means enriching our range by sourcing an increasing number of shocks, springs, steering and suspension SKUs from Tenneco ride performance and elastomer facilities outside of Europe to cover an increasing European car park of Japanese, Korean and North American cars, and segmenting these according to car age, value and consumer budget. In clean air we are expanding our product offering to cover an increasing amount of hot-end requirements with catalytic converters, diesel particulate filters, gasoline particulate filters, and a range of sensors and additives to enhance their functioning. Both our businesses will increasingly target the commercial vehicle sector.
What is certain is that the aftermarket will become increasingly more complex as the number of new products and services increases. Complexity brings opportunity for those who are bold enough to seize it, and you can be sure that we will.